general

The runaway rise in air fares driven by the sharp rebound in post-pandemic travel demand slowed in 2023, but travellers still face prices well above 2019 levels on many of the world’s most popular routes. Average ticket prices on more than 600 routes rose at an annual rate of 2.1% in September, the latest month for which data is available, down from double-digit growth at the start of the year, according to a Financial Times analysis of data from aviation company Cirium. Airlines have faced criticism for the rise in ticket prices, which has come as high demand for travel has coincided with a shortage of global aircraft. Industry costs including fuel and staff have also risen. The EU told the FT in November that it has been “looking into the details” of what has caused fare rises in the region, the Italian government threatened to impose pricing caps on some routes and European airports have also questioned the price jumps. But the growth in air fares has now dipped below the rate of US inflation, a proxy for inflation in developed economies, which was 3.7% in September. The data analysed prices on popular routes and used average one-way fares in economy seating, excluding taxes and fees. The figures showed that prices stabilised in 2023 but are still well above pre-pandemic levels on many routes. The average one-way economy class transatlantic flight from London Heathrow to New York’s JFK was $343 in September, 19% higher than in 2019. Fares between Singapore and Sydney were more than $100 higher than in the same month in 2019. Airlines across the world, from Ryanair to Singapore Airlines, have reported record profits, particularly through the summer months in the northern hemisphere.<br/>

A group representing major passenger airlines on Friday urged US transportation officials to do more to address the impact of private planes and air traffic controller staffing shortages on holiday flight delays and cancellations. Airlines for America, a group representing American Airlines, Delta Air Lines, United Airlines, Southwest Airlines and others, urged Transportation Secretary Pete Buttigieg and FAA chief Michael Whitaker to "take all possible actions to find the appropriate balance between commercial and private aviation traffic with the goal of minimizing delays and cancellations for the traveling public." The group in a letter also urged "all possible steps be taken to avert additional staffing triggers, particularly in high volume centers" for air traffic control. The FAA said airlines, general aviation and others "have a seat at the Command Center, where the FAA monitors the airspace 24/7 and gives updates every two hours." The FAA said "as air travel continues to rebound, the agency is taking immediate action to recruit, train and hire more air traffic controllers" but has acknowledged it is still about 3,000 controllers below optimal levels. Preliminary data from December 20—27 show 77% of delays have been due to volume, 19.1% to weather, and 0.9% due to FAA staffing, the agency said. Buttigieg said this month the US is on pace to have the lowest number of flight cancellations in five years. He and Whitaker have prioritized boosting air traffic control staffing. The FAA in September extended cuts to minimum flight requirements at congested New York City-area airports through October 2024, citing staffing shortages. New York Terminal Radar Approach Control staffing is just at 54% of recommended levels.<br/>

US airline stocks weathered a domestic travel slowdown and geopolitical turmoil to notch their first yearly gain since 2019, capping a hard-fought rebound from when the pandemic grounded aircraft and pummeled the industry. The S&P Supercomposite Airlines Industry Index advanced 7.1% this year, its best annual performance since rising 12% four years ago. SkyWest Inc. leads the nine-member gauge with a 217% surge, followed by 20% pops from Delta Air Lines Inc. and Allegiant Travel Co. The swing back to positive performance reflects consumers’ persistent demand for experiences despite the looming threats that elevated interest rates would rein in discretionary spending and conflict in the Middle East would exacerbate oil volatility. Record holiday travel has helped to brighten the financial outlook for the industry, with Delta, JetBlue Airways Corp. and Southwest Airlines Co. all making note of strong year-end bookings. “Valuations are rising recently as investors look past fare weakness to lower fuel prices which could provide the ability to cut fares and support demand with minimal or no impact on profit,” says Bloomberg Intelligence analyst George Ferguson. Challenges remain. The airlines index is still a ways away from the 52-week high it set in July, and this year’s jump isn’t close to making up for the roughly 56% it lost during the prior three years. There is also a risk that leisure travelers scale back their vacations in the new year as employers ramp up return-to-office mandates, and as consumers hit the brakes after leaning too heavily on their credit cards to fund everything from “revenge” getaways to expensive restaurant meals. Yet many are optimistic that an end to the Federal Reserve’s tightening cycle will help improve consumer confidence and support leisure and corporate travel. Delta will be the first major US carrier to give a read on Q4 performance and 2024 expectations when it releases results on Jan. 12.<br/>

The TSA is monitoring a potential terror threat against the United States from an affiliate of al-Qaeda, known as the AQAP. The group has released alarming videos online, calling for attacks on US airlines, prominent figures and iconic locations. The AQAP, identified as al Qaeda in the Arabian Peninsula, posted videos this week urging terrorist actions on global flights, Times Square and the New York City subway. The content includes specific calls for attacks on Jewish and Western targets, singling out American, British and French airlines. Notably, high-profile individuals such as Bill Gates, Elon Musk, and former Federal Reserve Chairman Ben Shalom Bernacchi are named as potential targets. A meticulously produced instructional video accompanies these threats, featuring depictions of airplanes exploding and providing detailed instructions on bomb-making. The video goes further to offer tips on bypassing airport security measures and boarding flights undetected. In response to these threats, the TSA issued a statement, acknowledging awareness of the AQAP communication. The agency emphasized its commitment to the ongoing security of transportation.<br/>

Nicaragua has become a hot spot for migrants from around the world seeking to avoid a brutal trek through the Darien Gap jungle -- including the 303 Indians whose plane was grounded last week in France on their way to the Central American nation. Migrants from South American and Caribbean countries, Africa and Asia, have long had to brave the lawless, virtually impassable rainforest that straddles Panama and Colombia, in a bid to reach the United States. However, analysts say that the government of Nicaragua's iron-fisted President Daniel Ortega, a longtime nemesis of the United States, has deliberately made it easier for migrants to bypass the Darien by flying straight to his country before heading north overland. Manuel Orozco, a migration expert at the Washington-based Inter-American Dialogue, told AFP that Ortega's government was facilitating "the business of a network of international air services" so that migrants "can reach the border with Mexico and the United States faster." "We collected data from more than 500 charter flights," said Orozco, adding that between April and June, airport authorities had hired "private companies located in Dubai to train officials in the international handling of paperwork for these types of flights." An Airbus A340 was detained last week at a Paris airport after an anonymous tip-off that it was carrying potential victims of human trafficking. After it was established that the passengers were traveling of their own free will, most of them were flown back to India on Monday. Indian police said the passengers had paid tens of thousands of dollars to agents to help them reach the southern border of the United States. Orozco said that the Nicaraguan government, which has remained mum on the matter, benefits from the cost of visas or tourist cards -- depending on the nationality of the arriving passenger -- as well as landing taxes.<br/>

Bulgaria and Romania came closer to joining passport-free movement in the European Union after the bloc agreed to ease maritime and air travel for the two countries. Member states approved a deal Saturday allowing the two Balkan countries to apply the rules of the so-called Schengen system for entering ports and airports from end-March after Austria, the last holdout against the expansion of the border-free area, partly lifted its veto. Bulgaria and Romania, which joined the bloc in 2007, have faced opposition from some member states over their apparent inability to tackle corruption and organized crime and to secure borders. Both countries for years ranked among the worst in the EU in terms of corruption, but have made some improvements recently. The two states have expressed hope that easing travel via land borders could follow, although Austria has been reluctant to agree for now, fearing an influx of migrants. Vienna wants to strengthen land borders with additional EU funding and demands that Sofia and Bucharest host migrants from Syria and Afghanistan. Lifting land controls would ease commercial traffic through Bulgaria and Romania, where trucks en route from Greece and Turkey would often spend days waiting to cross the Danube river.<br/>

New rules governing air traffic controllers' right to strike in France were signed into law on Friday, marking the end of a turbulent year for the aviation transport sector. Airlines flying to and from European destinations have hailed the reform as an important first step in reducing disruption to millions of passengers following a year that saw dozens of French strike cause the cancellation of thousands of flights. Under the new rules, airline staff performing duties "whose absence is likely to have a direct impact on the operation of flights" must individually declare their intention to strike no later than noon two days beforehand. Up until now, air traffic control unions were required to give notice of strike action five days in advance to ensure a "minimum service", but strikers themselves did not have to declare their participation – unlike other employees in the sector. This loophole provoked of excessive flight cancellations because the French Civil Aviation Authority could not provide reliable estimates of the number of controllers available for scheduled flights. The amendment to the General Civil Service Code was rubber stamped by the Constitutional Council on 21 December after being adopted by Parliament on 15 November. It was on Friday published in the Journal Officiel, the government's official gazette used to announce new laws and decrees.<br/>

The operator of Berlin Airport expects passenger numbers to increase by 8% next year as it continues its post-pandemic recovery, the CE says. The airport in the German capital launched in Oct. 31, 2020, after a years-long delay and at the height of the COVID-19 pandemic, when collapsing demand was wreaking havoc with the global aviation industry. Its recovery, based on passenger levels at the old Tegel and Schoenefeld airports that it replaced, is underway "but still delayed", said Aletta von Massenbach, CEO of the FBB operator. "We assume that the 2019 level can be reached again from the end of the decade," von Massenbach told Reuters in an interview. The aim is to have around 24.8m passengers at BER in 2024, von Massenbach said. By comparison, Tegel and Schoenefeld airports handled a combined total of 35.65m people in 2019. In 2023, Berlin Airport, or BER, met its target with around 23m passengers travelling through its gates, some 3m more than the year prior. "We are satisfied with how BER has developed and what we have created," von Massenbach said. However, she said that while air traffic had returned to or exceeded pre-pandemic levels across much of the globe, it was still lagging in Germany. "High state taxes and fees play a major role here. This is why the airlines are reducing their services," von Massenbach added. Budget airline heavyweights Ryanair and Easyjet have both pared back their activities in Germany in recent years, blaming comparatively high airport fees.<br/>

IGA Istanbul Airport's passenger numbers rose 18% this year to 76m and the hub is targeting 85m in 2024, acting CEO Selahattin Bilgen told Reuters on Friday, with discussions underway to add 11 more airlines by the end of next year. "We are currently in talks with 11 airlines. We want to bring them to our airport before the end of 2024," he said. "There are airlines from North America, the Far East and Central Europe." He said five of them were expected to be operating out of Istanbul Airport within the first six months of 2024. At a ceremony to mark the start of flights by Air China, Bilgen said Istanbul Airport was the third largest worldwide in terms of airlines served after Bangkok and Paris Charles de Gaulle, having a reached a landmark of 100 carriers. By that measure, Istanbul Airport will become the world's largest if the 11 airlines with which it is currently in talks agree to operate there, he said. On the issue of low-cost carriers, Bilgen voiced caution. "(They) can expand the market on one hand and harm competition on the other. That is why we are more selective and strategic about low-cost airlines," he said. Asked whether new borrowing was on the company's agenda to finance investments, Bilgen said its cash flow was strong enough currently but it may evaluate external borrowing if conditions are right, possibly through a eurobond issuance or project finance.<br/>

Airport baggage handling workers represented by the CCOO, UGT, and USO plan to strike nationwide Jan. 5-8. Iberia, Iberia Express, and Air Nostrum have already canceled approximately 461 flights in anticipation of the action. The industrial action had previously been planned for Dec. 29-31 and then postponed pending further negotiations. However, the strike was subsequently confirmed for Jan 5-8, prompted by working conditions deemed unsatisfactory by the unions. The action will disrupt airport operations and flight schedules nationwide; further cancellations are possible. Long queues are likely for passenger processing procedures. As airports deal with passenger backlogs, lingering flight disruptions are likely following the strike's conclusion.<br/>

All Boeing 737 MAX jets operated by Chinese carriers are back in service at the end of 2023, the US planemaker's China head said on Friday, nearly a year after they started flying following a global grounding in 2019. The best-selling Boeing model was grounded after fatal crashes in Indonesia and Ethiopia. The MAX returned to service around the world starting in late 2020 after modifications to the aircraft and pilot training, but Chinese airlines started to fly them again only in January 2023. "All China civil aviation 737 MAXs have resumed operations," Boeing China CEO Liu Qing said on Chinese social media, adding that this amounted to nearly 100 planes. The culmination of the MAX's return to service in China comes as Boeing conducts preparatory activities and flight tests on a number of 737 MAX jets designated for Chinese customers, raising speculation that the US planemaker could soon restart deliveries of the MAX to China, which have been suspended since 2019. A restart of MAX deliveries would be a major breakthrough for Boeing's relationship with China, which has been impacted by the MAX crisis and US-China political tensions. It would also be a financial win for Boeing, allowing it to collect payment for dozens of Chinese MAX planes in its inventory The company last week made its first direct delivery of a 787 Dreamliner to China since 2019, a step seen as a possible prelude to the end of Beijing's freeze on 737 MAX deliveries. Through November, it also handed over eight 777 freighters to Chinese customers, according to Boeing data.<br/>

Global aircraft leasing companies are reassessing their risk appetite for China amid heightened tensions with the US and in the wake of big losses following the grounding of planes in sanctions-hit Russia. Some international lessors have begun to reduce their exposure to the country, industry executives and analysts said. Friction between the US and China, coupled with uncertainty over war risks surrounding Taiwan, were adding to wider concerns over geopolitical risk, they added. China is the world’s single largest market for airline lessors, according to aviation consultancy Cirium, with almost 20% of their global portfolio leased to operators within the country, and it is forecast to remain a critical market for the aviation industry. But western lessors “may be at the start of a trend to de-risk” from China, said Eddy Pieniazek, head of advisory at aviation consultancy Ishka. “The major risk is about whether there would be war in [the] coming few years” across the Taiwan Strait, which could put many aircraft assets at risk, said an executive from a major aviation leasing company. “If you look at Russia, the aircraft got detained in Russia . . . that could also happen in China if the same sanctions [are] imposed on China.” Hundreds of planes owned by western aircraft leasing companies were stranded in Russia after its invasion of Ukraine in 2022. Many lessors are still embroiled in legal disputes with insurers over billions of dollars of claims. Aircraft leasing companies’ experience in Russia “probably alerted some lessors to review or reconsider their exposure concentrations”, including that of China, Pieniazek added. Los Angeles-based Air Lease Corporation, one of the world’s biggest aircraft lessors, owning about 448 planes and with a fleet net book value of $25.6b, said it has over the past five years reduced the share of its portfolio in China from about 20% to about 7% as of September this year.<br/>

Following last week’s delivery of the first EH216-S electric vertical take-off and landing (eVTOL) to a customer, China’s EHang has completed several “commercial demonstrations” using the pilotless, two-person air taxi. The passenger-carrying flights were operated on 28 December during launch events in Guangzhou and Hefei, with several city officials and private citizens taking rides on the autonomous aircraft. The flights marked a step toward “normalising flights with the EH216-S in aerial sightseeing at local scenic spots”, EHang says. ”More operation sites and flight routes for aerial sightseeing and logistics are under development in Huangpu district as well.” For example, the company is developing operations in Hefei’s Luogang Central Park, a nearly 1,270 hectare (3,138 acre) green space at the site of the former Hefei Luogang International airport. Flight routes will eventually expand to more scenic locations in Hefei, such as Swan Lake. ”Abundant application scenarios and massive demands for aerial sightseeing, tourism and regional shuttle services makes the Luogang Central Park an ideal commercial operation site for EH216-S pilotless passenger-carrying eVTOL aircraft,” EHang says. The firm, which is listed on the US stock market, secured a type certificate for the EH216-S from the Civil Aviation Administration of China in October, becoming the world’s first air taxi developer to be blessed by a major civil aviation regulator and setting the stage for planned commercial operations in 2024. On 21 December, EHang delivered its first aircraft to ETON, an aviation technology company associated with Guangzhou government. The EH216-S can carry two passengers plus luggage, within its 620kg (1,370lb) maximum take-off weight limit, on trips of up to 16nm (30km).<br/>