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The boss of the world's second biggest airline has said that tackling climate change will make flying more expensive. "Over time, it's going to cost us all more, but it's the right approach that we must take," Delta CE Ed Bastian told the BBC. Aviation is responsible for about 2.5% of the carbon emissions that are warming the planet, according to the International Energy Agency. Critics argue the best way to reduce them is by flying less. Delta says that after spending $30m a year on carbon-offsetting it has been carbon neutral since March 2020. It has also pledged to spend $1b over the next decade to cancel out all the emissions it creates. More fuel-efficient planes, sustainable aviation fuels and removing carbon from the atmosphere are some of the ways it hopes to achieve this. Reducing carbon emissions is crucial if the world is to limit global warming to 1.5C above pre-industrial levels as agreed in Paris in 2015, and has been the focus of the COP26 climate change summit in Glasgow. Andreas Schafer, professor of energy and transport at University College London, says it will "cost trillions rather than billions of dollars" to move the global aviation sector to net zero carbon emissions. Preliminary results from his team's research suggest airfares would need to increase by 10%-20% to cover the costs. "In the short-term, government support will be needed with those costs as decarbonising aviation will be extremely challenging, and current efforts will need to be scaled up dramatically", says Prof Schafer. Bastian concedes it is an ambitious goal that his airline won't be able to achieve alone. "It's the biggest long-term challenge this industry faces," he said. "We're in an industry that's classified as hard to decarbonise because we don't have the bio-fuels or the sustainable aviation fuels (SAFs) en masse yet that we're going to need."<br/>

Airline Grupo Aeromexico received a proposal to emerge from bankruptcy by having lead lender Apollo Global Management Inc. convert some debt into equity. A previous exit package didn’t include the US firm getting a stake. The carrier, which filed for Chapter 11 in 2020 after the pandemic decreased travel, said that a group of new and existing creditors and investors will repay the rest of the loan held by Apollo, which led the carrier’s debtor-in-possession financing. Amounts were not disclosed. Apollo orchestrated a $1b rescue plan of the struggling airline last year. The second tranche of the loan, worth $800m, gave the creditors the option to receive shares in the restructured company. Aeromexico’s largest shareholder, Delta, supports the plan and has already said it will acquire $185m of that tranche. Foreign ownership requirements will be complied through a group of long-term Mexican investors, Aeromexico said. The company’s board has approved the plan, and a revised version will be filed before a federal bankruptcy court in New York. The hearing to confirm the plan will be set by the court at a later date. The new plan will replace one filed on Oct. 1 that included $1.2b in equity and as much as $537.5m in new debt. However, that deal didn’t include Apollo converting any debt into equity. That plan estimated Aeromexico to be worth $5.4b.<br/>

Korean Air is “getting ready to return to a more normal life,” as it tentatively adds flights as travel restrictions and quarantine requirements fall. But the carrier has the luxury to be tentative and gradual. It, unlike the vast majority of airlines around the world, has reported profits for several quarters since the early days of the pandemic. The reason, of course, is cargo. Korean Air reported record third-quarter cargo revenues, beating its previous record by more than 100 billion won ($84 million). Korean Air’s reported 1.65t won in cargo revenues for the quarter ($1.4b), up 62 percent from the second quarter. Cargo, in fact, accounted for the lion’s share of Korean Air’s $1.9b Q3 revenue. The trend is expected to continue. Korean Air cited maritime shipping’s capacity constraints, port congestion around the world, and worker shortages at both ports and shipping lines as reasons for the modal shift to air cargo. The carrier also is anticipating a busy holiday peak season for cargo and is building out capacity at its cargo hubs and developing new airports as logistics centers, it said in its Q3 earnings report Friday. Half of the company’s cargo revenue comes from the Americas, another 17% from Europe, and the remainder from the Asia-Pacific region, the Korean Air said. Korean Air operates a fleet of 23 dedicated freighters (four Boeing 747Fs, seven 747-8Fs, and 12 777Fs) and at the end of Q3 had converted 10 Boeing 777s and six Airbus A330s into “preighters.” “Strong demand in cargo is not really satisfactory for us,” Korean Air Chairman and CEO Walter Cho said at the end of September. “I would really like passenger demand to come back up because that is the bulk of the business for us, and for the health of the industry.”<br/>