British Airways owner IAG and Air France-KLM became the latest airline groups to benefit from booming demand for leisure travel, as they reported record profits over the summer. IAG on Friday reported a 43% increase in Q3 operating profit before exceptional items to E1.75b, its second consecutive quarter of record results. “During the third quarter we saw sustained strong demand across all our routes,” said IAG chief executive Luis Gallego. The airline group, which also owns Aer Lingus and Iberia, reported particularly strong appetite for travel across the Atlantic and to leisure destinations in Europe. Rival Air France-KLM said its operating profit reached a record E1.34b in Q3, up 31% from a year earlier, driven by strong summer bookings. The results from two of Europe’s largest aviation groups underline the industry’s rapid recovery from the disruption of the Covid-19 pandemic. Low-cost airline easyJet has said it expects to report record profits over the summer, while London’s Heathrow airport raised its passenger forecasts this week. However, the rise in the price of oil and growing geopolitical uncertainty have raised questions over the durability of the recovery, and airline shares have fallen since the summer. Gallego said bookings for the rest of this year were “positive”, and early signs for 2024 were “in line” with expectations. “We are pleased how the business is performing . . . [but] we are very mindful of the geopolitical and macroeconomic uncertainty.” Both IAG and Air France said there had not been any significant hit to bookings from the tensions in the Middle East. But IAG’s CFO Nicholas Cadbury said strengthening the company’s balance sheet would be a “priority” over the next year, at the expense of shareholder payouts, in part because of the uncertain outlook. Net debt fell 22% from E10.4b to E8b in the first nine months of the year.<br/>
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Qantas Airways rebutted allegations by Australia’s competition regulator that the airline misled passengers by continuing to sell tickets on thousands of flights that it had already decided to cancel. Launching its fight against the watchdog’s lawsuit, Qantas said Monday that the regulator’s case “ignores the realities of the aviation industry.” The airline didn’t delay telling passengers their flights has been canceled for commercial gain, and all customers on scrapped services were offered an alternative flight or refund, it said. The Australian Competition & Consumer Commission sued Qantas in late August, claiming the company kept on selling tickets — typically for more than two weeks but sometimes longer than a month — for more than 8,000 scrapped services between May and July 2022. The regulator is seeking a record penalty of more than A$250m ($158m). “The ACCC’s case ignores a fundamental reality and a key condition that applies when airlines sell a ticket,” Qantas said. “While all airlines work hard to operate flights at their scheduled times, no airline can guarantee that.” Qantas’ defense suggests a protracted court case looms over the so-called ghost flight allegations, which triggered the early retirement of then-Chief Executive Officer Alan Joyce and led to a boardroom cleanout to repair the airline’s brand. Among a raft of scandals that have diminished the reputation of Qantas, the regulator’s accusations of deceit have been perhaps the most damaging.<br/>
The Australian Federation of Pilots said on Friday it has advised an unit of Qantas Airways it will stop work on Wednesday to Thursday next week in a bid to negotiate wages. AFAP members make up over 90% of the pilot group employed by Qantas' unit Network Aviation. The union has been negotiating with airline management over wage policy revisions in the resource-rich state, which is home to large deposits of iron ore and natural gas. Qantas in a separate statement deemed the actions by the union "unreasonable escalation of the dispute". "It is disappointing that there has not been any indication in that last four weeks that Qantas management might shift its position to bring its WA-based pilots' wages and conditions into line with those of other Qantas Group pilots," said Chris Aikens, senior industrial officer of AFAP. Qantas is currently trying to explore available avenues to make an agreement that benefits its pilots and meets the needs of the business, it added.<br/>