Lufthansa halted capacity expansion at its Eurowings low-cost arm after the group’s Q1 margins were squeezed by rising fuel bills and overcapacity that’s sparked a Europe-wide fare war. Europe’s biggest airline is abandoning plans to increase capacity at Eurowings by 2% this year. Earlier this month, Lufthansa issued a profit warning that attributed a plunge in earnings before interest and tax on fuel prices, cheap airline tickets and tough comparisons with year-earlier figures. The decision to dial back growth at Eurowings comes after the German carrier in March said it would slow group capacity increases to 1.9% this summer from the 3.8% previously planned in an effort to bolster prices. Revenues for airlines across Europe have been crimped by a capacity glut and fuel-price squeeze that’s forced eight airlines out of business since the summer. “We are confident, though, that we will see a recovery in our unit revenues as early as the second quarter,” Lufthansa CFO Ulrik Svensson said. “Our confidence is based above all on our favorable booking levels for the months ahead.”<br/>
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Brazil’s largest airline Gol Linhas Aereas Inteligentes on Tuesday cut its earnings projections for 2019 and 2020 after posting a net loss of 32.3m reais ($8.20m) in Q1. Gol had previously told investors that the next two years would be a turnaround for the business, with high net income margins, after posting significant losses in recent quarters. <br/>
Southwest, the biggest user of Boeing's 737 MAX jets that were grounded worldwide following two fatal crashes, dropped two places from the top in terms of passenger satisfaction in 2019, a survey by the American Customer Satisfaction Index (ACSI) showed. Southwest was ranked third this year out of 10 airlines, behind Alaska Air Group Inc and JetBlue Airways that climbed one place each to claim the first and the second spot. "Recent deadly crashes of the Boeing 737 Max (for Ethiopian Airlines and Air Lion) have left Southwest particularly vulnerable to safety concerns," ACSI said in a report. Passenger satisfaction for all airlines on average in 2019 was up 1.4% to 74 points, with Alaska scoring 80 points on a scale of 0 to 100, and JetBlue and Southwest got 79 each. American Airlines Group, which has the second-biggest fleet of the grounded MAX jets in the United States, lost 1 point to score 73, but maintained its fifth rank in the chart. American has grounded its 24 737 MAX jetliners until Aug. 19, leading to about 115 daily cancellations during the peak summer travel season. Southwest lost more than $200m in revenue during Q1 and has taken its 34 MAX aircraft out of the company's flying schedule through Aug. 5.<br/>
Saudi Arabian airline Flynas is considering upgrading part of its existing order for 80 Airbus A320neo jets to the larger A321 model, its CE said Tuesday. The airline, part owned by Saudi billionaire Prince Alwaleed Bin Talal’s firm Kingdom Holding, ordered the A320neos worth $8.6b in 2017. “We (have) started evaluating and are in discussion with Airbus,” Bander Abdulrahman al-Mohanna said. The larger versions of Airbus’ new model narrow-body jet would mainly be used for flights to the Sub-continent and North Africa, he added. Mohanna did not say how many A321neos it could take as part of a potential order upgrade or when a decision could be made. The airline, which this year expects 10% growth on the 6.6m passengers it carried in 2018, has also been considering an order for wide-body jets. Flynas is weighing up Airbus’ A330neo and Boeing’s 787-8 jets, which would be used to carry Muslim pilgrims to Saudi Arabia, home to the two holiest sites in Islam. “Unless we receive the offer that we are expecting we will not conclude any deal,” Mohanna said. <br/>
Budget airline Air Arabia is likely to order 100 or more Airbus or Boeing jets within the next three to four months, its CE said Tuesday. The United Arab Emirates’ only listed carrier has long been looking to update and expand its fleet of 54 Airbus A320 jets. “We need to put an order in. That is overdue,” Adel Ali said. The airline will hold talks with both planemakers this week, he said. The talks come against the backdrop one of the biggest crises in Boeing’s 103-year history after two of its 737 MAX jets were in fatal crashes. Air Arabia, which has only operated Airbus jets, could switch to Boeing aircraft, Ali said. “Whoever comes up with a better option we will go for,” he said. The order would replace aircraft at Air Arabia’s main base in Sharjah, UAE, and hubs in Egypt and Morocco. Air Arabia is also considering ordering smaller, regional jets for domestic flights in Egypt and Morocco, Ali said. <br/>
Wizz Air’s CE is confident his low-cost carrier can grow in Britain and tackle the challenges presented by Britain’s decision to leave the EU. Jozsef Varadi told Reuters on Tuesday that Wizz still had work to do to meet EU rules after Brexit but said it was time for Britain to “just get it done and move beyond Brexit” as the deadline for the country’s departure has been pushed back. “We remain very bullish, and very committed to the UK market. Even if I look at the current performance, it is pretty solid,” Varadi said in an interview, adding that he found the furor around Brexit “tiring”. “I don’t really care how Brexit plays out, to be honest. I think I would like to see the end of it, whatever it is.” Budapest-based Wizz Air, which is focused on central and eastern Europe, said this month its net profit for the year would be in the upper half of its guidance. That contrasts with bigger rivals, such as easyJet, which have been cautious about how Brexit will affect demand. Varadi said Wizz had grown 30% in London since the Brexit vote and that demand was still robust.<br/>
Southern Airways, parent of Mississippi-based commuter Southern Airways Express and Hawaii-based commuter Mokulele Airlines, has announced a strategic minority investment by SkyWest, parent of Utah-based regional SkyWest. Southern chairman and CEO Stan Little called the investment a “win-win solution” for both companies. Many of Southern’s 200 pilots aspire to advance their careers at regional and mainline carriers, according to the company. Southern views the investment by SkyWest—the largest regional carrier in the world by fleet size, passengers served and total destinations—as a means to enhance its recruiting capabilities by offering a career pathway that would see recruits graduate from flight school through its cadet program and ultimately on to careers at SkyWest. SkyWest CCO Wade Steel said, “Putting a pilot pathway program in place with Southern enhances our pipeline of future Part 121 professional aviators.”<br/>
Sun Country Airlines says lightning apparently struck its charter aircraft that was carrying Greater Peoria Honor Flight veterans from Illinois to Washington, D.C. The airline said flight 8657 "landed safely and without incident" at Ronald Reagan Washington National Airport on Tuesday morning. Sun Country said in a statement that "after landing, maintenance observed evidence of a lightning strike." Technicians are inspecting the aircraft and a separate plane was to be sent to Washington to bring the Honor Flight participants back to Peoria on Tuesday evening. <br/>