general

Planemakers can't build them but airlines can't stop buying them. Even as they wrestle with industrial problems preventing the delivery of jets sold before the pandemic, Airbus and Boeing are totting up billions of dollars of new orders stretching beyond 2030 amid a rebound in air travel. From Air India to Ireland's Ryanair and a new national airline in Saudi Arabia, a handful of carriers have placed firm or provisional orders for 700 jets. Turkish Airlines' surprise announcement on Thursday that it plans to order 600 jets in June spells what would be the fourth mega-deal in a few months - upstaging Air India's record order for 470 Airbus and Boeing jetliners. Turkey's national champion last month announced a 10-year strategic plan including a goal of 170m passengers by 2033, compared to over 85m in 2023. "They are aspiring to build a mega-connector airline from everywhere in Europe to everywhere in Asia and Africa," said Rob Morris, head of global consultancy at UK-based Ascend by Cirium. That would intensify a battle for connecting traffic between Istanbul's hub and rival centres in Europe and the Middle East. The announcement surprised many in the industry, however. US industry analyst Richard Aboulafia highlighted its timing - days before Turkey's May 14 elections - and noted the weight simultaneously being given to strategic aerospace projects including a fighter, attack helicopter and drones. "And now this plan to make Turkey an airline centre of the world too. The timing looks almost too coincidental," Aboulafia, managing director of Aerodynamic Advisory, said. An order of such magnitude could also become swept up in broader political topics such as discussions over Turkey's objection to Sweden joining NATO, Jefferies analysts cautioned.<br/>

Rotten luck seems to follow Mattia Zenere, 31, on his travels lately. Over the past five years, four of his flights have involved long delays or cancellations, including one misadventure — on a trip from London to Venice, Italy — that caused him to arrive a full day late. But there’s a silver lining: Thanks to Europe’s robust consumer protection rules for airlines, in each case, the customer service professional was refunded his out-of-pocket expenses. Mr. Zenere also received an additional hardship payout from the airline for three of the disruptions. “The law really works,” he said. For fed-up air travelers in the US, similar protections could be on the horizon — and the airlines aren’t happy about it. This week, President Biden and Pete Buttigieg, the transportation secretary, announced plans to introduce new rules this year that would require airlines to pay up for travel disruptions they cause. Following waves of pandemic-era flight interruptions and the fiasco that forced Southwest Airlines to cancel 16,700 flights around the winter holidays, Biden is betting that Americans will want the kind of protections Europeans (and non-Europeans who fly in Europe) have enjoyed for nearly 20 years. The EU law is popular — and generous. A flight delayed by more than three hours is considered canceled, and the passenger is entitled to between E250 and E600 in compensation. The payout is determined by flight distance, not ticket price, which airlines have long protested. Airlines can contest payments by arguing a disruption was caused by extraordinary circumstances such as bad weather, a strike action by air traffic controllers or “an out of the ordinary” technical issue with the plane. But European courts continue to narrow the definition of “extraordinary.” <br/>

Travel in 2023 has been expensive. Indeed, some prices — like those for international flights — have hit record highs. Americans are unleashing their wanderlust en masse after a few years of pandemic-era trip delays, making for a busy — and likely costly — summer travel season. “In my 19 years in the industry, this is by far the busiest year I’ve had on record,” Jessica Griscavage, a travel advisor and founder of Runway Travel, recently told CNBC. Typical trip costs increased by 9% in the first quarter of 2023, according to the NerdWallet Travel Price Index, which includes prices for flights, hotels, car rentals and dining out. When expressed in dollar terms, travelers would have paid an extra $180 per person for a $2,000 trip, NerdWallet found. But travelers saw a reprieve in April, according to federal data. Airline ticket prices declined by 2.6% in April relative to March, according to the consumer price index, issued Wednesday by the U.S. Bureau of Labor Statistics. They had risen in February and March. Hotel and motel prices, as well as those to rent a car or truck, each fell by more than 3% during the month. “As has been the case ever since the onset of the pandemic, travel prices have been volatile,” said Sally French, a travel expert at NerdWallet.<br/>

Flights to Europe will be plentiful this summer. Cheap airfare? Not as much. Airlines scheduled a near-record 51,000 flights from June through August from the US to Europe, according to airline data firm Cirium. The number of scheduled seats is the highest since 2018. Despite that increase in capacity across the Atlantic, fares are up sharply as airlines test travelers’ appetites for trips abroad. According to Hopper, US-to-Europe roundtrip flights are going for an average of $1,032, up 35% from last year and 24% from 2019. Average domestic U.S. airfare, by contrast, is down 15% from a year ago to $286 for a round trip, roughly in line with pre-pandemic levels. Executives at longtime operators of European service like Delta, newcomers like JetBlue, and budget upstarts like Norse Atlantic Airways and Play are all betting big that travelers will shell out for more international trips with the worst of Covid — and accompanying travel restrictions — in the rearview mirror. Airlines and airports have been racing to fill jobs in hopes of avoiding last summer’s chaos. “European travel was definitely still ramping up last summer,” said JetBlue CEO Robin Hayes in an interview with CNBC in late March. “I think a lot of people just didn’t fly last year, and now they’re looking to fly this year.” JetBlue is flying to London’s two largest airports from New York and Boston, and plans to launch service to Paris from New York in June. It plans to add service to Amsterdam this summer. Delta plans to offer a record number of seats from the U.S. to Europe, up 20% from last summer. The carrier will serve 69 markets in Europe, a spokesman said.<br/>

Passenger traffic at Portugal’s airports soared 54% in the first quarter from a year earlier and beat pre-pandemic levels, despite strikes and staff shortages at some European terminals, official data showed on Friday. The National Statistics Institute said around 12.9m passengers transited through the 20 Portuguese airports between January and March, compared with 11.2m in the same period in 2019, a year before the COVID-19 pandemic crippled global travel. The number of foreign tourists visiting Portugal surpassed 2.8m from January through March, making it the strongest Q1 on record, the INE said last month. Portugal’s airports operator ANA, owned by France’s Vinci , runs 10 of the country’s main airports, including those in Lisbon and Porto, as well as in the tourist regions of the Algarve and the island of Madeira. The INE said Lisbon airport handled 7.1m passengers in the quarter, 57.6% up from a year ago, representing more than half of all passengers passing through Portuguese terminals. France is the main country of origin and destination of passengers at Portuguese airports, followed by Britain and Spain, the INE said. Many European carriers remain wary of potential strikes, particularly by air traffic controllers in France, as they fear a repeat of the disruptions travellers faced last summer.<br/>

Britain's Gatwick airport shut its runway for almost an hour on Sunday over a "suspected drone" incident, Sky News reported. Operations at London Gatwick were suspended temporarily while investigations into the sighting of a suspected drone close to the airfield took place, the report said, citing a Gatwick spokesperson. The investigation was completed and the airfield reopened almost an hour later.<br/>

Australian airlines are pushing back against calls for new laws that would force them to pay cash compensation to passengers whose flights are delayed or cancelled, with claims it would force carriers to preemptively raise air fares to fund payouts. The resistance follows the Australian Competition and Consumer Commission, consumer advocate Choice and the Australian Lawyers Alliance all separately raising the prospect of a compensation scheme to rein in airlines arbitrarily changing their schedules, as the government considers its aviation white paper. Advocates of such a scheme claim Australian laws are “lagging behind the rest of the world”, and point to the EU’s air passenger compensation scheme as a solution. The EU scheme includes set amounts of between E250 and E600 in compensation per passenger when a flight’s arrival is delayed more than three hours, with the amount dependent on the distance of the trip. For longer delays and cancellations, passengers can opt to be refunded, which must be repaid within seven days. The scheme only covers delays caused by the airline, and does not apply to causes outside their control such as weather. However, Qantas, Jetstar, Virgin Australia, Bonza and Rex Airlines have not supported calls for such a scheme in Australia.<br/>

One of the bold predictions made in the dark days of the first Covid-19 lockdown was that air travel would never be the same again. Once executives discovered it was perfectly possible to hold meetings with counterparts across the globe via Zoom, business travel — from which many airlines derived the bulk of their income — would surely never fully recover; companies would balk at paying for pricey air tickets and hotels. As travel collapsed, many airlines were kept alive by bailouts. Hundreds of aircraft were parked in the Arizona desert. Things have turned out rather differently. Monthly air passenger numbers are virtually back to pre-pandemic levels. But demand is recovering fastest in the premium segment — driven not by business travellers but by leisure. Lufthansa chief Carsten Spohr said this week that his team’s urgings to expand first class — long in decline — were something he “never thought I would hear”. Air France-KLM says high-end leisure travellers are more than offsetting reduced corporate travel. The three biggest US carriers told investors last month passengers were eager to book seats at the front of the plane. The recovery is not only in first and business class. Low-cost Ryanair this week struck a deal to buy up to 300 Boeing aircraft. With demand close to outstripping supply amid a backlog of new planes, and labour and fuel costs soaring, air fares are rising at twice the rate of inflation. The struggle by airlines and airports to accommodate the surge led over the past year to delays, cancellations, and falling customer satisfaction levels. But that, in turn, may be pushing middle-class customers to upgrade their seats in search of a better experience — even, in some cases, at the cost of shortening their trips. <br/>

Singapore-based lessor BOC Aviation has agreed to purchase seven Airbus A320neo-family jets, with deliveries commencing this year. The lessor has disclosed the agreement to the Hong Kong stock exchange. BOC Aviation already has 105 A320neos and 86 A321neos on direct order with Airbus, of which it has respectively received 57 and 20.The lessor states that its overall fleet, at the end of March, stood at 635 owned, managed or ordered aircraft. BOC Aviation has not identified an engine selection for the additional A320neos, which can be fitted with the CFM International Leap-1A or Pratt & Whitney PW1100G.<br/>