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Wednesday, February 24th, 2021

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Spirit Aero’s Q4 2020 revenue plummets 55% on back of Boeing woes

Spirit AeroSystems Holdings (Spirit) has reported worse-than-expected results for its fourth-quarter 2020 operations, notably a 55% drop in revenue compared to the same quarter in 2019. The drop in revenue is a result of Boeing, one of its largest customers, struggling with the grounding of the 737 MAX and downturn in demand for new aircraft during the current COVID-19 pandemic.

Compared to 153 727 MAX shipsets delivered in 2019, Spirit delivered only 19 in 2020. Having been forced to cut back on production last year, with the 737 MAX now taking to the skies again will hopefully herald a ramp-up in production, thus benefitting Spirit. Spirit had also reported a drop in shipset deliveries to Boeing’s main competitor, Airbus, another of its major customers. Spirit’s total deliveries of shipsets, or complete sets of parts, fell 48.9% to 231 units for the fourth quarter of 2020.

“2020 was one of the most challenging years in aviation history. For Spirit, the 737 MAX grounding and the COVID-19 pandemic created a dual-crisis,” Spirit Chief Executive Officer Tom Gentile said. Spirit posted a loss of US$295.9 million, or US$2.85 per share, for Q4 ending December 31, 2020, compared to a profit of US$67.7 million, or 65 cents per share, for Q4 ending December 31, 2019. Total revenue plummeted 55.3% to US$876.6 million for the quarter.


Genesis and Heston Aviation form strategic alliance to create Heston Airlines

Genesis, the Dublin-based aircraft leasing company has formed an alliance with Heston Aviation, to build and launch Heston Airlines. Heston Airlines will be a newly established Lithuanian headquartered charter and ACMI service provider.

Over the past 12 months Genesis has supported the strategy and development of the airline and has just concluded on delivering the airline’s first 180-seat A320 aircraft to support the final stages of Heston Airlines application for an EASA Air Operator Certificate (AOC). Genesis will work with Heston Airlines to deliver additional A320 aircraft which are planned to enter service in 2021.

Commenting on the partnership Karl Griffin, CEO of Genesis said “Since March 2020, Genesis has been working together with the Heston team on this innovative way to bring flexible lift directly into the charter and ACMI airline market, providing both wet and dry leasing solutions to airlines as they start to take off with the vaccine roll-out across Europe.”

Spirit to add Louisville to route map

Spirit Airlines plans to add Louisville—one of the fastest-growing cities in the country—to its route map with nonstop daily service to four cities. Spirit plans to inaugurate service from the Louisville Muhammad Ali International Airport on Thursday, May 27, with flights to Fort Lauderdale (FLL), Orlando (MCO), Las Vegas (LAS) and SDF's only nonstop flight to Los Angeles (LAX).

Spirit's flight 502 will be the only nonstop service to Los Angeles from Louisville, removing intermediate stops on the way and making quick trips between the two cities easier than ever. The airline continues to seize that kind of growth opportunity as demand for air travel increases. Earlier this month, the carrier announced an accelerated delivery schedule for new Airbus aircraft joining Spirit's Fit Fleet™, which is among the youngest in the industry.

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Boeing begins T-7A Red Hawk advanced trainer production

The first U.S. portion of the T-7A Red Hawk advanced trainer has officially entered the Boeing jet’s state-of-the-art production line.

The training jet, designated the eT-7A Red Hawk by the U.S. Air Force because of its digital heritage, was fully designed using 3D model-based definition and data management systems developed at Boeing during the last two decades. The T-7A Red Hawk employed the digital engineering and design of the Boeing T-X aircraft that went from firm concept to first flight in just 36 months.

“The future of air dominance lies in the ability to move quickly, take smart risks and partner in new ways to get the job done,” said Shelley Lavender, Boeing senior vice president of Strike, Surveillance and Mobility. “By creating aircraft and systems along a digital thread, we can accelerate build times and increase quality and affordability for our customers in a way that has never been done before.”

The Advanced Pilot Training System also incorporates leading-edge ground-based live and virtual simulators to give students and instructors a “real as it gets” experience.

In September 2018, the U.S. Air Force awarded Boeing a US$9.2 billion contract to supply 351 advanced trainer aircraft and 46 associated ground-based training simulators. Saab is teamed with Boeing on the trainer and provides the aft fuselage of the jet.


Akbar Travels and Sabre cement 20-year relationship with new strategic partnership agreement

Software and technology provider Sabre Corporation and India’s largest travel agency, Akbar Travels, have signed a new long-term, strategic partnership agreement to further expand Sabre’s footprint in the Indian subcontinent while driving operational efficiencies to increase productivity and profitability for Akbar.

Under the extended and expanded agreement, Sabre will continue to be Akbar’s preferred global distribution (GDS) partner in India, ensuring that the firm, which is the largest travel company in India in terms of IATA-approved branches, staff numbers and business turnover, can continue to access real-time, rich content from hundreds of thousands of airlines, hoteliers and other travel providers through Sabre’s intuitive Sabre Red 360 interface.

In addition to this latest renewal, Akbar and Sabre will also be working more closely together through the appointment of software company Benzy Infotech, a 100% subsidiary of the Akbar Group, as Sabre’s partner for 15 states in India to promote and develop Sabre’s business in these markets and strengthen its presence across the Indian subcontinent.

This new announcement from Sabre and Akbar follows an earlier deal enhancement last year when Akbar selected Sabre’s Content Services for Lodging (CSL) APIs to enable its agents to more easily shop, compare and book more than a million lodging options for clients.


KLM takes delivery of first Embraer E2 jet

KLM Cityhopper, the regional subsidiary of KLM Royal Dutch Airlines, has received its first Embraer E195-E2 in a ceremony at Embraer’s facility in Brazil. This first E2 delivery to KLM, and lessor ICBC Aviation Leasing, brings the total number of Embraer jets in the KLM Cityhopper fleet to 50.

The total order for 35 jets, 25 firm orders with options for ten more, will be leased to KLM from ICBC Aviation Leasing (10) and Aircastle (15). KLM recently exercised four options increasing the firm order from 21 to 25 jets, with the further four aircraft coming from Aircastle’s existing order-book.

KLM is a global leader in airline sustainability and taking action to make operations more sustainable. KLM’s fleet renewal is a key strategy to reduce the airline’s environmental footprint. The E195-E2, Embraer’s new generation aircraft, is specifically designed to cut emissions and noise pollution. The E195-E2 delivers a 31% reduction in carbon emissions per seat over KLM Cityhopper’s first-generation E190s.

GA-ASI and GKN Aerospace expand strategic partnership

General Atomics Aeronautical Systems, (GA-ASI) and GKN Aerospace have signed a contract for GKN Aerospace to manufacture the advanced composite V-tails for GA-ASI’s new MQ-9B SkyGuardian® Remotely Piloted Aircraft System (RPAS) from its Cowes facility in the United Kingdom.

SkyGuardian is the baseline system of the U.K. Royal Air Force’s (RAF) Protector RG Mk1 and has also been selected by Belgian Defence and the Australian Defence Force. This represents another important milestone in the 10-year strategic relationship between GA-ASI and GKN Aerospace, and adds to the strong investment GA-ASI is making in U.K. industries.

GA-ASI and GKN Aerospace had previously entered into a pre-production contract, under which GA-ASI provided the required engineering technical data and tooling, and GKN Aerospace developed their manufacturing processes and produced demonstrator parts. Under this latest agreement, GKN Aerospace will begin full rate production of the V-tails from the Cowes facility to support MQ-9B aircraft production.


Astronics posts full-year 2020 net loss of US$115.8 million

Astronics Corporation, a supplier of advanced technologies and products to the global aerospace, defense and other mission critical industries, has reported financial results for the three and twelve months ended December 31, 2020.

Astronics has posted fourth-quarter revenues of US$114.8 million, down 42.1% from the comparator period of 2019, but up 7.8% sequentially from the third quarter. The company incurred a pre-tax loss of US$7.5 million. The company’s net loss of US$20.0 million included a US$14.1 million non-cash tax expense reflecting a reserve recorded against its deferred tax assets. Adjusted EBITDA was US$2.9 million, or 2.5% of sales, up US$3.0 million sequentially from the third quarter of 2020. Revenue in 2020 was US$502.6 million, down 35% compared with 2019 as a direct result of the global pandemic.

Net loss for the year was US$115.8 million while Adjusted EBITDA was US$28.8 million as the company rapidly adjusted to the new environment by aggressively adjusting its cost structure to changes in demand. Consolidated Adjusted EBITDA was US$28.8 million, or 5.7% of consolidated sales, compared with US$88.3 million, or 11.4% of consolidated sales, in the prior year.


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Tamar Jorssen
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Email: tamar.jorssen@avitrader.com
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