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Wizz Air CFO expects engine failures to end by 2027
Wizz Air aims at ending engine-related groundings for its Airbus aircraft before the end of 2027. However, a senior executive stated on Tuesday that he has not seen an improvement in Pratt & Whitney's bottlenecks which are blamed for the blocking of dozens of jets. Ian Malin, CFO of Wizz Airlines, said that the number of aircraft grounded due to long inspection waiting times has dropped from 60 at its peak. Wizz reported that 41 aircraft were grounded at the halfway point of the year due to GTF engine inspections. The plan is to have the fleet deparked by 2027. We are working toward that target," he said at the International Society of Transport Aircraft Trading conference (ISTAT) in Prague. He said, "That'll be challenging. Especially when we have 38 aircraft on the ground." Wizz Air CEO Jozsef Varradi told Bloomberg that he wanted to change the fortunes of Wizz Air by mid-2027. Wizz, a Hungarian airline, has been struggling to compete with other European carriers financially in the last few years due to engine problems. It has been unable to increase its capacity due to the groundings and issued two profit warnings. "Pratt actually shows some availability of engines but the overall turn-around time is not improving...Pratt said that this is coming down. Malin replied, "I haven't yet seen it." He added, "It's extremely frustrating because we have been dealing with this for two and a half years." RTX, the parent company of Pratt & Whitney, did not respond immediately to a comment request. Chris Calio, CEO of the U.S. Aerospace Group, said that in September, cases of aircraft being grounded due to Pratt engine failures have stabilized and are expected decrease, but "clearly, we have more to do."
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Indian states sign coal power agreements to meet increasing demand
Indian state electricity distributors sign long-term contracts to coal-fired generators in order to meet an expected surge in evening demand. This is despite efforts by the country to increase clean energy capacity. Bid documents examined by reveal that Uttar Pradesh, India’s most populous State, and Assam, a state in eastern India, have recently withdrawn incentives for clean energy project, are hoping to sign deals within the next two month for at least seven gigawatts coal-fired electricity, collectively to be delivered in 2020. India Ratings & Research reports that more than 17 GW coal-fired power capacity was contracted in various stages during the 16 months leading up to July. This is the largest pipeline of this kind since the Covid Pandemic. Analysts say that the rush to purchase, fueled by the projected increase in demand for air conditioning during non-solar times and the slow expansion of battery storage capacity, is driving investment. It is also expected to slow down decarbonisation efforts, in the third largest emitter of greenhouse gases in the world. Ashis Kumar Prdhan, senior consultant at Wood Mackenzie said that he believes the government's push to promote renewable energy will only prolong India's dependence on coal. India plans to increase coal power by 46%, from 210 GW to 307 GW in 2035. It also targets non-fossil energy capacity of 500 GW or nearly twice the current 251.4 GW. Pradhan stated that "we have revised our projections for coal-fired electricity generation in India. The peak is now expected to occur in the early 2020s as opposed to our previous outlook of the late 2030s." COSTS ARE RISING Adani Power announced in August that it would invest $5 billion into two coal-powered power plants. Torrent Power is evaluating plans for 5-7 GW in capacity over the next decade. This was announced by Jigish Mehta, the company's full-time director. Analysts say that while the plans could increase the coal share of the mix, solar energy is expected to be more popular during the day because it is cheaper. Mehta stated that "grid instability is a problem for state distribution companies due to the variability of renewable energy and the lack of scalable storage." Alexander Hogveen Rutter is an independent energy expert based in India. He said that building renewables and storing them was cheaper than adding new coal-fired power plants. He said that "new coal power is becoming more expensive, and the gap will continue to widen as batteries scale up." According to a report published by the Institute for Energy Economics and Financial Analysis in August, India has sold approximately 12.8 GW of battery energy storage for its development. However, only 219MW hours have been operational. Filings reveal that states such as Madhya Pradesh and Tamil Nadu have chosen to build new coal-fired power plants this year despite citing delays in renewable energy projects. Narendra Bhooshan is a senior official in the Uttar Pradesh Energy Department. He said that renewables alone could not fill the gap.
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IKEA purchases US logistics tech company Locus to boost online growth
IKEA acquired U.S. logistic technology firm Locus on Tuesday. The Swedish furniture retailer claimed that the deal would improve its delivery to customers, as it expands online sales. This acquisition is part of a $2.2billion push by Ingka Group - the largest global IKEA franchisee - in the U.S., where it is competing with Wayfair and Walmart, and also has to contend with increased tariffs on imported goods that increase its costs. IKEA refused to reveal the value of the transaction. Locus' most recent funding round, in 2021 was reported to have valued the company at $300 million. IKEA claimed that acquiring Locus will simplify its logistics, and reduce its global delivery costs by approximately 100 million euros ($117.41) per year. Locus is a software that uses artificial intelligence (AI) to group orders, predict routes, and minimize the time that delivery vehicles are stuck in traffic. This planning process, which was previously done manually by IKEA employees, has been automated, Parag Parekh told Ingka Group's chief digital officer in an interview. Parekh said that Locus would also allow IKEA customers to have more options and delivery windows, receive live updates about their packages, and get them faster. The technology will be tested in the U.S., UK and possibly other countries before being used globally. He said, "Speed is an important aspect, but for us it's the flexibility and the ability to track... And more importantly, all of this will help drive a more positive customer experience." Locus shareholders included Singapore sovereign wealth fund GIC, private equity firms Alpha Wave and Tiger Global and Qualcomm Ventures before the acquisition of all shares by Ingka, the retailer’s investment arm. Locus, as part of the agreement, will continue to serve clients outside IKEA. IKEA DOUBLES DOWN ON U.S. MARKET DESPITE TARIFFS IKEA, best known for its big, bright-blue suburban stores that display sofas, beds, and bookcases labyrinthinely, has focused on its online business in the last five years, and has invested in smaller, city-centre shops to target younger, more urban consumers. In 2024, online sales represented 28% of IKEA's total retail sales, up from just 11% in 2019. The purchase comes just one week after Ingka Investments purchased a Manhattan building for $213 millions, continuing to expand in the U.S. despite President Donald Trump's higher tariffs on imported furniture. Parekh stated that "in terms of macroeconomics, there is probably uncertainty in the quarters to come." "As a company, we remain committed to America."
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The pipeline agreement between Russia and China is expected to take a decade for exports to increase
Industry sources said that despite recent progress made by Russia in negotiations with Beijing regarding a new gas pipeline, it will take at least 10 years for natural gas exports from China to increase significantly as a result. Alexei Miller said that a legally binding memorandum had been signed by the CEO of Russian Gas Corporation Gazprom on the Power of Siberia 2 Pipeline during President Vladimir Putin’s visit to China in the last month. This development highlights Moscow's efforts in reorienting its vast reserves of gas towards Asia, after its energy trade with Europe – once its biggest market – collapsed due to Western sanctions imposed following Russia's invasion into Ukraine in 2022. It has never been reported when the pipeline will be completed. Key terms of the Pipeline Deal are not yet agreed. The proposed pipeline that would pass through Mongolia is expected to deliver 50 billion cubic meters (bcms) of gas per year from the Arctic Yamal area - similar to the Nord Stream pipeline damaged in Germany. After years of negotiation, however, the key elements of the agreement - such as pricing, investment terms, or the timing of delivery - are still unresolved. Two sources in the industry said that even if a deal is finalised by the end of the year, it will take five years for the pipeline to be completed and deliveries to begin. It would also take another five years to increase supplies. A person with knowledge of the situation said that Gazprom does not expect Power of Siberia 2 to reach its half-capacity before 2034-2035, if deliveries start after 2031. The Oxford Institute for Energy Studies analysts also believed it was a probable scenario. In a report published last month, they stated that a final agreement could result in the first supply being achieved by the end 2030 or 2031 and a significant part of ramp-up by January 1, 2035. The Power of Siberia 1 pipe, which will reach its planned capacity of approximately 38 billion cubic meters this year, is the pipeline that Russia started pumping gas to China from eastern Siberia in late 2019. During Putin's visit to the US last month, 6 bcm more was agreed through this route. Separately China agreed to export 12 billion cubic meters per year via the Far Eastern route to Russia, beginning in 2027. China is able to import gas from a variety of sources, including Turkmenistan and Turkmen liquefied gas. Russia will cover around 22% in 2024. (Reporting and Editing by Tomaszjanowski)
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Croatian JANAF and MOL negotiate an oil transport agreement
The Croatian pipeline operator JANAF will meet with the Hungarian oil company MOL on Wednesday in order to discuss ways of extending their collaboration beyond their current oil transportation agreement, which expires on December 31. JANAF delivers 2.1 million tons of crude oil per year to MOL refineries in Hungary, Slovakia and Romania. Croatian oil company offers to increase its delivery volume as Hungary is under pressure to reduce its dependence on Russian oil via the Druzhba Pipeline. Hungary and Slovakia, two EU member states that want to continue receiving Russian oil despite EU efforts at diversification of supply, are both keen to maintain this source. The Adriatic Pipeline would be the main alternative route for oil shipping. MOL has denied JANAF’s capacity to supply enough oil to its refineries, a claim JANAF rejects. JANAF is ready, both technically and organizationally, to supply all the crude oil needs of MOL's Central European refineries. The company also advocates increasing the amount of oil transported and expanding the collaboration with MOL. JANAF said, "We emphasize the importance of our pipeline because it is the only reliable route that guarantees the continuity and delivery of products." Hungarian officials accuse JANAF imposing high transportation fees. They claim that they are exploiting the situation resulting from the conflict in Ukraine. JANAF denied these claims and stated that it charges MOL standard rate. A spokesperson for MOL responded to a question about the scheduled talks with JANAF on Wednesday: "As usual, MOL is prepared for negotiations." JANAF also faces risks in its agreement with Serbian-owned Russian oil company NIS, which is valid until December 31 2026. The deal may be in jeopardy if U.S. Treasury’s Office of Foreign Assets Control imposes new sanctions against NIS beyond its current deadline of Oct. 8. OFAC sanctioned Russia’s oil sector, as well as the NIS. However, enforcement was repeatedly delayed. JANAF said its transport licence for NIS is valid until 8 October and it will ask to extend the licence.
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Source: India asks Boeing for details after Air India plane's emergency system malfunction
A government source who has direct knowledge of this matter confirmed that India's air safety regulator had requested more information from Boeing Co. after the emergency power system on an Air India Dreamliner 787 was activated unexpectedly on Saturday. Boeing and Air India spokespeople did not immediately reply to requests for comments. Air India reported that during the final approach the crew detected the Ram Air Turbine, an emergency power system. The aircraft landed safely, and all electrical parameters and hydraulic parameters were normal. After a short period of time, the aircraft was grounded for inspections and returned to service. According to the Federation of Indian Pilots, the incident took place at a height of 152 metres (500 feet). According to an email sent by the union to aviation ministry officials, the pilots' union requested that the Directorate General of Civil Aviation (DGCA), the air safety regulator in the country, thoroughly examine and investigate the electrical systems of dozens of Dreamliners. Boeing and a ministry spokesperson did not respond immediately to requests for comments on the email sent by the Federation of Indian Pilots. In June, 260 people were killed in an Air India Boeing 787 accident. Indian investigators found that the fuel engine switches on the aircraft had been switched from run to off almost simultaneously after takeoff. (Reporting and editing by Adityakalra, Kirsten Doovan, and Sharon Singleton; Abhijith Gaapavaram)
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Source: India asks Boeing for details after Air India plane's emergency system malfunction
A government source who has direct knowledge of this matter confirmed that India's air safety regulator had requested more information from Boeing Co. after the emergency power system on an Air India Dreamliner 787 was activated Saturday. Boeing and Air India spokespeople did not immediately reply to requests for comments. Air India reported that the crew of the aircraft, which was flying between the northern Indian city Amritsar and Birmingham, UK, detected the deployment of the Ram Air Turbine during the final approach. Indian investigators reported in July that the RAT was deployed during the initial climb prior to the Air India Boeing 787 accident which killed 260 people a month earlier. Indian investigators found that the fuel engine switches were almost all switched from run to shut off at the same time, just after takeoff. (Reporting and editing by Adityakalra, Kirsten Doovan; Abhijith Gaapavaram)
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Sweden fails to secure strategic reserve power for this winter
Svenska kraftnat, the Swedish transmission system operator, said that a tender for up to 800 Megawatts (MW) of backup electricity generation capacity to be used this winter failed. This leaves Sweden more vulnerable to power outages, it added. In a press release, Pontus de Mare said: "This is concerning." He added that the lack of a reserve made this winter's electricity system more susceptible. Grid operator: The grid operator has stated that the reserve capacity is intended to cover the period between November 16 and March 15, to ensure adequate power supply in the coldest months of the year. Svenska kraftnat was able to receive three bids from six participants who had prequalified, and all of them exceeded the price limit set by the tender regulations, which is 120,000 Swedish Crowns (12,777.24 USD) per megawatt. Svenska kraftnat said that the price cap was the reason for which a strategic reserve could not be contracted to cover the winter ahead. It feared the same outcome would occur next winter if it did not change the level of the price cap. The strategic reserve auction of this year replaced an earlier model, and aimed to bring the process into line with EU state aid regulations. Svenska kraftnat said that it will actively work with the Swedish Energy Market Inspectorate and the Swedish government to find viable solutions. Svenska kraftnat stated that while the risk of power shortages this winter is low, they are expected to increase in the future as consumption is predicted to rise faster than power generation. For units to qualify for the Strategic Reserve, they must meet a set of criteria including high and stable availability. They cannot also be active on the regular or balance power markets. $1 = 9.3917 Swedish Crowns (Reporting and editing by Terje Solsvik).
New York Times service news - Sept 18
The following are the top stories on the New York Times business pages. Reuters has not confirmed these stories and does not vouch for their precision.
- The Biden administration is giving a request by Japan's. Nippon Steel to resubmit its filing with the Committee. on Foreign Financial Investment in the United States for approval to. purchase U.S. Steel.
- The U.S. Transportation Department said that it would. permit Alaska Airlines to close its $1.9 billion. acquisition of Hawaiian Airline companies, clearing the method for. the very first significant U.S. airline merger in almost a decade.
- California will now need social media companies to. moderate the spread of election-related impersonations powered. by expert system, called deepfakes, after Gov. Gavin Newsom, a Democrat, signed three new laws on the subject.
- Musk-backed America PAC, among the most enthusiastic,. well-funded groups supporting previous U.S. president Donald. Trump's campaign, has actually changed up its ground video game in Arizona and. Nevada, 2 states essential to his re-election quote.
(source: Reuters)