Flybe warned Wednesday that H1 profit would be lower than expected, sending shares tumbling as higher maintenance costs compounded a tough airline market. Flybe said it would review its maintenance strategy with the aim of improving aircraft performance and costs. It would attempt to enhance the reliability of the Bombardier Q400 turboprop in particular. Shares fell as much as 18% after a warning which comes against a backdrop of intense competition in the sector that has kept prices low and put several larger companies out of business. Flybe said it now expected an H1 adjusted profit before tax in the range of GBP5-10m, down from 15.9m in H1 2016-17. “While half-year profits are lower than expected, I am confident that we are still on a clear sustainable path to profitability in line with our stated plan,” CEO Christine Ourmieres-Widener said. “The increased maintenance costs are disappointing, but we are already addressing these in the second half and remain focused on improving our cost base and reliability performance.”<br/>
unaligned
Norwegian Air Shuttle would like to cooperate with US JetBlue on bookings for long-haul passengers, CE Bjoern Kjos said Wednesday. “There are a couple of companies we think are very good and which we’d like to cooperate with. JetBlue is a really good firm that is highly relevant for us to look at,” Kjos said. The Oslo-based airline recently struck a similar deal with easyJet, allowing the British budget carrier’s customers to more easily connect to Norwegian’s long-haul flights to Asia and the United States. <br/>
Southwest is giving up a pair of coveted slots at Mexico City’s airport as the carrier shifts its growth focus elsewhere, including other leisure-friendly destinations in Mexico. Southwest won the rights to operate four additional flights in and out of Mexico City earlier this year after Delta Airlines and Aeromexico were forced to give them up as part of a joint venture between the carriers. The decision to relinquish the valuable rights comes at a time when Southwest is in the midst of an international growth-spree, launching service to 16 international destinations since 2014. That includes a heavy focus on popular tourist destinations, including Mexican beach towns, Jamaica and the Bahamas. Southwest was one of several carriers to gain new access this year at Mexico City International Airport, where the number of daily flights is limited due to space and capacity constraints.<br/>
Shareholders of Indonesian transportation firm PT Rimau Multi Putra Pratama Tbk have approved the company’s plans to raise 3.4t rupiah (US$251.57m) through a rights issue to buy PT Indonesia AirAsia. Rimau will sell 13.64b new shares and PT Fersindo Nusantara and AirAsia Investment Ltd - the current owner of Indonesia Airasia - are acting as standby buyers, Donny P. Pratono, commissioner of Rimau, said after a meeting with shareholders on Wednesday. Rimau will use 76% of the proceeds, or 2.6t rupiah, to buy Indonesia AirAsia’s perpetual securities that would eventually be converted into equity, he said. He also said the company would use the 24% for capital expenditure. “We see a good prospect in the airline business,” Pratono said. It is not clear when Rimau will sell the new shares, but Pratono said Indonesia AirAsia would effectively become Rimau’s unit by the end of November.<br/>
Embraer has confirmed it will deliver its first E190-E2 to Norwegian regional airline Widerøe, the type’s launch customer, in April 2018. The aircraft, which will be configured with 114 seats, will enter commercial service with Widerøe soon after the delivery. Widerøe has three E190-E2s on firm order and purchase rights for 12, valued at $873m if the deal is fully exercised. The first delivery date was confirmed by Embraer Commercial Aviation president & CEO John Slattery Wednesday. “Since the program was launched, the first half of 2018 has been our target, and now we are making good on this commitment,” Slattery said. He added the E2 program is “on time, on budget and better than the initial specification.” Embraer did, however, postpone the E175-E2 service entry to 2021 because of scope-clause uncertainty. Widerøe CEO Stein Nilsen said the airline has been working closely with Embraer to ensure a smooth entry into service. Over the coming months the familiarization will intensify, with immersion training for technical teams, ground handling, flight operations and cabin attendants.<br/>
JetBlue is coming to Minneapolis/St. Paul. JetBlue says the metro area had been the largest US market it did not serve. The Twin Cities also add a Midwestern dot to the airline’s route map, which is otherwise fairly spartan in the region. JetBlue’s Minneapolis/St. Paul flights begin on May 3, when it starts a schedule of three daily round-trip flights to its hub in Boston. The carrier will use Airbus A320 aircraft on the route. “As the largest airline in Boston we are answering calls from our customers who have long asked us to offer our great service and low fares on this important route,” said John Checketts, JetBlue’s VP network planning.<br/>
Thomas Cook is setting up a new airline in Spain, a move it hopes will lower costs at a time of tough conditions in the European short-haul market. The new airline will be based in Palma de Majorca and plans to start its first flights in early 2018 with at least three Airbus A320 planes, which were previously flying for the group's Belgian airline. The Majorca aircraft, which fly under a Spanish operating licence, will also be used for Thomas Cook's other airlines, according to seasonal demand, while some staff will be on seasonal contracts. "The new airline and base will provide us with the right platform to better manage the seasonal demand in our business, giving us more control at lower cost as we continue to expand the choice of destinations we offer our customers," said Christoph Debus, chief airline officer at Thomas Cook.<br/>