Airline executives are fuming about the prospect of grounding planes and trimming flight capacity amid a busy summer travel season after fresh problems arose with some of RTX's Pratt & Whitney engines. Pratt & Whitney's latest snag, revealed on Tuesday, will impact at least 1,200 of its Geared Turbofan (GTF) engines that power Airbus' popular A320neo jets and will need up to 60 days to inspect and fix after microscopic contaminants were found in a metal used in part of the engine core. While few airlines commented publicly about the engine contamination issue, multiple senior airline executives privately said they were shocked, and one who asked not to be identified called it a "nasty surprise." Carriers are already grappling with shortages of pilots, air traffic controllers and new planes, making it harder to add more flights. Some are leaning on bigger planes that can accommodate more passengers to get around operational challenges. "On the face of it, this came at a really awkward time," said Addison Schonland, partner at consulting firm AirInsight. RTX said it was looking to minimize the impact and support its customers, but airlines in the northern hemisphere are trying to optimize resources for the summer travel season, typically the industry's most profitable period. Major customers that took delivery of affected A320neo jets include Spirit Airlines, JetBlue Airways, Hawaiian Airlines and Wizz Air, according to aviation data provider Cirium.<br/>
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The Transportation Department announced on Wednesday that it had finalized new regulations to require more commercial aircraft to have accessible bathrooms, a long-awaited step to address complaints from disabled travelers about the difficulties of flying. Under the regulations, new single-aisle planes with at least 125 seats will eventually be required to have at least one lavatory large enough for a disabled passenger and an attendant to enter and move around in. Twin-aisle planes are already required to have an accessible lavatory. “Traveling can be stressful enough without worrying about being able to access a restroom,” Transportation Secretary Pete Buttigieg said in a statement. “Yet today, millions of wheelchair users are forced to choose between dehydrating themselves before boarding a plane or avoiding air travel altogether.” The finalized regulations came out of a lengthy effort by the Transportation Department, dating back to the Obama administration, to develop new rules intended to improve air travel for people with disabilities. In 2016, an advisory committee established by the department called for accessible bathrooms on new, larger single-aisle planes, and the department proposed new regulations last year to carry out that recommendation. Airlines have increasingly used single-aisle planes on lengthy flights, worsening the discomfort for disabled travelers who cannot use existing lavatories. The new requirement for accessible lavatories does not kick in immediately. It will apply to new single-aisle planes that airlines order beginning in 2033 or that are delivered beginning in 2035. But that timeline is faster than what the advisory committee laid out in 2016 and what the Transportation Department proposed last year. The new regulations also include other steps meant to improve air travel for people with disabilities, such as installing grab bars in lavatories on certain new planes.<br/>
US aviation regulators announced two new steps to tighten the process of approving airliner designs, actions required by Congress after crashes on Boeing 737 Max aircraft killed 346 in 2018 and 2019. The FAA's policy changes will take effect in 30 days after the public and industry have a chance to comment on them, the agency said in a press release on Wednesday. The FAA will establish stricter requirements for planemakers to inform the agency of unusual designs that require extra scrutiny during its process of evaluating aircraft designs, it said. The actions are among multiple moves ordered by lawmakers to address concerns raised in investigations of the crashes, which occurred off the coast of Indonesia and in Ethiopia. As the updated 737 Max family was being designed, Boeing officials altered a safety system that could push down the plane’s nose, but didn’t explain it to FAA engineers.<br/>
The European Union on Wednesday agreed to ban exports of battlefield equipment and aviation parts to Belarus, expanding sanctions on the Kremlin ally for its involvement in Russia's war against Ukraine. Spain, the current holder of the EU's rotating chairmanship, said in a post on social media platform X, formerly Twitter, the new sanctions were a response to "the situation in Belarus and the involvement of Belarus in the Russian aggression against Ukraine." Lithuania's EU ambassador, Arnoldas Pranckevicius, said in his post on X that the embargo covered "dual use battlefield and aviation goods", as well as a blacklist of individuals. The decision must still be finalised and will take effect if none of the bloc's 27 member states raise last-minute objections by Friday. A draft of the decision, which is dated June 24 and was seen by Reuters, named aircraft engines and their parts among exports under the new sanctions that extend to Belarus more of the trade curbs the EU has in place against Russia. Introducing sanctions requires the approval of all 27 member countries, something that has been missing for a wider package of restrictions that would target Belarusian industry, as advocated for by hawks Poland and Lithuania.<br/>
A fire early last week at Sicily's main airport is still causing massive disruption for visitors to the island, laying bare the disorganisation and poor infrastructure that challenge Italy's tourism ambitions. The fire broke out on July 17 at Catania airport, below Mount Etna, which acts as a hub for the east of Sicily and attracts more arrivals than the capital Palermo. The blaze, the cause of which is still being investigated, was swiftly extinguished and nobody was hurt, but in the following nine days thousands of disoriented tourists have complained of huge delays, a lack of information, and flights suddenly re-routed hundreds of miles away. Some disruption was inevitable, but visitors describe scenes of utter chaos that jar with the government's jaunty "Welcome to Wonder" advertising campaign, which aims to attract tourists using a computerised "influencer" version of Venus. Italy is trying to boost its appeal as a tourist destination, and a boom in arrivals this year has supported the economy as the manufacturing sector has struggled. Confused and infuriated tourists have complained of the airport's public address system breaking down and instructions being given by staff using megaphones, and only in Italian. The regional government says the situation is gradually improving, and it is confident the airport can return to full capacity by early August. Palermo, the island's second-largest airport, was also temporarily shut down on Tuesday due to nearby forest fires.<br/>
Spanish airport operator Aena’s first-half net profit more than doubled as passenger traffic returned to pre-pandemic levels and its revenues from retail sales rose. The company said on Wednesday it made a net profit of E608m compared with E277m in the same period last year. Some 144m passengers passed through its terminals in the first six months of 2023, 5% more than in the same period in 2019, before the pandemic ravaged the travel industry in 2020. Total commercial revenues reached E715.3m, 29% more than in the first half of 2022, it added. Aena renewed its duty-free shop contracts at all of Spain’s airports in the period. The deals are set to increase retail revenues by 16.3% for the full year, it said. On Tuesday, the company confirmed that Swiss duty-free retailer Dufry had won the contract to continue operating shops at Spain’s biggest airports in Madrid and Barcelona. The shops account for 44% of the Spanish airport operator’s total commercial revenue. In the first six months of 2023, sales at duty-free shops were 13.5% higher than in 2019, as passenger numbers recovered. The airport operator, unlike its peers, retained staff during the pandemic, which should allow it to fully benefit from the surge in consumer demand for travel this year. Aena’s board of directors decided earlier this week to increase its per-passenger charges by 4% from March 2024 to cover higher costs due to inflation and electricity prices.<br/>
Britain's Heathrow Airport warned on Wednesday that a slowdown in leisure travel is likely later this year, bringing an end to the post-pandemic boom which has helped airline profits soar despite disposable incomes shrinking. Heathrow, the busiest hub in western Europe, reported pretax profit up 6% to GBP279m in the first six months of the year, on a 42% rise in passenger numbers to 37m. That number was driven by more flights to and from destinations worldwide, helped by the reopening of China and soaring demand for transatlantic travel. "Leisure demand has really defied gravity," Heathrow CE John Holland-Kaye said. Consumers have prioritised holiday spend over the last year, splashing pandemic savings even as rising inflation and interest rates have eaten into household budgets. Delta posted the highest quarterly earnings in its history in the June quarter. British Airways-owner IAG is due to report results on Friday. But the rush on bookings will tail off in the second half, Heathrow warned, citing the cost of living crisis as a "material headwind".<br/>
Airlines could end up paying twice as much for insurance they need to protect themselves against losses triggered by war after a bruising year wiped out aviation war insurers’ revenue for 2023, industry sources say. Aircraft were destroyed at Khartoum airport in a conflict between military factions in Sudan that erupted earlier this year, resulting in losses of between $240 and $300m, according to three aviation insurance sources. The losses incurred in Sudan represented the total global annual premium in the niche aviation war insurance market, two of the sources said. Insurers are as a result weighing a potential doubling of the premiums on such policies when airlines typically renew cover in the fourth quarter, the sources said. The sources declined to be named due to client confidentiality. Insurers are already feeling the pinch as they face legal action for up to $10b in claims from around 400 aircraft stuck in Russia after sanctions on the country following its invasion of Ukraine last year. Some have since cut back on aviation war coverage to minimise future losses amid the conflict. The exposure to losses from Ukraine and Sudan has fed through to the reinsurance market. Reinsurers insure the insurers, who typically pass on any extra payments for reinsurance to their customers. Some types of aviation war reinsurance saw rates rise by up to 100% at the key July 1 renewal date, according to a report this month by broker Gallagher Re.<br/>
Southern Taiwan on Thursday shut businesses and schools while airlines cancelled hundreds of flights amid warnings of landslides and floods as Typhoon Doksuri churned past the island en route to China where it will make landfall later this week. As of 10:15 a.m. (0215 GMT) Typhoon Doksuri, categorised at the second-strongest typhoon level by Taiwan's weather bureau, headed towards the southern Taiwan Strait with maximum winds of 191 km (118 miles) per hour. At one point Doksuri was a super typhoon, but lost some of its strength after it lashed the coastline of the northern Philippines on Wednesday, bursting banks of rivers and leaving thousands without electricity. Doksuri killed five people in the Philippines, according to the country's disaster agency. Taiwan's weather bureau issued wind and rain warnings on Thursday for the southern and eastern part of the island, including the major port city of Kaohsiung where businesses and schools were closed and landslide warnings issued. All domestic flights and ferry lines were suspended in Taiwan while more than 100 international flights were cancelled or delayed. Railway services between southern and eastern Taiwan were shut.<br/>
The Civil Aviation Authority of Vietnam (CAAV) has identified several north Asian markets as having a slower recovery in passenger travel demand, even as international travel demand to the country picks up. At a work review conference held on 24 July, the authority says markets such as mainland China, Hong Kong and South Korea are seeing a “slower recovery rate” compared to other regions, though it did not go into detail. It adds that a key focus in the second-half of 2023 will be on tapping on Chinese travel demand. This is in contrast with the traffic recovery to Thailand, Indonesia and Australia, which the CAAV notes are between 10 and 30% higher than pre-pandemic 2019. Traffic to Japan, a market which opened only late-2022, has recovered close to 2019 levels, the authority adds. India, which Vietnamese carriers identified as an area of network opportunity while China remained shut, is also “very fast growth”, the CAAV states. In 2022, Vietnamese carriers – especially low-cost operator Vietjet Air – ramped up flying to India from key Vietnamese hubs. According to CAAV data, overall international traffic in the first six months of this year has recovered to around 72% that of 2019 levels. Domestic traffic, meanwhile, is now 8% higher than pre-pandemic levels, though the CAAV notes it is lower than traffic recorded in 2021, the highest levels seen during the pandemic. <br/>
Boeing results topped analyst expectations Wednesday thanks to a pickup in commercial aircraft deliveries as the manufacturer increases production, but losses in its defense and space businesses drove the manufacturer into the red for the quarter. The company generated $2.6b of free cash flow in the second quarter, ahead of analyst forecasts, and reiterated its full-year guidance of between $3b and $5b of free cash flow. Boeing shares surged nearly 9% to end the day at $232.80, the stock’s highest closing price since November 2021. Here’s how the company performed during the period ended June 30, compared with Refinitiv consensus estimates: Adjusted loss per share: 82 cents vs. 88 cents; Revenue: $19.75b vs. $18.45b. Boeing and main rival Airbus have both struggled to increase aircraft production in the wake of the Covid pandemic as some airlines face longer waits for new jets, just as travel demand rebounds. The company delivered 136 planes in Q2, up from 121 aircraft during the same period last year.<br/>
Boeing's first delivery of the 737 MAX 7 has been delayed to 2024, the company said in an SEC filing on Wednesday. Boeing still expects the FAA to certify the MAX 7 and begin FAA certification flight testing for the MAX 10 in 2023, the company said. MAX 10 is currently slated for first delivery in 2024. Both the MAX 7 and MAX 10 are seen as critical for Boeing to compete against Airbus for orders at the top and bottom of the narrowbody markets. A delay in getting the MAX 7 to launch customer Southwest will further draw out its entry into service, originally set for 2022, and could hinder the carrier's expansion, as it exclusively operates the 737. Boeing shares were up 7.7% on Wednesday afternoon on the strength ofQ2-results that beat Wall Street consensus. Boeing and the FAA have been going back and forth on the safety management system paperwork for months needed to get the MAX 7 certified and there is no clear timetable when the FAA might be able to sign off on Boeing’s submissions, sources told Reuters. "Safety dictates the timeline of certification projects. We cannot discuss ongoing certification projects," the FAA said in a statement.<br/>
Boeing is lifting production of its bestselling 737 narrow-body jet, but executives said Wednesday that it will take time for its facilities to stabilize production, even as they set their sights on future rate boosts. Shares of the company rose 7%, at one point hitting a 1-1/2-year high after Boeing also posted second-quarter results above Wall Street expectations. The planemaker is now transitioning its 737 production line - including the MAX models that make up the vast majority of 737 production - to building 38 jets per month, up from 31, the company said. "That's a big important move, and there'll be subsequent rate breaks beyond that," said CEO Dave Calhoun. "All of that is going to play into a margin trajectory that's going to start to look a lot more normal." Calhoun later added the company is already in "prep mode" to raise monthly 737 production to 42, but wouldn't specify whether Boeing would do so in 2023, as Boeing Commercial Airplanes head Stan Deal told Bloomberg TV in June. And while Calhoun said he would "love" to ramp up 737 production from its stated monthly target of 50 to 60 jets, Boeing needs to ensure production lines remain stable as rate increases in 2024. Boeing has signaled to suppliers that it will lift 737 production to 47 a month in June 2024, Reuters previously reported. While analysts pressed Boeing executives on production increases, Calhoun warned that continued supply chain constraints could persist for the foreseeable future, stating that, "Everyone is fighting for the next part."<br/>
Europe’s Airbus on Wednesday posted higher-than-expected underlying operating profit for the second quarter and reaffirmed financial goals for the year, while removing an interim industrial target on the route to record jet output. The world’s largest planemaker said adjusted earnings before interest and tax rose 34% to E1.845b ($2.04b) as revenues grew 24% to E15.9b, buoyed by higher jet deliveries. Analysts had forecast quarterly operating profit of E1.725b on revenues of 15.867b, according to a company-compiled consensus. Airbus said it was “progressing well” towards a widely watched production goal for its best-selling A320neo-family jets of 75 jets a month in 2026, which it reaffirmed. But it withdrew any public mention of a previously stated interim goal of 65 a month by end-2024. Tactical adjustments will be made as required to meet the ultimate 75-per-month rate, “which is now the key reference point for the company and the supply chain,” Airbus said. CE Guillaume Faury denied the decision to retire the interim target from the company’s official releases signaled any lack of confidence in its production plans. He said the 65-a-month target - slightly above what Airbus was producing before the pandemic - had been an important milestone in post-COVID recovery that was no longer relevant. However some suppliers were surprised by the decision to remove the target. Airbus told them during the Paris Airshow last month that it saw “no change” to its goals, they said. <br/>
A global initiative designed to grow the $2b market for carbon offsets outlined criteria for new voluntary standards on Thursday, and hopes to issued labelled credits by the end of the year to bring transparency to the unregulated marketplace. Demand for carbon offsets - credits for emissions-reducing activity that can be generated through projects such as tree planting - is expected to grow as companies with net-zero goals buy them to cancel out emissions elsewhere. But the market is unregulated, with many different standards and approaches making it difficult for companies to assess which credits they should use. Critics of the market cite concerns including poor transparency and questions over the environmental quality of projects. The Integrity Council for the Voluntary Carbon Market (ICVCM), an independent governance body for the market, has published its criteria for projects to achieve its new Core Carbon Principle (CCP) standards. The criteria "set a global threshold for quality which aims to unlock finance at speed and scale for projects to reduce and remove billions of tonnes of emissions that would not otherwise be viable," said Integrity Council Chair Annette Nazareth in a statement. The most widely traded offsets standards are those deemed eligible under the CORISA scheme set up for the global airline industry.<br/>