CFM56-7B ECU2018-08-08

Monday, August 13th, 2018



FBI investigating how and why Seattle mechanic took commercial plane before fatal crash

The FBI is currently investigating the motive behind the actions of a Horizon Air mechanic who ‘stole’ one of the carrier’s 76-seat Bombardier Dash 8 Q400 twin turboprop aircraft at Seattle-Tacoma Airport, then performed aerial stunts before taking his life by crashing it into nearby Ketron Island.
Shortly after take-off the plane, piloted by the 29-year-old ground service agent and named locally as Richard Russell, was shadowed by two F-15 fighter jets. Recordings of radio transmission conversations with the pilot reveal that efforts were made to convince him to land the plane, but instead he chose to deliberately crash it into the sparsely populated Ketron Island in South Puget Sound, some 25 miles to the south west of Seattle-Tacoma Airport.
The incident has raised considerable concern as to how anyone at a major airport and in broad daylight – Seattle hosts over 30 airlines which serve 90 destinations – was able to board an aircraft, taxi onto the runway and then take off without any intervention taking place. Questions were also raised as to what could have been done had the pilot chosen to deliberately crash the plane into the city rather than perform loop-the-loops.
From the recordings of conversations held between the pilot and officials, it would appear that he was in a state of mental distress, which has led certain aviation experts to question whether or not all persons employed in the aviation industry should undergo annual mental health checks.


SAS traffic figures – July 2018

SAS has reported that the scheduled number of passengers increased by 2.2% to 2.6 million in July 2018. Scheduled traffic and capacity increased by 1.9% and 3.0%, respectivel compared to the same period in 2017. Passenger load factor decreased by 0.9 points to 85.6%.

JetBlue Airways reports July load factor of 88.9%

JetBlue Airways has reported its preliminary traffic results for July 2018. Traffic in July increased 6.2% from July 2017, on a capacity increase of 4.1%. Load factor for July 2018 was 88.9%, an increase of 1.8 points from July 2017.

Air Lease Corporation reports second quarter 2018 results

Air Lease Corporation has reported that revenues increased U$17 million or 4.4% to US$398 million for the three months ended June 30, 2018 from US$381 million for the three months ended June 30, 2017. This increase was principally driven by the increase in the net book value of its fleet, partially offset by a reduction of sales and trading activity. For the three months ended June 30, 2017, Air Lease Corporation has sold 17 aircraft, generating US$18 million in gains, and for the three months ended June 30, 2018, the company chose not to sell any aircraft.
Income before taxes for the quarter ended June 30, 2018 was US$147 million compared to US$156 million for the quarter ended June 30, 2017. As ALC chose not sell any aircraft in the second quarter of 2018, income before taxes decreased compared to the second quarter of 2017.
Net income for the quarter increased to US$115 million, compared to US$101 million for the quarter ended June 30, 2017. The increase in net income in the second quarter of 2018 as compared to 2017 was primarily due to a lower income tax expense as a result of the U.S. Tax Cuts and Jobs Act (the “Tax Reform Act”), which, among other things, lowered the corporate tax rate from 35% to 21% effective January 1, 2018.
Adjusted net income before income taxes for the three months was US$160 million, compared to US$167 million for the three months ended June 30, 2017. The change in adjusted net income before income taxes was due to the decrease in the number of aircraft sold from 17 aircraft for the three months ended June 30, 2017 to zero aircraft for the three months ended June 30, 2018.
ALC's fleet grew by 11.9% to a net book value of US$14.9 billion as of June 30, 2018 compared to US$13.3 billion as of December 31, 2017. As of June 30, 2018, our fleet was comprised of 271 owned aircraft, with a weighted-average age and remaining lease term of 3.8 years and 6.8 years, respectively, and 49 managed aircraft. Air Lease Corporation has a globally diversified customer base of 93 airlines in 56 countries.
During the quarter the company took delivery of 14 aircraft from its order book and four incremental aircraft from the secondary market ending the quarter with 271 aircraft in its operating lease portfolio.


GE Aviation Asheville hits major production milestone

GE Aviation Asheville, a leader in delivering Ceramic Matrix Composites (CMCs) components for commercial aviation applications, celebrated the delivery of its 25,000th CFM International LEAP engine turbine shroud.
Just five years after breaking ground, CMC production at the site is thriving. Shroud production rates for the LEAP program have more than tripled each year since the site opened. Today, these Asheville-produced shrouds have surpassed more than 1.5 million flight hours on the 800+ LEAP engines in commercial airline service.
The LEAP is the world’s best-selling jet engine with a current backlog of more than 15,500 engines — translating to over 300,000 shrouds for the GE Aviation Asheville team to produce.
CMCs are a super material that is as tough as metals, but only one-third as heavy and can operate at 2,400 degrees Fahrenheit — 500 degrees higher than the most advanced alloys. When incorporated in today’s commercial engine, CMC can save millions of dollars annually for airline fleets. A 1 percent reduction in fuel consumption can save more than US$1 million a year for commercial air carriers. This next generation CMC material technology being produced by GE Aviation will improve fuel efficiency at 1 to 2 percent.

FL Technics lands Comair as new client

FL Technics, a global provider of integrated aircraft maintenance, repair and overhaul services, has signed an agreement with Comair, a private domestic airline operator in the Republic of South Africa, listed on the Johannesburg Stock Exchange (JSE).
Comair is a South African aviation and travel company, offering scheduled and non-scheduled airline services within South Africa, Sub-Saharan Africa and the Indian Ocean Islands, as its main business. The company operates under its low-fare airline brand, kulula.com, as well as under the British Airways livery, as part of a license agreement.
According to the agreement, Comair will receive extended base maintenance services. “The first aircraft, a Kulula.com Boeing B737-800 is being completed a 6YR C Check”, - said Zilvinas Lapinskas, CEO at FL Technics.


AeroCentury posts second quarter 2018 loss

AeroCentury, an independent aircraft leasing company, has reported a second quarter net loss of US$81,000, compared to net income of US$371,000 for the first quarter of 2018 and net income of US$356,000 for the second quarter of 2017.
In the first six months of 2018, net income decreased 76% to approximately US$236,000, from approximately US$997,000 in the first six months of 2017.
The second quarter and first six months of 2018 included US$0.6 million and US$1.6 million, respectively, of other income resulting from payments received from a lessee of three aircraft that were returned to the Company during 2017. Such payments were received after the aircraft were returned and were applied toward unpaid maintenance reserves as well as amounts owed for unsatisfied return conditions of the applicable leases. The unpaid amounts were not booked as receivables by the Company at the time of lease termination based on management’s evaluation of the creditworthiness of the lessee. Therefore, the Company is accounting for payments from this lessee as they are received and they are recorded in other income.
Average portfolio utilization was 91% during the second quarter of 2018, 90% in the first quarter of 2018, and 94% in the second quarter of 2017. The change between periods was primarily due to asset sales during late 2017 and 2018, as well as the return of several aircraft at lease end in 2017.
Total revenue and other income decreased 1% to US$7.8 million for the second quarter of 2018, compared to US$7.9 million in the preceding quarter, and decreased 4% from US$8.1 million in the second quarter a year ago.
Operating lease revenues increased 6% to US$6.8 million in the second quarter of 2018 from US$6.5 million in the preceding quarter and decreased 4% from US$7.1 million in the year-ago quarter, reflecting assets sales during 2017.
Operating lease revenues accounted for 88% of total revenues in the second quarter of 2018, compared to 82% in the first quarter of 2018 and 88% in the year-ago quarter.
The Company recorded no maintenance reserve revenue in the first or second quarters of 2018 and US$0.7 million in the second quarter of 2017.
During the second quarter of 2018, the Company recognized US$18,100 in gains from disposal of assets, compared to US$8,200 in losses in the preceding quarter and losses of US$147,700 in the second quarter of 2017.


TUI encounters quadruple troubles, sees double-digit three-month earnings drop

It has been a tough time for Touristik Union International (TUI), the world’s largest leisure, travel and tourism company in the world, the result of which has seen the Group’s underlying earnings fall 18% to €193 million for the previous three months up to the end of June, net profit falling 31% to €110.5 million for the same period.
Despite TUI’s turnover for the third quarter rising 5% to €5 billion and the Group remaining confident of achieving double-digit earnings growth this year, for the fourth year in a row, shares fell more than 9% to €15.96 in early trading on Thursday, August 9.
The group has been hit by a weakened pound, while it also expects to take a €35 million full-year hit from the devaluation of the Turkish lira after local loans were translated back into euros. It is estimated that flight disruption, caused predominantly by French air traffic controller strikes, cost the Group €13 million, while the recent heatwave has seen an increase in ‘staycation’ holidays, even though summer bookings were up 4%.
The Group’s Chief Executive, Fritz Joussen, commented: “We have delivered a profitable operating result already after nine months for the second year in a row. For the full year, we expect to deliver double-digit earnings growth for the fourth consecutive time.
“We have considerably reduced our seasonality and thus our susceptibility to external challenges through the Group’s transformation focusing on hotels and cruises.
“TUI is in good health, we are flexible, deliver a strong operational performance and invest in our growth segments while maintaining our cost discipline.” (€1.00 = US$1.17 at time of publication.)

Freight growth slowdown continues in June

The International Air Transport Association (IATA) has released data for global air freight markets showing that demand, measured in freight tonne kilometers (FTKs), rose 2.7% in June 2018, compared to the same period the year before. This continues the slowdown in air cargo growth that began earlier in 2018. Growth for the first half of 2018 stands at 4.7%, less than half the growth rate in 2017.
Freight capacity, measured in available freight tonne kilometers (AFTKs), rose by 4.1% in June 2018. Capacity growth has now outstripped demand growth in every month since March.
There are three main factors driving the slowdown:
- The restocking cycle, during which businesses rapidly built up inventories to meet demand, ended in early 2018. There was a marked fall in air cargo volumes from March.
- We are now seeing a structural slowdown in global trading conditions as indicated by the fall in the Purchasing Managers Index (PMI) to its lowest level since 2016. Factory export order books have turned negative in China, Japan and the US.
- The temporary grounding of the Nippon Cargo Airlines fleet in the second half of June exaggerated the slow-down by shaving up to 0.5 points off June growth.
All regions except Africa reported a year-on-year increase in freight volumes in June 2018, but the slow growth in Asia-Pacific, which accounts for nearly 37% of the entire air cargo market, dragged the global growth rate down.


Turkish Airlines posts operating net profit for first half 2018

Turkish Airlines managed to increase both passenger and cargo revenue in the first half of 2018. Total revenue for this period increased significantly, by approximately 30% compared to the same period last year, reaching US$6 billion.
During this period Turkish Airlines increased net operating profit from US$17 million to US$258 million, due to increasing demand and unit revenues, despite increasing fuel prices.
In the first half of the year, EBITDAR (earnings before interest, taxes, depreciation, amortization and rent), which is used as a cash generation indicator, stood at US$1.28 billion, a 38% increase. EBITDAR margin improved by 1.5 points to 21.5%.
Total Load Factor climbed 4.3 points to 80.4%, the highest load factor in Turkish Airlines’ history for the first half of a year. During the same period, increases in total number of passengers carried, capacity (available seat kilometre) and demand (revenue per kilometre) were 18%, 9% and 16% respectively, year-on-year.


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September 18, 2018 – Copthorne Tara Hotel, Kensington, London, UK

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September 19, 2018 – Copthorne Tara Hotel, Kensington, London, UK

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October 16 - 18, 2018 – Amsterdam

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November 20, 2018 – Gibson Hotel, Dublin, Ireland
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