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Byline: financeAlex derber london Requirement to set aside capital proportional to size of incoming fleet is 'restricting growth', says boss of parent company Any sale of CIT Aerospace would be [...]

safety alex derber london A new generation of satellites should dramatically improve the tracking of future volcanic ash clouds, but airlines and passengers weary of the disruption these cause may [...]

labour ALEX DERBER LONDON BALPA: Ryanair 'intimidating' flightcrews over union link Flightcrew representatives have accused Ryanair of a 'massive campaign of threats and intimidation' to prevent its UK pilots from [...]

Ethiopian Airlines' commitment for 17 widebodies, including 12 A350 XWBs, has finally given Airbus a foothold in a carrier whose fleet has been dominated by Boeing types. The African airline [...]

Activist investor Elliott Investment Management is seeking to replace most of the Southwest Airlines board by nominating 10 new candidates for the 15-person board. The candidates include individuals with extensive experience in the airline industry, such as former CEOs and senior officials from various airlines and organizations. Elliott believes that the current board has not held management accountable for Southwest's poor performance and aims to provide shareholders with a choice between the existing board and a new board that brings fresh thinking and expertise. Elliott manages funds with an approximately 11% economic interest in Southwest Airlines. [Extracted from the article]

LATAM Airlines is in discussions with Embraer regarding a potential order for up to 30 aircraft. This comes after LATAM Brazil's CEO, Jerome Cadier, mentioned last week that the company was considering adding small narrowbody aircraft, such as the Airbus A220 or Embraer E2, to its fleet. LATAM had previously been in talks with Gol to acquire Boeing 737 aircraft, but those negotiations fell through, leading LATAM to explore alternative narrowbody aircraft options. LATAM currently operates a fleet of 332 units, including both Boeing and Airbus aircraft. [Extracted from the article]

The National Company Law Tribunal in India has approved the merger of Air India Express and Air Asia's Indian operation. The merged entity will be owned entirely by Air India Express. Air India Express operates as an international low-cost carrier, providing connectivity to short/medium haul international routes in the Gulf and Southeast Asia. AIX Connect, formerly known as Air Asia India, operates as a domestic low-cost carrier with a network extending to 19 destinations in India. The fleet of the merged entity includes Boeing 737 Max aircraft, 737-800s, Airbus A320neos, and A320-family aircraft. [Extracted from the article]

Turkish Airlines is pressuring CFM International to lower the price of its Leap-1B engines in order to secure a large order for Boeing 737 Max aircraft. The airline chairman, Ahmed Bolat, stated that Turkish Airlines may have already signed for the Max aircraft if it weren't for CFM's pricing. Turkish Airlines currently has 194 Airbus A321neo aircraft on order, but Bolat expressed a desire to split their new narrowbody exposure between Boeing and Airbus. Turkish Airlines is reportedly in talks with Boeing for an order of 150 737 Max aircraft and 75 787s. In December, the airline placed an order with Airbus for 22 new aircraft. Turkish Airlines has also recently returned to the leasing market, signing contracts for additional narrowbody and widebody aircraft. They have secured leases for six 737 Max 8s from CDB Aviation Lease Finance, one widebody on a 72-month lease, four more 737 Max 8s from Jackson Square Aviation, and ten units from DAE Capital. Additionally, Turkish Airlines has signed an agreement with Aercap for the lease of three new 787-9 aircraft and 25 new 737 Max 8 aircraft. [Extracted from the article]

SMBC Aviation Capital, an aircraft lessor, has reported a successful year with record profits and strong trading. They traded 42 aircraft worth $1.7 billion and saw a 41% increase in lease revenue, reaching $1.9 billion. The company's pre-tax profit was $460 million, a 35% increase from the previous year, and adjusted operating cash flow also increased to $2 billion. SMBC AC has 271 narrowbody aircraft on order and 67% of its portfolio consists of new-technology aircraft. The CEO, Peter Barrett, attributed their success to a disciplined approach to capital allocation and asset acquisition, allowing them to take advantage of the current market conditions. [Extracted from the article]

During the first quarter of 2024, Falko Regional Aircraft engaged in various transactions, including the acquisition of 24 Embraer aircraft from Nordic Aviation Capital and the signing of nine lease extensions for E190/195 aircraft. Falko also sold seven aircraft and two engines, with plans to sell a turboprop in the second quarter. Additionally, letters of intent were signed for the sale of two aircraft and the placement of one aircraft on lease to a European regional carrier. Falko's chief commercial officer, Mark Hughes, expressed satisfaction with the level of activity and highlighted the acquisition of 24 aircraft from NAC, which solidifies Falko's position as a leading lessor of Embraer E-Jet aircraft. [Extracted from the article]

Korean Air has announced the sale of five Boeing 747-8 aircraft to Sierra Nevada Corporation as part of its plan to introduce new aircraft. The sale is valued at $675 million and is expected to be completed by September 2025. Sierra Nevada Corporation specializes in aerospace products, including a modified 747 used as an airborne command center. Korean Air currently operates a fleet of nine 747-8 passenger aircraft and seven 747-8Fs, all built between 2012 and 2017. [Extracted from the article]

Air Asia Cambodia has launched its operations in Phnom Penh with two Airbus A320 aircraft. The airline, led by Vissoth Nam, has received its air operator's certificate in Cambodia. Initially, Air Asia Cambodia will focus on domestic flights, with plans to announce international destinations in the next quarter. Tony Fernandes, the CEO of Air Asia's parent company, Capital A, highlighted Cambodia's economic potential and strategic location within the ASEAN region. [Extracted from the article]

The UK government plans to implement a sustainable aviation fuel (SAF) mandate for airlines starting in 2025. The mandate aims to have SAF meet 2% of the country's jet fuel demand by 2025, 10% by 2030, and 22% by 2040. The government hopes that the mandate will drive demand for SAF, reduce emissions, and provide investor confidence. The plan includes a review mechanism to manage prices and minimize the impact on ticket fares. Additionally, the mandate will include a cap on the feedstocks used in the hydroprocessed esters and fatty acids (HEFA) process, which delivers most commercially available SAF. The UK government also plans to introduce a separate obligation on power-to-liquid fuels from 2028 to drive innovation and diversification. [Extracted from the article]

Fly Arystan, the low-cost carrier subsidiary of Air Astana, has been awarded its own air operator's certificate (AOC) by the Aviation Administration of Kazakhstan (AAK). Since its launch in 2019, Fly Arystan has operated under Air Astana's AOC and has expanded its fleet to 18 aircraft, with six more to be delivered in 2024. The awarding of its own AOC reflects the airline's growth and operational complexity, and will allow Fly Arystan to pursue opportunities for international expansion and partnerships with other airlines. Fly Arystan remains a wholly owned subsidiary of Air Astana. [Extracted from the article]

Virgin Atlantic Airways has reported a loss in 2023 but expects to make a profit in 2024. The UK carrier reduced its annual loss to £139 million ($175 million) last year and attributes its potential profitability to high yields on Caribbean routes and premium seats. The company's losses in 2023 were partly due to high interest rates on the £1 billion of private sector debt it acquired during the pandemic. Virgin Atlantic is seeking financing for a new Airbus A350-1000 delivery scheduled for the second quarter of 2024. [Extracted from the article]

LOT Polish Airlines is considering whether to continue its partnership with Embraer or switch to Airbus for the supply of 84 regional aircraft. Currently, more than half of LOT's fleet consists of Embraer aircraft, with the rest being Boeing equipment. LOT is also looking to lease up to nine widebody aircraft. The airline aims to expand its operations and increase its fleet to 110 aircraft by 2028. [Extracted from the article]

In 2023, European airline group IAG saw a significant increase in profitability, with an operating margin of 11.9%. While operating cash flow remained similar to the previous year, free cash flow increased due to lower capital expenditure. The group took delivery of 34 aircraft, with most of them acquired from Airbus and Boeing. All of the group's mainline carriers were profitable, with British Airways, Iberia, Vueling, and Aer Lingus all reporting operating profits. Passenger revenue increased by 33% compared to 2022, while cargo revenue decreased by 28%. [Extracted from the article]

In 2023, European airline group IAG saw a significant increase in profitability, with operating profits reaching €3.5 billion, nearly three times that of the previous year. The group's operating margin was 11.9%, and total revenues rose to €29.4 billion. Despite a 28% decrease in cargo revenue, passenger revenue was 33% higher than in 2022. All of the group's mainline carriers, including British Airways, Iberia, Vueling, and Aer Lingus, reported profits. IAG also announced new appointments for CEO and chairman positions within the company. [Extracted from the article]

Thai Airways has defended its recent order for 45 Boeing 787-9 aircraft, stating that it will not impact its ability to repay creditors. The airline is open to various financing methods, including operating or financial leases for the widebodies. Without the order, Thai Airways warned that its fleet would have decreased significantly, making it difficult to generate enough revenue to repay its debts. The airline entered restructuring with debts of around $13 billion and has been decommissioning older, less fuel-efficient aircraft to reduce costs. It has also secured additional widebody aircraft from lessors to meet post-pandemic passenger demand. [Extracted from the article]

The Export Development Canada (EDC) is reportedly suing Tanzanian carrier Precision Air for $26 million in the UK High Court. The case involves the financing of two ATR42-600 turboprops by EDC in 2012. Precision Air is accused of defaulting on lease finance payments since 2021. This information comes from media reports and a report by Global Trade Review. [Extracted from the article]

Thai Airways has reportedly selected Boeing for an order of 45 Boeing 787-9s, which was previously attributed to an unidentified customer. There were earlier reports that the airline was in talks to purchase up to 80 Boeing widebodies, and it is now suggested that Thai may increase its firm order to that number in the future. The decision to choose the 787 over the Airbus A350 was reportedly due to a disagreement over engine maintenance costs with Rolls-Royce. Thai Airways has chosen the General Electric GEnx engine for its latest order. [Extracted from the article]

Flag carrier SAS has made some progress in its operational and financial performance, but it remains loss-making and heavily in debt. The airline reported an operating loss of SEK2.7 billion ($260 million) for the 12 months to October 2023, an improvement from the previous year. However, higher costs from adverse currency and fuel price trends have hindered further improvement. SAS has reduced its financial net debt by approximately SEK1 billion to SEK32.6 billion, primarily through cash flow and rejecting lease contracts. The airline expects approval of its Chapter 11 plan in early 2024, with a modest recovery expected for creditors and no value for existing shareholders. In the current financial year, SAS expects to receive new aircraft and phase out or lease some existing ones. [Extracted from the article]

LATAM Airlines Group is predicting a strong recovery in 2024 following its restructuring and exit from Chapter 11 bankruptcy protection. The airline expects to reduce its debt and increase its cash reserves, with net financial debt to adjusted EBITDAR projected to be 1.8-2x by the end of 2024. LATAM also anticipates exceeding pre-pandemic passenger capacity levels in the first quarter of 2024 and achieving record adjusted annual EBTIDAR. The airline projects revenue of up to $12.8 billion for 2024, assuming a jet fuel price of $100 per barrel and an exchange rate of 5.1 Brazilian reals to the dollar. [Extracted from the article]

Air New Zealand expects its first-half profit to be at the lower end of its previous guidance due to soft passenger demand in its local markets. The airline has seen signs of softness in domestic travel, particularly in corporate and government travel, with late booking activity remaining weaker compared to the prior year. However, demand to North America remains solid, although there is pricing pressure from higher competition from US carriers. Demand in Asia remains unchanged. [Extracted from the article]

In November, Boeing delivered a total of 54 commercial aircraft, with 45 of them being Boeing 737 Max models. This brings the company closer to its original goal of delivering 400 Max aircraft for 2023, despite reducing the target to 375 units due to a supplier error. Additionally, Boeing delivered six 787s in November and aims to deliver eight more in December to meet its target of 70 units for the year. In terms of orders, Boeing received 114 in November, bringing its year-to-date total to 1,085, a significant increase compared to the same period last year. [Extracted from the article]

The Federal Aviation Administration (FAA) has given Boeing approval to start certification flight testing for the 737 Max 10. This is a significant step towards getting the largest airplane in the 737 MAX family certified for passenger service worldwide. Boeing has already completed 1,000 hours of flight testing, and now with the FAA's authorization, certification testing with FAA pilots onboard can commence. The Max 10 is expected to begin certification flight testing in 2023 and be delivered to customers in 2024. [Extracted from the article]

Middle East Airlines (MEA), Lebanon's flag carrier, has reduced its flight schedule and moved a significant portion of its fleet out of the country due to changes in its war insurance coverage resulting from the Israel-Hamas conflict. MEA chairman Mohammed El-Hout stated in an interview that the airline will only operate eight out of its 22 aircraft this week, with the others being relocated to Istanbul, Cyprus, and Qatar. MEA is facing an 80% reduction in its war risk coverage, and some insurers have issued cancellation notices to airlines in Israel and Lebanon. [Extracted from the article]

According to the FT, due to the dispute Jakarta is withholding cooperation with the UK's Serious Fraud Office over the latter's investigation into bribery by Bombardier officials. Indonesia is planning to sue the British government after being shut out of a multi-billion-dollar settlement with Airbus that related partly to bribery by the OEM within the Southeast Asian country. [Extracted from the article]

In return, Azul will benefit from the permanent elimination of lease payment obligations that had previously been deferred during the COVID-19 pandemic; a permanent reduction in lease payments from original contractual lease rates to agreed-upon current market rates; the deferral of certain payments to lessors and OEMs; and other concessions including improved end-of-lease compensation obligations and aircraft return conditions, the elimination of future maintenance reserves payments, and the negotiated early termination of certain aircraft leases. Brazilian carrier Azul has slashed its annual lease payments by roughly a quarter after completing a restructuring with lessors and OEMs. [Extracted from the article]

Despite Mexico's thriving low-cost airline sector, the government has said the airline will offer fares 50% cheaper than the competition. The airline is to be overseen by generals in the Mexican army, which Mexico's government has already put in charge of operating the nation's civil airports. Mexicana is set to relaunch this month despite amid some concern about its management structure and fleet financing. [Extracted from the article]

India carrier Spicejet swung to profit in the three months to 30 June 2023 as it benefited from a fall in capacity. The airline's 737 Max fleet renewal campaign has stalled, while lessors CDB Aviation and SMBC Aviation Capital have had their 737 Max 8s leased to Spicejet deregistered. Spicejet's operating fleet has shrunk to just over 20 Boeing 737s currently operating alongside eight De Havilland Dash 8s. [Extracted from the article]

- Binter Canarias placed a firm order for six Embraer 195-E2 aircraft, its fourth commitment for the E2. B Commercial aircraft b - Avolon was confirmed as the customer behind a previously unidentified order for 40 Boeing 737 Max aircraft. - Air India finalised a previously announced order for 220 Boeing aircraft: 190 737 Max units, 20 787s and 10 777X aircraft. [Extracted from the article]

Skywest had previously financed 24 E175 deliveries with support from BNDES for deliveries between August 2021 and April this year. Brazilian National Bank for Economic and Social Development (BNDES) has approved financing of R$1.3 billion ($270 million) to support the delivery of 11 Embraer 175 aircraft to Alaska Air Group. [Extracted from the article]

-Saudi low-cost carrier Flynas firmed up an order for 30 A320neo-family aircraft, taking the airline's total order with Airbus to 120 A320neo aircraft, including 10 A321XLRs. - Indian carrier Flybig signed a purchase agreement and with De Havilland Canada for two Twin Otter Series 400 aircraft. B Commercial aircraft b - Indian low-cost carrier Indigo placed a firm order for 500 Airbus A320-family aircraft, taking its order total for the type to 1,330 units. [Extracted from the article]

In addition, Lufthansa and the finance ministry have agreed on an option mechanism to enable a full takeover by Lufthansa in the medium term. The transaction structure provides for joint operational control by Lufthansa Group and the Italian finance ministry, with Lufthansa selecting ITA's chief executive officer and one board member. [Extracted from the article]

Eamsiri also revealed plans for the Bangkok-based carrier to relist on the Thai Stock Exchange in 2025, and predicted that the flag carrier would achieve full recovery in 2024. Thai Airways is forecasting annual EBITDA of THB20 billion ($590 million) as its recovery runs ahead of schedule due to a surging recovery of tourism to Thailand. According to the report, Thai is also talking to Boeing about its long-term fleet plan. [Extracted from the article]

The article reports that supplier delays are negatively affecting new aircraft production and aftermarket programs. Topics covered include the case of the delay in Boeing Co.'s production of its 787 Dreamliner jet airliner, the negative impact of the introduction of new technologies in the aerospace supply chain, priority of suppliers for aircraft manufacturers over maintenance, repair and operations (MRO) companies and the preemptive action taken by Boeing to address supply delay.

Indian full-service carrier Vistara broke even for the first time in the quarter ended December 2022. Reports emerged in late 2022 that Vistara co-owned Tata would merge the airline into Air India, which it also owns. [Extracted from the article]

Aircraft lessor Aircastle has filed claims against insurers for $266 million related to Russia's expropriation of its aircraft. According to I Airfinance Journal i 's sister publication I Insurance Insider i , Aircastle believes some of the aircraft have been dismantled for parts and others are unretrievable, and that insurers should pay out under the lessor's all-risk and war perils policies, which have limits of $1.25 billion and $450 million, respectively. [Extracted from the article]

Air Asia's cargo airline is to lease three Airbus A321 freighters from BBAM. Once all the aircraft are delivered, Teleport's freighter fleet will rise to four aircraft. [Extracted from the article]

The flag carrier currently has 54 out of 70 narrowbody aircraft in service, and is operating 33 out of 43 widebodies. Air India plans to increase its fleet by more than a quarter by adding 30 wide- and narrowbody aircraft over the next 15 months. [Extracted from the article]

So no need to raise much debt for the aircraft deliveries this year", Laderman said. United Airlines intends to pay cash for its aircraft deliveries this year, using borrowing that it agreed during the pandemic, its chief financial officer, Gerald Laderman, has said during a recent Cowen transportation conference. Laderman also emphasised that tackling United's debt is one of his top priorities, and that he would to pursue early repayment of some of it were it not for onerous pre-payment clauses. [Extracted from the article]

Romanian low-cost carrier Blue Air has suspended all flights from its home country for a week. I Local news media i have reported that the suspension, which runs from 7 September until 12 September, was caused by Romania's environment ministry blocking the airline's accounts due to unpaid carbon levies. Blue Air appointed a new chief executive officer, Steven Greenaway, in February, but he left the company in July. [Extracted from the article]

The restructurings include the waiver of lease rentals in arrears as well as reducing future lease rates with a corresponding longer lease term where necessary and return of aircraft. At 30 June 2022, the group's lease liabilities amounted to MYR14.2 billion ($3.18 billion) and included deferred aircraft leases of approximately MYR1.8 billion. Subsidiary airlines of Malaysia-based Capital A, the company formerly known as Air Asia Group, have restructured 106 aircraft leases. [Extracted from the article]

Other new director Detlef recently stepped down as chief executive officer of logistics company Kuehne + Nagel, while van der Eijk had a 20-year career with KLM. "I am very pleased to welcome Harald, Detlef and Ryanne to easyJet. Easyjet has named Harald Eisenacher, Detlef Trefzger and Ryanne van der Eijk as non-executive directors from 1 September 2022. [Extracted from the article]