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Friday, May 13th, 2022

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IAI to convert four B777-300ER aircraft for Cargojet

Israel Aerospace Industries (IAI) has signed an agreement to carry out passenger-to-freighter (P2F) conversions for Cargojet Canada’s Cargo Airline. The agreement was signed as a result of the growing global demand for cargo aircraft and includes the conversion of four B777-300ER aircraft and additional options in the future.
IAI has recently signed a number of new agreements for cargo conversions, including converting B777-300ER aircraft for Emirates and establishing new conversion lines worldwide, including in Abu Dhabi, Ethiopia and other locations around the world. This agreement with Cargojet strengthens IAI’s strategy to expand its growing cargo conversion lines globally. 

Cargojet is a leading Canadian provider of time sensitive premium air cargo services to all major cities across North America, providing dedicated ACMI and international charter services and carries over 25,000,000 pounds of cargo weekly. Cargojet operates its network with a fleet of thirty-one aircraft and is a long-term IAI customer for aircraft conversions. Currently, IAI is converting the first B777-300ER aircraft for AerCap Cargo, who are also the co-investor on the programme, in a process which is expected to finish in 2022. This is the very first conversion of this model.

Willis Lease Finance Corporation reports first-quarter pre-tax loss of US$27.7 million

Willis Lease Finance Corporation has reported first-quarter total revenues of US$68.8 million. For the three months ended March 31, 2022, aggregate lease rent and maintenance reserve revenues were US$53.0 million and spare parts and equipment sales were US$6.6 million. The company reported increased total revenues in the first quarter when compared to the prior year period, primarily due to an increase in lease rent revenue and short-term maintenance revenue.

Quarterly performance was negatively impacted by the effects of the Russian military action in Ukraine and related sanctions. In the first quarter, the company recorded a US$20.4 million impairment on two engines located in Russia, which are expected to be unrecoverable and wrote down US$0.9 million of receivables associated with Russian leases.

Furthermore, through its joint venture Willis Mitsui & Company Engine Support (WMES), the company recorded an additional net impairment of US$2.4 million, presented through loss from joint ventures, for one engine located in Russia, which is also expected to be unrecoverable.

Lease rent revenue increased by US$6.6 million, or 21.0%, to US$38.1 million in the first quarter of 2022, compared to US$31.5 million in the same quarter of 2021, primarily reflecting an increase in the number of engines placed on lease. This increase was partly offset by a US$0.3 million reduction in lease rent revenue associated with Russian leases which was determined to be uncollectible as of March 31, 2022.

Maintenance reserve revenue was US$14.8 million in the first quarter of 2022, a decrease of 25.1% compared to US$19.8 million in the same quarter of 2021.


ITA Airways becomes first Italian A350 operator

Italy’s new national carrier, ITA Airways, has taken delivery of its first A350 aircraft, becoming the 40th operator of the type. The aircraft, which is on lease from ALAFCO, landed for the first time in Italy at Rome Fiumicino Leonardo da Vinci International Airport on Wednesday May, 11.

ITA Airways’ A350 cabin is configured in a two-class layout, with 334 seats comprising 33 full lie-flat bed Business and 301 Economy seats.

ITA Airways’ A350 will start operations in early June 2022 to serve the new intercontinental routes that the company will open in the summer season from Rome Fiumicino to Los Angeles, Buenos Aires and Sao Paulo.

In December 2021, the Italian carrier firmed up an order for 28 Airbus aircraft, including 18 single-aisle (seven A220s, 11 A320neos) and ten A330neos, the latest version of the most popular A330 wide-body airliner. Moreover, ITA Airways already leased more than 50 additional new generation Airbus aircraft, six of which are A350s, to complement its fleet modernisation.

Daher reimburses its loan guaranteed by the French government and secures €180 million in new funding

Daher has completed the company’s total reimbursement of the €110 million French government guaranteed loan (Prêt Garanti par l’État, PGE) granted in June 2020, while also securing funding of €180 million from new American investors and from its banking pool. These two new operations illustrate the confidence of Daher's financial partners in the company’s management of the consequences stemming from the COVID-19 crisis – which demonstrated its strong rebound capacity – while also taking into account the strengthening of its presence in the United States.

In June 2020, Daher obtained a loan of €170 million from its historic banking pool, guaranteed by the French government. This funding made it possible to cover the company's cash needs as well as the implementation of its transformation plan that is aimed at positioning Daher as a recognised player in its markets at the time of recovery.

Two years later, after having quickly and successfully carried out its restructuring plan, Daher was able to finalise the PGE total’s reimbursement – the initial €60 million portion of which already had been reimbursed in June 2021 – based on the good performance of its aircraft manufacturing and logistics activities following the strong resumption of global activity and the positive recovery of air traffic.

This €180 million refinancing – including €105 million in the form of a U.S. private placement with a pool of new American investors and €75 million in loans from its banking pool – illustrates the confidence that benefits Daher in terms of the company’s activities, its strategic choices and governance.

The initial amount of €150 million was oversubscribed at a total of €180 million, enabling an extension of the loan’s duration, thereby providing Daher with additional means for its strategy as a consolidator in the sector.


Ryanair signs winter maintenance agreement with STS Aviation Group

Ryanair has announced a new winter maintenance agreement with UK MRO provider, STS Aviation Group, which will see the airline undertake two lines of heavy maintenance at its modern MRO facility in Birmingham. Ryanair’s fleet will grow to over 600 aircraft over the coming years and this agreement will ensure that the airline has flexibility as to where it places its aircraft for upcoming winter maintenance seasons.

Commenting on the deal, Ian Bartholomew, Senior Vice President Business Development Europe at STS Aviation Services said:

“We are delighted that Ryanair has selected STS Aviation Services to perform nose-to-tail lines of heavy aircraft maintenance at our facility located in Birmingham, UK. This contract win is testament to the professionalism and dedication of our entire team, and we look forward to receiving the first aircraft later this year while expanding the relationship and supporting the long-term growth of such a prestigious customer.”

Syphax Airlines chooses Rusada’s ENVISION

Relaunched Tunisian carrier, Syphax Airlines, has signed up for Rusada’s airworthiness, MRO and flight operations software, ENVISION.

Syphax Airlines, based out of Sfax–Thyna International Airport, plans to commence flights this summer using a fleet of Boeing 737-800s. The airline will operate passenger flights to multiple destinations in Africa and Europe, with a view to continually grow their fleet until 2027 based on the needs of the market.

Syphax has signed up for seven of ENVISION’s modules including, Fleet Management for airworthiness, Line Maintenance, Inventory Management and Flight Operations.

Rusada will begin the implementation project immediately to ensure the system is live in time for Syphax’s first flight.


Etihad Cargo appoints Tim Isik Vice President - Commercial

Etihad Cargo, the cargo and logistics arm of Etihad Aviation Group, has appointed Tim Isik as Vice President – Commercial. Based in Etihad Cargo's headquarters in Abu Dhabi, Isik will oversee the carrier's global commercial operations.

Isik joins Etihad Cargo from American Airlines, where he gained over a decade of experience working within the aviation and air cargo sectors. In his new role with Etihad Cargo, Isik will oversee the development and deployment of the carrier's sales strategy and be responsible for further growing Etihad Cargo's strategic relationships, executing sales and marketing plans and driving team performance. Isik will lead Etihad Cargo's commercial operations globally, supported by Latha Narayan, Etihad Cargo's Director – Commercial Asia Pacific, Australasia and Indian Subcontinent, and Mark Faulkner, Director – Cargo Commercial West. Isik will report to Martin Drew, Senior Vice President – Sales & Cargo.

Gol and Avianca to combine under umbrella of holding company

Brazilian airline Gol Linhas Aereas Intellegentes SA (Gol) and Columbia carrier Avianca have announced they are coming together under one umbrella in the form of a holding company named the Abra Group.

While the two companies will remain independent, their combination will make them one of South America’s largest carriers that would be a match for Chile’s LATAM Airlines Group where scheduled seats are concerned. Abra Group will have Gol and Avianca as controlling main shareholders, despite the two airlines maintaining their individual brands.

The deal, which will also include investor commitment of up to US$350 million (£287 million) in Abra Group, is expected to close in the second half of the year. However, the combination may attract attention from competition regulators as, having successfully completed its bankruptcy reorganisation last year, Avianca has already agreed to merge with major Columbian carrier Viva while, according to Reuters news agency, the Abra Group, which describes itself as a "pan-Latin American network of airlines," will also own a non-controlling 100% economic interest in Viva's operations in Colombia and Peru and a minority interest in Chile's Sky Airline.

Where issues could arise concerning the joint operation may relate to American Airlines holding a stake in Gol and JetSmart, while Avianca is a partner of United Airlines.

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Tamar Jorssen
Vice President Sales & Business Development
Email: tamar.jorssen@avitrader.com
Phone: +1 (788) 213 8543