MIAMI — Russian budget airline Dobrolyot reportedly says it signed a draft contract for up to sixteen new Boeing 737-800s on Wednesday, despite being grounded by sanctions.
Dobrolyot’s parent company, Aeroflot, was forced to yank the plug on its fledgling venture on August 4th, a victim of fresh economic sanctions leveled against Russia by the US and European Union (EU).
The carrier celebrated its first revenue flight only a few months ago in June, operating regional flights out of Moscow with a fleet of two Boeing 737-800s. Its list of destinations includes Crimea, a disputed territory which Russia says it annexed in March of 2014. The US and EU, however, do not recognize the claim, and thus have targeted the sanctions at companies with investment and trade ties to the region.
As noted, that includes Dobrolyot, which made it eligible, so to speak, to find itself in the crosshairs of the sanctions. Authorities were able to target the carrier by shutting off its access to airplanes, but how?
It turns out that the carrier happens to be leasing its two Boeing 737s from aviation leasing firm BBAM, which in turn happens to be majority owned by Onex Corp, based in Toronto. Normally this would’ve been the end of it, but Canada joined the list of nations taking part in the US/EU sanctions last Wednesday, thereby sealing the airline’s fate. Canada’s participation now enabled officials to find a pathway to force BBAM to shutter its lease agreement with Dobrolyot, effectively robbing it of its own fleet.
The airline had been intending to open flights across Europe as well as domestic Russian destinations. Parent company Aeroflot had reportedly planned to pump tens of millions into the venture, predicting significant growth in the first five years. That is until Dobrolyot turned to Dobroflop overnight. Given the investment thus far it is likely that both parties, Aeroflot and Dobrolyot, are fast courting leasing firms outside the reach of the sanctions. Probable candidates include lessors based in China and Singapore, as neither nation is participating in the punitive actions.
Failure to find a new friend in the leasing community could leave the venture treading water until 2017, when the first of the reportedly ordered 737s are due to arrive.