Los Angeles International Airport projected (15-Jan-2021) it will report around 29 million passengers for 2020, about 33% of the 88.1 million passengers recorded in 2019 [more - original PR]
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China’s most successful LCC, Spring Airlines, showed a whopping 45.3% y-o-y domestic passenger growth in the month of Dec-2020. By Oct-2020, Spring had added 60 new routes during the year.
For the month of Dec-2020, the airline’s domestic cargo volume (tonnes uplifted) increased by an even larger, 73% y-o-y.
International passenger numbers however slipped to a trickle, as China’s quarantine restrictions made short haul discretionary flying difficult.
The first part of this report contained an overview of the limited airport privatisation activity during 2020 in Asia Pacific and Europe. This second part looks at the Americas, the Middle East and West Asia, and Africa.
In North America the airport privatisation momentum has dried up again, while in Latin America the Brazilian concessions are up to their seventh tranche and counting, but with few really attractive airports remaining for international investors.
In the Middle East and West Asia transactions on small airports remain the norm in Russia while in several of the ‘stans’ governments are seeking to attract foreign investors mysteriously to help them achieve some sort of international hub status for their airports. Meanwhile, Qatar Airways has established itself as potentially an ambitious investor in Russia…
From there to Africa, a continent which still cannot attract any real interest in its airports from outside the region, and isn’t likely to while the prevarication which exists in Nigeria continues.
Australia’s leading health official on 18-Jan-2021 announced his belief that national border restrictions on international travel were likely to remain in place for the duration of 2021.
On 17- and 18-Jan-2021, Australia recorded no new locally acquired cases of coronavirus, the first time in many months, with constant monitoring and tracing.
Meanwhile, China is constantly recalibrating its inbound air services as coronavirus cases occur.
Japan is the latest market to illustrate the new reality of the airline industry; that capacity and traffic levels move in inverse relationship to the number of new COVID-19 cases.
From Japan being one of the countries with most success in combatting the pandemic last year, a new surge in infections is threatening to wipe out much of the local airline industry’s hard-won gains.
The latest spike in cases in Japan has prompted the government to declare a state of emergency for the second time since the coronavirus first emerged. This has caused the two major airlines to scale back their domestic schedules in January and February.
Such moves are causing further pain to the country’s tourist industry, which is already hurting from the lack of international travellers. It is also exacerbating concerns about whether the Olympic Games will be held in Tokyo in Jul-2021, as scheduled.
Japan is far from being the only Asia-Pacific market that has had a promising rebound derailed by a new flare-up of COVID cases.
Australia, for example, was finally benefitting from a substantial recovery in domestic capacity in the fourth quarter, but capacity plans have been cut back due to a surge that has resulted in more state border closures. Some of the most successful countries in restoring domestic travel, such as Vietnam and China, have also had temporary setbacks due to spikes.
The question now for Japan will be how long it takes to get the latest resurgence under control.
Premium Analysis
CAPA Live: Allegiant Air has a robust arsenal for 2021Allegiant Air is joining other ultra low cost and low cost operators in concluding that it has certain advantages in recovering from the COVID 19 pandemic – a focus on leisure passengers and a favourable cost structure.
Additionally, Allegiant believes its balance sheet is well fortified as 2021 gets under way, and does not see any major competitive shifts in the market it serves. And where it does face competition, Allegiant believes its pricing structure will emerge as a critical advantage. Additionally, the airline is aiming to take advantage of favourable conditions to source used aircraft, but on its own terms.
But despite that edge, Allegiant realises that a full recovery from the COVID-19 crisis will take years, and the airline remains focused on building up its strengths as the industry works to determine how it will continue to navigate the crisis during 2021.
At a time when the aviation industry is searching for up-to-the-minute market intelligence, news, trend analysis and thought leadership, CAPA - Centre for Aviation delivers a virtual “Summit” on the second Wednesday of each month, jam-packed with information, data and live interviews. CAPA experts, global airline CEOs and other cutting-edge industry leaders present live from a next-gen virtual event platform.
The most recent CAPA Live event was on 13-Jan-2021, and featured the below speakers. Find out more
Stephen King
VP Airline Relations, London Gatwick Airport
David Stroud
Managing Director, ASM - Global Route Development
Daniel Roeska
MD & Senior Analyst, Bernstein Research
Stephen Furlong
Senior Equity Analyst, Davy Research
John Strickland
Director, JLS Consulting
Recorded at CAPA Live November, 11 Nov 2020
Airline CEO Interview - Regional Express
Australia's aviation market has been deeply affected by the coronavirus pandemic, but there is some strong hope that there will be a resumption of air movements around the Australian domestic market before Christmas.
The Nov-2020 edition of CAPA Live included a discussion with Lim Kim Hai, chairman of the local Australian operator Regional Express (Rex), who said that the regional government rules had meant that the impact of border closures was "quite unequal" across the Australian states, with some states like Western Australia, Queensland and South Australia experiencing "almost no impact".
Speakers:
Regional Express, Executive Chairman, Lim Kim Hai
CAPA - Centre for Aviation, Chairman Emeritus, Peter Harbison
IATA and Emirates Airline announced (19-Jan-2021) a partnership to trial the IATA Travel Pass, a mobile app allowing passengers to securely manage their travel in line with any government health requirements. Emirates is scheduled to implement Phase 1, for the validation of COVID-19 PCR tests before departure, in Apr-2021 for passengers travelling from Dubai International Airport. Emirates is one of the first airlines to launch the Travel Pass along with Etihad Airways. [more - original PR - IATA] [more - original PR - Emirates]
Global Crossing Airlines received (18-Jan-2021) its first A320 at Miami International Airport. CEO and chairman Ed Wegel reported the carrier plans to operate A321 and A330 aircraft as well and will take delivery of its first A321 freighter later in 2021. There are two aircraft deliveries scheduled to the carrier in 1Q2021. [more - original PR]
IAG and Globalia amended (19-Jan-2021) the original agreement in which Iberia will acquire the entire issued share capital of Air Europa Lineas Aereas. Details include:
- Iberia will pay EUR500 million for the acquisition of Air Europa, a reduction from the EUR1 billion previously agreed;
- Payments will be deferred until the sixth anniversary of the acquisition completion;
- The revised terms in the amendment agreement are conditional on the satisfactory negotiation between Iberia and Spain's Sociedad Estatal de Participaciones Industriales (SEPI) regarding the non-financial terms associated with the financial support provided by SEPI to Air Europa during 2020;
- Completion of the acquisition is expected to take place in 2H2021, subject to approval by the European Commission;
- Details of Air Europa:
- Gross assets: EUR967 million as of 31-Dec-2019;
- Revenue (2019): EUR2.1 billion;
- Operating profit (2019): EUR71 million;
- Pre-tax profit (2019): EUR42 million
- Passengers (2019): 13.1 million. Passenger volumes declined approximately 70% in 2020;
- Current operating fleet: 52 aircraft, compared to 68 at the end of 2019. All aircraft except one are on operating lease.
IAG CEO Luis Gallego stated: "Being part of a large group is the best guarantee to overcome current market challenges which will also benefit Air Europa once the transaction is completed". He added: "I am pleased that we have reached agreement with Globalia to defer payment until well into the expected recovery in air travel following the end of the pandemic and when we expect to be realising significant synergies resulting from the transaction". [more - original PR]
CAPA - Centre for Aviation, in a report entitled: 'The Hiccup Effect: Australia points 2021 direction for int'l aviation', stated (19-Jan-2021) Authorities like in China and Australia, where the virus has been largely suppressed, will be slow to reopen unconditionally. The report said although there is a constant threat of new domestic outbreaks in Australia, recent history suggests that tracing competence has become so sophisticated that local surges can quickly be contained. [more - CAPA Analysis]
London Luton Airport (LLA) submitted (18-Jan-2021) an application to Luton Council to change its passenger cap from 18 million to 19 million p/a. The application, which follows a public consultation held in Oct-2020, seeks to vary five conditions of LLA's original planning permission, granted in 2014, to allow it to accommodate an additional one million passengers. The increase will not require any physical changes or new construction at the airport, and the airport will continue to operate within the existing terminal infrastructure. A full environmental impact assessment has been submitted as part of the application. [more - original PR]
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