general

The recovery in business travel has stalled this year amid record price rises for premium flights and growing pressure on big companies to cut their carbon emissions. Europe’s three major airline groups reported a drop in the rate of recovery in corporate travel in their most recent earnings, while bookings at US airlines have flatlined over the past year. According to data from the Global Business Travel Association and CWT, a business travel and meetings company, the average premium-class air fare has risen from $3,666 in 2019 to $4,395 this year. Recent price rises are the highest on record, they said. Robin Hayes, CE of JetBlue, said in the US airline’s results call this month that the industry was now operating “in a world where business travel may not be coming back”. British Airways owner IAG, Air France-KLM and Lufthansa said bookings from corporate customers were between 60 and 70% of pre-pandemic levels in Q2, a decline from the first three months of the year, according to calculations from analysts at Bernstein. IAG CE Luis Gallego told analysts that “things are not improving recently” for corporate travel, and that booking volumes have “plateaued”, although he highlighted signs of a stronger second half of the year. The bosses of Air France-KLM and Lufthansa, meanwhile, said they had written off a full recovery in domestic business travel, with Air France cutting capacity on some routes in response. Across the Atlantic, the post-pandemic recovery has typically outpaced Europe, but business travel bookings at US airlines have stagnated at 75% of 2019 levels since spring 2022, according to analysts at Melius Research. Paul Abbott, CE of American Express Global Business Travel, said multinational companies had been slower to bring back business travel than small- and medium-sized companies, where demand has recovered to 86% of 2019 levels, compared to 70% for larger corporates. His company has increased its focus on SMEs and reported record revenues in its most recent quarter.<br/>

Airlines spent decades cramming as many seats into coach as possible. Now they’re focusing on adding roomier seats in a worldwide chase for high-spending travelers like Natalie Rasmussen. “I’m not going to fly to Europe in 36B. 36B is a bra size, not an airline seat,” said Rasmussen, an application scientist who lives in near San Jose, California. Rasmussen said she won’t fly in standard coach on long-haul flights. Instead, she opts for business class or premium economy, a newer cabin that sits between business and coach and offers more legroom, a bigger seat-back screen and other perks but not the lie-flat seats of front-of-the-plane fame. Premium seats yield many times standard coach fares, making them even more important to carriers as ticket prices, generally, fall and business travel’s rebound from the Covid pandemic levels off. Airline executives have said customers have shown a willingness in the wake of the pandemic to pay for more space on board. Rasmussen said she recently paid $500 to upgrade on her way home from Europe to ditch premium economy and fly in Delta Air Lines’ highest-end cabin, Delta One, which comes with a lie-flat bed, large entertainment screen and a privacy door. Airlines are in an arms race to outfit thousands of new aircraft with high-end seats — and more of them. Economy seats account for 79.3% of seats between the U.S. and Europe, down from nearly 81.9% in 2018, before the pandemic, according to aviation data firm Cirium. Business-class seats’ share of seats sold has grown slightly, from 12.9% to 13.5% though premium economy’s share has increased even more, making up 6.4% of seats sold, up from 4.2% five years ago, while first-class seats’ share fell.<br/>

Jets cross the sky 30,000 feet above millions of acres of corn blanketing the US heartland. As airlines face pressure to cut emissions, they have joined forces with farmers to lobby in Washington so that corn helps power those planes. Their push has encountered resistance from environmental groups that say refining corn into biofuels has minimal benefits for earth’s climate. New tax rules that could make or break corn ethanol’s prospects as a so-called sustainable aviation fuel may be released as soon as next month. Airlines have pledged net zero emissions by 2050. But their plan hinges on sustainable aviation fuel that is in scarce supply, made mainly from cooking oil or animal fats. The US biofuels industry, the world’s largest, was supercharged by a 2007 law that forced blending increasing amounts of ethanol into petrol. The industry now faces the threat of declining demand, however, as more battery-powered cars arrive on American roads. With airlines in need of a product and biofuel refiners looking for a new market, they have allied to include ethanol in the plane fuel mix. Their lobbying campaign is centred on tax credits for aviation fuel established in the Inflation Reduction Act, the landmark climate law signed by President Joe Biden a year ago. The credits are worth $1.25 a gallon for fuels that reduce emissions by at least 50% compared with jet fuel, and up to $1.75 per gallon for further reductions.  Carriers such as United Airlines and Alaska Airlines have joined farm groups, US biofuel refinery owners such as Archer Daniels Midland and Green Plains, and international oil companies including BP and Shell, to push federal tax officials to embrace an analysis of greenhouse gas emissions that would make ethanol eligible for more generous tax credits. The IATA estimates airlines will globally need 450bn litres (119b gallons) of sustainable fuel a year to meet its mid-century carbon goals, but last year refiners made about 300m litres.<br/>

The US and China will approve twice the number of passenger flights currently permitted for air carriers to fly between the two countries, the Biden administration said on Friday, in a rare sign of cooperation between the world’s largest two economies. The US Transportation Department said it would will increase the number of Chinese passenger flights allowed to fly to the US to 18 weekly round-trips on Sept. 1 and increase that to 24 per week starting Oct. 29, up from the current 12. It said the Chinese government will agree to the same increase for American carriers, confirming a decision reported earlier by Reuters. The agreement between Beijing and Washington, which have sparred on many fronts, comes after China on Thursday lifted pandemic-era restrictions on group tours for more countries, including key markets such as the US, Japan, South Korea and Australia. USDOT said the first tranche of flights was approved to start Sept. 1 “to meet an anticipated increase in demand around the start of the academic year.” Sources said US airlines are not expected to immediately take advantage of all 18 weekly flights. The Chinese Embassy in Washington referred questions about specifics to authorities in China, but said “direct flights are essential for increasing mutual visits between Chinese and American peoples. We hope that the restoration of more flights will do good to the flow of people and trade between the two countries.” After Secretary of State Antony Blinken’s June trip to the China, consistent engagement by USDOT and the State Department with Chinese officials “made this important step forward possible,” USDOT added. “Our overriding goal is an improved environment wherein the carriers of both parties are able to exercise fully their bilateral rights to maintain a competitive balance and fair and equal opportunity among U.S. and Chinese air carriers,” USDOT said in its approval order on Friday.<br/>

Peru announced an air security agreement with the United States on Saturday in what the government described as a push to stop planes belonging to drug gangs from entering the South American country's airspace. The deal revives a bilateral security cooperation pact with the United States from 20 years ago, according to a government statement, and will permit new intelligence and training support to flow to Peru's air force. It covers upgrades to two dozen helicopters and radar equipment, with the statement also citing "intense collaboration" with the United States, but without disclosing the cost of the security assistance. The US Department of Defense did not immediately respond to a request for comment. The statement cited Peruvian Defense Minister Jorge Chavez, who stressed that airspace interdictions efforts under the agreement will be carried out via non-lethal means. An earlier air security pact between the two countries was suspended two decades ago after Peru's air force shot down a plane it had misidentified, killing two US citizens.<br/>

Flight disruption has become a feature of post-pandemic travel in the UK, according to new data which illustrates how the aviation industry has struggled to deliver consistent performance since mass travel restarted. Around 32% of flights departing from UK airports were cancelled or delayed in the first five months of the year, according to Financial Times analysis of figures from the Civil Aviation Authority (CAA). The level was higher than in the two years leading up to the coronavirus pandemic, where it at stood at 25% and 22% in 2018 and 2019, respectively. The figures cover the performance of flights from 26 airports that the aviation sector regulator tracks. The scale of the problem has not been as significant as last summer, when parts of the industry buckled owing to staff shortages and more than 50% of flights were cancelled or delayed. But the data instead shows that heightened disruption — defined as a flight cancelled or delayed by over 16 minutes — has become a near constant theme of the industry’s recovery. The trend is apparent at terminals across the country. Delays and cancellations were higher in the first five months of 2022 and 2023 than in 2019 at each of the UK’s eight largest airports. Moreover, delays have persisted despite departures not yet rebounding to 2019 levels. In May, CAA data captured 78,149 scheduled flights departing UK airports. In the same period of 2019, the figure was 90,452. Last year, airlines and airports suffered from staffing problems as the industry struggled to get back on its feet after Covid-era travel restrictions were lifted.<br/>

Russian air defences on Friday downed a Ukrainian drone as it flew towards an unspecified target in Moscow, the defence ministry said, the latest in a flurry of drone attacks on the Russian capital. Earlier, Moscow's Vnukovo airport and Kaluga airport, some 150 km southwest of the capital, were temporarily shut due to a suspected drone flight. They later reopened. "... an attempt by the Kyiv regime to carry out a terrorist attack by an unmanned aerial vehicle (UAV) on a facility in Moscow was thwarted," the ministry said in a statement, adding the drone was jammed and crashed in a forest west of Moscow. "There are no casualties and no damage," it said. Earlier, Vnukovo airport said it had been compelled to suspend all flights "for reasons beyond the control of the airport", adding that some flights had been redirected to other airports in the Moscow region. It gave no further information. Flights later resumed at both Vnukovo and Kaluga airports. Drone air strikes deep inside Russia have increased since a drone was destroyed over the Kremlin in early May. Civilian areas of the capital were hit later in May and a Moscow business district was targeted twice in three days earlier this month.<br/>

Japan is preparing for its second typhoon in a week, with airline companies canceling flights and rail operators warning of disruptions. Typhoon Lan is expected to make landfall Tuesday in central Japan near Osaka, the country’s second largest metropolitan area. The Japan Meteorological Agency has called for precautions against heavy rain, mudslides and strong winds. Japan Airlines said Sunday afternoon it had canceled 19 domestic flights for Monday due to the storm, with more updates expected. Regional operators of Japan’s high-speed trains, Central Japan Railway Co. and West Japan Railway Co., warned they could halt operation completely on parts of their system Tuesday, and said delays and suspensions were likely on Monday and Wednesday. As of Sunday afternoon, Typhoon Lan was about 320 kilometers (199 miles) south of Japan’s Hachijojima island and moving northwest, according to the JMA. The storm, which is called Typhoon No. 7 in Japan, is packing maximum winds of about 144 kilometers per hour. It’s expected to make landfall on a path across the center of Japan’s main island — a heavy industrial region with major automobile factories — before turning north toward Hokkaido. <br/>