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Friday, August 14th, 2020

COVID-19 impact worsening within Europe warns IATA

The International Air Transport Association (IATA) is urging governments to get together and lift border restrictions as well as finding alternatives to quarantine measures if further economic damage is to be avoided.

Despite a more recent increase in air traffic over the last months, helped by the reopening of borders between Schengen and non-Schengen EU states, overall volume is down 50% year on year and overall, for 2020, passenger numbers are expected to fall by 60% year on year. The threat of an anticipated second wave of the pandemic has led to further uncertainty and while passenger numbers are anticipated to recover, the return to pre-pandemic numbers may not occur until 2024.

In June it had been estimated that nearly six million aviation-supported jobs were at risk, that figure now has been revised upwards to seven million. “It is desperately worrying to see a further decline in prospects for air travel this year, and the knock-on impact for employment and prosperity. It shows once again the terrible effect that is being felt by families across Europe as border restrictions and quarantine continue. It is vital that governments and industry work together to create a harmonized plan for reopening borders,” said Rafael Schvartzman, IATA’s Regional Vice President for Europe.

The air transport industry has been working closely with regulators, including the International Civil Aviation Organization (ICAO) and the European Aviation Safety Agency (EASA) to put protocols in place to ensure the safety of travelers and crew. As the current risk of transmission of the COVID-19 virus on board remains at a low level, this is proof that airlines and airports are already successfully implementing appropriate measures.


TGIS teams up with BCT Aviation Maintenance to create one-stop service for aviation sector

East Midlands based global engine and aircraft consultants, TGIS Aviation Management, has announced a new service to the aviation leasing community.

TGIS has teamed up with BCT Aviation Maintenance to offer a combined asset management, storage maintenance and return-to-service package. BCT can offer both EASA and FAA certification.

Ian Smith, Technical Director of TGIS commented, “We wanted to offer a service to the aircraft leasing community that reflects the challenging times the commercial aviation sector finds itself in. Together with BCT, we are able to offer transition management and approved maintenance support during extended periods of aircraft inactivity. Using our combined core of industry experienced personnel, we are able to provide a cost-effective solution to the challenges ahead.”

’Robert Brown, CEO of BCT Aviation Maintenance commented ‘’We are excited to work together with TGIS and look forward to providing support in the industry using our shared resources and knowledge.’’

Munich Airport’s network is growing again

Traffic at Munich Airport has been picking up again. As of early August, 45 airlines already connect Munich with 140 destinations, including 13 destinations in Germany, 18 destinations in Greece, 15 in Spain, 13 in Italy, nine in Turkey, seven in France, five in Croatia, four in Portugal, and three in Bulgaria.

The North African destinations of Cairo (Egyptair) and Tunis (Tunis Air) are once again in Munich’s flight plan, along with two destinations in Canada, six in the U.S.A., three in the Arabian Gulf, and three in the Far East. Air Canada, Emirates, Etihad, Lufthansa, Qatar Airways, Delta Air Lines, and United Airlines have once again included Munich in their intercontinental route networks. This brings the non-European route network back to 14 destinations. The number of weekly departures in August has now reached 1,100 take-offs.

With Lufthansa ramping up their hub operation step by step, hub traffic is also increasing again – already one in three passengers currently uses Munich as a transfer airport again.


Embraer appoints new global commercial team

Following the appointment of Arjan Meijer as President & CEO of Embraer’s Commercial Aviation business in June, the Brazilian planemaker is making a number of key leadership appointments in its global commercial team.

Martyn Holmes has been appointed Chief Commercial Officer of Embraer’s commercial unit. He joined the company in 2012 and is moving on from his previous role, as Vice President for Europe, Russia and Central Asia. Holmes will continue to be based in Amsterdam at Embraer’s EMEA head office, and will report to President & CEO, Arjan Meijer.

Cesar Pereira, has been appointed Vice President of Europe, Middle East and Africa (EMEA), Embraer Commercial Aviation, relocating from Singapore to the Amsterdam office.

Raul Villaron moves on from his role as Vice President Middle East and Africa to Singapore, as Vice President Asia Pacific, looking after Embraer’s Commercial Aviation for the Asia Pacific region (not including China). He has been with Embraer for 15 years, and prior to this current appointment was the Marketing Director for the EMEA region. Guo Qing remains as the Vice President of China for Embraer Commercial Aviation.

Mark Neely has been appointed Vice President of The Americas for Embraer Commercial Aviation. In this role, he will cover both continents of the Americas from his base in the United Sates. Neely has been with Embraer for ten years and was Regional Vice President Sales, in North America.


Norwegian extends cooperation with Lufthansa Technik

Norwegian Air Shuttle ASA and Lufthansa Technik have extended their cooperation for the overhaul of the carrier's 90 Boeing 737NG-strong fleet by another five years.

The services are performed at Lufthansa Technik's location in Budapest, Hungary, within the framework of a Total Base Maintenance Support (TBS®) contract, with the first contract events planned for September 2020.

The main characteristics of Total Base Maintenance Support TBS® are the guaranteed availability of layovers and a commercial service package geared to individual customer needs. As one of a total of five Lufthansa Technik overhaul sites in Europe, Lufthansa Technik Budapest will provide services within the framework of the new contract. As a TBS® customer, Norwegian also has access to the entire overhaul network of Lufthansa Technik for additional or unplanned maintenance events.

Fly Leasing reports second-quarter 2020 financial results

Fly Leasing (FLY) has posted its financial results for the second quarter of 2020. FLY is reporting net income of US$9.6 million for the second quarter of 2020, compared to net income of US$54.1 million for the same period in 2019. Net income for the six months ended June 30, 2020 was US$47.7 million, compared to net income of US$99.0 million for the six months ended June 30, 2019.

Adjusted net income was US$11.3 million for the second quarter of 2020, compared to US$61.9 million for the same period in the previous year. For the six months ended June 30, 2020, adjusted net income was US$54.9 million, compared to US$109.0 million for the same period last year.

On June 30, 2020, FLY’s total assets were US$3.5 billion, including investment in flight equipment totaling US$3.0 billion. Total cash on June 30, 2020 was US$309.3 million, of which US$289.0 million was unrestricted. The book value per share on June 30, 2020 was US$29.46, a 21% increase since June 30, 2019. On June 30, 2020, FLY’s net debt to equity ratio was 2.1x, a decrease from 2.3x on December 31, 2019.

On June 30, 2020, FLY had 86 aircraft and seven engines in its portfolio. FLY’s aircraft and engines are on lease to 41 airlines in 25 countries. The average age of the portfolio, weighted by net book value of each aircraft and engine, was 8.0 years. The average remaining lease term was 4.9 years, also weighted by net book value. On June 30, 2020, FLY’s portfolio was generating annualized rental revenue of approximately US$318 million. 


Jet Aviation Geneva delivers 240-month check on Bombardier Global Express

Jet Aviation’s maintenance facility in Geneva has re-delivered its first 240-month check on a Global Express. The inspection was successfully performed in conjunction with an avionics modification and a number of service bulletins. The company has since initiated a combined 120/180-month check on a Global Express XRS — with more in the pipeline.

Essentially a repeat (the second) of the largest inspection for the Global Express, the 240-month check involves an extensive overhaul of all major aircraft systems and structures, including the internal side of the aircraft’s fuselage. Gaining access for such rigorous scrutiny necessitates removal of the entire cabin and soundproofing materials, ensuring exceptional care in their storage, while paying great attention to detail for the duration of the check.

GECAS and S7 Airlines sign agreement for two 737-800 BCFs

GECAS (GE Capital Aviation Services) has signed an agreement with S7 Airlines  for two 737-800 Boeing Converted Freighter (BCF) aircraft. S7 Cargo, general agent for cargo operations sales of S7 Group, will manage freight services.

S7’s air freight program currently utilizes belly capacity on passenger planes and these narrowbody freighters will mark the inauguration of dedicated air freighters for the Russian-based operator.

GECAS, Boeing’s launch customer for the type, expects the freighters to deliver in November 2020 and January 2021. The aircraft will fly medium and short-haul routes for S7.


American Airlines prepares to drop some service to smaller cities as expiration of federal aid nears

As CNBC's Leslie Josephs reports, American Airlines is preparing to scrap flights serving two-dozen medium and small cities as the expiration of federal coronavirus aid that placed restrictions on carriers from cutting service approaches, according to an executive at the carrier.

Airlines are required to maintain minimum levels of service through Sept. 30 under a US$25 billion federal aid package that also prohibited layoffs through the end of the third quarter. American was granted US$5.8 billion in support under the program.

The deal was meant to preserve both jobs by providing payroll assistance and air service around the country, even though most planes were flying with a fraction of their normal passenger loads. Regulators allowed airlines some exemptions in service.

The new cancellations for up to 30 destinations could show up in fall schedules as early as next week, the American Airlines executive told CNBC. The person asked not to be identified because the changes haven’t been finalized yet.

Airline labor unions and executives from carriers themselves have been pushing Congress for another US$25 billion in payroll support to keep paying workers through the end of next March, as demand remains depressed.

The proposal has gained bipartisan political support in Congress and from President Donald Trump, but lawmakers and the White House have failed to reach a deal on a new, national coronavirus aid package that would likely house the provision for additional airline aid.

If the Department of Transportation had to inform airlines by Aug. 1, if it were to extend the minimum service requirements.

“The Department did not propose to extend the obligations, but will use the authority in the CARES Act to monitor ongoing access by the traveling public to the national air transportation system,” a DOT spokesman said. “The Department is also prepared to implement any new provisions of law in this area if enacted by Congress.”

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