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Tuesday, April 28th, 2020

Airbus furloughs 3,200 U.K. workers as it continues to haemorrhage cash

European aerospace giant Airbus has decided to furlough 3,200 of its staff based at its plant in Broughton, Wales, which is responsible for the manufacture of wings. These employees will be able to take advantage of the U.K.s job retention scheme whereby the government guarantees 80% of an employee’s salary while they are unable to work, up to a maximum of £2,500 per month.

Airbus has agreed with unions to add up to a further 10% of furloughed workers’ normal salary. The move will be staggered over a three-week period and will initially last for three weeks per employee. Additional U.K. staff at the Filton unit, which both designs and supports wings, remain unaffected by the move.

Airbus recently sent out a letter to its 134,000 employees in which it stated that the company “may now need to plan for more far-reaching measures” owing to the enormous loss in business. Airbus is due to announce its first-quarter financial results this Tuesday and major job losses could be announced. Having chosen to cut production by one third at the beginning of April, Guillaume Faury, Airbus CEO, has made it clear that this one-third reduction in productivity may not be a worst-case scenario, writing in the letter to staff that: “We're bleeding cash at an unprecedented speed, which may threaten the very existence of our company. We must now act urgently to reduce our cash-out, restore our financial balance and, ultimately, to regain control of our destiny.”

According to unnamed sources, Airbus is exploring avenues including state-guaranteed loans, having already taken advantage of the French furlough scheme when it suspended work for 3,000 French employees.


SWISS to reconfigure three Boeing 777s into cargo aircraft 

SWISS and its Swiss WorldCargo division have performed more than 80 cargo-only flights since the end of March, transporting over 1,300 tons of airfreight between Asia and Switzerland. The cargo concerned have consisted mainly of medicines and medical supplies and equipment for the Swiss healthcare system.

SWISS plans to operate over 100 further cargo flights on behalf of various private and public entities between now and the end of May. The Airline of Switzerland will also introduce a new network of cargo-only services offering regular cargo flights between Zurich and Shanghai (up to three times daily), Beijing (up to twice daily), Chicago and Tokyo (twice weekly) as well as Bangkok and Singapore (weekly). Further destinations are expected to be added to the new network over the next few weeks.

In a further development, SWISS is considering to remove the Economy Class seating from three of its twelve Boeing 777-300ER aircraft to meet the growing demand for air cargo capacity. More than 800 seats would be deinstalled at Zurich airport for this purpose. The modifications would help ensure consistent and regular goods deliveries and thereby help keep Switzerland optimally connected with the world in the difficult present conditions – particularly for the provision of medical and humanitarian supplies to and from the country.

COMAC delivers 24th ARJ21 aircraft

Commercial Aircraft Corporation of China (COMAC), has delivered the 24th ARJ21 aircraft. This ARJ21 aircraft has been purchased by ICBC Leasing and is leased to Chengdu Airlines. It is the 17th time to deliver an ARJ21 aircraft in the form of leaseback.

The aircraft is in all economy-class cabin configuration and has seats for 90 passengers. Up to now, COMAC has delivered 24 ARJ21 aircraft, and the ARJ21 aircraft fleet has safely carried more than 810,000 passengers.


SAS to reduce workforce by up to 5,000 full-time positions

As a result of COVID-19, demand is expected to be significantly affected during the remainder of 2020 and it will take some years before demand returns to the levels experienced before the outbreak. Consequently, SAS needs to adapt the business to a lower demand environment. As a consequence, SAS will initiate processes to reduce the size of its future workforce by up to 5,000 full-time positions.   

Currently, SAS is only operating a very limited domestic network in Norway and Sweden. Given the current restrictions, SAS expects limited activity in the important summer season. In addition, it will most likely take some years before demand returns to the levels seen before COVID-19.

The potential reduction of the workforce by up to 5,000 full-time positions will be split with approximately 1,900 full-time positions in Sweden, 1,300 in Norway and 1,700 in Denmark. The processes will be implemented in accordance with the labor law practices in each respective country. During this process, SAS will actively engage with its unions and other stakeholders to seek solutions to reduce the number of actual layoffs across the Group, as well as other productivity enhancements.

Boeing to resume 787 operations in South Carolina

Boeing will resume 787 operations at Boeing South Carolina (BSC), with most teammates returning on May 3 or May 4. The return includes all operations that were temporarily suspended on April 8 in response to the COVID-19 pandemic.

"The health and safety of our teammates, their families and our community is our shared priority," said Brad Zaback, Boeing South Carolina site leader and 787 vice president and general manager. "Our approach to resumption of operations ensures we honor that priority by ensuring personal protective equipment is readily available and that all necessary safety measures are in place to resume essential work for our customers and prioritize the health and safety of our team. We have also taken the necessary steps to ensure a steady supply base for our operations."

Senior leaders will return on Thursday, April 30, and managers will return on Friday, May 1, to prepare for the operations resumption.


As flight bookings dive, consumers still plan to travel

Research released by ForwardKeys, the travel analytics firm, has revealed the extent of the collapse in aviation in the wake of the COVID-19 outbreak. In the year to April 19, air travel fell to exactly half of what it was in the equivalent period last year. The cancellation rate peaked in mid-March and global aviation seat capacity has fallen from over 40 million seats in operation to less than 10% of that number today. However, despite the evaporation of demand, flight search data reveals that consumers are still dreaming about travel.

The year-to-date drop-off in flight arrivals has been most severe in the Asia Pacific region, where the outbreak started, down 56.1% on the equivalent period in 2019. Europe is next, with arrivals down 50.2%. Travel to Africa and the Middle East is down 42.6%; and travel to the Americas is down 39.8%. However, with over 90% of all flights currently grounded, the year-to-date trend is set to deteriorate substantially in the near term.

ForwardKeys’ analysis of year-to-date flight bookings shows that they are 86.8% down compared to the first 15 weeks of 2019. Bookings from Asia Pacific are down by more than 100%, which means that in the period, new bookings were outweighed by cancellations. Bookings from Europe were down by 84.7%, from the Americas were down by 75.9% and from Africa & the Middle East were down by 71.4%. Throughout March, there have been effectively no new bookings, as well as a massive wave of cancellations – and that pattern has continued into the first two weeks of April.

ForwardKeys has also undertaken an analysis of flight searches done in several countries during March, when most of the population has been in quarantine. It reveals that they are still researching foreign travel and, furthermore, that they have a disproportionate interest in long haul travel in the third and fourth quarters of the year. Countries researched include France, Italy, Japan, Spain and South Korea.


KlasJet adds cargo services to its portfolio by collaborating with BlueBird Nordic

KlasJet, a private and corporate jet charter company and a subsidiary of Avia Solutions Group, has added cargo services to its portfolio by collaborating with cargo airline BlueBird Nordic. The latter company’s newly acquired Boeing 737-300 (LY-MRN), will enable KlasJet to carry out cargo services globally.

The alliance of KlasJet’s experience providing the highest quality services, planning difficult, time-critical routes and BlueBird Nordic’s experience in air cargo sector benefit each other expanding the opportunities that private charter can offer.

As for the current situation in the world, born from the COVID-19 outbreak, KlasJet has already showed the ability to react to these extreme circumstances by providing repatriation and humanitarian flights. Adding cargo services means responding to the currently rising demand in the market, which will be of use when transporting a team of medics, who require special gear, carried together with them, larger amounts of medical supplies, personal protective equipment and other.

AAR Mobility Systems awarded US$125 million sole source firm-fixed-price contract from U.S. Air Force

AAR’s Mobility Systems division has been awarded a sole source firm-fixed-price (FFP) requirements contract, that includes a base year with four one-year option periods from the U.S. Air Force for the production and repair of 463L cargo pallets. The total contract value is US$125 million. The cargo pallets will be manufactured and repaired in Cadillac, Michigan.

“AAR continues to produce and maintain this strategic asset for the U.S. Air Force to ensure it meets its worldwide operational requirements,” said Lee Krantz, Senior Vice President, AAR Mobility Systems. “For many years, AAR has been proud to provide the 463L cargo pallet to the U.S. Armed Forces, its allies, and other U.S. Government agencies.”


ILS and Component Control launch ILS Bridge for Quantum

ILS and CCI will launch the ILS Bridge for Quantum. This new solution will allow automated listing of Quantum Inventory on ILS and provide real-time connectivity between Quantum Control and ILS, a leading digital aerospace marketplace.

“Mutual Quantum ERP and ILS customers have asked for this capability given the criticality of both systems in our customers’ aviation supply chain,” says John Herrman, EVP and GM at ILS. “This integration solution will connect our software platforms and begin unlocking the combined value of our platforms”, says Todd Lewis, President and GM of Component Control.

The ILS Bridge for Quantum is a fully integrated, real-time connectivity solution that simplifies inventory and RFQ management for buyers, provides robust out-of-the-box functionality, and enables intelligent supply chain management with improved data integrity.

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Tamar Jorssen
Vice President Sales & Business Development
Email: [email protected]
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