Lufthansa is banking on Airbus' latest A350 wide-body jet to shore up its Munich hub, where the deployment of less efficient planes means normally lucrative long-haul flights are losing money. The first 15 of 25 A350s ordered by Lufthansa are to be based in Munich, with the composite-fuselage, twin-engine model providing a 25% fuel saving compared with the 4-turbine Airbus A340s currently used there. “The new A350 fleet is a big step toward profitability’’ for those routes lagging behind, Wilken Bormann, who heads Lufthansa’s operations in Munich, said. Two A350s are now flying from the secondary hub, with the third delivered Saturday, and the number is set to reach 6 this year and 12 by the end of 2018, he said. Lufthansa is focusing on Munich after turning all inter-continental routes from its main Frankfurt base profitable last year. <br/>
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Air China has posted a net income of CNY6.8b (US$978m) in 2016, up 0.4% over a net profit of CNY6.8b in 2015, according to the domestic accounting standard. Operating revenue for the year grew 4.6% to CNY114b, while operating expenses increased 4.2% to CNY87.2b. The carrier cited strong international and domestic market demand, as well as challenges including a sluggish cargo market demand, erupting geopolitical events, intensifying industrial competition and constantly appreciating US dollars as main reasons for the performance. Passenger capacity jumped 8.6% to 233.2b ASKs against an increase of 9.6% in passenger revenue to 188.2b RPKs. Passenger boardings rose 7.6% to 96.6m with an average load factor of 80.7%, up 0.75 point over 2015. <br/>
Avianca says its shareholders have approved the airline to launch an investigation into the airline’s minority shareholder Roberto Kriete for a potential conflict of interest, opening the door for a second lawsuit by the carrier against Kriete. The move, adopted during a March 31 shareholders meeting, is the latest development in an ongoing legal dispute between Kriete and Avianca majority shareholder Synergy. Synergy introduced the measure in the meeting, says the airline. Kriete's Kingsland Holdings filed a lawsuit against Synergy, Avianca and United Airlines in late February, seeking to stop partnership talks between the two airlines. Kingsland owns a 14.5% stake in Avianca, and says Synergy chose United as a partner for Avianca because the deal would personally benefit Synergy’s owner German Efromovich. <br/>
Neither of Norway’s two main airlines have committed to basing themselves at a new airport for which the govt announced major financial backing last week. The govt last week secured a parliamentary majority for the allocation of NOK1.5b (US$175m) for the construction of a new airport in Rana. Along with NOK600m from Rana Municipality and local businesses, developer Polarsirklen lufthavnutvikling (Polar Circle Airport Development, PLU) hopes to have the airport operational by 2024. But Scandinavian Airlines said that as things stand, the new airport would be “of no benefit to us”. An SAS spokesman said that “with such a thin volume of traffic, we feel that this development is not right to prioritise.” <br/>