Etihad grounds 5 cargo planes, pilots asked to take unpaid leave

DUBAI/ABU DHABI, Jan 24 (Reuters) - Etihad Airways has grounded its five Airbus freighters, and is asking its pilots to take unpaid leave as it continues to rethink its strategy, the airline and sources told Reuters on Wednesday.

The state-owned Gulf carrier has been reviewing its business since 2016 after billions of dollars spent buying stakes in other airlines failed to deliver substantial returns. This contributed to a $1.87 billion loss in 2016, its first loss since 2010.

Etihad confirmed to Reuters it has grounded its Airbus freighter fleet, five A330 Freighters, and that it had opted to operate an all-Boeing 777 Freighter fleet. It declined to comment on whether it had offered pilots unpaid leave.

“This freighter is the right aircraft for our long-term requirements,” Peter Baumgartner, the chief executive of Etihad’s airline operations, said in an email to Reuters.

Etihad operates five Boeing 777 Freighters.

The Abu Dhabi-based airline is considering selling or leasing the Airbus freighters, one of the sources said.

Etihad’s cargo operation slowed in 2016 to report flat growth of 596,000 tonnes handled.

Etihad is encouraging pilots to take unpaid leave for periods as short as one week or as long as 18 months as it reviews its fleet requirements with the intention of retiring some aircraft, according to three sources.

Pilots are being asked to take leave on a voluntary basis, one of the sources said.

Etihad employed 2,225 pilots for a fleet of 122 jets as of February 2017, according to the most recent data on its website.

Etihad has made few comments on its strategy review in which hundreds of positions have been removed and several routes cut since it was launched.

Etihad once owned as many as eight minority stakes in other airlines; two have been sold and another two have declared insolvency.

New Group Chief Executive Tony Douglas, who joined this month, is likely to have to decide what to do with those investments. (Reporting by Alexander Cornwell in Dubai and Stanley Carvalho in Abu Dhabi. Editing by Jane Merriman)