When the Covid-19 crisis hit the airline business this year, Lufthansa was planning to phase out the half-dozen aging MD-11 freighters that remain in its fleet by the end of 2020. Then cargo rates skyrocked. The virus destroyed demand for air travel, and as airlines grounded their fleets they also created a shortage of air-cargo space by removing much of the capacity being transported in the belly of passenger liners. Dedicated freighters like Lufthansa’s MD-11s, which had been giving way to belly freight, suddenly became big profit generators, helping airlines to offset some of the devastation from the loss of ticket sales. The German company, one of the biggest cargo operators among passenger carriers, began to consider slowing the MD-11s’ retirement, analysts at CAPA Centre for Aviation wrote in April. Like dozens of its peers, it also drafted passenger planes into temporary cargo duty. Lufthansa is now considering keeping some of its MD-11s in operation well into next year, according to spokeswoman Jacqueline Casini. One key will be whether air-freight prices remain high enough to justify keeping them in use. The airline is slated to receive its ninth and final Boeing 777 freighter for Frankfurt, a more-efficient, twin-engine aircraft, at the end of this month. It has four more 777Fs at its Aerologic joint venture in Leipzig. With visibility into demand extending no longer than eight weeks, no decision has been made and the MD-11s could still retire as planned, Casini said.<br/>
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India is proposing to drop a condition that the winning bidder for Air India will have to take on $3.3b of aircraft debt, people with knowledge of the matter said, as the government struggles to sell the loss-making carrier kept afloat by taxpayer-funded bailouts. PM Narendra Modi’s administration is being advised to drop the rule on concern it will deter buyers, the people said, asking not to be identified as the proposal isn’t public. A group of bureaucrats has vetted the plan, and under the new proposition, potential buyers will be allowed to bid on the enterprise value and not on the entity value, the people said. A renewed attempt to sell Air India, which hasn’t made money since 2007, has been hurt by the pandemic, forcing the government to keep extending a deadline to bid. The offer, announced in January, was sweetened to pass on only the debt related to plane purchases to the new owner. The airline had $8.4b in total debt at the end of March, 2019 and posted a loss of $1.2b that year -- its highest ever. Despite the losses, the airline has some lucrative assets which include prized slots at London’s choked Heathrow airport, a fleet of more than 100 planes and thousands of trained pilots and crew. The airline will have to shut down if it can’t find a buyer, Aviation Minister Hardeep Singh Puri told the parliament last year. The new proposal sweetens the deal.<br/>
THAI has asked its creditors to file their requests for debt repayments with the Department of Legal Execution after the Central Bankruptcy Court on Monday accepted its request for debt restructuring. THAI acting president Chansin Treenuchagron said creditors must submit their requests within a month of the order for the airline's rehabilitation being published in the Royal Gazette. "All the creditors except customers can file their requests with the Department of Legal Execution. We've put in place measures to take care of the customers, so they do not need to worry," he said. According to the airline, customers are allowed to keep unused tickets for use after its rehabilitation or with its subsidiary Thai Smile Airways which is still operating. They can also trade their tickets for travel vouchers that will be valid until Dec 31, 2021. The court's decision came after three rounds of hearings were held on Aug 17, 20 and 25. Chansin said the rehab plan is expected to be submitted to the court by the end of the year and the Department of Legal Execution will hold a meeting with the airline's creditors to examine the plan. He said the court is likely to rule on the plan and the appointment of administrators early next year but declined to give any details saying it must be approved by the court.<br/>
A Thailand court on Monday approved the restructuring of Thai Airways, which is billions of dollars in debt and struggling to survive the coronavirus tourism crash. The global aviation sector was plunged into crisis by the pandemic as countries severely restricted travel, forcing airlines to ground vast numbers of planes and seek government help as they haemorrhaged cash. The kingdom, once a majority shareholder in Thai, reduced its stake in May and went to the insolvency court to resolve the airline's debt -- which totalled 332.2b baht ($10.6b) by the end of June, according to local media. "The problem that caused debtor's financial situation is not from its business but from the rapid change in aviation, particularly the impact from Covid-19," Bangkok's Central Bankruptcy Court said Monday. It approved Thai's request for a rehabilitation plan, which would see its debt and company organisation restructured. Thai said after the ruling that it would propose that plan by the end of the year. Shares in the airline rallied more than 7% on Thailand's Stock Exchange Monday.<br/>
About 150 Japanese flight attendants at United based in Narita, Chiba Prefecture, are at risk of losing their jobs by Oct. 1 when the US carrier closes three of its international bases, their union has said. While the company said those affected can move to bases in the United States if they have a right to work in the country, some 700 flight attendants at Narita, Hong Kong and Germany's Frankfurt do not have such a right, according to the Association of Flight Attendants-CWA. Some 350 flight attendants are based at Narita and 180 of them are Japanese, said Tony Wetterer, head of the union's council in the city. Only about 30 have a US work permit. United informed the employees in June that the three bases would close on Oct. 1 and they would be let go by that date if they cannot provide documentation for a US work permit, according to the association. The Washington-based union, which represents nearly 50,000 flight attendants at 20 carriers, said earlier that it immediately went into negotiations with United, but the talks broke down when the management refused any solutions that did not involve companywide concessions.<br/>
Air NZ has announced that Monday afternoon’s rush to buy seats after the Covid rules were relaxed has resulted in a blockbuster afternoon of sales. The airline sold 110,000 seats compared to the usual 31,000 per day pre-Covid-19. The national carrier had put 180,000 tickets on sale, with 160,000 available for under $50. The government's decision to relax physical distancing rules on public transport has seen airlines promise to increase flights and release hundreds of thousands of cheap airfares to encourage domestic travel. As soon as the announcement was made that distancing would no longer be required on planes, Air NZ CEO Greg Foran says the airline immediately made more tickets available. In six hours, the airline sold 70,000 seats on Monday, he says. Foran said this is what happens when the airline has the opportunity to operate the domestic airline at full potential. During level one, the airline's prices increased by 13%. "When you can only sell basically half the seats you're pretty sub-optimised in your operation. When all of a sudden you can unmask 50 per cent of your inventory available for customers what happens is that creates a situation." Jetstar coming back into the market has played somewhat into the decision, he said. Jetstar announced it will resume domestic flights from Thursday, following a four-week suspension.<br/>
Retrenched Singapore Airlines staff who started receiving their pink slips from Monday (Sept 14) have been told that they will continue to receive their salary until Dec 15 this year. They will also retain their medical and other benefits until then. On top of this, each affected employee will be paid in lieu of the notice period in their employment contract. This can be up to three months' salary. Those who have been in service for two years or more will receive one month of pay for every year of service, capped at 25 months. The retrenchment exercise - which affects about 2,400 staff - is being conducted at the SIA Training Centre, near Changi Airport, for Singapore-based staff. A SIA spokesman said Monday that the airline has begun "the difficult and painful process of releasing some of our staff members from their service". He said: "We have worked closely with our unions to finalise the arrangements as soon as possible for those who are affected, and we will aim to minimise the stress and anxiety for our people. The terms of the release are in accordance with our collective agreements with our unions. SIA has also provided additional assistance, where possible and necessary."<br/>