star

Avianca CE Hernan Rincon said Tuesday he expects the Colombian airline to become one of only two major international carriers connecting the Latin American region with global destinations. Rincon said that the airline is working to boost its presence in Argentina and Mexico, where parent company Synergy Holding is negotiating a 49% stake in Aeromar Airlines. Synergy purchased Argentine carrier Macair Jet in 2016. "There will continue to be some smaller regional airlines of course, but airlines that have the capacity to serve all of Latin America … We believe that there will be only two," Rincon said, adding that he expects Chile's Latam Airlines to be the other. "We’re building for that," he said. Synergy rather than Avianca itself is spearheading the effort, but the Bogota-based airline it controls will be at the center of future deals from an operations and strategic perspective, Rincon said. Avianca, which is also studying a potential merger with its sister airline in Brazil, flies to Argentina and Mexico but its footprint is limited. Avianca also has a limited presence in Chile, which Rincon said is unlikely to change in the near future. Another major step in the company's expansion plans is an agreement with United Continental that Rincon said would help Avianca expand beyond the 20 US destinations it expects to serve directly within the next two years. That deal is still being negotiated and faces a legal challenge from Avianca's No. 2 shareholder, Kingsland Holdings Ltd, which alleges the proposed agreement would benefit Synergy's principal, German Eframovich, at the expense of other shareholders.<br/>

Air NZ cautiously flagged an earnings improvement in the current year as it posted a 21% drop in core annual profit on Wednesday, citing fierce competition. The carrier "faced an unprecedented increase in the level of competition from some of the world's largest airlines," CE Christopher Luxon said. Even so, strong inbound tourism helped Air NZ post its second-highest ever profit of NZ$527m (US$383m) in the year ended June 30, down from last year's record NZ$663m but in line with market expectations. "Looking forward to the year ahead, the airline is optimistic about the overall market dynamics," New Zealand's biggest airline said in a statement to the New Zealand Stock Exchange. The airline said it planned to spend about NZ$1.5b on aircraft and associated assets over the next four years as it battles rivals like Qatar Airways and American Airlines. Air NZ has six aircraft due for delivery this financial year and another 16 in the next financial year. The anticipated improvement in earnings this year was contingent on an average jet fuel price of $60 a barrel - the average over the past two months - which would equate to a full-year fuel cost of NZ$880m.<br/>

Air NZ will be giving 8500 members of staff a NZ$1700 bonus after the company reported its second highest earnings in company history. The airline's full year earnings fell 21% in an increasingly competitive market, but were still the second highest ever as the airline continues to benefit from lower jet fuel prices and the country's ongoing tourism boom. "This year Air New Zealand faced an unprecedented increase in the level of competition from some of the world's largest airlines and effectively rose to the challenge," said CE Christopher Luxon. The bonus awarded by the board will go to Air New Zealand staff who do not have other incentive programmes as part of their employment agreement.<br/>