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IATA: Global airlines to record record net profit of $41 billion next year
IATA, the global airlines trade association, said on Tuesday that the airline industry would record record profits in 2019 despite supply chain issues causing delays and slower deliveries of aircraft. Airbus, the plane manufacturer, has cut its 2025 plane delivery target due to a quality problem with certain metal panels used on its A320 aircraft. In recent years, the world's two largest jetmakers Airbus (Airbus) and Boeing (Boeing) have both experienced delivery delays to their airline customers. Airlines say that they can't reduce fuel costs while increasing the number of passengers without newer, more efficient aircraft. IATA is optimistic about the year ahead. Willie Walsh, director general of the International Air Transport Association said in a press release that airlines have "successfully" built shock-absorbing resistance into their business. This resilience is helping to deliver stable profitability. LESS CONFIDENCE IN THE AIRBUS Walsh stated that Airbus' performance has improved while Boeing has seen a decline in confidence. This is due to ongoing supply chain problems. The European planemaker was forced to halt production earlier this month. Reduce delivery targets When defects were discovered in some of the fuselage panels days after 6,000 A320 series planes had been recalled over a software bug linked to cosmic radiation. "I believe we're seeing a change where people are recognizing that Boeing's performance is significantly better. "People have more faith in Boeing to deliver on their commitments, and we see people have less confidence in Airbus," Walsh said. "It is disappointing for the industry because there will be fewer new planes being delivered than expected,"? he said. Airbus has cut its delivery target by 4%. It also confirmed that deliveries had already slowed down in November. This was just weeks after the A320 family, including the A321, the best-selling model, surpassed the troubled Boeing 737 MAX to become the most delivered passenger jet in the history of the industry. (Reporting and editing by Jan Harvey, Louise Heavens, and Joanna Plucinska)
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Airline warns green fuel goals are at risk as the supply is short
The 'International -Air Transport Association' said that the global airline industry will likely?miss their targets for using green jet fuel in the next few years. They blamed fuel producers and regulators. Sustainable aviation fuel, made from used or waste cooking oil and waste cooking oil, is a fuel that can reduce emissions significantly when compared to traditional jet fuel. It is still two to five time more expensive than conventional jet fuel. IATA anticipates that 2.4 million metric tonnes of SAF will be available by 2026. This represents just 0.8% the total fuel consumption. The wider aviation sector committed to achieve net-zero emission by 2050 in 2021, and heavily relied on a gradual shift to SAF. We're not seeing SAF produced at the volume we had hoped and expected. Willie Walsh, director general of the trade group, told journalists that this was disappointing. He warned earlier that the 2050 goal of net zero could be in danger. According to IATA, sustainable aviation fuel is only 0.3% of jet fuel used worldwide and will reach 0.7% in 2025. According to experts, the production of sustainable aviation fuel must?grow quickly in order for the sector to meet its emission goals. The airlines have said for years that they would buy all the SAF fuel available but blame jet fuel producers for artificially raising prices and not producing enough. Walsh explained that the problem is not one of cost, but rather of availability. They are unable to obtain the SAF they need to achieve their ambitions. He said that he expects many airlines to backtrack on their official sustainability commitments in 2026. Air New Zealand is leading the charge for setting more realistic expectations. LESS CONFIDENCE IN THE AIRBUS Walsh stated that despite ongoing supply chain problems, Boeing has shown improved performance. The European plane manufacturer was forced to halt production earlier this month. Reduce delivery targets Days after recalling 6,500 A320 series planes due to a software bug linked to cosmic radiation, defects were found in some of the fuselage panels. "I believe?we're seeing a change where people are recognizing that Boeing's performance is significantly better. "People have a lot more faith in Boeing to deliver on the promises they've made and we are seeing less confidence in Airbus," Walsh said. He added, "It is disappointing for the industry because there will be fewer new aircraft delivered than expected." Airbus has cut its delivery target by 4%. This comes after it confirmed that deliveries had slowed down in November. This was just weeks after the A320 family, including the A321, the best-selling model, surpassed the Boeing 737 MAX, which is currently experiencing problems, as the most delivered passenger jets in history. (Reporting and additional reporting by Olivia Le Poidevin, Geneva Editing Louise Heavens).
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South Africa issues first infrastructure bonds to raise $693 million
The National Treasury of South Africa announced on Tuesday that it had issued bonds for infrastructure and development finance, totaling 11.795 billion Rand ($692.74 millions) in 10-year and 15 year instruments. Treasury released a statement saying that bids exceeded 26 billion Rand, and the issue achieved a 2.2?times subscription. The government hopes that the projects funded through the bond sale, will help to drive higher economic growth as well as improve service delivery. The bonds are part of a larger plan to allocate more than 1 trillion rands over the next 3 years for public infrastructure in Africa's largest economy. Treasury raised 6.996 billion rand through the 10-year bond with an interest of 8.575% and 4.799 billion rand by way of the 15-year bonds at an interest of 9.13%. They could fund projects such as the renovation of 'the Tygerberg Hospital' in Cape Town and a major water pipe in Limpopo province. In a separate deal, South Africa raised $3.5 Billion last week by Issuing two new dollars bonds On international capital markets
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IATA: Global airlines to record record net profit of $41 billion next year
IATA, the global airlines trade group, said that despite supply chain problems that have led to a slower delivery of aircraft and delays in introducing more fuel-efficient planes next year, the airline sector will post record profits. Airbus, the plane manufacturer, has lowered its 2025 plane delivery target due to a quality problem with certain metal fuselage panels of its A320 aircraft. In recent years, the world's two largest jet manufacturers Airbus and Boeing both faced delivery delays for their airline customers. Airlines say that they can't reduce fuel costs by flying more passengers if they don't have newer planes with better efficiency. IATA still struck a positive?note? for the coming year. Willie Walsh, director general of the International Air Transport Association said in a press release that airlines have built a shock-absorbing resistance into their business. This has led to stable profitability. (Reporting and editing by Jan Harvey; Joanna Plucinska)
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Airline warns green fuel goals are at risk due to a shortage of supply
The International Air Transport Association (IATA) said that the global airline industry will likely?miss? its targets for using green jet fuel in the next few years. It blamed fuel producers and regulators. SAF, which is primarily made from used or waste cooking oil, has the potential to reduce emissions by a significant amount compared with traditional jet fuel. It is still two to five time more expensive than traditional?fuel. IATA estimates that 2.4 million metric tonnes of SAF will be available by 2026, which is just 0.8% of the total fuel consumption. In 2021, the aviation industry committed to achieve net-zero emission by 2050. This was based heavily on a gradual shift to SAF. "We are not seeing SAF being produced in the quantities we had hoped and expected." Willie Walsh, director general of the trade group, told journalists that this was disappointing. He warned earlier that the 2050 goal of net zero could be in danger. According to IATA, sustainable aviation fuel is only about 0.3% of jet fuel used worldwide and was expected to reach 0.7% by 2025. According to experts, the aviation sector must increase production quickly to achieve its emission goals. The airlines have said for years that they will buy all the 'greener' fuel available but blame jet fuel producers for artificially raising prices and not producing enough. Walsh explained that the problem is not one of cost, but rather of availability. They are unable to obtain the SAF they need to "fulfill the ambition they have expressed." He said that he expects many airlines to backtrack on their sustainability pledges by 2026. Air New Zealand is leading the charge in setting realistic expectations. (Reporting and editing by Louise Heavens, Joanna Plucinska)
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CMA CGM to pay bond with Air France-KLM stake
CMA CGM, the shipping group, is looking to raise approximately?325 millions euros ($378.3million) through a three-year bond that it can re-pay with its shares in Air France-KLM. CMA CGM can also repay the bond with cash or a combination of cash and Air France KLM shares. CMA CGM now holds 8.8% of Air France KLM's capital. It became a shareholder when it formed an air freight partnership in 2022. The cargo partnership was scrapped by the companies in early 2024, and CMA CGM’s share of that partnership expired in February. Ramon Fernandez, CMA CGM Chief Financial Officer, said that the company remains an Air France KLM shareholder, is confident in their?management team and believes there's upside potential for Air France KLM's stock price. He said: "CMA CGM has issued this exchangeable bond, which it sees as a cost efficient financing that allows the Group to diversify their funding sources." CMA CGM stated that the reimbursement via Air France-KLM's shares would represent a premium between?30% to 35% over December 9th's average share price. CMA CGM has invested in its own air cargo division, and expanded its footprint in land logistics via its CEVA subsidiary. CMA CGM, the Saade Family, who founded and control the Marseille-based Group, has also invested in other sectors, such as media, and major French companies like Carrefour.
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Lithuania declares a state of emergency in response to smugglers balloons from Belarus
The government of Lithuania announced that on Tuesday, a?state of emergency was declared due to the threat to public safety posed by smuggled s?balloons from Belarus. Lithuania accuses Belarus of allowing smugglers use weather balloons for contraband cigarettes to be transported across the border. This has repeatedly forced Vilnius Airport to stop operations and disrupt air traffic. Vladislav Kondratovic, Interior Minister at a live-streamed government meeting, said: "The state of Emergency is declared not only because of civil aviation disruptions, but also due to national security interests." Kondratovic said that the declaration gives increased operational freedom to military forces, allowing them to work in coordination with the police or act independently. He did not, however, provide any further details. It was not immediately clear how long the emergency measures would last. Belarus, which allowed the use of its territory for Russia's invasion of Ukraine in 2022, denied responsibility for balloons. It also accused Lithuania of provocation, including sending a drone that dropped "extremist materials". Lithuania, which is a member of NATO and the European Union but was once a part of the Soviet Union, rejected these accusations as false. Ursula von der Leyen, President of the European Commission, said that the situation on the border had "worsened" and called Belarus' balloon incursions "hybrid attacks" which were "completely inacceptable." Lithuania in The Belarus border region was placed under a state-of-emergency over what it called illegal migration to the Baltic nation. Non-residents were not allowed access. Next year Vilnius declared a state of emergency following Russia's invasion in Ukraine, out of fear that Lithuania would also be targeted. It imposed restrictions on freedom of speech to curb what they said was possible Russian propaganda. (Reporting and writing by Andrius Sytas; editing by Terje Solsvik).
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India orders IndiGo, the airline in crisis, to reduce flights by 5%
IndiGo has been ordered by India's aviation regulator to reduce its?planned flight schedules by 5%. The?airline had to cancel?atleast 2,000 flights due to poor roster planning last week. IndiGo was asked to submit a revised schedule on Wednesday by the Directorate General of Civil Aviation. IndiGo was told by the regulator to reduce?flights? on routes that are operated by rival airlines and to avoid those where it has a monopoly. The notice didn't specify a deadline for the mandatory cuts. IndiGo didn't immediately respond to a request for comment. IndiGo was approved to depart 15,014 times per week during the winter travel season in India. The airline has cancelled 951 of the 64 346 flights that were approved in November. IndiGo shares fell 0.22% to?4,912 on Tuesday. Since December 1, they have lost almost 17.1% of their value. The airline was criticized for failing to 'adequately plan for new rest periods and duty rules which came into effect 'on?November 1st, leaving planes on the ground. This affected the travel plans for tens of thousand of passengers. Reporting by Abhijith Ganahapavaram and Aleef Jahan, Editing by Tom Hogue & Thomas Derpinghaus
After farmers' protest, Heraklion Airport in Greece resumes flights
Aviation officials reported that flights to and from Heraklion Airport, on the Greek island of 'Crete, resumed early on Tuesday after protesters who had blocked the terminal, ended their protest.
Three flights were canceled and several others delayed on Monday after a group?of?farmers stormed the runway in Heraklion and threw rocks at police.
An anonymous Greek aviation official said that the airport reopened its operations on Tuesday at around 0800 GMT.
Farmers have blocked traffic with thousands of trucks and tractors in dozens blockades during a nationwide protest triggered by delays in funding.
After a corruption scandal, in which some farmers, assisted by state employees feigned land ownership, they are now facing a deficit of over?600 millions euros ($699million) from European Union aid as well as other?payments.
The audit process has slowed down subsequent payments. Reporting by Angeliki Koutantou, Renee Maltezou, and Alexander Smith
(source: Reuters)