Virgin America, caught up in a Dallas fare war, said it will fly out of the city with empty seats rather than sell tickets at rates so deeply discounted it can’t make money. The pricing battle began in 2014 when Southwest Airlines and Virgin added flights after restrictions at Dallas Love Field were lifted and ultra-discounter Spirit Airlines increased service from nearby Dallas-Fort Worth International, American Airlines’ biggest hub. Carriers trimmed fares to fill seats that flooded the market. While that’s no longer the case, the “very toxic fare environment” has continued, said Virgin America CE David Cush. “We are not going to fly passengers at rates that will not make money,” he said Thursday. “We are going to make sure we get an average ticket value up to where its sustainable and we can earn a return, and we’ll take the hit on load factor.” <br/>
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Virgin America posted a jump in its earnings on a sharp drop in fuel costs, the latest airline to benefit from low oil prices. Virgin America said fuel costs fell 33% in the latest quarter, while unit revenue declined 5.1%. Capacity expanded during the quarter by 10% compared with the same period last year. During the quarter, Virgin—which launched service last year from its base in San Francisco to Honolulu and Maui—said it planned to expand that service to those airports from Los Angeles this spring. The quarter's profit included a noncash gain of US$173.5m related to an income tax allowance. The company posted a profit of $190.9m, up from $3.9m a year earlier. Revenue climbed 5.2% to $391.5m. <br/>
Norwegian Air will start direct flights between Paris and the US this summer but must postpone new service from Cork, as US regulators mull whether to approve those flights. The Paris flights underscore the ambitions of the carrier to expand its long-haul business to the US. "The most interesting cities for (US) tourists to go to are London, Paris, Barcelona and Rome. That's where we see large leisure growth in the future," CE Bjorn Kjos said, noting Norwegian will more than double the number of Boeing 787s it flies in the next 2 years. "We have opened a new base in Rome now. Obviously there is a reason why we open new bases," he added. A more than 2-year review by the US DoT of a request by Norwegian's Irish subsidiary to fly from the US is putting some growth plans on hold, however. <br/>
Norwegian Air Shuttle will consider spinning off its aircraft leasing unit, as new jets arrive from Airbus and Boeing , the airline said Thursday. The carrier has orders for 100 Airbus A320neo and 100 Boeing 737 Max aircraft. It plans to lease out some or all the Airbus planes. The airline already has agreed to rent 12 of the Airbus planes to HK Express and plans to add older Boeing 737 jets to the leasing arm's portfolio when they are retired from the Norwegian fleet. Depending upon growth demands, the company may fly some of the A320neos itself from 2018 until more 737 Max jets arrive. Norwegian also operates Boeing 787 Dreamliners and plans to expand its international flying by 40% this year compared with 2015. <br/>
Flydubai's CE expects another difficult year for the carrier as tough economic conditions put pressure on yields. The airline this month reported a 60% drop in 2015 net profit to AED100.7m, blaming a stronger US dollar and tough market conditions. These factors pressured its overall yield and this is expected to continue in 2016. "This is going to be a difficult year because of the overall economic outlook - there might be challenges with yield," said Ghaith al-Ghaith Thursday. The UAE dirham is pegged to the US dollar, which has been trading recently at multi-year highs against a number of currencies, this strengthening makes tickets booked in other currencies comparatively more expensive. Ghaith said the carrier was trying to boost traffic from its Dubai hub to CIS countries, even if there was less inbound traffic from those countries. <br/>
Meridiana is asking unions to agree to 900 job cuts - nearly half its workforce - as part of a planned partnership with Qatar Airways. Meridiana, owned by the Aga Khan, is under a govt-sponsored restructuring plan. The holding company behind Meridiana plans to complete a deal with Qatar Airways in the first half of 2016 after signing a MOU earlier this month. Qatar Airways will invest fresh money into a new company that will manage the airline, in which it will hold a 49% stake, Meridiana chairman Marco Rigotti said. The Aga Khan's fund will own the remaining 51%, Rigotti said, adding he hoped to strike a deal with unions by March over cuts to Meridiana's current 2,000-strong workforce. Industry minister Federica Guidi described a deal with Qatar as "the only option to relaunch and strengthen Meridiana", the ministry said. <br/>
Russian aviation authorities have granted charter carrier Azur Air designations for its first international scheduled services. The airline is now able to operate up to 3X-weekly Krasnodar-Barcelona and Rostov on Don-Barcelona flights and weekly Moscow-Bangkok service. Azur Air plans to launch the scheduled flights in IATA 2016 summer season using all possible frequencies, the carrier said. It will fly a Boeing 767 on the Moscow-Bangkok route and the 757 on routes to Spain. “Launch of scheduled flights is a new step of company development. We understand that scheduled [service] is becoming crucial for package tours. The carrier is also trying to follow another travel market trend—the travellers’ needs to organise the trips themselves,” Azur Air DG Mikhail Kritsky said. <br/>
Juneyao Airlines has applied to the Civil Aviation Administration of China to open long-haul intercontinental routes to further explore the fast-growing outbound travel market. Currently, the carrier may operate only domestic and international routes to neighbouring countries, such as Japan, Korea and Thailand. Chairman Wang Junjin said several months earlier that it was considering opening long-haul intercontinental routes for the long term, but the specific timetable depends on its Shanghai hub strategy, market demand and resource allocation. A company insider revealed Juneyao is planning to buy long-haul aircraft and is evaluating Airbus A350 and Boeing787 aircraft. It plans to make a decision in 2017 or 2018. Juneyao operates 50 A320s. <br/>
VietJet Air said Thursday it had signed a US$3.04b deal with Pratt & Whitney, underscoring the growth potential of Southeast Asia's low-cost airline market. The engines will power the 63 Airbus A320neo and A321neo aircraft ordered by the carrier, VietJet said. Industry players have said that Southeast Asia, including Vietnam, is a key growth market for budget air travel, driven by the region's growing middle class. VietJet says it currently has a fleet of 34 aircraft, including A320s and A321s, and operates 200 flights each day. Boeing is forecasting that Southeast Asia needs 3,750 new airplanes in the next 20 years, with more than three-quarters of the deliveries being single-aisle airplanes favoured by budget carriers. <br/>