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Thursday, October 7th, 2021

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Air Asia Group and Airbus reach agreement over restructuring of massive plane order

Malaysia’s Air Asia Group has come to an agreement with European planemaker Airbus over changes to an existing order for 362 narrow-body planes. As part of the arrangement, 13 A320neos will be switched to the larger A321neo model. While the original schedule for deliveries is not publicly known, the new schedule will see deliveries through to 2035.

According to Reuters news agency, Airbus has also improved the terms of the purchase of the planes by the cash-strapped carrier in order to salvage the valuable contract. While Air Asia currently operates four A321neos, it put a halt on deliveries during the pandemic and during that period Airbus sold six A321neos that had been built for it. There had been considerable speculation from the carrier’s auditors over Air Asia’s ability to remain a going concern during the pandemic when taking into account its effect on the travel industry as a whole. However, this week AirAsia said it had received approval from Malaysia's only financial guarantee issuer for a loan of up to 500 million ringgit (US$120 million) with an 80% government guarantee.

AirAsia Group President Bo Lingam said the airline had thoroughly reviewed its network and fleet strategy as it prepares for travel to resume. "Our business model is robust, and there is a lot of pent-up demand," he said. "We are confident that our airlines will be able to rebound and recover strongly as soon as travel restrictions are lifted."


Finnair reports traffic performance for September 2021

In September, Finnair carried 298,200 passengers, which was 158.1% more than in September 2020. The number of passengers in September 2021 was 11.9% more than in August 2021 (month-on-month figures are not fully comparable as there is one fewer day in September).

The COVID-19 impact, including the strict travel restrictions imposed by several countries, still affected all passenger traffic figures. It was particularly visible in the North Atlantic and Asian figures.

The overall capacity, measured in Available Seat Kilometres (ASK), increased in September by 151.3% year-on-year and by 12.9% month-on-month. Finnair operated, on average, 144 daily flights (cargo-only included), which was 73.5% more than in September 2020 and 13.4% more than in August 2021. The differences between capacity figures compared to September 2020 are explained by the longer average stage length of flights operated and by the larger gauge of aircraft operated. Finnair's traffic, measured in Revenue Passenger Kilometres (RPKs), increased by 220.0% year-on-year and by 8.9% month-on-month. The Passenger Load Factor (PLF) increased by 8.7% points to 40.5% year-on-year but decreased by 1.5% points month-on-month.

The ASK increase in Asian traffic was 20.9% year-on-year. In European traffic, the ASKs were up by 179.6%. The ASKs in domestic traffic increased by 25.2%.

RPKs increased in Asian traffic by 26.6%, in European traffic by 339.8% and in domestic traffic by 34.3% year-on-year.

The PLF was 19.4% in Asian traffic and 16.1% in North Atlantic traffic but both were supported by the very strong cargo operations and a high cargo load factor. The PLF was 65.5% in European traffic and 70.7% in domestic traffic.

Passenger numbers increased in Asian traffic by 27.6%, in European traffic by 254.6% and in domestic traffic by 35.2% year-on-year.

In North Atlantic traffic, ASK, RPK and passenger number growth rates year-on-year cannot be calculated as there were no passenger flights in September 2020.


Grazia Vittadini joins Rolls-Royce as Chief Technology Officer Designate

Rolls-Royce has released that Grazia Vittadini, former CTO at Airbus, will be joining as Chief Technology Officer, Designate, to succeed Paul Stein when he steps down next year after almost 12 years leading the company's pioneering research and technology efforts. Separately, Harry Holt, Chief People Officer, has decided to leave to take up the post of Chief Operating Officer at Vertical Aerospace. His successor will be announced in due course.

Vittadini, who will join on November 2, 2021, spent almost 20 years at Airbus and over the last decade held a number of senior positions, most recently Chief Technology Officer. As CTO, she piloted Airbus into bold, new and sustainable technologies, ranging from electrification and hydrogen-based propulsion to digitization and Artificial Intelligence, autonomy, connectivity and advanced materials, while creating a diverse, high performing technology organization. She stood down from her CTO role at Airbus in July and leaves at the end of October.

SIA Engineering announces divestment of Asian Surface Technologies

SIA Engineering Company (SIAEC) has entered into an agreement with PAS TECHNOLOGIES B.V. (PAS) for the sale of SIAEC’s entire 39.2% shareholding in Asian Surface Technologies (AST) to PAS. AST is a joint venture based in Singapore between SIAEC (39.2%), United Technologies International (20.0%) and PAS (40.8%). Its principal activities include the repair of aircraft engine fan blades and the provision of wear-resistant and high-temperature corrosion-resistant coating services to the aviation, and oil and gas industries.

The consideration for the sale of SIAEC’s 39.2% stake in AST to PAS is US$2.79 million in cash. The agreement has been concluded after negotiations on a willing-buyer, willing-seller basis, and after taking into account, inter alia, the net asset value and financial performance of AST. Based on AST’s audited financial statements for the financial year ended December 31, 2020, the net asset value of the AST shares disposed of by SIAEC is S$3.81 million.

SIAEC will recognize an estimated gain of S$2.68 million on divestment of its entire stake in AST. SIAEC has been reviewing its portfolio of joint ventures for consolidation, and to focus on building next-generation aircraft capabilities. The divestment decision was made in light of the declining work volume at AST. Completion of the sale has taken place and AST has ceased to be an associated company of SIAEC.


Norwegian passenger numbers show continued increase

Norwegian’s traffic figures for September have shown a continued increase in the number of passengers as demand strengthens across its network. Traditional booking patterns are beginning to return and the carrier is seeing more people planning ahead and booking to travel to popular city breaks and winter sun destinations.

In September, Norwegian carried 977 719 passengers, an increase of 206% compared to the same period last year. Compared with September 2020, the total capacity (ASK) has increased by 154% and passenger traffic (RPK) was up 248%. Load factor in September was 72.4%, an increase of 20 percentage points compared to last year.

Norwegian continues to ramp up operations in line with demand and the company has now reopened bases in Stavanger, Bergen, and Trondheim. Norwegian operated an average of 46 aircraft in September, of which 92.1% departed on time.

Joramco names Adam Voss new COO

Joramco, the Amman-based aircraft maintenance, repair and overhaul (MRO) facility, and engineering arm of Dubai Aerospace Enterprise (DAE), has named Adam Voss as its new Chief Operating Officer (COO) reporting directly to Fraser Currie Joramco’s CEO.

Voss has more than 30 years’ aviation experience in the maintenance and engineering of large commercial aircraft. He has worked across the Middle East, U.K., Asia, India, South Africa, and Australasia for leading carriers, most recently heading up South African Airways Technical as its CEO.


APOC acquires first CFM56-5b for up-cycling as engine portfolio expands

APOC has purchased its first CFM56-5b engine for immediate part-out. It is one of a range of engines that the business is sourcing to augment the new spare parts division and will comprise the complete array of components for overhaul including LLPs, fan blades, HPT, and HPC blades. The part-out will be undertaken by GA Telesis and is anticipated to be completed within the month.

“APOC is able to offer A320 family aircraft operators’ customers flexible green-time engine leasing solutions, so we need a range of assets to meet these varying needs” says Anca Mihalache, VP Engine Trading & Leasing. “We already part-out engines that come off-lease as they become un-serviceable, but as a fairly new department we are also buying engines directly for part-out and we have an impressive target for the acquisition and dismantlement of engines over the next five years.”  

Alaska Airlines launches new code-share agreement with Iberia

Alaska Airlines further expanded its global reach today with the announcement of a new code-share agreement with Iberia Airlines, a fellow member of the oneworld alliance. The agreement further strengthens the existing partnership between the two airlines by providing flyers with exciting and convenient travel options.

The agreement allows passengers on Iberia to book travel and easily connect to more than 40 routes throughout Alaska's network for travel on or after October 7, 2021. On the West Coast, Iberia has nonstop service between Los Angeles and its Madrid hub, and seasonal service between San Francisco and Barcelona – enabling seamless connectivity to the Alaska network beyond both California cities. 

Alaska launched its partnership with Iberia on March 31, 2021, the same day Alaska formally became a member of the oneworld global alliance. Iberia has been a member of oneworld since 1999.

C&L Aerospace acquires Legacy 500 inventory

C&L Aerospace, a C&L Aviation Group company, has acquired an Embraer Legacy 500 inventory consisting of all parts from a tear-down project where the aircraft had very low time and cycles. All parts from the aircraft will be stocked in C&L’s newest 27,000 ft² warehouse location in Bangor, ME.

The inventory totals over 1100 line items and covers everything from control surfaces to avionics, landing gear, and all other rotables and structural components.

This inventory acquisition is part of a major investment in the company’s parts business, which in 2021 has included 15 aircraft tear-down projects including the nine ERJ 145 aircraft the company purchased from a European-based operator and a multi-million dollar ATR spare parts purchase made by the company.

As with all of C&L’s inventory, these Legacy 500 parts will be inspected and made ready for sale, which includes photographing and barcoding each part and corresponding documentation which is sent as viewable links on all customer quotes.

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Tamar Jorssen
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Email: tamar.jorssen@avitrader.com
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