Governments have provided airlines $123b to help weather the coronavirus storm, the global aviation industry said Tuesday, warning though that the assistance was adding to surging debt in the industry. The IATA warned that the sector's debt was expected to rise to $550b by the end of the year -- an increase of 28%. While governments have in many cases come to the rescue of their countries' embattled airlines, IATA pointed out that $67b of the $123b committed so far would have to be repaid. The remainder of the state aid consists of wage subsidies ($34.8b), equity financing ($11.5b), and tax relief/subsidies ($9.7b). "Government aid is helping to keep the industry afloat. The next challenge will be preventing airlines from sinking under the burden of debt that the aid is creating," said IATA CE Alexandre de Juniac. IATA highlighted regional disparities, saying that airlines in North America had been promised aid worth 25% of their 2019 revenues; in Europe, the figure was 15% and in the Asia-Pacific region, 10%. However, in Africa and the Middle East, that was 1.1% and in South America, just 0.8%. IATA pointed to bankruptcies in Australia, Britain, Italy, Thailand and Turkey where governments had not stepped in strongly enough.<br/>
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As the coronavirus pandemic transforms passenger aviation, the cheap-seats shuffle is no more. Traditionally, some economy-class passengers on flights that are not full will move from their assigned seats before or shortly after take-off. But anyone hoping to take advantage of extra space is likely to be scolded by cabin crew and told to go back to their assigned place. Passengers remaining in their allocated seats is one of the measures the IATA says will be necessary when aviation restarts at scale. IATA’s member airlines are desperate to attract new business. The restart will depend upon passenger confidence. Airlines and airports are deploying measures from airport temperature checks to mandatory face coverings on board in a bid to reduce risk and reassure travellers. But since some passengers may, knowingly or not, take flights while infectious, Iata is also recommending a track-and-trace system whereby nearby travellers can be reached after the journey and told to self-isolate. Nick Careen, IATA’s senior VP for airport, passenger, cargo and security, said: “Once you are in your seat, you can’t change any more.” By ensuring the airline’s seating records tally with passenger behaviour, contact tracing will be much more effective. Prior to the coronavirus pandemic some airlines sought to dampen self-service seat selection on board, in order not to disrupt complex “weight and balance” calculations. But many were lax, so long as passengers did not attempt to “self-upgrade”.<br/>
Europe’s aviation safety agency called on airlines and airports Tuesday to participate in a program to help evaluate new coronavirus guidelines in real-life situations. The European Union Aviation Safety Agency published the guidelines last week in conjunction with the European Center for Disease Prevention and Control with the goal of allowing air travel to resume under safe conditions, both operationally and from a public health point of view. The aviation agency said the evaluation program will focus on airlines that are fully applying the guidelines and flying to airports that are as well to get the best picture of how the recommendations are working and where improvement is needed. “The airports and airlines participating in this program will be pioneers at the forefront of the return to normal operations after this unprecedented crisis for commercial aviation,” EASA Executive Director Patrick Ky said. “The feedback they provide to us will be instrumental in ensuring that we genuinely achieve the health safety aims of these guidelines and will help the entire sector to resume operations in a way that makes passengers and staff feel safe and secure.”<br/>
China's finance ministry said on Tuesday that it would subsidise Chinese and foreign airlines for cargo flights to and from the country in an effort to support the cargo industry and stabilise the global supply chains. The cash support will be back-dated to cover any flights from April 1 and will be continued until June 30, said the finance ministry on its website. For cargo aircraft converted from passenger planes, 80% of conversion costs will be subsidised, the ministry said, adding that the cargo flights would be awarded based on flight miles.<br/>
House Democrats want Treasury Secretary Steven Mnuchin to explain why airlines are getting away with cutting workers’ hours after they received portions of $25b in government coronavirus relief funds aimed at maintaining worker payroll. The lawmakers also want Mnuchin to explain whether he told the airlines they were permitted to cut the hours. Airlines, including Delta, JetBlue and United, have announced or already cut the schedules of their hourly workers to reduce costs after air travel demand fell to the lowest in decades. That’s despite having accepted government aid as part of the CARES Act, on the condition they withhold from laying off or cutting worker pay rates through Sept. 30. “United, Delta, and JetBlue airlines have all unilaterally cut workers hours – in some cases significantly decreasing these employees’ pay and benefits,” Reps. Jan Schakowsky and Jesus Garcia of Illinois, and Katie Porter of California, wrote in a letter to Treasury that they plan on delivering later Tuesday. “The creative position held by these airlines is that an hours cut is somehow unrelated to compensation, which is protected under the CARES Act. The hour cuts imposed by these carriers have made some workers eligible for unemployment assistance – a circumstance the legislation was explicitly designed to prevent. These carriers are very clearly out of compliance with the letter and spirit of the law.” The House lawmakers in their letter Tuesday pushed Mnuchin to release guidelines clarifying that reducing hours would be in violation of the CARES Act. <br/>
Air travel over the Memorial Day holiday weekend returned to levels not seen since plummeting in March when stay-home orders took effect across most of the US. More than 318,000 people passed through US airport security checkpoints on Thursday followed by 348,673 on Friday, topping 300,000 for the first time since March 23, according to figures from the US TSA. More than 8,500 flights took off on Thursday and on Friday, the most of any single day since April 13, as airlines added service, according to data from FlightAware. The volumes are still a fraction of prior-year levels, underscoring the depth of the pain inflicted on the travel industry by the Covid-19 pandemic and measures imposed to slow it down. The number of people who passed through airport security checkpoints on Friday represented just 12% of passenger volumes on the Friday before Memorial Day last year. Ahead of the three-day weekend, some airlines had been reporting early positive signs with bookings beginning to out-pace cancellations and some growth in leisure travel. Southwest added 119 flights during the holiday weekend, in part to limit the number of passengers on each plane to allow for social distancing.<br/>
Boeing is expected to announce US job cuts this week after disclosing last month it planned to shed 10% of its worldwide workforce of 160,000 employees, people briefed on the plans and a union said. A spokesman for the Society of Professional Engineering Employees in Aerospace (SPEEA) union that represents 17,600 Boeing employees told Reuters Tuesday the company informed the union it should expect layoff notices on Friday. Boeing declined to comment. In April, Boeing CE Dave Calhoun said the company had “begun taking action to lower our number of employees by roughly 10% through a combination of voluntary layoffs, natural turnover and involuntary layoffs as necessary.” Calhoun said in April Boeing will need to make “even deeper reductions in areas that are most exposed to the condition of our commercial customers — more than 15% across our commercial airplanes and services businesses, as well as our corporate functions.” SPEEA said about 1,300 of its members applied to take voluntary layoffs. <br/>
Boeing and Airbus are researching the new coronavirus’s behavior inside jetliners, part of an industry push to curb risks that have brought air traffic to a near standstill. Their work will involve academics, engineers and medical experts expected to examine new measures to prevent disease transmission on airplanes, according to the companies and people involved in their discussions. The effort to better understand air-travel risks during the pandemic comes as airlines try to reassure nervous passengers that masks and filtered cabin air provide reliable protection from infection in flight. Boeing said it is developing computer models that simulate the cabin environment and could ultimately inform decisions by airlines, health officials and regulators on how to prevent the virus’s spread. “We’re taking steps to better understand any potential risks,” a spokesman said. Airbus said the plane maker is exchanging information with universities in the US and other countries. Airbus engineers are also exploring other methods of reducing the spread of the virus including self-cleaning materials, a disinfectant that can last for five days and touchless devices in lavatories, the company said. The FAA has been in touch with Boeing, Airbus and experts at the CDC to assess coronavirus risks for fliers and how to mitigate them, people familiar with those discussions said. The CDC said its experts participated in a call with the FAA and Boeing about recommendations concerning Covid-19 and travel. Story has more.<br/>
Aircraft leasing giant AerCap Holdings on Tuesday pushed back deliveries of 37 aircraft to 2023 and beyond as it looks to boost liquidity and lower capital spending. The world’s largest aircraft leasing company, which had previously forecast the deliveries to be between 2021 and 2022, said the rescheduling would help reduce its cash capital expenditures in 2020 and 2021 by a total of about $4.7b. “We expect our cash capital expenditures during these years to decrease further as we continue our discussions with the aircraft manufacturers and our customers. All of the aircraft delivering in 2020 and 2021 have already been placed on long-term leases,” the company said.<br/>