US House Committee on Transportation and Infrastructure approved (14-Jun-2023) the Securing Growth and Robust Leadership in American Aviation Act (HR 3935), a bill to reauthorise the US FAA and aviation safety and infrastructure programmes through to Sep-2028. The bipartisan legislation was approved by a unanimous vote. Committee chairman Sam Graves stated the bill is "critical to America's global leadership in aviation, to our economy and millions of jobs, and to making the entire system safer and more efficient for all users and the travelling public". As previously reported by CAPA, the bill aims to improve FAA efficiency and operations by making organisational structure changes, grow the aviation workforce, uphold safety standards and invest in airport infrastructure. [more - original PR]
Malaysia Airlines has made a strong financial and operational recovery from the COVID-19 crisis, allowing the airline to turn its focus to customer and fleet investments. The company appears poised to achieve its long-awaited return to net profitability this year.
While this is partly due to the booming demand environment that is lifting many airlines, Malaysia Airlines’ restructuring efforts have undoubtedly made it more financially robust for the longer term.
Malaysia Airlines is due to begin receiving Boeing 737 MAX aircraft this year – despite delivery delays – and intends to start a selection campaign to cover the next stage of its narrowbody replacement needs.
On the widebody side, Malaysia Airlines is due to receive its first A330neos next year. In the shorter term, it is looking to boost its widebody fleet with more leased aircraft.
Taking in new aircraft will update both the fleet and cabin product. In the meantime, other improvements to aircraft cabins and services are under way or planned, as the airline enhances its customer experience proposition to compete better in the full service and premium sectors.
The privatisation of airports caught on rapidly in Latin America two and a half decades ago – initially in Mexico and Argentina, latterly in Brazil – and is to be found in many other countries in the region now. One exception was Paraguay, the small state sandwiched between Bolivia, Argentina, Brazil and Uruguay.
Paraguay has a mindset of its own, and that has manifested in this industry in an avoidance of privatisation activity, but that was not always the case. A PPP (Public-Private Partnership) deal was to have been struck in 2015 for the Asunción Airport, which serves the capital, but it was suspended following several legal glitches of the kind that are commonplace in that part of the world.
Ultimately, the civil aviation authority decreed that a new terminal at the airport would be self-funded instead – but that was never going to happen. So in 2023 a partnership deal is back on the cards and both the newly elected president and the defeated challenger are in favour of it.
The question now is whether previously interested parties (there were quite a few) can be enticed back, and if the regional leader can be attracted this time as well. On the surface the airport does not seem to have that much going for it...but that surface is there to be scratched beneath.
Speaking to CAPA TV on the sidelines of the IATA AGM in Istanbul in early Jun-2023, Finnair CEO Topi Manner described the lessons his airline had taken from the COVID-19 pandemic:
"I think the most lasting impact has been that we are a culturally stronger airline and I think the whole industry is culturally stronger. In our case, our operating model has changed quite a bit. We are faster, we are more nimble, we are more resilient."
However, Finnair's strategic focus on Europe-Asia was hit by the "double crisis" of COVID-19 and the closure of Russian airspace, so – "we have been needing to do pretty creative things".
Yet according to Mr Manner: "1Q 2023 was positive for us in terms of operating profit, so it was a good start for the year… the summer season looks to be very busy and therefore I'm looking forward to having a good year."
Asia Pacific airlines have a collective 4,430 commercial aircraft on order, accounting for almost 40% of identified outstanding orders globally.
Of this figure, nearly 2500 aircraft orders are concentrated with 10 airlines.
Almost 95% of the unfilled orders with these 10 airlines are for narrowbodies, with particularly large backlogs in place with short haul operators in Southeast Asia and South Asia.
Across the wider region, narrowbodies account for approximately 80% of orders. Narrowbody ordering is being supported by LCC growth and rapidly expanding regional connectivity to accommodate the travel demands of the region’s expanding middle class.
Berlin Brandenburg Airport: first positive EBITDA since opening, but passenger numbers still low
The story of Berlin Brandenburg Airport’s long drawn-out construction, which took the best part of a decade, is well documented.
To add insult to injury, when the airport finally did open in Oct-2020 it was right in the middle of the first COVID-19 waves, with hardly any passengers and a terminal mothballed.
Now it has reported a small profit (as measured by EBITDA) for 2022 and is starting to look to the future. Passenger numbers were close to 19 million in 2022, and a further increase of 10-15% is anticipated for 2023.
Stabilising the company was, rightly, the first priority, but the management ought now to turn its attention to the traffic mix, which simply doesn’t square with expectations at what is the capital city of the premier economy in Europe and the fourth in the world.
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Air New Zealand and New Zealand Government announce SAF production feasibility study investment
Air New Zealand and New Zealand's Government announced (16-Jun-2023) plans to invest over NZD2 million (USD1.2 million) in studies to consider the feasibility of producing sustainable aviation fuel (SAF) in Aotearoa. The commitment includes NZD1.5 million (USD935,175) from Air New Zealand and NZD765,000 (USD476,939) from the government. A working group is progressing proposals from LanzaJet and Fulcrum BioEnergy, with the next phase to evaluate the technical, economic, supply chain and environmental feasibility of establishing and operating a SAF production facility in New Zealand. Air New Zealand chief sustainability officer Kiri Hannifin said: "Globally, SAF is in very high demand but limited supply. Commercially producing SAF in New Zealand would not only help lower the country's emissions while creating jobs, regional economic development, and Māori and Iwi investment opportunities, but also provide energy security and energy independence which is something New Zealand doesn't have". New Zealand Tourism Minister Peeni Henare said: "Sustainable aviation fuel currently represents the most viable option for reducing carbon emissions from aviation... A domestic sustainable aviation fuel industry would build tourism and aviation sector resilience and also bring flow-on economic benefits like job creation". The second stage of the SAF feasibility work will continue to early 2024. [more - original PR - Air New Zealand] [more - original PR - New Zealand Government] [more - original PR - LanzaJet]
ICAO announced (14-Jun-2023) the certification of first nine batches of sustainable aviation fuel (SAF) under the Carbon Offsetting and Reduction Scheme for International Aviation (CORSIA). The batches account for 1542 tonnes of CO2 emission reductions, representing a reduction of 75% to 84% compared to conventional aviation fuels. The batches were certified by the International Sustainability and Carbon Certification and Roundtable on Sustainable Biomaterials. The certification process is based on the application of the standards set forth in the convention on International Civil Aviation's Annex 16, Environmental Protection, Volume IV. The batches were produced by ECOCHEM in China, Neste in the Netherlands and World Energy in the US. [more - original PR]
United Airlines and Eve Air Mobility to launch commuter eVTOL flights in San Francisco from 2026
United Airlines and Eve Air Mobility announced (14-Jun-2023) plans to launch commuter flights in San Francisco using Eve's electric vertical takeoff and landing (eVTOL) aircraft, expected to enter service in 2026. The companies will work with local and state authorities as well as infrastructure, energy and technology providers to build San Francisco's advanced air mobility (AAM) ecosystem. United and Eve will also collaborate to identify origin and destination areas for the future eVTOL route network. Eve Air Mobility co-CEO Andre Stein stated: "The Bay Area is perfect for eVTOL flights given its size, traffic, focus on sustainability, innovation and commitment to add other options for mobility". United previously announced a USD15 million investment in Eve and a conditional agreement for up to 400 eVTOL aircraft. [more - original PR]
Volaris announced (14-Jun-2023) a USD50 million investment agreement alongside Indigo Partners, GenZero, Cleanhill Partners, Frontier Airlines and Wizz Air to accelerate the production of sustainable aviation fuel (SAF) through the CleanJoule startup. CleanJoule will use the investment to develop its technology for producing SAF from agricultural waste and organic residues. As part of the consortium's investment, Volaris, Frontier Airlines and Wizz Air agreed to acquire 90 million gallons of SAF, with Volaris to receive 30 million gallons. Volaris president and CEO Enrique Beltranena said: "The development of sustainable fuel has made significant progress but still faces challenges, such as achieving competitive and cost-effective production volumes, especially for airlines operating under the low-cost model. That is why joining this investment is crucial to ensure the viability of our model and the sustainability of our business". [more - original PR]
Airbus reported (14-Jun-2023) the following highlights from its global market forecast for 2023 to 2042:
- Passenger traffic demand is forecast grow at a 3.6% compound annual growth rate over the next 20 years;
- Airbus forecast demand for 40,850 new passenger and freighter aircraft deliveries over the next 20 years, of which 32,630 will be narrowbody and 8220 widebody;
- Freighter demand is expected to reach 2510 aircraft over the next 20 years, with around 920 being newly built. Express air cargo growth will outpace general air cargo. The world freighter fleet in service will reach 3230 aircraft by 2042;
- Only 25% of the passenger in-service fleet are latest generation aircraft;
- Forecast deliveries by region:
- North America: 6970, 17% widebody and 83% narrowbody;
- Europe and CIS: 7970, 20% widebody and 80% narrowbody;
- Latin America: 2390, 8% widebody and 92% narrowbody;
- Africa: 1180, 25% widebody and 75% narrowbody;
- Middle East: 3420, 47% widebody and 53% narrowbody;
- China: 9440, 15% widebody and 85% narrowbody;
- Asia Pacific (excluding China): 9480, 21% widebody and 79% narrowbody.
Airbus forecast China and India will power growth, further shifting aviation's 'centre of gravity' toward Asia. Airbus expects the pace of fleet renewal towards the most fuel efficient aircraft will likely accelerate. Around 17,170 older, less fuel efficient aircraft will be replaced by newer fuel efficient aircraft. Airbus noted the demand to replace older aircraft is likely to increase to achieve the industry's sustainability ambitions and commitments. [more - original PR]
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This report utilises the the CAPA Aircraft Interiors Database to analyse recent industry trends with data, visualising areas that have shown tremendous growth while providing clarity on how leading suppliers in each sector have shrunk and grown.