general

The Covid-19 pandemic, with its lockdowns and travel bans, clobbered the world’s airlines. Revenues per passenger-kilometre, the industry’s common measure of performance, plummeted by 66% in 2020, compared with 2019. The IATA expects them to remain 57% below pre-pandemic levels this year. Although the world’s listed airlines have collectively just about recovered from the US$200b Covid-induced stockmarket rout, forecasters reckon that air travel will return to levels from 2019 only by 2024. The companies’ total annual losses may hit US$48b in 2021, on top of US$126b in 2020. Many have been torching cash as fast as their aeroplanes burn jet fuel. Plenty survived only thanks to government bail-outs. The industry-wide picture conceals disparities, however. Some airlines are struggling despite having cut costs, slashed fleets and shored up balance-sheets with commercial loans. Others are brimming with confidence. Big American and Chinese ones with large, increasingly virus-free domestic markets will return to profitability first. Frugal low-cost carriers that went into the pandemic in the black are close behind. Story has more.<br/>

IATA DG Willie Walsh believes a more cautious approach to network expansion from airlines battling to restore balance sheets ravaged by the crisis may mean capacity falls short of demand as travel restrictions are lifted. While passenger traffic figures for May issued by IATA today showed only a small improvement over April date - traffic as measured in RPKs was down 63% on 2019 levels rather than the 65% reduction in April - there has been some reopening of travel markets since June and growing optimism for the second half. Walsh said: ”I think the evidence in terms of airline schedules supports the view that airlines certainly believe that demand is increasing, and as we are seeing evidence of restrictions being removed in certain countries, there is a greater willingness to travel.” He also points to signs that even where restrictions remain in place, people are less discouraged from travel if there is no requirement to quarantine at their destination, even if they may have to on their return home. ”We are still optimistic but cautious about the second half,” Walsh says. But he believes a legacy of the extra debt airlines have had to take on during the crisis - and with much of the industry still burning cash - is carriers are likely to adopt a more cautious approach to returning capacity.<br/>

The head of global airline body IATA said he was cautiously optimistic about demand for travel in the second half of the year, adding that he expects transatlantic flying between Britain and the United States to re-open in the coming weeks. Schedules are expanding as airlines sense consumer demand for travel rising and progress with COVID-19 vaccinations means shuttered routes could resume, IATA DG Willie Walsh told reporters. "I think we have to be optimistic that we will see a relaxation in relation to transatlantic flying during the coming weeks," Walsh said Wednesday. Major airlines including American Airlines, IAG unit BA, Delta and United have for some months been pushing the US and UK governments to re-open travel between the two countries citing the pair's advanced vaccination programmes. Walsh said there had been no announcement on the matter at the G7 leaders meeting in June due to a lack of data about the vaccine's efficacy against the Delta variant of the virus, but that had changed now. A transatlantic re-opening would be a huge boost for the airlines. Walsh's optimism came after IATA published figures for May showing that passenger air travel demand remains subdued globally, 63% lower in May 2021 compared to the same month two years ago before the pandemic struck. Walsh blamed ongoing restrictions and a lack of co-ordination between governments for creating consumer confusion and hindering the speed at which aviation can recover.<br/>

A coalition of 24 industry organizations on Wednesday urged the White House to lift restrictions that bar much of the world from traveling to the United States but the Biden administration showed no signs of taking immediate action. The groups led by US Travel Association and representing airlines, casinos, hotels, airports, airplane manufacturers and others, urged the administration to ease entry restrictions by July 15 that were imposed last year during the pandemic,and to quickly lift entry restrictions on UK travelers. "We have the knowledge and the tools we need to restart international travel safely, and it is past time that we use them," US Travel CE Roger Dow said. Separately, 75 members of the US House of Representatives called on Biden to reopen the US border with Canada to non-essential travelers. The lawmakers in a letter cited projections that if the restrictions are not lifted, the United States could "lose 1.1 million jobs and an additional $175 billion by the end of this year." The CDC has raised concerns about the Delta variant of COVID-19 in US government meetings, sources said. Industry and US officials told Reuters they do not expect the administration to lift restrictions soon. The CDC wants airlines to implement international passenger contact tracing as part of any lifting of restrictions, sources told Reuters.<br/>

The way airlines handle extra, optional fees -- such as the charges to check a bag or reserve a specific seat -- could change under a set of rules being developed by the Biden administration. The rules -- requiring faster refunds and upfront disclosure of fees -- are under development at the US Transportation Department, said Brian Deese, director of the White House's National Economic Council. Deese said at a recent White House briefing that the plans would "protect airline passengers and to promote fair ... competition in the airline industry." The proposals will come on the tail of a significant pandemic-related spike in consumer complaints about airlines, nearly all expressing dissatisfaction with airline refund policies. The first proposal, due to be released in days, would require airlines to refund extra fees in more circumstances than under the current requirements, according to a source familiar with the plans. It would require airlines to refund fees for checked bags that arrive late, the source said -- more than 12 hours delayed for a domestic flight and 25 hours delayed for an international flight. If the bag is not delivered in that window, the rule would require a refund of any checked bag fees. The official said current refund rules apply to lost -- but not delayed -- luggage. That proposal would also require the prompt refund of optional fees if the service -- such as choosing a seat and using Wi-Fi internet -- does not work or is not used, the source said.<br/>

Greece, Turkey and Spain led the growth in flight activity across Europe over the past two weeks as Eurocontrol data illustrates leisure markets are benefiting most from the easing of travel restrictions in the region. In a social media update today, Eurocontrol director general Eamonn Brennan highlighted a sharp increase in flights across many European markets over the past two weeks in line with the gradual reopening of destinations. That includes a 43% lift in flights to and from Greece, with Turkey showing a 31% rise across the two weeks to 6 July 2021. In both cases, the figures are down just 24% on the same period in 2019. Activity to and from Spain also increased almost a third over the past two weeks and is the second busiest European country by flights over that period. Despite the lift, flight activity remains 42% down on the same period in 2019. The Eurocontrol figures show a double-digit rise in flight activity across the 10 busiest European markets over the past two weeks. The UK had the joint smallest growth in flight activity over the fortnight, at 12%. That reflects both the relatively small number of countries on the UK’s green list for quarantine-free travel, as well as restrictions imposed by countries on travel from the UK because of the current high levels of the coronavirus Delta variant.<br/>

Two of the world's biggest airlines will trial fast-track lanes at Heathrow airport for fully-vaccinated arrivals. Under the scheme passengers on four routes will be able to upload their vaccination status before boarding. The trial by British Airways and Virgin Atlantic comes as the aviation industry calls for quarantine-free travel to the UK from lower-risk amber list countries. Transport Secretary Grant Shapps is set to announce such a scheme this week. The trial, due to start this weekend, will allow passengers who are fully vaccinated and are travelling on selected flights to Heathrow from Athens, Los Angeles, Montego Bay and New York to show proof of their vaccination status. Those taking part in the trial will still have to follow all the rules according to the government's traffic light system; book all the required tests and quarantine if they come from an amber list country. People taking part will be able to use a dedicated arrivals lane at the UK border.<br/>

Fully vaccinated travellers arriving from countries on Britain's "amber list" for international travel during the COVID-19 pandemic are set to avoid quarantine from as early as July 19, British media reported on Tuesday. The Times newspaper said government ministers would meet this week to approve a policy that will allow people to travel from amber destinations on the three-tier traffic-light system without isolating for up to 10 days. At present, travellers arriving from a country on the amber list, which includes top tourist destinations Spain, France, the United States and Italy, are required to isolate on arrival. The Sun said Transport Secretary Grant Shapps would unveil the rule change on Thursday, and reported that travellers will be required to take a test before they return to Britain and then a PCR test on the second day of return. British Prime Minister Boris Johnson set out plans on Monday for the final step in easing England's COVID-19 lockdown, including the removal of laws governing social distancing and face coverings, and an end to official advice to work from home. Seeking to convince the government that scrapping quarantine for vaccinated travellers is logistically possible, British Airways, Virgin Atlantic and Heathrow Airport are set this week to start checking the vaccine status of passengers arriving on flights into Britain.<br/>

Saudi Arabia said on Wednesday that global airlines industry body IATA had agreed to open a regional headquarters in Riyadh but the industry's main trade association denied it would be a regional base in the latest evidence of sensitivities over the status of foreign business representation in the kingdom. The General Authority of Civil Aviation (GACA) late on Wednesday announced it had signed a "headquarters agreement" with the IATA to open its "regional office in the kingdom". IATA, which represents some 290 airlines around the world, currently has its regional office in Jordan's capital Amman. IATA said the body had agreed to set up an office in Saudi Arabia but not a regional headquarters. "It will serve the growing needs of the industry in (Saudi Arabia). We have a regional headquarters ... in Amman and we are not moving its functions to (Saudi Arabia)," an IATA spokesperson said. Saudi Arabia is putting pressure on companies to move their regional offices to the kingdom, warning that from 2024 it would not award state contracts to those with regional headquarters elsewhere. <br/>

Turkish Defence Minister Hulusi Akar and his US counterpart Lloyd Austin on Wednesday had a “constructive and positive meeting” to discuss a plan for Turkey to operate and guard Kabul airport after the NATO withdrawal from Afghanistan, the Turkish defence ministry said. Ankara has offered to run and guard the airport after NATO’s withdrawal, and has been in talks with allies, namely the United States, on financial, political and logistical support. Security of the airport is key for the operations of diplomatic missions out of Afghanistan after the withdrawal. The Pentagon said that Austin and Akar discussed the drawdown of the U.S. forces from Afghanistan and both “reasserted the importance of adequate security” at the airport. It said the two agreed to speak again in the near future. The talks would continue on Thursday, the Turkish statement said.<br/>

With some countries in Asia starting to frame Covid-19 as a disease that needs to be managed rather than stamped out, there’s hope 2021 may not be the total travel writeoff feared a few months ago. Speaking in parliament earlier this week, Singapore Finance Minister Lawrence Wong said that while the coronavirus is unlikely to go away any time soon, rising vaccination rates and improving treatments mean it can be thought of “more like influenza.” Similarly, Australian PM Scott Morrison has promised a “new deal” that would shift the country’s strategy from suppressing the coronavirus to managing it. Thailand, meanwhile, has reopened the tropical island of Phuket to holidaymakers, so long as they’re vaccinated, and on Tuesday, Hong Kong CE Carrie Lam, mulling the start of a long-anticipated travel bubble with Singapore, indicated both sides should require inoculation as a precondition for participating. And India has increased domestic flight capacity to 65% from 50% as its recent wave of infections ebbs. Such moves are buoying expectations about freer travel toward the end of the year. For now, Asia can only look on in envy as people crowd tourist hotspots in Europe and New York gets back to business. But there’s hope that by Christmas, borders can start to reopen. “We’re seeing an acknowledgment, including in countries where there have been a lot of strict restrictions, that this is a virus that doesn’t fully disappear and instead is one we live with and manage,” said David Mann, chief Asia economist at Mastercard Economics Institute. Restrictions will be on a loosening trend if you take a six- to 12-month view, especially in places where they’re making progress on vaccinations.”<br/>

Thailand plans to convert a terminal at the nation’s main international airport into a field hospital as a surge in coronavirus infections that’s straining the nation’s public health system shows little sign of easing. Airports of Thailand, operator of the Suvarnabhumi International Airport, has been asked to convert the newly completed terminal into a facility with an intensive-care unit, medical rooms and support for patients with mild to medium symptoms. The hospital will initially provide at least 5,000 patient beds, according to a government statement late Tuesday. Medical facilities are already at capacity, and deaths could double by August if the outbreak doesn’t ease, Kumnuan Ungchusak, an expert in epidemiology and adviser to the Health Ministry said at a seminar last week. Most cases have emerged from Bangkok, which continues to report the most infections and deaths each day. Separately, Thailand’s Covid taskforce said it will consider proposals for a lockdown in the virus hotspots of Bangkok and its surrounding areas once the health officials submit them. <br/>

Australia’s new limits on international travel appear to be the harshest since restrictions on incoming passengers were introduced, according to a Guardian Australia analysis. The limit on the number of international arrivals coming into Australia via commercial flights, the so-called “passenger cap”, will be halved from 14 July over concerns from some state premiers around the Delta variant of Covid-19. The reduced cap means the weekly state and territory intake is reduced from the previous cap of 6,370 (which included an extra 300 spots for vulnerable people to return via Brisbane) to 3,070. While the reduction is due to be reviewed by 31 August, Scott Morrison has indicated it will be in place until at least the end of the year. Even taking into account the number of places available for people to quarantine at the Howard Springs facility, which takes passengers from commonwealth-organised repatriation flights and domestic travellers to the NT, the limit on arrivals will be the strictest since the beginning of the pandemic with the exception of a few days in February when Victoria stopped accepting international flights while other states had their travel caps halved.<br/>

A consortium led by Macquarie Group is exploring a rival offer for Sydney Airport, in a potential challenge to IFM Investors Pty’s A$22.3b ($17b) bid, people with knowledge of the matter said. The Australian firm has been speaking with potential partners, including local pension funds, about making a joint offer, according to the people. The bidding group could include funds managed by Macquarie Infrastructure & Real Assets, the people said, asking not to be identified because the information is private. Macquarie may also use some of its own capital for the deal and could seek to rope in some of the MIRA funds’ investors to join the consortium, one of the people said. Any transaction for Sydney Airport, Australia’s main overseas gateway, would be one of the boldest bets yet on a recovery in global travel after the coronavirus pandemic. Including debt, a purchase of Sydney Airport would rank as the largest-ever acquisition in the country and one of the world’s biggest airport deals in recent years.<br/>