Tuesday, October 9th, 2018



Air France offers pilots 45 pay raise – SNLP union remains silent

Air France’s new Chief Executive, Ben Smith, has wasted no time in tackling the wage negotiation problem that has beleaguered the French carrier and seen the downfall of its previous Chief Executive, Jean-Marc Janaillac, who resigned back in May. Having previously worked with Air Canada, Smith has proposed a two percent pay raise backdated to January this year, coupled with a further two percent next January, according to a union official.

Air France are keen to end the raft of damaging strikes which have impacted heavily on its finances, strikes in 2018 alone amounting to some €355 million (US$384 million) while grounding hundreds of flights.

While the pilots’ union may well respond as soon as Tuesday, October 9, SNLP also expects a further pay review to take place this month. According to an Air France spokesperson: "These were discussions with (our) social partners and not negotiations," and has refused to pass further comment on the matter.

Smith, who only joined Air France last month has taken over direct leadership of the Air France business from the carrier's departing managing director Franck Terner, while last week the carrier announced the appointment of another Air Canada veteran, Oltion Carkaxhija, to a vice-president role including oversight of labor negotiations.


Japan Airlines and China Eastern Airlines seek antitrust immunized joint venture

Japan Airlines (JAL) has filed an application with Japan’s Ministry of Land, Infrastructure, Transport and Tourism (MLIT) seeking immunity from antitrust laws to create a joint venture (JV) with China Eastern Airlines. If approved, the carriers` will jointly feature over 50 cities in Japan and over 80 on China`s domestic routes, providing countless advantages for consumers in both countries.

Since the two airlines began offering codeshare flight operations in 2002, JAL and China Eastern have offered premium services on their respective network. The antitrust immunized JV will allow the two companies to further coordinate marketing, sales, and product development efforts to create more benefits for their mutual customers.

Southwest Airlines reports September load factor of 80.5%

Southwest Airlines has reported that traffic in September 2018 increased 5.3% from September 2017, while Capacity increased 6.8% compared to the previous year. The September 2018 load factor was 80.5%, compared with 81.7% in September 2017.

Beach Aviation Group

Liebherr-Aerospace Toulouse SAS cooperates with IoT Valley

Liebherr-Aerospace Toulouse SAS, Liebherr’s center of excellence for air management systems for the aviation industry, joins forces with IoT Valley via a partnership initiated in July 2018. This initiative is in line with the company’s global innovation drive.

Innovation is a major topic at Liebherr-Aerospace Toulouse SAS. A global innovation drive was thus instigated to enhance sustainability and make the company more reactive in an increasingly changing technological environment. Central to this initiative is the opportunity given to employees at all levels of the company to suggest and test their ideas.

From this basis, the idea of forming a partnership between Liebherr-Aerospace Toulouse SAS and IoT Valley emerged. An initiative led by the production teams of Liebherr-Aerospace in order to benefit from the dynamics of this alliance is proof of the company’s drive for innovation.

This partnership, comprising start-ups and key account partners, will enable Liebherr-Aerospace Toulouse SAS to focus its attentions on improving and optimising its production sector. To date, four objectives for innovation have been identified: enhancement of productivity and quality, improvement of quality of working life, development of data management and its valorization.

Nicolas Perrier, Head of General Methods Department, commented: “This partnership with IoT Valley will enable Liebherr-Aerospace Toulouse to tap the expertise of start-ups and encourage us to be more reactive in our deployment of innovative ideas. We are convinced that the results of our exchanges will go beyond the field of production and lead towards a culture change in terms of how we approach innovation.”

Work will therefore focus on the production sector, the performance of which other sectors of Liebherr-Aerospace Toulouse SAS will benefit from, and especially its customers. The company prepares itself for and responds to tomorrow’s challenges – together with its clients.

SAS presents 2019 summer program – 6 new destinations and 17 new direct routes

SAS is continuing to strengthen its offer by opening 17 new direct routes from Scandinavia in summer 2019 and 6 totally new destinations – Catania, Florence, Marseille, Cornwall Newquay, Szczecin and Antalya.

Demand for summer travel is increasing. SAS is therefore offering a number of new direct flights and destinations in summer 2019 and increasing frequency to several of the most popular travel hot spots. New destinations from Stockholm Arlanda are Catania Sicily, Marseille, Naples and Reykjavik while Gothenburg Landvetter will gain a direct flight to Faro in Portugal.

Other exciting summer news is direct flights from Copenhagen to Cornwall Newquay. Poland also continues to attract visitors from Scandinavia and SAS is launching a direct route to Szczecin from Copenhagen.


CDB Aviation closes US$700 million secured portfolio financing

CDB Aviation, a wholly owned Irish subsidiary of China Development Bank Financial Leasing (CDB Leasing), has successfully closed a secured portfolio financing facility for US$700 million, covering a fleet of 19 Airbus and Boeing aircraft.

“Diversifying financing sources at a competitive cost of capital is a key objective for CDB Aviation, and we appreciate the strong support from our banking partners in concluding this transaction,” said CDB Aviation Chief Financial Officer Will Gramolt.

The seven-year facility is provided by a group of eight banks, consisting of: BNP Paribas, Crédit Agricole Corporate & Investment Bank, ING Bank, National Australia Bank, Natixis, Société Générale, Sumitomo Mitsui Trust Bank, and Westpac Banking Corporation, each acting as Mandated Lead Arranger.

Crédit Agricole Corporate & Investment Bank is acting as Facility Agent. The Security Trustee is Bank of Utah. Allen & Overy acted as counsel for the Mandated Lead Arrangers. Clifford Chance represented CDB Aviation.

SkyQuest International reports third quarter aircraft sales

SkyQuest International has announced their aircraft sales for the third quarter of 2018.

SkyQuest has sold one CASA 212-300 (Serial Number 212-379) on behalf of AAR Airlift Group (United States) to Skydive Paraclete (United States).
One Cessna 402C (Serial Number 402C-0233) on behalf of Ryan Air (United States) to Chartair Pty Ltd (Australia) and one de Havilland DHC-8-103 (Serial Number 265) on behalf of AAR Airlift Group (United States) to Bighorn Airways, Inc. (United States).


Lufthansa Technik establishes Additive Manufacturing Center

Lufthansa Technik has set up an Additive Manufacturing (AM) Center with the aim of bundling and expanding the competence and experience the company has gained using this technology in the past.

Additive manufacturing is often referred to as 3D printing. In addition to an unrivaled degree of freedom in designing the parts, additive manufacturing produces individual parts very quickly - a huge advantage when prototypes or one-off parts must be manufactured.

In the highly weight-conscious world of aircraft, the lower weight of parts makes using the AM technology very attractive.

Dr. Aenne Koester, head of the AM Center, explains: "The new AM Center will serve as a collaborative hub where the experience and skills that Lufthansa Technik has gained in additive manufacturing can be bundled and further expanded. The aim is to increase the degree of maturity of the technologies and to develop products that are suitable for production."

As the transfer of a new technology into the highly-regulated world of commercial aircraft operation and MRO poses a challenge, a joint team of Lufthansa Technik experts and AM specialists from numerous industry partners and research institutions develops strategies to support the introduction of this technology. As one example, a cooperation with Oerlikon AM aims at enhancing the understanding of process repeatability, a key element of industrialization and certification. The collaboration will also help drive the industrialization of additive manufacturing forward, as the study results will be shared with relevant industry bodies to support defining standards for the qualification and approval of aircraft components.

Scoot takes delivery of its first A320neo

Scoot, the low cost wing of Singapore Airlines, has taken delivery of its first A320neo in Toulouse, France.

Scoot has placed orders for 39 A320neo aircraft under its fleet renewal programme. The new addition complements the airline’s existing fleet of 27 A320ceo Family aircraft.

Powered by Pratt and Whitney Pure Power engines, the new aircraft features 186 seats in Scoot’s configuration. Selected for its outstanding operational efficiency, comfort and range, the A320neo will be deployed by Scoot on its services across Asia.

Featuring the widest single aisle cabin in the sky, the A320neo Family incorporates the very latest technologies including new generation engines and Sharklets, which together deliver at least 15% fuel savings at delivery and 20% by 2020. With more than 6,100 orders received from over 100 customers, the A320neo Family has captured nearly 60% share of the market.

C&L Aviation

Héroux-Devtek completes acquisition of CESA

Héroux-Devtek a leading international manufacturer of aerospace products, has successfully completed the acquisition of Compañia Española de Sistemas Aeronáuticos, S.A. (CESA), a subsidiary of Airbus SE for a purchase price of €137 million (approximately CA$206 million) enterprise value, including CESA’s net outstanding debt of €23 million euros (approximately CA$35 million), subject to customary closing adjustments.

The transaction was funded through a combination of a CA$50 million seven-year unsecured subordinated term loan provided by Fonds de solidarité FTQ, the Corporation’s revolving credit facility and available cash on hand. In connection with this acquisition, the Corporation’s credit facility was amended, increasing the borrowing limit toUS CA$250 million from CA$200 million.

Headquartered in Madrid, Spain, CESA is a leading European provider of fluid mechanical and electromechanical systems for the aerospace industry. Its main product lines include actuation and hydraulic systems as well as landing gear products.

Management is updating its sales guidance for fiscal 2019 to reflect the CESA acquisition. Management now expects sales for fiscal 2019 to be in the range of CA$460 million to CA$470 million, representing an increase of approximately 20% over last year. Capital expenditures are expected to be approximately US$20 million.

Management is also issuing new long-term sales growth guidance reflecting both the Beaver acquisition completed last July and the CESA acquisition. Management expects fiscal 2022 sales in the range of CA$620 million to CA$650 million.


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