Wednesday, July 31st, 2019

Air France-KLM signs commitment for 60 A220 aircraft

The Air France–KLM Group has signed a Memorandum of Understanding (MoU) for 60 A220-300 aircraft to modernise its fleet. The aircraft are powered by Pratt & Whitney’s latest-generation PW1500G geared turbofan engines and are intended to be operated by Air France. Air France currently operates a fleet of 144 Airbus aircraft.

With an order book of 551 aircraft as of end of June 2019, the A220 has all the credentials to win the lion’s share of the 100-to-150-seat aircraft market, estimated to represent 7,000 aircraft over the next 20 years.

Component Control

Air Canada posts 2nd quarter net income of CA$343 million

Air Canada has reported second quarter 2019 EBITDA of CA$916 million compared to second quarter 2018 EBITDA of CA$739 million. The airline reported second quarter 2019 operating income of CA$422 million compared to second quarter 2018 operating income of CA$308 million. Adjusted net income was CA$240 million in the second quarter of 2019 compared to adjusted net income of CA$129 million in the second quarter of 2018.

Second quarter 2019 net income amounted to CA$343 million compared to a second quarter 2018 net loss of CA$102 million. The second quarter of 2019 included foreign exchange gains of CA$117 million while the second quarter of 2018 included a loss on disposal of assets of CA$186 million and foreign exchange losses of CA$82 million.

"The impact of the Boeing 737 MAX grounding will be felt more acutely in our very busy summer period and, as a result, third quarter EBITDA is expected to increase approximately five per cent versus the third quarter of 2018," said Calin Rovinescu, President and Chief Executive Officer of Air Canada. "Third quarter projected capacity is expected to decline approximately two per cent compared to the third quarter of 2018, as opposed to an originally planned capacity increase of approximately three per cent. In our planning, we will be removing the Boeing 737 MAX from our schedule until at least January 8th, 2020.


Lufthansa blames short-haul price war and fuel prices for 70% drop in quarter’s net profit

Announcing a 25% drop in adjusted EBIT earnings to €754 million for the second quarter and net profit plummeting 70% to €226 million, Lufthansa’s share price fell 5.5% by 0850 GMT, July 30, having already fallen by almost a third over the last year. Aside from a €200 million tax provision hitting profits hard, the company blamed a combination of price competition on short-haul routes, plus rising fuel and maintenance costs.

Commenting on the situation, Lufthansa Chief Financial Officer Ulrik Svensson said: "Our earnings are feeling the effects of tough competition in Europe and sizeable overcapacities, especially on our short-haul routes out of Germany and Austria," adding that: "We are expecting that we will indeed have a very tough price competitive situation with these carriers for the rest of the year and maybe also into 2020."

Lufthansa had hoped June’s turnaround plans for its low-cost carrier Eurowings would have had positive results but is now looking to a pick-up in long haul business to offset an adjusted EBIT margin of -4% to -6% for Eurowings projected for the year as a whole. In June Lufthansa said that Eurowings would look to cut costs by 15% over the next three years, focusing on short-haul flights as part of a plan to once again become profitable by 2021.

Lufthansa has maintained its guidance for 2019, having cut its full-year profit forecast due to lower prices and higher fuel costs compounding the effect of losses at its budget subsidiary Eurowings. Since June it has been forecasting an adjusted EBIT margin of between 5.5% and 6.5% for 2019 - which would correspond with adjusted earnings of between €2.0 billion and 2.4 billion - a decline of 14% to 28.5% compared with last year. Fuel costs were reported as €255 million higher in the second quarter than in the previous year. While the newspaper Handelsblatt reported on Monday that Lufthansa was considering adopting a corporate holding structure to simplify its operations, improve profitability and regain the support of investors, Ulrik Svensson has said the company had no plans to change its corporate structure.

TP Aerospace

BAA Training Vietnam ready to open

BAA Training Vietnam – a European standard aviation training provider has announced the completion of the construction of a brand new modern aviation training centre in Ho Chi Minh city.  3000-square-meter, strategically located 18km from the airport training facility is designed to accommodate 4 full flight simulators and fulfil the need of the professionals’ aviation training in the region.  The brand new training centre has spacious studying and briefing rooms, a VIP lounge and in-house accommodation solution.

The newly-built modern training centre will start providing operations with Airbus A320 pilot training as the brand new state-or-the-art Airbus A320ceo full flight simulator (FFS) is currently being assembled. The first Airbus A320 type rating student-pilot group is expected to start in August, while the second, Airbus A320neo, is scheduled to reach the training centre by the end of 2019. In addition to type rating training, the company is to provide wet and dry lease FFS services to corporate clients. It is also planned to add Flame V9000 Commander Fire Fighting Trainer at the end of 2019.

“Vietnamese aviation market has been growing by the average 8% per year and is expected to continue its growth in the upcoming 20 years’ time. Airlines in Vietnam keep announcing fleet expansion plans –National carrier alone has recently announced plans to acquire 50 new narrow-body aircraft including Airbus A320. With the modern training facilities and equipment, experience and deep know-how we are ready to accommodate Vietnamese pilots with European standard aviation training solutions”, comments Egle Vaitkeviciute, CEO at BAA Training.

Established in 2018 BAA Training Vietnam declares bringing 20 years of experience in the field and its know-how from its headquarters in Europe – BAA Training, which is one of the TOP 3 biggest independent aviation training centres in Europe well-known in the market for its full scope and flexible aviation training solutions for private and business clients. It has a global network of clients from 96 countries. Since 2016 BAA Training has launched Cadet Pilot programs with leading airlines in Turkey, Hungary, Iceland, Laos, Latvia, Lithuania and Vietnam. In 2019 the company has launched MPL training program with Avion Express.

Embraer delivers 26 Commercial and 25 Executive Jets in 2Q19

Embraer has delivered a total of 51 jets in the second quarter of 2019, of which 26 were commercial aircraft and 25 were executive jets (19 light and 6 large). As of June 30th, the firm order backlog totaled US$16.9 billion compared to US$ 16.0 billion at the end of first quarter 2019. Embraer’s second quarter 2019 backlog increase is largely due to continued market demand, mainly for the new family of Praetor jets in Executive Aviation.

In the second quarter, Embraer received the Type Certificate for the E195-E2 from three regulatory authorities: ANAC, the Brazilian Civil Aviation Agency (Agência Nacional de Aviação Civil); the FAA (U.S. Federal Aviation Administration) and EASA (European Aviation Safety Agency). The E195-E2 is the largest of the three members of the E-Jets E2 family of Embraer commercial airplanes.


Munich Airport Supervisory Board appoints Jost Lammers new President and CEO

The Supervisory Board of Flughafen München GmbH (FMG), the Munich Airport operating company, has selected Jost Lammers as the airport's next president and CEO. Lammers has been appointed for a five-year term effective as of January 1, 2020. He will succeed Dr. Michael Kerkloh, who is to retire on December 31, 2019 after leading the FMG Group very successfully for more than 17 years.

Albert Füracker, the Bavarian minister of finance and the chairman of the FMG Supervisory Board, sees Jost Lammers as an "excellent choice": "As the CEO in Budapest, Mr. Lammers has guided that airport through an impressive period of growth and development. We have therefore selected a candidate whose experience, skills, personality and age make him the ideal choice to lead Bavaria's Gateway to the World into the future and successfully master the many challenges that lie ahead."

Jost Lammers, Thomas Weyer (CFO and Director of Infrastructure) and Andrea Gebbeken (Managing Director: Commercial and Security) will make up Munich Airport's new Management Board.

GA Telesis MRO Services Group signs long-term landing gear MRO agreement with China Express Airlines

GA Telesis, a leader in integrated aviation services, reported the execution of a new long-term agreement with China Express to overhaul landing gear valued at US$27 million.

The agreement has a five year term and covers the repair and overhaul of the entire fleet of CRJ900 landing gear. The agreement encompasses coverage of 35 aircraft over five years, and includes a leasing component that was created and provided by the Inventory Leasing Group from within the GA Telesis Ecosystem™.


BOC Aviation announces operational transactions for second quarter ended June 30, 2019

During the second quarter 2019 BOC Aviation has delivered a total fleet of 499 aircraft owned, managed and on order. The average aircraft age was 3.1 years and the average remaining lease term was 8.2 years for the 314 owned aircraft fleet, weighted by net book value. At the end of the second quarter BOC Aviation had an order book of 162 aircraft and took delivery of 14 aircraft (including two acquired by airline customers on delivery).

18 aircraft scheduled for delivery in the first half of 2019 were delayed, comprising 12 Airbus aircraft delayed primarily due to industrial constraints and six Boeing aircraft delayed primarily due to the 737 MAX grounding. BOC Aviation has signed 32 lease commitments during the second quarter and had a customer base of 92 airlines in 40 countries and regions in the owned and managed portfolios.

BOC Aviation has sold eight owned and two managed aircraft and has managed a fleet comprising of 23 aircraft. Furthermore BOC Aviation repossessed five owned and three managed aircraft from airlines that had ceased operations and delivered all eight aircraft to new customers.

Millennium International Avionics names Todd Slater Business Development Director

Millennium International Avionics has named Todd Slater as the new Business Development Director. In this position Slater will be responsible for developing sales and service channels for the Commercial Air Transport and Corporate Aviation divisions, along with third-party support.

Slater started his career with Absolute Aviation (now Wencor) as a bench technician and has held multiple technical and leadership roles. Most recently, he has served as the Director of Pricing and in the sales division for Wencor Group MROs. 


Aircalin takes delivery of first of two A330neo aircraft

New Caledonia’s Aircalin has taken delivery of its first of two A330-900 at a delivery ceremony in Toulouse, France, with the second aircraft joining the fleet later in 2019, replacing its existing two
A330s. Aircalin is also a customer for the A320neo and will replace its existing two A320s to become an operator of two A330-900s and two A320neos.

Aircalin’s A330neos are configured in a comfortable three-class layout with 291 seats or 25 more seats than its existing smaller A330-200s. These include 26 business, 244 economy and for the first
time, premium economy with 21 seats.

The A330neos will boost capacity and non-stop connectivity between the French Pacific Island territory and markets in Japan, Australia and the Pacific Islands nations.


click here to download the latest PDF edition


click here to download the latest PDF edition

click here to subscribe to our other free publications


click here to view in PDF aircraft and engines available for sale and lease


Engine Leasing Seminar
September 17, 2019 – Holiday Inn Kensington High Street, London, UK

Effective Risk Management in Aircraft Leasing and Aviation Finance
September 18, 2019 – Holiday Inn Kensington High Street, London, UK

Advanced Engineering 2019
October 30 - 31, 2019 – NEC, Birmingham, UK

EyeforTravel Revenue Optimization and Marketing Summit
November 26 - 27, 2019 – Hotel Novotel Amsterdam City, Amsterdam, NL