IAG is cutting its medium-term capacity growth targets, slashing the figure to 3.4% per year for 2020-22 from its previous level of 6% for 2019-23. Capacity growth in 2020 will be around 3.2%, says the company, discounting effects from the British Airways strike in September this year. This moderation of expansion will be reflected in lower average earnings per share growth of 10% for the 3-year period rather than the 12% originally expected. Despite the revisions the company is maintaining its aim of a 12-15% operating profit margin for the period. IAG plans gross capital expenditure of E4.7b (US$5.2b) per year against a net capital expenditure of E2.6b under the previous outlook. This reflects a switch from net to gross capital expenditure in its forecasts. <br/>
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IAG CE Willie Walsh believes there is greater reluctance among investors to save collapsing airlines, and insists that a tough attitude towards weak carriers is necessary. The company presented data suggesting that new European short-haul airlines which started up between 2000 and 2016 lasted an average of only 6 years. It also put the failure rate at around 70%. Walsh said that there was increasing resistance from financiers to offer rescue. "The best form of consolidation is when the weak disappear – and we're seeing that," he says. "In the past, where weak airlines were able to convince somebody to acquire them – we're not seeing that anymore." Walsh says that IAG is prepared to investigate opportunities to acquire carriers with prospects. <br/>
British Airways will turn next year to replacing its large fleet of older-generation Boeing 777s, but indicates it will retain some of the aircraft until at least 2030. The carrier has 46 in the fleet – comprising 3 777-200s and 43 777-200ERs. It will phase out the 3 -200s in 2020 by replacing them with 3 777-300ERs under an operating lease agreement disclosed last year. IAG CFO Steve Gunning said BA was maintaining its aim to phase out the last Boeing 747-400 in Feb 2024. Iberia would follow with the withdrawal of its last Airbus A340-600 in 2025. The type is being succeeded by A350-900s, of which Iberia has ordered 20. Gunning says the remaining 43 777-200ERs make up the "last big core fleet" that is due to undergo replacement. <br/>
Qantas Airways Monday pledged to slash its carbon emissions to net zero by 2050, joining IAG as the industry's response to climate change activists gathers momentum. "We're doing this because it's the responsible thing to do," Qantas' CE Alan Joyce said, calling climate change concerns "real". IAG last month became the first major airline group to make the net zero by 2050 commitment, leading the way amid intense pressure from climate change activists such as Extinction Rebellion and teenager Greta Thunberg. Qantas said it was looking to cap net emissions at 2020 levels and will invest US$34.29m over 10 years to develop sustainable fuel to help lower carbon emissions by 80% compared with traditional jet fuel. <br/>
American Airlines has taken the grounded Boeing 737 Max out of its schedule until March 5, 2020. The announcement comes following Southwest Airlines' statement earlier in the day that it too would delay scheduling the aircraft until early March. American had previously said that it expected the aircraft to return to service in January. It now anticipates cancelling "approximately 140 flights" per day through March 4. The new March date is also just days short of the anniversary of the second of 2 737 Max crashes which left the aircraft type grounded worldwide. American adds that once the aircraft is cleared to fly again, it expects to slowly introduce it back into the schedule. “Since American will gradually phase the MAX into our operation over the course of a month, additional refinements to our schedule may occur,” the airline said. <br/>
SriLankan Airlines is looking to expand its network to parts of Asia-Pacific and Europe, as it makes progress on reducing financial losses under its turnaround plan. The carrier says it will start flying to Sydney in 2020, along with Ho Chi Minh City, while growing its presence in India with a service to Ahmedabad. Plans to resume European points such as Frankfurt and Paris "continue to be under consideration." Having appointed a new board and management team in 2018, the carrier rolled out multiple initiatives to rein in cost. Such measures saw operating losses shrink "by more than 50%" to US$19m for the 6-month period to Sept 30, versus an operating loss of $39m last year. Net loss came in at $76m, an improvement of $10m from last year's $86m figure. <br/>