CAPA News Briefs

AENA announced (24-Feb-2021) its board signed off a new extraordinary incentive package to recover operations for the 2021 summer season. The measure will apply between 01-Apr-2021 and 31-Oct-2021 and incentivises recovery rates above specified thresholds. For the first three months the recovery threshold is 30% while for the last four months it is 45%. All operations above these percentages will be incentivised in their landing charge by the same percentage as their recovery. The incentive means that airlines will receive a discount on their average monthly landing charge for all operations above the set levels, irrespective of the number of passengers carried. [more - original PR]

Air Transport Services Group (ATSG) reported (25-Feb-2021) the following financial highlights:

• Three months ended 31-Dec-2020:
  • Revenue: USD399.4 million, -1.0% year-on-year;
    • Cargo Aircraft Management: USD83.4 million, -1.7%;
    • ACMI: USD275.3 million, -6.1%;
  • Operating expense: USD339.9 million, -3.2%;
    • Labour: USD145.3 million, +15.7%;
    • Fuel: USD31.6 million, -29.4%;
  • Operating profit: USD59.4 million, +13.8%;
  • Net profit: USD5.1 million, compared to a loss of USD40.2 million in p-c-p;
• 12 months ended 31-Dec-2020:
  • Revenue: USD1571 million, +8.2%;
    • Cargo Aircraft Management: USD308.7 million, +8.1%;
    • ACMI: USD1147 million, +6.4%;
  • Operating expense: USD1364 million, +7.0%;
    • Labour: USD519.0 million, +19.7%;
    • Fuel: USD148.4 million, -4.3%;
  • Operating profit: USD206.4 million, +16.6%;
  • Net profit (loss): USD32.1 million, -47.5%;
  • Total assets: USD3002 million;
    • Cash and cash equivalents: USD39.7 million;
  • Total liabilities: USD2146 million. [more - original PR]

London Heathrow Airport CEO John Holland-Kaye said (24-Feb-2021) "2020 has been one of our most challenging years" and the airport declined "to passenger levels we haven't seen since the 70s". Mr Holland-Kaye said the resumption of travel will "save thousands of jobs and reinvigorate the economy", and the airport will collaborate with "the Global Travel Taskforce to develop a robust plan underpinned by science and backed by industry". [more - original PR]

Aeroflot Group reported (24-Feb-2021) the following traffic highlights for Pobeda for the Jan-2021:

• Passengers: 928,000, +0.5% year-on-year;
  • Domestic: 876,100, +20.4%;
  • International: 51,800, -73.4%;
• Passenger load factor: 90.3%, -4.1pp;
  • Domestic: 91.9%, -3.6pp;
  • International: 75.6%, -16.0pp;
• Passenger traffic (RPKs): -8.3%;
  • Domestic: +13.6%;
  • International: -70.8%;
• Number of flights: 5423, +4.5%;
  • Domestic: 5059, +24.9%;
  • International: 364, -67.9%. [more - original PR]

Safran announced (25-Feb-2021) the following FY2021 outlook:

• Recent slowing of air traffic recovery in several regions has generated uncertainty, notably with a risk of delayed recovery of civil aftermarket;
• Back-end loaded activity and profitability for FY2021;
• Adjusted revenue to decrease in a range in the low single digits in organic terms. If currency is at an estimated spot rate of USD1.22 to the EUR then adjusted revenue expected to decrease a range in the high single digits;
• Adjusted recurring operating margin to increase above 10%, at least a 30pp improvement versus 2H2020;
• Free cash flow generation to stay at least at the same level as in 2020 despite strong uncertainties regarding working capital evolution;
• Original Equipment segment:
  • LEAP deliveries of more than 800;
  • CFM56 deliveries to be halved as expected;
  • Lower deliveries in widebody programme, reflecting 787 production rate adjustments by Boeing and the impact of deferrals of retrofit activities for the Aircraft Interiors segment;
• Services segment:
  • Civil aftermarket estimated growth in the high single digits (in USD terms);
  • Other services revenue to decrease in the low single digits (in organic terms);
• Recurring operating income:
  • Increasing recurring operating margin in Propulsion;
  • Stable recurring operating margin in Aircraft Equipment, Defence and Aerosystems;
  • Recurring operating margin negative but improving throughout the year in Aircraft Interiors;
• Continuing and extending manufacturing footprint optimisation;
• Slight increase in R&D expenses but impact almost neutral on recurring operating income;
• Stability in capex outflows, thanks to the 2020 decrease in capex commitments despite an increase in 2021 commitments (related to strategic priorities and differed investments in 2020). [more - original PR]

Brazil ANAC authorised (09-Feb-2021) shared ownership of aircraft in Brazil. The approval seeks to simplify and cut red tapes in the general aviation segment, creating conditions for increased competition in the air transport sector. [more - original PR - Portuguese]

Qantas Group CEO Alan Joyce stated (25-Feb-2021) Group domestic market share increased to approximately 70% in H1FY2021, which was assisted by more than 20 large corporate accounts and growth in small to medium sized enterprises selecting Qantas. Qantas and Jetstar experienced strong leisure demand following the easing of border restrictions, with Jetstar experiencing "a trebling of bookings in November, with more than 250,000 bookings during sale activity". Mr Joyce said improved planning processes have allowed for rapid network and schedule changes to maximise revenue opportunities during border restrictions. [more - original PR]

Abu Dhabi's Department of Culture and Tourism, via the official Visit Abu Dhabi website, updated (22-Feb-2021) its travel 'green list'. Under the new guidelines passengers travelling from the following territories are exempt from quarantine requirements: 

• Australia;
• Bhutan;
• Brunei;
• China;
• Greenland;
• Hong Kong;
• Iceland;
• Mauritius;
• New Zealand;
• Singapore.

Clean Sky executive director Axel Krein said (24-Feb-2021) time is of the essence if European aviation is to meet its goal of net zero emission by 2050. The Clean Sky project is investigating a wide range of different technologies that could make climate neutrality a reality said Mr Krein, although "a lot more work must be done before those technologies are market-ready, and the time has come to ramp up our green aviation research activities". He cautioned that in order to reach zero-emission by 2050, new technologies and aircraft products "cannot only start to enter the market by 2040 or 2045", calling for an investment of EUR12 billion in R&D. This could subsequently trigger aircraft manufacturers to invest a further EUR50 billion to develop new aircraft types. [more - original PR]

Delta Air Lines announced (24-Feb-2021) plans to continue its COVID free travel corridor flights between Atlanta and Rome, following an initial pilot phase. The carrier has applied to relevant Italian authorities for permission to extend route into the summer after 05-Mar-2021. As previously reported by CAPA, Delta and Alitalia commenced the codeshare in Feb-2021, enabling passengers quarantine free entry to Rome from the US. Essential travellers can book Alitalia's dedicated COVID tested service from New York JFK and Delta's COVID tested service from Atlanta. Passengers are required to test negative for COVID-19 both prior to departure and on arrival in Rome. [more - original PR]

US Department of Transport (US DoT) Office of the Inspector General released (23-Feb-2021) its report into the US FAA's certification efforts for the Boeing 737 MAX 8, finding weaknesses in the agency's certification and delegation processes hindered its oversight of the aircraft programme. Key findings include:

• While the FAA and Boeing followed the established certification process for the 737 MAX 8, there were limitations in FAA's guidance and processes that impacted certification and led to a significant misunderstanding of the Manoeuvring Characteristics Augmentation System (MCAS), the flight control software identified as contributing to the two accidents:
  • The FAA's certification guidance does not adequately address integrating new technologies into existing aircraft models;
  • The FAA did not have a complete understanding of Boeing's safety assessments performed on MCAS until after the first accident;
• Communication gaps further hindered the effectiveness of the certification process. In addition, management and oversight weaknesses limit FAA's ability to assess and mitigate risks with the Boeing Organization Designation Authorization (ODA). For example, the FAA has not yet implemented a risk-based approach to ODA oversight, and engineers in the FAA's Boeing oversight office continue to face challenges in balancing certification and oversight responsibilities. Moreover, the Boeing ODA process and structure do not ensure ODA personnel are adequately independent;
• While the FAA has taken steps to develop a risk-based oversight model and address concerns of undue pressure at the Boeing ODA, it is not clear that FAA's current oversight structure and processes can effectively identify future high-risk safety concerns at the ODA.

The US DoT made 14 recommendations to improve the Agency's aircraft certification process and oversight of the Boeing ODA. FAA concurred with all 14 of the recommendations and provided appropriate actions and planned completion dates. [more - original PR]

US FAA reported (25-Feb-2021) it has assessed USD5.4 million in deferred civil penalties against Boeing for failing to meet all of its performance obligations under a 2015 settlement agreement. Boeing aircraft manufacturer also agreed to pay USD1.2 million to settle two pending FAA enforcement cases. Under the 2015 agreement, Boeing pledged to change its internal processes to improve and prioritise regulatory compliance. The agreement required the company to meet specific performance targets, and authorised the FAA to assess deferred penalties if it failed to do so. The 2015 agreement prevents Boeing from appealing the FAA's penalty assessment, and the five year term of this agreement has ended. Boeing previously paid USD12 million in civil penalties as an initial condition of the 2015 agreement. The terms of this new settlement were reached at the end of Dec-2020. [more - original PR]