Flybe to defer half its Embraer deliveries

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UK regional carrier Flybe is to defer, for at least three years, delivery of 16 Embraer 175 jets which had been due to arrive over 2014-15.

The airline says that the aircraft will not be introduced until 2017-19.

Flybe is undergoing a restructuring programme to cut costs and says the deferral will reduce pre-delivery payments for the coming winter season by £20 million ($30 million).

The shift comes alongside a measure to withdraw from London Gatwick in March 2014 and sell its slots to budget carrier EasyJet.

Flybe's strategy will enable it to fund the turnaround, it says, without financing from shareholders.

It has exceeded the initial £25 million savings target set for the restructuring, stating that it has secured cost reductions of £30 million.

The second stage will aim to save another £12 million in 2013-14 and £23 million annually from 2014-15.

Flybe has reduced its headcount to 2,140 personnel, with 290 having left under a redundancy programme - all but 43 voluntarily.

Another 300 have left as a result of outsourcing of business.

About 70% of Flybe's line maintenance has been outsourced to Monarch Engineering since 1 May, while some airport services were handed to ground-handling specialists in April.

Flybe adds that it has reached a preliminary agreement with the cockpit union BALPA which centres on a 5% salary cut across the pilot corps in exchange for additional time off duty. The airline has also renegotiated supplier contracts, including airport charges, to save £6 million.