general

The travel industry has reaped the rewards of a frantic summer season, with airlines reporting record profits and hotels on both sides of the Atlantic having returned to near pre-pandemic occupancy. But it is now facing an uncertain winter and questions over whether the insatiable demand for holidays can withstand persistently high inflation and economic stagnation, or is a post-pandemic bubble waiting to burst. Most senior executives, particularly in Europe, are confident that consumer spending on travel appears immune to the cost of living crisis. But some cracks are appearing to show across the Atlantic, where the first signs of weakening demand have appeared in the domestic market. Low-cost airline Spirit said it had turned to “steep discounting” as it issued a profit warning this month, while JetBlue reported a “shift away” from domestic travel in August. More optimistic executives say travellers are swapping domestic breaks for foreign holidays, and an influx of US tourists certainly boosted Europe’s tourist industry this summer. But as domestic trips in the US were one of the first parts of the travel industry to restart during the pandemic, there are also fears this slowdown could be an early warning that peoples’ broader desire for travel is wilting. In Europe, Michael O’Leary, CE of the continent’s largest airline Ryanair, remains “cautious” despite strong winter bookings that are 3-4% ahead of where they were last year. “I am worried about the state of consumer confidence . . . you have higher interest rates, higher mortgage payments and energy prices,” he said. O’Leary expects to have to cut prices to fill planes during quieter periods as the industry becomes more “peaky”, and for overall fares to fall by “low single digits” this winter. Sébastien Bazin, CE of hotel giant Accor, agrees that the industry is braced for a “diminishing in pricing power”. The French company has offset occupancy levels that are 4% lower than before the pandemic by raising prices 10%. “With interest rates the way they are and what we’ve seen with inflation the way it is, the discretionary income of consumers is going to be far less, but we’ve planned for that,” said Bazin. Accor now expects more normal growth in revenues per available room of 2.5-5% a year, he added, “because of pressure on the middle class population”. For most though, serious cracks are yet to appear. As of mid-September, booked occupancy for hotels worldwide in the fourth quarter is 11% ahead of the same time last year, according to travel technology platform Amadeus.<br/>

Heavy rain and dangerous flash flooding delayed and canceled flights on Friday at La Guardia and Kennedy Airports, with the number of grounded flights also mounting at other airports in the Northeast. Wait times crept up to nearly an hour at Newark Liberty International Airport and Boston Logan International Airport. At Kennedy, the average delay for outbound flights is more than three hours. And the extreme weather hasn’t just kept flights on the ground. At La Guardia, floodwaters began rising in Terminal A, forcing it to close. Terminal A handles, on average, fewer than 10% of La Guardia’s flights, said Amanda Kwan, a spokeswoman for the Port Authority of New York and New Jersey, which operates the area’s airports. Mircea Abrantes, 38, and Florence Layne, 66, were on the same flight to Houston from La Guardia on Thursday night, which they both missed. Resigned to catching the next available flight on Friday afternoon, they spent the night hunched over airport benches in the waiting area of Terminal A. Then the deluge struck. Around 9 or 10 a.m., flood water rushed into the terminal, sending travelers running for higher ground, Layne said. Their 12:30 p.m. flight with Spirit Airlines was canceled, the terminal was evacuated, and the women were shuttled to Terminal C. The next available flight to Houston leaves tomorrow afternoon — from Newark. “I can’t take any more of it; I’m just tired,” said Layne, who has abandoned her plans to attend a business convention in Houston. She plans to catch a bus, and then a train, back to her apartment in East Flatbush, Brooklyn. The diminished operations at the area’s airports are not more pronounced then they would be on a typical stormy day, said Ian Petchenik, a spokesman for Flightradar24, a flight-tracking company. But this could change if flights are grounded for a prolonged period, he said.The airspace in and around metro New York is the busiest and most complex in the country, according to the Port Authority. About 30 percent of flights in the United States pass through New York area airports at some point each day, Petchenik said.<br/>

Italy and war-torn Libya on Saturday resumed commercial flights for the first time in a decade, authorities in the Libyan capital said. Flight MT522, operated by the Libyan carrier Medsky Airways, departed Mitiga International Airport in Tripoli for Rome’s Leonardo da Vinci-Fiumicino Airport, according to Libyan airport authorities. There were 25 passengers on the flight, said Hamdi al-Zanad, head of the Libyan airline. A return flight was scheduled to land in Tripoli on Saturday afternoon, according to Mitiga International Airport. There will be a round-trip flight between the Libyan and Italian capitals on Saturdays and Wednesdays, according to the Mitiga airport announcement. The government of Prime Minister Abdul-Hamid Dbeibah in Tripoli lauded the resumed flights, posting photos on social media that showed passengers boarding the flight and officials celebrating. Italy and other Western nations banned flights from Libya as the oil-rich nation in North Africa plunged into chaos after a NATO-backed uprising toppled and killed longtime dictator Moammar Gadhafi in 2011. In the disarray that followed, the country split into rival administrations in the east and west, each backed by rogue militias and foreign governments. Amid the chaos, Libya has had direct flights to limited destinations, including cities in neighboring Egypt and Tunisia, and other Middle Eastern countries, such as Jordan.<br/>

Thailand’s capital city will add a third passenger terminal to its biggest airport as the Southeast Asian nation prepares for a surge in tourist arrivals under a visa waiver program for Chinese visitors during the peak holiday season. Airports of Thailand Pcl, which operates Bangkok’s Suvarnabhumi international airport, on Friday opened for trial the satellite terminal built at a cost of about 35b baht ($1b). Airlines including Thai units of AirAsia X and Vietjet will operate from the facility, which is expected to reach its full capacity of 15m passengers next year. The addition of the new terminal comes as Thailand is expecting a rush of tourists during the so-called high season from now until the end of February for the local travel industry. Prime Minister Srettha Thavisin, who attended the terminal’s soft launch, said his government was promoting tourism as it can quickly help stimulate the nation’s sagging economy. “Tourism can create jobs and income for the Thai people quickly,” Srettha said. “I am confident the new facility will make a good impression on international travelers” with its spacious layout and modern designs that may help position Bangkok as an aviation hub for the region, he said. With the addition of the satellite terminal that’s connected to the main airport building through an automated trains, Suvarnabhumi’s annual passenger capacity will jump to 60 million from 45 million now. Airports of Thailand is also building a third runway at the airport that will be completed in the third quarter of next year, increasing aircraft handling capacity to 94 flights per hour from 68 now. Srettha’s government, which took power earlier this month, has waived visa requirements for Chinese and Kazakh travelers for a five-month period to lure more holidaymakers as Thai economy faces headwinds from rising in oil prices and sluggish exports. Chinese were the largest group of visitors to the Southeast Asian country before the pandemic, accounting for about 28% of the record 40 million foreign arrivals in 2019. <br/>

The head of the competition watchdog has called for a fresh mandate from the Albanese government to monitor the airline industry and help new entrants compete with established players Qantas and Virgin. The chair of the Australian Competition and Consumer Commission, Gina Cass-Gottlieb, said the regulator sees “a case” for a mandate to look into competition, prices and industry practices after an earlier direction expired in June. Cass-Gottlieb’s call follows a Senate inquiry hearing this week in which industry and airline heads, including Virgin Australia’s Jayne Hrdlicka, backed a revamped watchdog monitoring program – standing in contrast to Qantas, which did not support a renewed probe.In June 2020, the Morrison government directed the ACCC to monitor the domestic industry for anti-competitive behaviour at a time of crisis, following Virgin Australia entering administration and the loss of budget carrier Tiger, as well as broader disruptions from pandemic border closures threatening other airlines operations. Despite calls for an extension from within the aviation sector and consumer advocates concerned about price gouging, the ACCC’s domestic airline monitoring program concluded in June. Since then, concerns about anti-competitive practices such as slot hoarding have only grown, with the ACCC launching court action against Qantas for allegedly advertising and selling tickets for more than 8,000 flights that it had already cancelled in its system. Asked if the ACCC would like monitoring of the aviation industry to be renewed, Cass-Gottlieb told Guardian Australia: “That original direction had a specific focus on the impact of Covid. “We do see a case for reinstatement of a direction that would look to the status of competition, and survey prices, costs and the manner of operations.”<br/>

Twelve months into her four-year mandate as ATR’s first female chief executive, Nathalie Tarnaud Laude maintains the Toulouse-based airframer’s recovery is “on track” and that it will deliver at least 40 aircraft this year, after shipping 20 units in the first eight months. ATR has also taken 22 firm orders in 2023 – including deals with Azul, Berjaya Air, and Mandarin Airlines announced at June’s Paris air show. With “more in the pipeline”, Laude says she is confident of achieving a book to bill ratio of 1:1 this year, as well as restoring ATR to profitability for the first time since the Covid-19 crisis. It follows a dismal 2022 in which the Airbus/Leonardo joint venture delivered just 25 aircraft and notched up 26 orders, around half the figure its shareholders had been banking on when the industry began to emerge from the effects of the pandemic late the previous year. Speaking to FlightGlobal at the regional turboprop manufacturer’s Blagnac campus, Laude, who took over in September last year, says her “focus has been to rebuild after Covid”, and that she has been “encouraged by the wonderful engagement and levels of motivation from all the employees in this company”. She blames ATR’s poor 2022 performance largely on “a tough [supply chain] environment”, which she expects to continue into 2024. “It wasn’t so much a problem with demand,” she says, although she admits ATR customers tend to commit to purchases only 24 months ahead of an expected delivery. She adds that other encouraging signals are that fleet utilisation is back to 2019 levels, with just under 1,200 ATRs in operation, and a 160-strong backlog. A glut of used examples on the market – something that hampered new aircraft sales during 2022 – has also “dried up”, she says. Her target is to bring annual production back up to 80 – the level ATR enjoyed through much of the 2010s – by the “second half of the decade”, and to take the book to bill ratio “well above” 1:1. “That clearly means we will need to sell more,” she remarks. ATR will restart a 400h flight test campaign for its short take-off and landing (STOL) version of the ATR 42-600, after an initial sortie in May last year. It follows the installation of a larger rudder, built by Leonardo. The certification target is now June 2025, slightly later than previously suggested. ATR has 21 orders for the variant, but Laude expects more to follow once the certification schedule is confirmed. The company is targeting sales to airlines that use short airfields in mountainous and island regions. This includes Japan where Laude says there are 10 airports inaccessible to all but the smallest passenger aircraft. “With this variant we can really bring more connectivity to communities that have little or no air access,” she says.<br/>

Environmentalists have condemned a “ludicrous” private jet service that transports wealthy people’s dogs, which this week ran its first flight from Dubai to London. For GBP8,166, one way, customers were able to sit with their dogs on their laps and sip champagne as they travelled from Al Maktoum international airport to Farnborough in a Gulfstream IV-SP jet. The company, K9 Jets, which is run by a husband-and-wife couple from Birmingham, already operates services to New Jersey, Los Angeles, Frankfurt, Paris and Lisbon. Announcing the new route, Adam Golder, the company’s co-founder, told AeroTime Hub: “K9 Jets believes pet family members deserve to travel in comfort and style alongside their owners. “We couldn’t be more excited to kick off this new route, just in time for the holidays, so guests can celebrate with their loved ones (including pets) in style.” K9 celebrated the launch of the service on Instagram with a picture of a passenger sitting at a walnut table with a glass of champagne, her face wearing a delighted smile as she is nuzzled by her golden retriever. Extinction Rebellion, the climate protest group, criticised the service. “This is clear evidence that super-wealthy people are still capable of loving an animal like one of their own, which strangely offers me some sense of hope. Yet I’m left dumbfounded that the same people cannot connect to the collapsing natural world around them, and thus come to their senses,” said XR spokesperson Todd Smith, a former Thomas Cook first officer. <br/>