Delta posts US$5.7 billion quarterly loss as it cuts projected flight increases by 50%

©Delta Air Lines

As the COVID-19 pandemic shows no sign of receding and numbers of reported cases increasing in over 35 U.S. states, the uncertain demand for future air travel has seen Delta Air Lines (Delta) halve its anticipated 1,000 flight increase for the month of August to just 500 flights. Having posted a net quarterly loss of US$5.8 billion, it’s worst result since 2008, and currently operating at a cash burn rate of approximately US$27 million on a daily basis, the U.S. carrier, which is the world’s second-largest carrier by number of scheduled passengers carried, revenue passenger-kilometers flown and fleet size, had Read more

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U.S. follows Europe’s example and bans all Pakistan International Airlines flights

Pakistan International Airlines ©AirTeamImages

In the wake of the grounding of nearly one-third of all Pakistan International Airlines’ (PIA) pilots, the U.S has followed in the footsteps of the European Union Air Safety Agency (EASA)and has revoked the permission for PIA charter flights to fly to the U.S. The U.S. Department of Transportation took such action on the recommendation of the Federal Aviation Administration (FAA) owing to its concerns over the validity of pilot certifications. A copy of the revocation of special authorization was dated July 1 and a copy was sent to Reuters news agency. The EASA issued a six-month ban on PIA Read more

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Rolls-Royce burns through £3 billion in first half of 2020

©Rolls-Royce

With the effects of the COVID-19 pandemic seeing flight hours of Rolls-Royce engines halved, the British company has advised that it has already burned through £3 billion (US$3.8 billion) and anticipates that a further £1 billion (US$1.3 billion) of outflow will transpire in the second half of the year. For the months of April through June, flying hours for its engines fell 75 percent. While still having £8.1 billion (US$10.5 billion) available, Rolls-Royce is now looking at options to strengthen its balance sheet, according to Warren East, the company’s CEO. He told reporters this Thursday that: “The COVID-19 pandemic has Read more

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Shares in Asia’s largest low-cost airline tumble – future now in “significant doubt” 

Air Asia ©AirTeamImages

Air Asia’s future is in “significant doubt” according to Ernst & Young auditors. Asia’s largest low-cost carrier has been hit hard by the massive drop in air travel as a consequence of the COVID-19 pandemic and strict travel restrictions. In a statement issued to the Kuala Lumpur stock exchange by Ernst & Young, the carrier’s substantial level of debt was highlighted, with current liabilities exceeding current assets by 1.84bn ringgit (US$430m). Shares in the Malaysia-based carrier fell 17% on Wednesday, a day after trading was halted. With so many planes currently grounded by the pandemic, the current financial performance indicates Read more

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Additional major blow to 737 MAX as Avolon cancels orders for 27 of the troubled jets

©Boeing 737 MAX

Within a week of Norwegian Air Shuttle cancelling an order for 92 of the 737 MAX, aircraft lessor BOC Aviation cancelling an order for 30 of the jets and subsequent to its April cancellation of 75 ordered 737 MAX jets, aircraft lessor Avolon has announced it is cancelling orders for a further 27 of the aircraft. The Ireland-based lessor has cut its near-term commitments by more than 140 aircraft since the beginning of the year. While the 737 MAX has remained grounded since March 2019 after two fatal crashes while it looks to fix identified problems and obtain the required Read more

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Virgin Australia bondholders and others demand alternative sale propositions be considered

Virgin Australia ©AirTeamImages

Bondholders in Virgin Australia Holdings (Virgin Australia) have made an application to the Takeover Panel seeking approval to submit an alternative purchase proposal to creditors to consider against the currently accepted offer from private equity group Bain Capital for an as-yet undisclosed sum. Bondholders are not the only ones to object to what they see as unacceptable sales processes carried out by the administrators, Deloitte, which had precluded them from submitting their own proposal. According to Reuters news agency, Singapore’s Broad Peak Investment Advisers and Hong Kong’s Tor Investment Management are also seeking interim orders allowing them to access information Read more

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Air France to cut staffing levels by 15%, Hop! by 50%. 7,500 jobs to go

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The flag carrying airline Air France, along with its low-cost subsidiary Hop!, are to make substantial staffing cuts as a direct consequence of the effect of the COVID-19 pandemic on air travel. Air France has indicated that it will shed 6,000 jobs from a workforce of approximately 41,000 staff, while Hop! will reduce its approximate 2,000 staff by 1,020. The carrier’s parent company, Air France-KLM is Europe’s second-largest carrier and the job cuts are anticipated to take place over a three-year period. After discussions with unions, the carrier confirmed that: “Air France and Hop! are working together with the unions Read more

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Five American airlines agree deal on government loans with U.S. Treasury

©American Airlines

Under a US$25 billion emergency loan program, five American airlines have confirmed they have successfully concluded negotiated loan deals with the U.S. Treasury. Unlike previous financial assistance in the form of payroll assistance which did not have to be repaid, this new financial aid will be in the form of a repayable loan, though the terms have not been disclosed. While several more U.S. airlines are still in negotiations with the U.S government, American Airlines is due to close on a US$4.75 billion treasury loan in Q3, which is in addition to the payroll loan of US$5.8 billion already received. Read more

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Aeromexico files for Chapter 11 bankruptcy

©Aeromexico

With Latin American (LaTam) governments refusing to bail out their struggling airlines, Aeromexico has become the latest LatAm carrier to file for Chapter 11 bankruptcy as the effect of the Covid-19 pandemic continue to wreak havoc with the travel industry. Aeromexico has made it clear that the bankruptcy filing was totally “voluntary” and that to all intents and purposes it would carry on with its current plans. This included quadrupling the number of international flights and doubling the number of domestic ones in August as restrictions on travelling are lifted. The Mexican carrier has confirmed that tickets, reservations, electronic vouchers Read more

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Major job losses likely at Airbus as world’s leading planemaker targets 40% drop in production

Airbus A320-200 production ©AirTeamImages

Speaking to German newspaper Die Welt, Airbus CEO Guillaume Faury confirmed plans for the world’s largest planemaker to reduce output by 40% over the next two years to counter the drop in demand for aircraft and delivery delay requests resulting from the effects on global travel by the COVID19 pandemic. The company is now in talks with unions ahead of any formal announcement which is expected at the end of July. Airbus needs to find a balance between job losses and financial aid being offered by European governments. “It’s a brutal fact, but we must do it. It is about Read more

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