The US Transportation Department said Tuesday it had launched a $3 billion aviation manufacturing payroll subsidy program that will cover up to half of eligible companies' compensation costs for as long as six months. The program, funded by Congress, requires companies to commit to not conducting furloughs without employee consent or laying off employees covered by subsidies during the six-month period. Applications must be filed by July 13. Companies eligible include aircraft, engine, propeller or component manufacturers and companies that repair or overhaul airplanes and parts. The subsidy program cannot cover more than 25% of an employer’s total U.S. workforce as of April 2020 and can only cover employees with total annual compensation of $200,000 or less. To qualify, a company must have involuntarily furloughed or laid off at least 10% of its total workforce, or have experienced at least a 15% decline in 2020 total operating revenues.<br/>
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The United States and Europe on Tuesday agreed to put aside a 17-year dispute over aircraft subsidies for Boeing and Airbus and work together to counter China’s global ambitions to dominate key industries. The agreement, which suspends the threat of billions of dollars in punitive tariffs on each other’s economies for five years, is a clear sign of President Biden’s seriousness in repairing relations with the European Union and getting the wealthy bloc on his side in what he regards as a generational challenge from the rise of a technologically advanced and autocratic China. Biden sees Europe as an ally, not an economic “foe” as former President Donald J. Trump did, and he has pledged to work with the EU to counter China’s military, economic and technological ambitions. While Trump also saw the dangers of an unbound China, he did little to try to bring Europe along, instead punishing it with tariffs. Biden is convinced that, as Asia as a whole grows in population and wealth, the democratic world that believes in the rule of law and multilateral institutions must do more to protect its economies and values. “Europe is our natural partner, and the reason is, we’re committed to the same democratic norms and institutions, and they are increasingly under attack,” Biden said. The agreement means that significant punitive tariffs estimated at $11.5 billion, on a wide variety of products including aircraft parts, wine, tractors, spirits, molasses and cheese, will continue to be suspended after both sides had agreed to do so in March while they tried to settle the dispute. The battle first broke out in 2004, over government subsidies that Europe provides to Airbus.<br/>
The administration of US President Joe Biden has nominated former airline pilot Chesley Sullenberger to be its next ambassador to the ICAO. Sullenberger gained global fame in 2009 after landing a US Airways Airbus A320 in the Hudson River near Manhattan, following a dual bird strike that took out both engines. “C. B. ‘Sully’ Sullenberger, III is a former United States Air Force fighter pilot, retired airline pilot, safety expert and keynote speaker,” the White House writes on 15 June. He has also served as a NASA aviation safety research consultant and an accident investigator. Sullenberger holds a Bachelor of Science degree from the US Air Force Academy, as well as advanced degrees from Purdue University and the University of Northern Colorado, the White House adds. The Air Line Pilots’ Association, International (ALPA) praises the nomination, saying Sullenberger brings “a deep understanding of the global airline industry, garnered through his military and airline piloting experience, as well as his extensive aviation safety work as an ALPA volunteer”. “As the agency responsible for international aviation standards, the US ambassador to ICAO is an important post and ALPA remains ready to continue to contribute to ICAO’s indispensable work,” the group says.<br/>
The Biden administration is engaging with China in an effort to win approval for Boeing’s 737 Max planes, which remain banned in the country even as other jurisdictions have reauthorized it following crashes. “We’re absolutely working on it,” Commerce Secretary Gina Raimondo said in an interview Tuesday with Bloomberg Television’s David Westin. “China’s a big market, and we have to make sure American companies can do business there and export there.” The Max has returned to service in most of the Americas and Europe after two deadly crashes more than two years ago. But China, the first country to ground the Max, has yet to lift its ban on flying the plane. The country’s airlines last announced orders for the single-aisle workhorse when Barack Obama was in the White House. The Commerce chief spoke earlier this month with her Chinese counterpart, Wang Wentao, following a call between US Trade Representative Katherine Tai and China’s senior economic official Liu He late last month. But the two countries have yet to resume formal trade negotiations since President Joe Biden took office and initiated a broad review of China relations. Raimondo also said she had spoken with Boeing CEO Dave Calhoun.<br/>
It is hard to compete against your own products. Vaccination campaigns are finally giving airlines the visibility they need to buy jets again. This is of particular relief to Boeing Co, which back in July had about 100 of its 737 MAX planes in storage without an owner. Now the number is only about 10, thanks to a wave of orders from major carriers like United Airlines and Alaska Airlines. It confirms one of the cornerstones of aviation economics: There are always buyers of new, more efficient aircraft. With fuel accounting for a third of airlines' operating expenses, the cost of the latest jets is small compared with the savings they provide. The question is at what price. Carriers' haste to purchase the MAX suggests that Boeing is offering generous discounts. Irish low-cost carrier Ryanair, which is known for scooping up cheap planes at moments of crisis, ordered 75 units last December. The MAX's tarnished reputation gives Boeing a particular reason to prioritize sales over margins. But a broader factor also is at play, including for European manufacturer Airbus SE: It is extremely cheap to buy their planes -- particularly bigger models -- in the secondhand market. According to the latest appraisals by international advisory firm Ishka, a 15-year-old 737 was 20% cheaper this April than in January 2020. A wide-body 777-300ER was 45% cheaper. The book values of planes often take between 12 and 24 months to fully reflect the impact of a crisis. The data suggest that these older planes, which have been the biggest victims of airlines' moves to shrink their fleets, have already found their footing in the used market, and may even be revalued higher from here. When it comes to more modern wide-body planes, though, valuations haven't stopped falling. <br/>
From the Wright brothers’ historic flight in 1903 to the development of supersonic aircraft, the history of aviation has been driven by technology and ambition. Now, as the 21st century progresses, the sector continues to show its appetite for innovation and radical design. Last September, for instance, a hydrogen fuel-cell plane capable of carrying passengers took to the skies over England for its maiden flight. The same month also saw Airbus release details of three hydrogen-fueled concept planes, with the European aerospace giant claiming they could enter service by 2035. More recently, United announced it had signed a commercial agreement to purchase aircraft from a start-up called Boom Supersonic. These moves are linked by a focus on technologies designed to reduce aviation’s environmental footprint — a major task, even if the number of flights last year slumped due to the coronavirus pandemic. According to the International Energy Agency, carbon dioxide emissions from aviation “have risen rapidly over the past two decades,” hitting almost 1 gigatonne in 2019. This, it notes, equates to “about 2.8% of global CO2 emissions from fossil fuel combustion.” Elsewhere, the World Wildlife Fund describes aviation as “one of the fastest-growing sources of the greenhouse gas emissions driving global climate change.” It adds that air travel is “currently the most carbon intensive activity an individual can make.”<br/>