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Jet2 warned that airline price wars will extend well into 2022, hurting margins as discounters led by Ryanair Holdings Plc add capacity and put pressure on smaller carriers. The UK package holiday and leisure airline slid the most in eight months after saying it expects further losses in the second half of its financial year. The impact of lower ticket prices is being exacerbated by rising costs for staff, fuel and carbon offsets, according to a statement Thursday. Average fares for flight-only customers were down 25% in the first half ended Sept. 30 because of “aggressive price competition.” Ryanair has sought to rapidly build back networks and grow market share as Covid-19 restrictions ease, keeping ticket prices low to fill up planes. The Irish airline said this month it expected to post “somewhere between a small loss and break-even” in the financial year ending March as it pressures weaker competitors. Carriers are bringing back too much capacity to the market, led by Ryanair and smaller rival Wizz Air, wrote analysts at Exane BNP Paribas in a report Nov. 17. With higher fuel prices and rising inflation, airline margins will be under pressure in 2022, they wrote.<br/>

Global supply chain constraints will continue to hit freight movers until at least the end of next year and could stretch beyond 2022 as logistics companies struggle with labour shortages amid booming demand, Emirates' cargo boss said. A shortage of freight space and manpower as a result of the pandemic compounded by a rapid recovery in demand has jammed seaports and airports and led transport costs to skyrocket. "It's not something that will disappear overnight," Emirates SkyCargo Divisional Senior Vice President Nabul Sultan said. "I believe honestly it's going to be at least another year or two if not more ... I think it is going to go beyond 2022," he said. "There are huge logistical challenges that are out there." A vast amount of air freight globally is typically moved around by passenger jets, many of which airlines continue to keep grounded as travel demand gradually returns. At Emirates, the passenger jet fleet accounts for about 70% of its total cargo capacity, according to Sultan. Emirates has stripped the seats out of 16 Boeing (BA.N) 777-300ER passenger jets, temporarily transforming them into "mini-freighters" to cater to booming cargo demand. Emirates this week announced it would permanently convert at least four of its older 777-300ER jets into freighters. In addition to the "mini-freighters," it is also operating some cargo-only flights using passenger jets that still have seats. Emirates will receive converted freighters roughly every five to six months starting from the fourth quarter in 2023, Sultan said, though it hopes the time frame will reduce to nearer four months.<br/>

Jeju Air, South Korea's biggest budget carrier, said Friday it is resuming flights to Bangkok starting later next month on the back of eased entry curbs in the Southeast Asian country. Jeju Air will operate four flights per week for the Incheon-Bangkok route from Dec. 22, about 18 months after it suspended the route on the outbreak of the COVID-19 pandemic. Since the flight suspension, it has only been running chartered planes to fly South Korean citizens traveling for essential reasons such as business or public service. The flight resumption comes as Thailand has lifted the mandatory COVID-19 quarantine for vaccinated travelers from South Korea while requiring them to present negative COVID-19 test results. With the planned flight resumption, Jeju Air plans to speed up the process to normalize the regular routes amid the easing of entry restrictions in foreign countries, helped by rising vaccination rates.<br/>

Frill-free carrier AirAsia is in the last lap of negotiations to sell its remaining stake in AirAsia India to its joint venture partner Tata Group, two sources close to the matter said. The Malaysian company holds 16.33% of AirAsia India, while Tata currently controls 83.67%. Talks between the two sides began earlier this year and gained momentum after the Indian government announced Tata's successful bid to take over national flag carrier Air India last month, said the sources, who requested anonymity. The negotiations are expected to be concluded by early next year, said one source, the same time as Tata is due to take over Air India's operations. AirAsia has been eyeing an exit from its Indian venture for almost a year. In December 2020 it announced the disposal of a 32.67% stake to Tata Sons for $37.7m, with a provision to sell the remaining 16.33% for $18.8m. AirAsia India at present has a fleet size of 33 aircraft and operates about 200 flights daily. If the sale is finalized, India would be AirAsia's second foreign venture to collapse since the coronavirus pandemic paralyzed air travel amid movement restrictions and international border closures, after Japan in October 2020. "India was a tough market to break as far as [the] airline business is concerned, and with the pandemic, it made it tougher for AirAsia," said one of the sources. AirAsia founder and group CEO Tony Fernandes declined to comment when asked about the discussions with Tata. "It would not be fair for them (Tata)," he said. <br/>

Thai AirAsia has announced mass layoffs and extended furloughs after struggling with the impact of the pandemic, despite the country's reopening on Nov 1. Tassapon Bijleveld, executive chairman of Asia Aviation (AAV), the largest shareholder of TAA, made the announcement to TAA's employees on Wednesday, indicating that the real situation in terms of the aviation outlook remains unstable, prompting the company to reduce its fleet size next year and consequently reduce its workforce to maintain financial stability over the long run. "Even though we've negotiated with suppliers and banks to help offload aircraft leasing costs, and we may get additional liquidity after restructuring this month, our balance sheet cannot be strong enough if those expenses still run. We have to permanently cut the fleet for at least two years or until international and domestic flights fully recover," Tassapon said at the internal meeting. TAA announced on Monday that its fleet size would be cut from 60 to 54 as revenue from international routes is still limited due to different reopening policies from country to country. Tassapon added that the airline had already bottomed out in the third quarter, and it estimated that the domestic market should fully recover by mid-2022, while international flights might gradually return to 20-30% of 2019 levels. The best-case scenario for international routes is that TAA resumes 50% of pre-pandemic scheduled flights by the end of next year.<br/>

Virgin Australia has signed letters of intent to acquire seven more Boeing 737-800s, amid optimism about meaningful travel recovery a year after emerging from voluntary administration. The announcement, disclosed on 18 November, is the third time the carrier is expanding its fleet in the one year post-administration. In April it announced it would acquire 10 more 737s, and in August, another nine jets. The latest additions take the airline’s fleet to 84 aircraft, up from 58 aircraft a year ago. Says Virgin Australia chief Jayne Hrdlicka: “This fleet growth underlines the confidence we have in the future of our business and the industry generally. Vaccination rates are rising, borders are opening, and demand is returning.” Apart from the incoming 737-800s, Virgin Australia also has 25 737 Max 10s on order, which it expects to take delivery of around mid-2023. Hrdlicka also confirms that the airline’s entire workforce will be stood up by December, with “hundreds of new roles” to be added, to support the introduction of new aircraft. She adds: “We are really positive about travel restarting as borders open more fully. We have used our time well while the industry was quiet and are well advanced on all aspects of our transformation strategy and we fully intend to continue growing with demand to ensure we operate at roughly 33% of the domestic market.” <br/>