Boeing says it needs more money – dividends unlikely for many years

In a virtual shareholders’ meeting on Monday this week, Boeing CEO David Calhoun warned that the world’s second-largest planemaker will need to raise further cash over the next six months and will be unlikely to pay any shareholder dividends for many years to come. “That process could take three to five years... It’s going to be a while before dividends come back,” Calhoun said. 

The aerospace giant is suffering, financially, from the dual problems of the effects of the COVID-19 pandemic on the industry and ongoing problems which has seen its 737 MAX jet remain grounded for over 13 months. “We know we’re going to have to borrow more money in the next six months in order to get through this really difficult moment, to provide the right liquidity to the supply chain that represents our industry,” Calhoun said during the company’s virtual annual general meeting, adding that: “Our first priority is going to be to pay that back, the principle and the interest that goes with it.” 

Boeing’s intention is to maintain the current supply chain by ordering parts and services from smaller companies to ensure their continued survival. Boeing will report first-quarter earnings Wednesday, April 29, while last month it drew down its entire US$13.8 billion credit line and suspended its dividend. Boeing’s first- quarter deliveries were down one third compared to the same period last year. The anticipated return to service of the 737 MAX by mid-year no longer seems to be feasible with a key certification flight test unlikely to take place before the end of May, though Calhoun was keen to point out the company’s continued confidence in the MAX.

Source: AviTrader

Bombardier expects 11,000 employees to return-to-work over next few weeks

Bombardier has begun the process of recalling most of its Canadian-based employees who were placed on furlough following government mandates enacted to slow the spread of COVID-19. Suspended manufacturing and service activities will gradually resume as of May 11.

Nearly 11,000 employees are expected to be back to work within the next few weeks across the company's aviation and transportation segments and Bombardier’s Corporate Office. Return-to-work schedules will vary by site and be subject to new procedures to ensure employee health and safety.

Site and function leaders will be communicating specific plans and dates directly to employees. All recalled employees whose physical presence is not required at Bombardier’s production or service sites will be asked to work from home until further notice.

Source: AviTrader

Airbus reports first-quarter 2020 net loss of €-481 million

Airbus has reported consolidated financial results for its first-quarter 2020.

Consolidated revenues ​decreased to €10.6 billion, -15% compared to first-quarter 2019, reflecting the difficult market environment impacting the commercial aircraft business with 40 less deliveries than a year earlier, partly offset by a better mix and more favourable foreign exchange environment.

A total of 122 commercial aircraft were delivered (Q1 2019: 162 aircraft), comprising eight A220s, 96 A320 Family, four A330s and 14 A350s. Airbus Helicopters delivered 47 rotorcraft (Q1 2019: 46 units) with its 19% increase in revenues reflecting the favourable delivery mix and growth in services. Revenues at Airbus Defence and Space were stable year-on-year. One A400M transport aircraft was delivered in the quarter.

Airbus reported EBIT Adjusted of €281 million, down 49% from the previous year. The company reported a net loss of € -481 million for the first-quarter. Consolidated free cash flow ​​amounted to ​€ -8,030 million and included the payment of € -3.6 billion in penalties related to January 2020’s compliance agreement with the authorities.

Source: AviTrader

Probe into Boeing-Embraer deal by EU antitrust regulators continues

On October of last year, the probe by European Union antitrust regulators into Boeing’s acquisition of the commercial aircraft arm of Brazilian Plane manufacturer Embraer came to a halt as it waited for the provision of additional documentation that had been requested. This so-called “stop the clock” intervention ended on April 7 this year after what is understood to be the provision of millions of documents. 

EU antitrust regulators, according to the latest filing, have resumed their investigation into Boeing’s acquisition of the commercial aircraft arm of Brazilian planemaker Embraer, with a decision due by August 7. The principal concern with regard to the US$4.8 billion deal is that Embraer is currently the third-largest planemaker in a highly competitive commercial aircraft industry, especially in the single-aisle segment. 

Embraer specializes in 70- to 120-seat jets and is in direct competition with the Airbus A220 program which was recently acquired from the Canadian plane and train manufacturer, Bombardier, but it’s acquisition by Boeing would subsequently see the market lose a competitor.

Source: AviTrader

Qatar airways repatriate over a million people since mid-February

The COVID-19 pandemic has created an unprecedented challenge for the global aviation industry. While the airline continues to maintain operations where possible to take people home and to transport essential supplies, overall demand for air transport has declined significantly. Qatar Airways has said that it helped over one million passengers to return their homes, operating a mix of scheduled and charter services plus extra sectors. In the past several weeks, the airline has helped repatriate over 45,000 passengers back home to France, 70,000 to Germany and over 100,000 people back to the United Kingdom. The demand to help get stranded travelers home has also seen Qatar Airways operate flights to new destinations such as Brisbane, Christchurch and Toronto. The national carrier of Qatar continues to operate approximately 60 scheduled flights a day to around 40 destinations and is working closely with embassies across the globe to arrange charters to repatriate stranded citizens.

Qatar Airways Cargo has increased operations to ensure the continuity of global trade and movement of essential medical and aid supplies. The Cargo division of the company operates a significant cargo schedule with almost 100 flights per day. Last month, the operator has worked closely with governments and NGOs to transport over 70,000 tonnes of medical and aid supplies to impacted regions around the world on both scheduled and charter services, the equivalent of roughly 500 fully loaded Boeing 777 freighters. To continue to fulfil demand the Group’s cargo division is also utilizing passenger aircraft to carry freight-only to destinations in China, Europe, India and the Middle East.

“The entire team at Qatar Airways has worked incredibly hard to take people home over the past few weeks. We have built a strong level of trust with our passengers, governments, travel trade and cargo businesses as a reliable partner when we were needed the most and we continue to offer a schedule where possible and allowed by governments," Qatar Airways Group Chief Executive, H E Akbar Al Baker, said.

“We also introduced an employee pay deferral scheme which the Company will credit salary back as soon as possible when circumstances allow. Many other work groups overseas and across all job levels have also offered to take voluntary salary deferrals in solidarity with their colleagues, reinforcing the fact that the Qatar Airways Group family is one who has the best interests of each other and the airline at heart,” Al Baker added.

Qatar Airways says that it maintains the highest possible hygiene standards, which include the regular disinfection of aircraft, the use of cleaning products recommended by the International Air Transport Association (IATA) and the World Health Organization (WHO), and thermal screening of the crew. In addition, Qatar Airways’ aircraft feature the most advanced air filtration systems, equipped with industrial-size HEPA filters that remove 99.97% of viral and bacterial contaminants from re-circulated air, providing the most effective protection against infection. All the airline’s onboard linen and blankets are washed, dried and pressed at microbial lethal temperatures, while its headsets are removed of ear foams and rigorously sanitized after each flight. These items are then sealed into individual packaging by staff wearing hygienic disposable gloves.

Source: Airline Watch

Dubai Airports planning for phased travelre-startafter Covid-19 restrictions lift

Dubai Airports, operator of the world's busiest airport by international traffic, is planning for "gradual remobilisation" once travel restrictions aimed at containing the spread of Covid-19 are eventually lifted. It is also offering relief measures for its aviation and commercial partners under a "business stabilisation framework", Dubai Airports said in a statement on Wednesday.

"Flexibility is more important now than ever,” said Eugene Barry, executive vice president of commercial at Dubai Airports.

“Of paramount importance is that we protect and retain our aviation and business partnerships, which have been carefully built over a number of years, and ensure that our revenue and service drivers will be in a position to remobilise, in line with approvals from federal authorities."

The coronavirus pandemic has led to a near-total shutdown of global travel leading to expectations that it will cut airlines' passenger revenue by more than half, or about $314 billion ( Dh1.15 trillion) this year, and threatening the loss of 25 million jobs worldwide, according to the International Air Transport Association.

Dubai Airports said it responded to the Covid-19 crisis through an assistance programme for aviation partners, tenants and concessionaires covering the period from March 1 to May 31. The programme includes includes waiving 100 per cent of minimum guarantees or equivalent fees for partners who have been required to cease trading due to the suspension of airport operations caused by the global pandemic.

For those that have maintained partial operations, other measures are in place to address the reduction in aviation activity, including "rescheduling and other financial adjustments", it said without elaborating.

"We have taken a number of unprecedented measures to mitigate the impact of Covid-19 to our own business, as well as those of our partners," Mr Barry said. "Our futures are intertwined, and dependent on our ability to maintain core relationships, but also on adapting to unprecedented conditions and new behaviours.”

IATA, an industry body representing some 290 carriers, has warned that cash-strapped airlines are in need of government rescue packages to survive the crisis or face the risk of bankruptcy.
The Dubai government has already stepped up support for its airline, Emirates, pledging an equity injection at the end of last month.

Passenger operations at Dubai International and Dubai World Central (DWC), with the exception of repatriation flights, were suspended by UAE authorities on March 24. The suspension is in place until further notice, Dubai Airports said.

Cargo operations, which are excluded from the ban, are surging at Dubai International as 12 airlines, including Emirates SkyCargo and flydubai, have been given permission to operate an average of 110 weekly flights weekly in response to "heightened demand" for pharmaceuticals, food, and other essential goods, the operator said.

Source: TheNational.ae

American Airlines uses COVID-19 disruption to retire vintage 737s and other jets

Having announced two weeks ago that it was to retire 34 Boeing 757s and 17 Boeing 767s, American Airlines has announced that with the dramatic downturn in world travel, it will now be retiring 76 Boeing 737s that the carrier acquired between 1999 and 2001. In addition, it will also be retiring nine Airbus and 20 Embraer E190s according to Reuters news agency. There is also the distinct possibility that a number of its 50-seat regional jets will also be retired. American Airlines sees this as an opportune moment to retire an additional number of jets with a view to replacing them with Boeing 737MAX jets that are currently on order but awaiting the lifting of the model’s grounding after two fatal crashes. “Decisions beyond the 757 and 767 have yet to be finalized, and we continue to make refinements to our overall fleet plan,” American spokesman Ross Feinstein said, adding that decisions would be based on demand. The move to newer, more fuel-efficient jets, while avoiding costly retrofitting that may have been required on older 737s, will still require considerable expenditure, but running costs will be significantly reduced as a consequence. While many carriers may now choose to dispose of older aircraft, this could prove beneficial for the manufacturing side of the aerospace sector as a demand for new jets could increase substantially with an increased rate in retirements. To date, American Airlines has temporarily parked 135 out of 150 wide-body jets — including 787 Dreamliners — and more than 300 single-aisle jets, and may continue to park more of its smaller aircraft as the COVID-19 crisis continues, the carrier’s president, Robert Isom, told employees. Source: AviTrader

Giant Antonov returns to the skies

The world’s biggest plane, the Antonov AN-225, is back in the skies and may soon be making a welcome return to the cargo market.

Flightradar24 recorded a March 25 flight of just under two hours by the giant, six-engine Antonov AN-255 at its home in Kyiv, where it has been undergoing a major upgrade.

Flightradar24 tracked the flight.

It was spotted by AN-225 enthusiast and Popular Mechanics writer Eric Adams who said the aircraft entered the maintenance and upgrade program in October, 2018.

“The flight lasted two hours, with the aircraft completing two laps above the Ukrainian countryside before returning to Antonov Aiport (GML),” Adams said

The AN-225 caused traffic chaos in Perth, Australia, when it visited in 2016 to deliver a 117-tonne power generator.

Watch the AN-225 land in Perth

Called Mriya (Dream in Ukrainian), the plane was developed for the Soviet space program to carry the Buran spaceplane and Energiya rocket.

It entered commercial service in 2001 and has set more than 240 world records during its lifetime.

The monster plane has a maximum take-off weight of 640 tonnes. is powered by six turbofan engines and a landing gear system boasting 32 wheels.

Credit: AirlineRatings