Most US airlines lost money in the first quarter, traditionally the weakest time of year for travel, but they are all eagerly looking ahead to a summer of full planes and high fares. American Airlines and Southwest Airlines said Thursday that they expect to be solidly profitable in the second quarter. They joined Delta Air Lines and United Airlines in giving an upbeat outlook for the April-through-June period, which includes the start of peak season for carriers. “We see a strong demand environment this summer, and we’re highly confident that will continue,” American CEO Robert Isom said on a call with analysts. Airlines are getting a tailwind from leisure travelers, who are still eager to leave home after a long pandemic lockdown. Their gaze is shifting this summer from domestic destinations to overseas. “Demand is smoking hot for international destinations,” said Ryan Green, Southwest’s chief commercial officer, “and then it’s the typical summer destinations that you would expect — Florida, the Southwest, Hawaii.” American cited strength in both domestic and international bookings. In the last two weeks, both Delta and United posted large losses for the first quarter but also spoke in glowing terms about the summer outlook.<br/>
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Six of the Philippines’ biggest conglomerates have revived a proposal to upgrade its congested main airport, signaling confidence in air travel recovery. Alliance Global Group Inc., JG Summit Holdings Inc., Aboitiz Equity Ventures Inc., Ayala Corp., Filinvest Development Corp. and Asia’s Emerging Dragon Corp. submitted to the government a 100b-peso ($1.8b) proposal to modernize and increase the capacity of the Ninoy Aquino International Airport, they said in a joint statement. Also part of the group is US-based infrastructure investor and airport operator Global Infrastructure Partners. The proposal includes a “significant upfront payment to the government” and seeks to more than double the airport’s annual capacity to 62.5m passengers by 2028, according to the statement. Manila’s main gateway has been plagued by congestion and flight disruptions, with a power-supply problem cancelling hundreds of flights in January. The consortium in 2018 submitted to President Rodrigo Duterte a proposal to upgrade the airport in the capital, but was rejected at the height of the pandemic. President Ferdinand Marcos Jr.’s administration has expressed openness to tap the private sector to manage the Manila airport, as part of a wider infrastructure push.<br/>
The U.S. ethanol industry is lobbying the Biden administration to ensure lower-carbon aviation fuel made from ethanol will qualify for subsidies under the Inflation Reduction Act, arguing such provisions are crucial to meeting U.S. climate goals. The campaign reflects the ethanol industry's desire to expand into aviation following years of stagnant demand for the corn-based fuel as an ingredient in gasoline, and projections that motor fuel demand will fall in the future due to better efficiency and the ascent of electric cars. "Over the last 18 months, there's been a growing recognition in our industry that long-term you've got to be looking at new uses and new markets and nontraditional applications for ethanol if we're going to continue to grow our industry and its value," said Geoff Cooper, president of the Renewable Fuels Association, one of the organizations involved in the push. Sustainable aviation fuel (SAF) is considered vital to decarbonizing the hard-to-electrify airplane industry and the Biden administration is targeting at least 11.4b liters of SAF production per year in the United States by 2030 as part of its broader push to fight climate change. At issue is a requirement in the Biden administration's IRA package, signed into law last year, that SAF yield a 50% reduction in lifecycle emissions compared with petroleum-based jet fuel before it can qualify for a $1.25 tax credit. The lifecycle emissions impact of SAF can vary widely depending on the feedstock that producers use to make it, which can include a variety of substances ranging from soybean oil, to used cooking oil and animal fat.<br/>
Global freight volumes fell at some of the fastest rates for three decades earlier this year, but at the end of the first quarter showed signs of bottoming out. Volumes were down by -2.1% between December and February compared with the same period a year earlier, according to the Netherlands Bureau of Economic Policy Analysis (“World trade monitor”, CPB, April 25). The rate of decline was in the 8th percentile for all overlapping three-month periods since 1992; volumes have only fallen this fast during the last three recessions in 2020, 2008/09 and 2001/02. Reflecting the global slowdown, the US rail network hauled 1.06m containers in February, the lowest for the time of year since 2015 and before that 2012, data from the Association of American Railroads showed. Global freight has been hit by excess inventories held all along the supply chain as consumer and business spending has reverted from merchandise to services after the pandemic.<br/>