CAPA News Briefs

New Zealand's Government and ASEAN commenced (18-Sep-2019) negotiations on a unified air services agreement. New Zealand Transport Minister Phil Twyford reported "while New Zealand has negotiated individual air services agreements with each of the ten ASEAN member states, there are differences between them" and a single agreement "would raise the overall quality of air services within the region". Mr Twyford said a regional agreement will facilitate traffic increases to New Zealand, while increasing destinations and services to Southeast Asia. [more - original PR]

IATA, via its 3Q2019 Cargo Chartbook, reported (12-Sep-2019) that after a period of escalation in the trade war, only 34% of respondents of the Jul-2019 Business Confidence Survey expected cargo traffic volumes to increase in the coming twelve months. This led to a strong fall in the weighted score. In parallel, 41% of surveyed airlines' heads of cargo were expecting deteriorating cargo yields in the next twelve months, up from 23% in Apr-2019. Consequently, the weighted score ventured into the area associated with deteriorating aggregate yield outlook for the second time in 2019. [more - original PR]

Qatar Airways Group CEO Akbar Al Baker stated (18-Sep-2019) the carrier's decision to convert 10 of orders for 50 A321neo into A321LRs, was due to the aircraft's extra range which will enable it to "connect Doha to new growing markets where demand is not sufficient for widebody aircraft, or where current narrowbodies are unable to reach". [more - original PR]

Qatar Airways reported (18-Sep-2019) a net loss of QAR2.3 billion (USD631.8 million) in FY2018/19. Qatar Airways Group CEO Akbar Al Baker attributed this financial loss to "the loss of mature routes, higher fuel costs and foreign exchange fluctuations". [more - original PR]

British Airline Pilots' Association (BALPA) cancelled (18-Sep-2019) additional strike action planned at British Airways (BA), scheduled for 27-Sep-2019. BALPA general secretary Brian Strutton commented the pilots "pilots have decided to take the responsible course" and take the initiative to "sort out this dispute" despite "no sign of that from BA." Mr Strutton added that it is his view that "now is the time for cool heads and pragmatism to be brought to bear". [more - original PR]

FedEx Corporation reported (17-Sep-2019) its fiscal 2020 earnings forecast is being lowered to line up with its reduced revenue outlook, the result of increased trade tensions, weakening global economic conditions, increased FedEx Ground costs and the loss of a large customer. FedEx Corporation EVP and CFO Alan B Graf Jr stated the company is "continuing to make strategic investments" to enhance capabilities and efficiencies, which is in turn expected to "drive" increases in earnings, margins, cash flows and returns for the long term. In order to "better match capacity with demand" and "mitigate the effects of macroeconomic uncertainty", Mr Graf said the company is also carrying out more cost reduction initiatives and bringing about post peak reductions to the FedEx Express network. Forecast for 2020 is as follows:

• Earnings per diluted share: USD10 to USD12, before the year end MTM retirement plan accounting adjustment;
• Effective tax rate: 24% to 26%, before the year end MTM retirement plan accounting adjustment;
• Capital spending forecast: USD5.9 billion. [more - original PR]

Metropolitan Washington Airports Authority reported (18-Sep-2019) the following traffic highlights for Washington Dulles International Airport for Jul-2019:

• Passengers: 2.5 million, +2.9% year-on-year;
• • Commercial domestic: 1.6 million, +2.1%;
  • Commercial international: 897,152, +4.6%;
• Cargo: 22,184 tonnes, -9.0%;
  • Freight: 21,390 tonnes, -7.5%;
    • Domestic: 8201 tonnes, +7.8%;
    • International: 13,189 tonnes, -15.0%;
  • Mail: 794 tonnes, -36.5%;
• Aircraft movements: 25,067, +3.7%;
  • Commercial domestic: 17,574, +6.4%;
  • Commercial international: 4929, +2.5%. [more - original PR]

FedEx Corporation chairman and CEO Frederick W Smith reported (17-Sep-2019) the company's operating results for the three months ended 31-Aug-2019 were "negatively impacted by a weakening global macro environment driven by increasing trade tensions and policy uncertainty". FedEx's operating results were also damaged by the loss of business from a large customer, one less operating day, increased costs to expand service offerings and continued mix shift to lower yielding services. These outcomes were partially offset by lower variable incentive compensation expenses, revenue growth at FedEx Ground and higher yields at FedEx Freight. Mr Smith noted the company is positioning itself to "leverage future growth opportunities as we continue the integration of TNT Express, enhance FedEx Ground residential delivery capabilities and modernise the FedEx Express air fleet and hub operations". [more - original PR]

GRU Airport Sao Paulo Guarulhos International Airport reported (18-Sep-2019) the following traffic highlights for Aug-2019:

• Passengers: 3.6 million, +1.7% year-on-year;
• • Domestic: 2.4 million, +4.1%;
  • International: 1.3 million, -2.6%;
• Aircraft movements: 22,750, -3.2%;
  • Domestic: 16,633, +0.2%;
  • International: 6117, -11.5%. [more - original PR]

Virgin Atlantic outlined (18-Sep-2019) plans to "challenge the dominance of IAG" and British Airways at London Heathrow Airport. Key details include:

• Plans to significantly increase its long haul route network and launch a new comprehensive network of domestic and European routes following completion of Heathrow's third runway;
• Plans to serve 103 domestic, European and long haul destinations, up from 19 long haul destinations in 2020;
• Of the 84 new destinations planned, 12 are domestic (including Belfast, Glasgow and Manchester), 37 are European (including Barcelona, Dublin and Madrid), and 35 are global (including Buenos Aires, Tokyo and Santiago);
• Virgin Atlantic's proposed flying programme aims to increase in choice for customers;
• To achieve its expansion plans, the carrier is also calling on the UK Government to reform the way new Heathrow slots are allocated.

Virgin Atlantic CEO Shai Weiss commented: "Never has the need for effective competition and choice at Heathrow Airport been more evident than during this [2019] summer of disruption, which has brought misery for tens of thousands of travellers... Britain, and those who travel to it, deserve better than this. Air passengers need a choice and Virgin Atlantic is ready to deliver when Heathrow expands". [more - original PR]

Japan National Tourism Organisation (JNTO) reported (18-Sep-2019) visitor arrivals to Japan for Aug-2019. Details include:

• Total foreign visitors: 2.5 million, -2.2% year-on-year;
  • China: 1.0 million, +16.3%;
  • Taiwan: 420,300, +6.5%;
  • South Korea: 308,700, -48.0%;
  • Hong Kong: 190,300, -4.0%;
  • US: 117,800, +14.3%;
  • Thailand: 49,600, +4.4%;
  • Vietnam: 43,700, +27.7%;
  • Philippines: 31,500, +27.5%;
  • France: 30,900, +9.6%;
  • Canada: 27,600, +10.6%;
  • Australia: 27,000, +13.8%;
  • UK: 26,200 +8.4%;
  • Indonesia: 16,200, -7.3%;
  • Malaysia: 19,800, -1.7%;
  • Singapore: 19,700, +20.6%;
• Japanese departures: 2.1 million, +3.7%. [more - original PR -English/Japanese]

SAS launched (18-Sep-2019) a new ancillary product for passengers to purchase biofuel when booking a ticket to help reduce CO2 emissions by up to 80%. Biofuel will be placed into 20 minute blocks of fuel at EUR10 per block, with passengers eligible to purchase the amount of blocks to cover their travel time. SAS will make no profit from the new ancillary product and it will be added to the biofuels already purchased by SAS. [more - original PR]