The head of the world’s biggest airline trade body said on Monday passenger traffic was recovering faster than expected and that, on average, the industry could now see those figures return to pre-pandemic levels in 2023, a year earlier than expected. The easing of COVID-19 related restrictions around the world has released demand pent up over the last two years when governments shut their borders, leading to a jump in flights. IATA DG Willie Walsh told Reuters the near-term outlook remained positive even as the aviation industry faces new headwinds such as high oil prices, inflation and workforce shortages. “We’re seeing very strong bookings. Certainly all the airline CEOs that I’m talking to are seeing not just good demand for near-end travel but they continue to see demand as they looked through the year,” he said at a conference in Riyadh. Many regions are expected to perform better this year, though Walsh cautioned that he did not expect a quick recovery in Asia-Pacific, citing restrictions in China as it pursues a zero-COVID policy. But he said that overall, given the current accelerated pick up in passenger traffic, the industry could reach pre-pandemic passenger figures next year, helped by a strong summer in 2023. “I don’t think we should be distracted from the fact that we are seeing a strong recovery and I think that recovery will gather momentum as we go through the rest of this year into 2023.”<br/>
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As the airline industry recovers from the pandemic, the emphasis in the U.S. has been on domestic airport hubs like Charlotte and Denver, but one international gateway hub has stood out. That is Miami International Airport. The gateway is uniquely positioned as close to short-haul leisure destinations in the Caribbean, and the key hub for South America, which was one of the international sectors that recovered the fastest. Miami is also a hub for American Airlines, the global US airline ramped up quicker than its two principal competitors. In 2021, Miami was the busiest airport for international traffic in the US, according to figures released this month by Airports Council International (ACI). The facility handled 13.2m international travelers, and ranked 11th globally for international traffic. Air travel joins a larger boom happening in Miami, from new efforts to attract the tech sector and fresh startups, to next-level buyer interest in Miami’s red-hot real estate. Miami’s successes in the past two years may have been a pandemic anomaly, to be sure. Overall, Miami handled 37.3m air passengers in 2021. The total was down 19% from the 2019 but double the year before. While ACI has not yet released its full list of the world’s busiest airports in 2021, other US hubs and leisure-oriented cities handled more overall travelers, including Atlanta, Chicago O’Hare, and Las Vegas.<br/>
Mexican President Andres Manuel Lopez Obrador said on Monday an incident at the Mexico City International Airport (AICM) was being investigated, after a video reportedly taken over the weekend showed a plane almost landing on an already-occupied runway. Concerns over reports of a number of recent incidents prompted Rogelio Jimenez Pons, deputy transport minister, to propose a halt of operations at the nearby newly-built Felipe Angeles International Airport (AIFA) as a temporary solution. "If the investigation tells us to do that (stop operations at AIFA), we will do so. Security is above any other type of interest," he said. Video of the weekend incident appeared to show two jets from Mexican low-cost carrier Volaris nearly colliding. It surfaced online days after a report from an international pilots association cited "several" safety concerns in the capital's air space. Volaris shares fell nearly 8% on Monday. On Sunday, the carrier's chief executive, Enrique Beltranena, said on Twitter he had called for internal and external investigations. "Thanks to the training of our pilots and their impeccable monitoring of the processes, no passenger or crew member was at risk during the situation reported at the AICM the night of May 7," Beltranena said. Lopez Obrador called for a meeting to "put the airspace in order" and said the director of the Navigation Services in the Mexican Air Space (SENEAM), Victor Hernandez, had resigned. Jose Alfredo Covarruvias, general secretary of Mexico's Air Traffic Controllers Union, said the union had sent around 30 reports of safety incidents to the federal civil aviation agency. "We've got to see what factors led to this error, to make sure above all that it doesn't happen again," said Covarruvias, who also welcomed the investigation and Hernandez's resignation. "If it happens again, it's not an accident," he added.<br/>
German airport operator Fraport said on Monday it would reconsider its stake in St. Petersburg Pulkovo if the airport was targeted by western sanctions or if there was evidence it was being used by Russia to wage war against Ukraine. Fraport has said it was bound by a contract that did not allow it to sell the stake until 2025, and it did not want to give up the asset worth E160m ($168.11m) to Russia. “But if there’s evidence Pulkovo is being used for the war in Ukraine, we will have a new situation. This may also apply in case of new sanctions,” said Michael Boddenberg, Fraport’s chairman and the finance minister of the German state of Hesse. “We are therefore assessing the situation day by day,” Boddenberg said in a statement after an extraordinary supervisory board meeting he had called over Fraport’s assets in Russia.<br/>
Thousands of passengers have had to queue outside terminals at Birmingham and Manchester airports, and dozens have missed flights, in chaotic scenes underlining the aviation industry’s struggle to return to normal pre-pandemic service. The staff shortages that led to congested terminals at Easter and widespread flight cancellations have persisted, with Birmingham deciding to move passengers outside to disentangle check-ins from security lines. Passengers described the experience as “manic” and “absolute chaos” on social media. One at Manchester, who described himself as a regular flyer, tweeted he had “never seen it this bad” as lines of people stretched outside the airport buildings in the early morning. Airports and carriers have blamed staff shortages for the long queues faced by passengers around the country in recent weeks. Many lost staff during the pandemic, some through redundancy, but also as employees left to take up other jobs elsewhere. Most have been in the process of rehiring thousands of staff, with demand for travel soaring after the lifting of Covid travel restrictions in the UK. But the rush to recruit has been accompanied by lengthy waits for security clearance, and staff absence amid high rates of coronavirus has worsened matters. The queues at airports have contributed to airline decisions to cut flights from their schedules – although they both are also struggling with staff shortages, from the combination of the Omicron variant spreading through their bases and the length of time for approve new recruits.<br/>
The head of Nigerian state oil firm NNPC and the central bank governor told the national assembly and the country’s airline association on Monday that they were unable help with soaring jet fuel prices. However, in a resolution to the meeting, NNPC agreed to supply jet fuel to marketers nominated by the Airline Operators of Nigeria, and the association will itself apply and be granted a jet fuel import licence, the speaker of the house of representatives, Femi Gbajabiamila, said. Fuel prices have risen sharply around the world since Western companies began imposing a series of increasingly tight financial sanctions on Russia after its invasion of Ukraine in late February. The price increase has affected already debt-laden airlines that rely on imported kerosene, or jet fuel, that is not subsidised, unlike gasoline. “We cannot fix the prices of aviation fuel on a deregulated commodity. The only way we can fix the price of aviation fuel is to introduce a subsidy,” NNPC chief Mele Kyari told lawmakers. Nevertheless, the head of AON said NNPC had failed on its earlier promise to supply jet fuel at a fixed 500 naira ($1.21) a litre. “NNPC told us the president has approved 25,000 metric tonnes for us (airlines) but we never got this fuel,” Allen Onyeama, vice president of AON and chairman of Air Peace, said, referring to Nigerian President Muhammadu Buhari. “We nominated some marketers who have been licensed ... to handle the 25,000 tonnes, but we are yet to get this fuel.”<br/>
Airports Company South Africa CE Mpumi Mpofu said on Monday that some airlines had cancelled flights as a result of a shortage of jet fuel at Johannesburg’s O.R. Tambo International Airport. Last month an oil industry body flagged the jet fuel shortage, linking it to damage from devastating floods in the KwaZulu-Natal province. Mpofu added on Monday at a news conference that state logistics group Transnet aimed to restore 50% of a flood-damaged railway line by June 9.<br/>
South Africa's state-controlled Central Energy Fund is working on providing an additional 1.5m litres of jet fuel for Johannesburg's OR Tambo International Airport in the event of further supply shortages, the head of the airport operator said on Monday. Last month an oil industry body flagged the jet fuel shortage at Johannesburg's OR Tambo International Airport, one of Africa's busiest airports, linking it to damage from devastating floods in KwaZulu-Natal province that have left thousands homeless and caused at least 10b rand ($633m) of damage to infrastructure. "While overall stock levels are stable, certain suppliers impacted by the declared force majeure are still unable to acquire the quantities of jet fuel they require," Mpumi Mpofu, CE of Airports Company South Africa (ACSA), told a news conference. As a result, the Central Energy Fund will invoke available legislative measures to ensure there is energy security and "they are working on providing approximately 1.5m litres of jet fuel in the event that the mismatch between supply and demand is not mitigated," Mpofu added.<br/>
Saudi Arabia on Monday pitched aviation industry leaders on its plans to become a global travel hub, drawing scepticism from analysts who questioned how it could compete against regional heavyweights. The conservative kingdom's aviation goals, part of Crown Prince Mohammed bin Salman's wide-ranging "Vision 2030" reforms, include more than tripling annual traffic to 330m passengers by the end of the decade. It also wants to draw $100 billion in investments to the sector by 2030, establish a new national flag carrier, construct a new "mega airport" in Riyadh and move up to five million tonnes of cargo each year. "Over the next 10 years the kingdom will emerge as the Middle East's leading aviation hub," Transport Minister Saleh Al-Jasser told the forum's opening session. The strategy hinges on tapping the large domestic market of Saudi Arabia, whose population is around 35m, he said, citing what analysts described as a major advantage for Saudi carriers over regional rivals Emirates and Qatar Airways. "We are very focused on building connectivity to Saudi Arabia, in helping the tourism industry to grow in Saudi Arabia and helping the Saudi people connect to the world... That's what we are focused on," he said. But steep competition raises questions about how feasible the Saudi plans are. "They're fighting multiple headwinds on the aviation front," said Robert Mogielnicki with the Arab Gulf States Institute in Washington. "You have established regional players that have great brand recognition and are already important parts of the economies of Qatar and Dubai." In Saudi Arabia, by contrast, "the air transport sector is not as central to the economy so that urgency is not there, though the Saudis do have big ambitions for the sector. It's a new entity, so they're going to have to play catch-up."<br/>
Russia will soon be forced to start cannibalising the aircraft on its territory because the sanctions regime means no new spare parts are being delivered. The trend may culminate in a mass grounding, so that by 2025 between half and two-thirds of all commercial aircraft in the country could be inoperable, the newspaper Kommersant reported citing a Ministry of Transport report that has not been made public. The draft report on the development of Russia’s aviation sector until 2030 maps out two scenarios, one “baseline”, the other pessimistic. In the worst-case scenario, the country could face serious shortages from the second half of this year, a matter of weeks from now, when foreign-made aircraft will start to be “intensively reduced” and dismantled. The ministry developed the document in accordance with instructions from President Vladimir Putin following a meeting on March 31. It sent a copy of the document to Russia’s Association of Air Transport Operators for familiarisation. Kommersant said its authenticity was confirmed by sources at the ministry, the association, and two airlines.<br/>
Plans appear to have stalled for China’s state-owned aerospace and defence conglomerate Aviation Industry Corporation of China (AVIC) to upgrade dozens of airstrips in the Solomon Islands to transform the Pacific Islands country into a regional hub, reports Australia’s ABC News. In return, the Solomon Islands government would purchase six aircraft from AVIC's commercial aircraft division, according to a leaked Memorandum of Understanding (MoU) signed in 2019. AVIC is a major manufacturer of civil aircraft in China, including the MA-600 and upcoming MA-700. Implementation of the MoU seems to have stalled due to COVID-19. Solomons - Solomon Airlines CEO Brett Gebers said he was unaware of the agreement. Currently, the airline’s fleet consists of one A320-200 leased from Carlyle Aviation Partners and four in-house turboprops used on domestic routes, including three DHC-6-300s and one DHC-8-100, the ch-aviation fleets advanced module reveals.<br/>
Dozens of Koreans have been duped out of more than RM2m in what is believed to be a flight ticketing scam. The victims were enticed with huge discounts on their airline tickets to and from South Korea as well as the promise of 100% refunds for those unable to board their flights should they test positive for Covid-19. So far, over a dozen police reports have been lodged nationwide, especially in Kuala Lumpur, Selangor and Johor. It is learnt that a couple – a Malaysian in his 20s and his Korean wife in her 30s who are operating a travel agency in Sabah – could be involved in the scam. The South Korean Embassy in Kuala Lumpur is aware of the scam and has been asking their nationals to lodge reports on the matter.<br/>
The head of the world's largest aircraft leasing company threw his weight behind Boeing on Monday and said the jetmaker would overcome a spate of industrial and certification problems. "I think Boeing will bounce back. There are a few scenes in this movie to be played out yet," AerCap CE Aengus Kelly told the Airline Economics conference. "Clearly Boeing has got its own issues, but Boeing is a tremendous company that's helped build the world for the last 100 years and I would never write them off, they still build great airplanes," said Kelly, whose firm is one of Boeing's largest customers. Shares of Boeing fell to a nearly 1-1/2 year low last week after the US planemaker posted a quarterly loss, unveiled $2.7b in charges and added costs and expressed doubts over hitting 737 MAX delivery targets. Boeing also announced it was delaying its 777X project by more than year to 2025 and could not say when it would resume deliveries of its 787 after a year-long halt. Kelly said he was a big believer in Boeing's 737 MAX, which he said was attracting robust demand. Airbus has announced plans to sharply raise output of the competing A320neo family. The CE of AerCap's smaller rival Avolon last week said Boeing had lost its way and needed to fundamentally re-imagine its strategic relevance. The founder of another major leasing company, Air Lease Corp, said earlier on Monday that the Boeing 777X jetliner project was at risk in light of the latest delays.<br/>
Airlines have been warned that the days of abnormally cheap financing costs are over, pointing to higher lease rates amid changes in the way risk is managed after the war in Ukraine. New money has poured into aviation over the past decade as investors sought refuge from low bond rates in the higher yields available from dollar-denominated hard assets like aircraft. "For a lot of investors, getting a mid-single-digit return on an aircraft lease is a lot better than getting negative interest rates in bank accounts or 1 to 2% returns on government bonds," industry veteran Steven Udvar-Hazy, chairman of Air Lease Corp, told a UK Aviation Club dinner in Dublin. "I think that's all changing ... The airline industry, from a credit rating point of view did not really deserve those kind of rates. And now I think the sense of reality is coming back in; I think lease rates will go up, interest rates are going up." Udvar-Hazy, a founder of the leasing industry who began his career advising Aer Lingus while still a student in 1973, said airlines would have to adjust to higher lease rates in the same way as they absorb fuel, labour and other operating costs. Air Lease last week posted a quarterly loss after an $800 million write-off of jets stranded in sanctions-hit Russia. read more Russia has effectively seized hundreds of foreign-leased jets after changing the law to prevent their repossession. "I think as lessors and financial institutions, we have to pay more attention to these risks. And that's another reason that (lease) rates will go up," Udvar-Hazy said.<br/>
Boeing is moving its headquarters from Chicago to a suburb of Washington, DC. But some analysts think this move is one in the wrong direction. Boeing was based in Seattle from its founding in 1916 to 2001. During its heyday it was renowned as an engineering-driven company that made the best, safest planes. But many industry watchers felt that reputation was lost as Boeing shifted to focus on the bottom line — and they point to its 2001 decision to move headquarters from Seattle to Chicago as a stark sign of that ill-advised shift. The company's Thursday announcement that it will move once again, to Arlington, Virginia, only gives critics more fuel: By moving into the shadow of both the Pentagon and Congress, Boeing seems to be signaling it has lost the commercial race to Airbus and wants to be seen as primarily a defense and space contractor. The fact that the announcement comes the same week Airbus revealed it's increasing production of commercial jets at its factory in Mobile, Alabama, only seems to drive home that point. "One company is saying 'We're going to build lots of jets.' The other is saying 'We're going to lobby the Pentagon and Congress for defense dollars.' It's a big contrast," said Richard Aboulafia, managing director at AeroDynamic Advisory and a leading aerospace analyst. Boeing said that the Arlington move is designed to bring the company closer to its "customers and stakeholders, and its access to world-class engineering and technical talent." Aboulafia isn't surprised Boeing decided to move its headquarters to Arlington, but he is disappointed. A move back to the Seattle area would have sent a strong signal that Boeing is was once again ready to embrace engineering, he added. "It would have been great for morale and shown an intent to focus on their badly neglected commercial airline products," said Aboulafia. "Imagine the power if they said 'We're going to back to our roots.' It's just disappointing. It's the road not taken." Boeing's engineering and quality problems have posed major challenges for the company. <br/>