IndiGo placed (25-Apr-2024) a firm order for 30 A350-900s, to support its long haul international network expansion plans, with purchase rights for 70 additional A350 family aircraft "for possible future needs under certain conditions". The aircraft will be powered by Rolls-Royce Trent XWB engines and deliveries are expected to commence in 2027. IndiGo CEO Pieter Elbers said the order "marks a new chapter for IndiGo and will further shape the future of the airline and for Indian aviation at the same time". [more - original PR]
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Capacity and demand surge in China-New Zealand market as airlines eye further growthWith visitor flows from China to New Zealand recovering strongly, capacity in this market is expected to exceed pre-pandemic levels during the southern hemisphere winter season.
The resumption of flights to New Zealand by Sichuan Airlines means that six Chinese airlines are now operating there. Some of them plan significant capacity increases in coming months.
New Zealand was already a popular market for mainland China's airlines before the pandemic, which is a major reason why capacity and demand is rebounding more quickly than in many of China's other international markets.
Although China's outbound travel has been generally slow to gain momentum, it is a good sign that it returning to pre-pandemic levels in certain markets - particularly a long haul destination like New Zealand. This bodes well for other countries that are waiting for Chinese traffic flows to bounce back.
China-New Zealand routes are dominated by the Chinese airlines, but having this many extra foreign airlines boosts Auckland Airport's competitiveness.
The China market is important for New Zealand, both in terms of current service and potential demand. This market was growing rapidly before the COVID-19 pandemic, and there is scope for further expansion that will be helped by having such a broad range of Chinese airlines already flying to New Zealand on multiple routes.
easyJet is celebrating the 20th anniversary of its first Berlin flight, which flew to Schoenefeld from Liverpool on 28-Apr-2004. In 2018 easyJet added Berlin Tegel to its airport network when Air Berlin exited, and it soon became the biggest operator by seats in the German capital city.
When Berlin Brandenburg Airport replaced its two predecessors on 31-Oct-2020, easyJet became the first airline to take off from the new airport the following day.
easyJet expects to fly to more than 50 destinations from Berlin this summer, including five new destinations. Moreover, it has demonstrated its commitment to Brandenburg with on-site investments, including a hangar.
Nevertheless, easyJet rationalised its Berlin operations in 2022 and it is far from its pre-pandemic capacity: for the week of 29-Jul-2024 its Brandenburg schedule has only 39% of the seats that it offered across Schoenefeld and Tegel in the equivalent week of 2019.
In 2018 and 2019 easyJet was Berlin's biggest airline. Ryanair assumes that mantle this northern summer.
Branding has become increasingly important as a field of marketing, and noticeably so in the air transport sector - where airlines are no longer assessed by their 'sexiness', as they were 40 or 50 years ago, but by a host of metrics that collectively identify their 'brand value', 'brand equity' and 'brand sustainability'.
A leading brand valuation and strategy consultancy, Brand Finance, has published an annual report on how branding applies to airlines and airports in 2024.
In the former case the biggest brands by all the metrics are also the biggest airlines with few exceptions.
The same is true of airports, with a noticeable paucity of winners among small airports in the sustainability category, where some of them have actually been the most active. Most of the 'leaders' are from cities that are global powerhouses.
Meanwhile, a spat in California between two neighbouring airports over the selection of a new name for one of them demonstrates how, at the end of the day, an airport's name can be its most important feature and benefit of all.
Both United Airlines and Alaska Air Group appeared to have cracked the code to create meaningful results in 1Q - typically the weakest quarter for US airlines.
Each airline's profitability in 1Q2024 was wiped out by the grounding of their respective Boeing 737 MAX-9 fleets early in 2024, after the inflight blowout of a door plug on an Alaska Airlines 737-9.
Hopefully, the aircraft groundings should be a one-time event; but United and Alaska are bullish that profitability in 1Q2024 could become a common occurrence.
Premium Analysis
Edinburgh Airport – VINCI to take a controlling interest; becomes second largest UK airport operator24-Apr-2024
Edinburgh Airport – VINCI to take a controlling interest; becomes second largest UK airport operator
Quietly and stealthily, the French airports operator VINCI - with more than 70 assets worldwide, the leading private sector operator - has been building its portfolio in the UK, while all eyes have been on its acquisitions elsewhere.
Having already acquired Belfast International (100%) in 2018 and a majority stake in London Gatwick Airport the following year, VINCI has now moved to take a similar position to that at Gatwick by acquiring 50.01% of the equity at Edinburgh Airport, which serves the Scottish capital city and the second most visited tourist city in the UK.
The transaction should be completed in the summer of 2024, at which time VINCI would become the second largest airport operator in the UK by passenger numbers.
At the same time GIP, the majority shareholder at Edinburgh now, continues the downscaling of its airport activities...except where they concern VINCI, which is becoming the de facto operating partner of the funds manager (which has recently been wrapped up in the giant BlackRock asset manager).
But there are other factors to consider while the deal is secured, such as the position of the minority investors at Edinburgh, which represent major Australian pension funds.
And it does pose the question of whether VINCI might be tempted to go for a 'full house' of UK capital city airports by taking a look at least at what Cardiff Airport has to offer.
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26-Apr-2024 12:15 PM
US FAA announces USD76m for projects under Airport Infrastructure Grants programme
US FAA announced (25-Apr-2024) the award of USD76.1 million for 45 airport related infrastructure projects across 22 states under the FY2024 Airport Infrastructure Grants programme. Recipients include:
- Las Vegas Harry Reid International Airport: USD27.8 million for installation of runway edge drains and apron reconstruction works;
- Bangor International Airport: USD8.3 million for runway rehabilitation works;
- Sioux Falls Regional Airport: USD8.1 million for the design phase of a terminal building expansion project and terminal rehabilitation works;
- Colorado Springs Airport: USD6.4 million for rehabilitation of a terminal building to accommodate a 14,000sqft federal inspection service facility;
- Melbourne Orlando International Airport: USD3 million for terminal building rehabilitation, including the installation of a new baggage system;
- Grand Forks International Airport: USD2.9 million for runway reconstruction;
- South Bend International Airport: USD1.8 million for taxiway reconstruction;
- Dickinson Theodore Roosevelt Regional Airport: USD1 million for the design phase of a terminal building reconstruction project;
- Friday Harbor Airport: USD1 million to increase the capacity of an existing fuel farm by adding a supplemental tank for Jet A fuel and installation of a larger 12,500 gallon aviation gas fuel tank. [more - original PR]
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26-Apr-2024 12:14 PM
Southwest to cease operations at Bellingham, Cozumel, Houston and Syracuse airports in Aug-2024
Southwest Airlines CEO Bob Jordan announced (25-Apr-2024) the carrier plans to suspend operations at Bellingham International Airport, Cozumel Airport, Houston George Bush Intercontinental Airport and Syracuse Hancock International Airport on 04-Aug-2024. The carrier also plans to reduce capacity at Atlanta Hartsfield-Jackson International Airport and Chicago O'Hare International Airport. Mr Jordan stated: "To improve our financial performance, we have intensified our network optimization efforts to address underperforming markets". [more - original PR] [more - original PR - II]
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26-Apr-2024 11:27 AM
Southwest Airlines to reduce workforce, offer voluntary time off under cost control initiatives
Southwest Airlines CEO Bob Jordan reported (25-Apr-2024) the carrier is implementing cost control initiatives, including limiting hiring and offering voluntary time off programmes in 2024. As a result, Southwest now expects to end 2024 with approximately 2000 fewer employees compared to the end of 2023. [more - original PR]
Norwegian reported (25-Apr-2024) "current booking trends remain encouraging with many customers now booking their summer holidays and business travellers placing high value on Norwegian's strong operating performance". The carrier noted: "Air travel remains a key priority among Norwegian's customers". The duration of the booking curve has improved compared to the two previous years, giving the company more visibility on bookings. [more - original PR]
Norwegian Group CEO Geir Karlsen, in the group's 1Q2024 results press conference, stated (25-Apr-2024) aircraft delivery delays are an issue, and "going forward we are concerned over deliveries from Boeing". Mr Karlsen added: "The good thing is that we have a fleet that is leased and we have redeliveries over the next years, that we can extend". Mr Karlsen continued: "This is something we will absolutely continue to do over the next 2/3 years", as he believes "it will be at least two years until we see the production level at Boeing at the level they want it to be".
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