Latest News
-
Italy's ITA Airways considers a lawsuit against Pratt & Whitney over engine defects
The CEO of ITA 'Airways' said on Sunday that the airline will decide in the next 'eight weeks' whether to sue RTX's Pratt & Whitney for engine problems which have grounded 20% of its 80 'aircraft'. Globally, hundreds of A320neo jets - the latest version?of Airbus' single-aisle aircraft - have been grounded. The 'long waiting times for engine inspections, repairs and maintenance and a manufacturing issue at Pratt & Whitney have all contributed to this. Joerg Eberhart said, "It is imminent" on the sidelines of a 'global gathering' of top airline executives at Rio de Janeiro. "We'll have to?decide within the next 6-8 weeks." RTX 'didn't immediately?respond to a?"request for comment. (Reporting by Allison Lampert in Rio de Janeiro, editing by Manuela Andreoni)
-
Fuel shock in Iran War slashes 2026 profit forecast for global airlines
On Sunday, the global airline industry almost halved their 2026 profit projection, citing conflict in the Middle East, which has?driven fuel prices up, disrupted important air corridors, and exposed?the 'fragility of an industry operating on thin margins. In its annual report, the International Air Transport Association (IATA), which represents over 370 airlines and accounts for about 85% global air traffic said that it expects to see a combined profit of $23 Billion in 2026. This is well below an earlier projection of $41 Billion, down from $45 Billion in 2025. Even though passenger demand is resilient, planes are flying fuller, and revenues will rise to over $1.1 trillion, the downgrade highlights airlines' vulnerability to geopolitical events and fuel volatility. Willie Walsh, IATA's Director General, said that the two main factors have led to a reduction in the forecast. "The first is the significant rise in jet fuel prices which has been higher than I thought anyone would have anticipated, and the second factor has been the disruption of the airlines in Gulf region," Walsh said at the annual meeting of the IATA group in Rio de Janeiro. Walsh predicted that some smaller airlines would go bankrupt this year or next due to higher fuel prices. Spirit Airlines, the U.S.'s low-cost airline, shut down in December. It was dubbed "the first airline victim of the Iran war". Walsh stated that airlines are expected to cut routes which are not profitable to protect their margins. Fares, however, are unlikely to drop soon since they have risen dramatically since the beginning of the Iran War. Walsh explained that fares would likely remain high in an environment where the demand is still strong, but the capacity has decreased. A FUEL COST SHOCKS OUT HIGHER REVENUES Airline reroutes flights to avoid restricted or closed airspace due to the Middle East conflict triggered by U.S. airstrikes against Iran. This adds hours?to some trips, increases fuel consumption and puts strain on already limited capacity. Oil prices are surging on the back of fears about supply disruptions. This has pushed jet fuel prices higher, and widened refinery margins. Airlines have seen a sharp increase in their largest cost. Gulf airlines like Emirates, Qatar Airways, and Etihad Airways are facing the most operational uncertainty following a near-complete closure of regional airspace? at the start of the conflict. Walsh said that most regions would remain profitable but at a lower level, whereas Middle East airlines will likely slip into the negative due to conflict and weaker demand. IATA expects the fuel bill for airlines to rise to $350 billion by this year, from about $252 billion last year. Fuel accounts for?nearly a third? of operating costs. This is reducing the profitability of airlines per passenger. Airlines are now expected to earn $4.50, or roughly half what they earned last year. IATA anticipates that industry revenues will rise 9.4% this year to $1.16 trillion, driven by a steady travel demand and higher fares. They also expect to see a growing income from extras like seat upgrades and onboard service. The sector is also being squeezed by aircraft shortages. Airline delays in Boeing and Airbus deliveries force airlines to use older, less fuel efficient planes for longer. This increases maintenance costs and stifles efforts to improve margins.
-
Etihad Airways purchases widebody aircraft, returns to pre-war capacity by June
In an interview, CEO Antonoaldo Neves stated that Etihad Airways will be ordering more widebody aircraft to meet its 8% increase in flights over the previous year by June 15. On Saturday, he said that Abu Dhabi's airline is purchasing widebody planes in the "double digits" but declined to provide any further details. Neves stated that Etihad has restored flights following the cuts made in March, as the U.S. and Israeli war against?Iran shifted regionally, increasing fuel prices. Etihad, he said, "doesn't plan to reduce?costs? by cutting flights for the time being." He said, "The largest cost we have is an empty plane." "So I cut costs by not having empty planes."
-
Ethiopia Airlines to make decision on regional jets in the next three weeks
Ethiopian Airways will likely decide in the next three months on an order of 25 smaller commercial 'jets' to expand its local network. This was announced by CEO Mesfin TasewBekele late Saturday night during a meeting of airline executives held in Brazil. Africa's largest airline, with 147 aircraft in its fleet, is considering the Airbus A220 and Embraer E-2, as well as the Boeing 737 -MAX 7 which will be certified this year by the U.S. faa. The planes will be used for both domestic routes as well as around neighbouring countries. Bekele stated that there are some issues but a decision would be made in a matter of a few months. Bekele didn't specify what the issues were. The A220 program is still in the red, and it faces stiff competition from Brazilian competitor Embraer. Ethiopian Airlines, like other carriers, has struggled with rising fuel prices because of the "war in Iran". It has also cut Middle East flights due to lower passenger demand. For example, it reduced frequency to Dubai, from three flights per day to two, he explained. The airline is spending 60% more per plane on jet fuel than it did in the past, despite resolving concerns about shortages. "We have resolved the supply problem." He added, "It is fine now" on the sidelines of?the International?Air Transport Association (IATA's) annual summit this weekend in Rio de Janeiro. "But the pricing issue is a very serious issue."
-
Boeing executive: China can get aftermarket support for its 200-jet aircraft order.
Boeing's top executive for services?said that Boeing can support China with aftermarket parts to back up a 200-planes order announced by the planemaker in response to a visit made by U.S. President Donald Trump to Beijing this year. Chris Raymond, Chief executive of Boeing Global Services said that China would have no problems obtaining parts for the deal, "if they are parts that we can sell globally." He also added that the planemaker had a warehouse in China. Kelly Ortberg, CEO of Boeing Global Services, said that China's 200-jet deal would be finalized later this year. It is only the "initial tranche" of what could become a much bigger deal. China's commerce ministry said the U.S. would have to give the country supply guarantees on?aircraft engines and components as part of the Boeing deal. Raymond stated that despite the war in Iran, there was still a demand for aircraft modifications in most regions. Raymond added that supply chain issues continue to be a problem for parts such as flight deck windows and engine components distributed by?Boeing. The executive said that his 'division' is looking to'slash costs by using analytics and not through layoffs. (Reporting by Allison Lampert in Rio de Janeiro)
-
Alaska Air: Demand and fares may support cash flow in the second half despite fuel price shock
Alaska Air Group hopes to reinstate its financial guidance during its second-quarter earnings conference call, if fuel prices stabilize, said Chief Financial Officer Shane Tackett on Saturday. Volatility in jet fuel costs had forced the carrier's?full year outlook. Alaska is unwilling to restore guidance until they have more confidence about the outlook. Tackett, speaking at the annual meeting of the International Air Transport Association in Rio de Janeiro, said: "We would like to see more stability." Tackett says that the carrier is expecting a more difficult second quarter than they had expected before the recent fuel shock. However, he said that higher fares and resilient customer demand should help to offset the majority of the impact in the second half. He predicted that operating cash burn would fall to zero or even turn positive in the second part of the year. Alaska recently borrowed $1 billion, divided between secured and unsecured debt. But?Tackett stated that the company did not plan to make another liquidity move, or reduce capital spending. He said that corporate bookings for the next 90-day period are up 20-30% from a similar time last year, across most industries and geographies. Tackett stated that Alaska also works with energy companies to obtain more jet fuel from Singapore for the West Coast, as refining margins are high in its core geographies. He stated that the airline has no plans to retire Hawaiian Airlines' Airbus A330s and A321s, and they expect to remain an Airbus operator for "a long time." (Reporting and editing by Manuela Andréoni in Rio de Janeiro)
-
Southwest Airlines sticks with Boeing after MAX 7 delays push service back to 2027
Southwest Airlines' Chief Operating Officer Andrew Watterson said on Saturday that the airline expects Boeing's long delayed 737 MAX 7 to enter revenue service by 2027. The company is also focused on adding more aircraft types in order to reduce risks, rather than focusing on another type of aircraft. Watterson responded that Southwest Airlines was not interested in Airbus's A220. Watterson stated in an interview at the International Air Transport Association annual meeting in Rio de Janeiro that diversification does not come from a second type of fleet. "A second fleet type can increase risk." It doesn't make any sense to ignore that," he said. The?MAX 7 still awaits certification by the U.S. Federal Aviation Administration. Watterson stated that Southwest will spend about six months on?internal projects after certification. This includes adding the aircraft to their operating specifications and manuals. He said that the clock begins when they certify it. Watterson stated that the MAX 7 delays had not forced Southwest Airlines to delay specific routes but limited its ability better match aircraft sizes with demand. He said the penalty is too many large aircraft and not enough small jets in markets or periods of lower demand. STARLINK ROLLOUT Southwest also?moves ahead with Starlink-powered Wi-Fi. However, Tony Roach said that the carrier hasn't ruled out Amazon’s Leo satellite -network. Southwest Airlines' chief customer and brand officer, Tony Roach, said the airline expects to be able to service an aircraft with Starlink by the end of this month. Executives said that the airline has set a goal of equipping 300 aircraft by the end of the year with Starlink. However, the speed depends on the ability of Starlink to supply the equipment. Watterson said, "Our 'tech ops' can retrofit as quickly as Starlink can supply," Watterson added. Watterson said that activist investor Elliott Investment Management was correct to say Southwest had been slow to change despite the fact that many changes were already underway. Elliott Investment Management was unambiguously?correct in that we were too late," he said. Watterson said that investors underestimated Southwest's customers' willingness and ability to pay for new services, and revenue per available seat-mile would be the "litmus" test for whether or not the changes were working. (Reporting by Rajesh Kumar Singh in Rio de Janeiro)
-
Breeze Airways, a US low-cost carrier, sets its sights on the 2027 IPO
?U.S. Breeze Airways, a low-cost domestic carrier, is planning an initial public offering in 2027. Its Chief Executive David Neeleman announced this on Saturday. He said that the carrier had considered an IPO earlier but decided to delay it due to the market 'conditions'. This was revealed during an interview on the eve of the annual summit of the International Air -Transport Association (IATA) in Rio de Janeiro. He said that "to have an IPO the market must cooperate and the industry must cooperate." Neeleman added that the low-cost carrier has steadily built up its financial stability since it launched in '2021. The company does not have to raise capital now and can wait for the right equity market environment before launching publicly. Breeze was founded by Neeleman who, as the founder of JetBlue and Azul before, aimed to connect underserved American cities via a?affordable point-to-point flight service.
Copa Airlines maintains its no-hedge policy as fuel shock tests airlines
Copa Airlines does not plan to hedge fuel despite recent price spikes linked to the war with 'Iran. CEO Pedro Heilbron said that the airline is confident its strong 'balance sheet' and pricing adjustments can absorb the shock. He said that the Panamanian airline hasn't hedged fuel for over a decade, and doesn't intend to change its course.
Heilbron explained, "We are just covering the costs." "Yields were adjusted, but not 100%. "It's only a partial effect." The global airline industry has raised fares to compensate for higher fuel costs, but the increases have been constrained by demand and competition. The executive stated that the industry is relying on fuel prices to gradually ease.
Heilbron said Copa's conservative balance sheet and strong liquidity provide flexibility to weather volatility. He said that this gave Copa?room to maneuver, and also to be resilient.
The demand in Latin America is still strong, Heilbron reported, thanks to the stronger currencies on key markets like Brazil.
Copa, a hub-model airline that operates from Panama and flies Boeing 737s, continues to grow along with the planemaker's deliveries. The airline recently agreed to purchase up to 60 737 MAX aircraft, which will allow for both fleet renewal and expansion.
"There is a high demand for new aircraft from both Boeing and Airbus. If you don't place your order early enough then you will be left without delivery. This 'new order' is for 2030-2034", he explained.
The order includes flexibility for MAX variants as well as options for the MAX 10 which is yet to be certified. Copa is reviewing its fleet mix and hasn't made a final decision yet.
Boeing's CEO stated that the company has been delivering on schedule or slightly earlier than expected. Gabriel Araujo in Rio de Janeiro and Luciana Magnalhaes, editor Manuela Andreoni.
(source: Reuters)