The plan to cut company losses, which exceeded $300 million in financial year 2002/03, includes cancelling an order placed with European consortium Airbuslast year for two A340-600s and five new A318s. In order to cut back on maintenance costs, the airline also plans to reduce by half the number of aircraft types in its fleet to five. EgyptAir is preparing to put its Boeing777 and 747 jets up for sale by the end of the year.

However, the carrier has confirmed an order placed in April for seven A330-200 aircraft to replace the seven A330-600s which are the backbone of its 32-strong passenger fleet. The companies have declined to reveal the size of the most recent deal, but the list price of the 275-seat aircraft is about $140 million. Rolls Royceof the UK announced in mid-June that EgyptAir had chosen its Trent 700 engine for the new A330-200 airliners, in a deal worth an estimated $150 million. First deliveries are due in June 2004 (MEED 20:6:03).

EgyptAir Holding Companyhas also entered negotiations over acquiring a controlling 40 per cent stake in a new private airline, Air Cairo, which will replace the bankrupt Shorouk Air. National Bank of Egyptand Banque du Caire each hold 20 per cent stakes in the new company. Operations are due to start in September, concentrating on charter flights to Egypt?s main tourist resorts. Shorouk was established in 1992 as a private joint venture between EgyptAir and Kuwait Airways Corporation.

Despite the impact of the Iraq conflict on the tourism sector, foreign visitor numbers have rebounded quickly. The 22 per cent year-on-year fall in tourist levels in March was followed by a 15 per cent drop in April and a 10 per cent fall in May, according to Tourism Minister Mamdouh el-Beltagi. Egypt welcomed 5.2 million foreign tourists last year, a slight drop on the record of 5.5 million visitors in 2000.