Global airline passenger traffic was at 94.1% of 2019 levels in 2023, according to annual data from IATA, as an improving trend through most of the year put the industry within touching distance of pre-Covid demand. That assessment follows IATA’s projection in December last year that traffic measured in revenue passenger kilometres (RPKs) is expected to be 4.5% above 2019 levels in 2024, ending four years of lost growth amid the impact of the Covid-19 pandemic. US domestic traffic was 3.3% up on 2019 levels in 2023 RPKs in the final quarter of 2023 were at 98.2% of 2019 levels, IATA said on 31 January, “reflecting the strong recovery towards the end of the year”. The 2023 traffic performance was up 36.9% year on year, the airline association adds. “The strong post-pandemic rebound continued in 2023… with a strong performance in quarter four teeing-up airlines for a return to normal growth patterns in 2024,” says IATA director general Willie Walsh. International traffic – which accounted for just over 60% of RPKs – was 11.4% down on 2019 levels in 2023, while domestic traffic – accounting for around 40% of RPKs – was up 3.9%.<br/>
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Boeing said on Wednesday that it would not provide a full-year financial forecast, the clearest indication yet that the company is trying to assure customers that it is prioritizing safety amid growing concerns about its popular 737 Max jets. Even as it announced its quarterly earnings, the company chose to concentrate instead on discussing quality control and accountability. Boeing is trying to stem the fallout from an incident less than four weeks ago during which a hole blew open on an Alaska Airlines 737 Max 9 plane shortly after takeoff. “My focus is on Alaska Airlines Flight 1282 and the actions we are taking as a company to strengthen quality and earn the confidence of our customers, the confidence of our regulators and the flying public,” Boeing’s CE, Dave Calhoun, said on a conference call with Wall Street analysts. “We caused the problem, and we understand that,” Mr. Calhoun added without specifying what Boeing got wrong. “Over these last few weeks, I’ve had tough conversations with our customers, with our regulators, congressional leaders and more. We understand why they are angry, and we will work to earn their confidence.” With federal officials still investigating the Jan. 5 incident, Boeing’s executives had been grappling with how much to emphasize its efforts to improve safety while also reassuring shareholders about its financial performance. Quality concerns have taken on new urgency after news accounts, including a report in The New York Times, that Boeing workers had opened and reinstalled the panel that blew off the plane, known as a door plug.<br/>
Boeing has been sued by shareholders who said the company prioritized profit over safety and misled them about its commitment to making safe aircraft, prior to the Jan. 5 mid-air cabin panel blowout on an Alaskan Airlines 737 MAX 9. According to a proposed class action filed on Tuesday, Boeing spent more than four years after the Oct. 2018 and March 2019 crashes of two other MAX planes, which killed 346 people, assuring investors that it was "laser-focused" on safety and would not sacrifice safety for profit. Shareholders said Boeing's statements were false and misleading because they concealed the "poor quality control" on its assembly line, and caused its stock price to be inflated. Boeing's share price fell 18.9% from Jan. 5 to Jan. 25, 2024, the day after the Federal Aviation Commission barred Boeing from expanding MAX production because of safety concerns. The decline wiped out more than $28b of market value. The lawsuit filed in the Alexandria, Virginia, federal court covers shareholders from Oct. 23, 2019 to Jan. 24, 2024, and is led by Rhode Island General Treasurer James Diossa. Other defendants include Boeing CE Dave Calhoun and his predecessor Dennis Muilenburg, and CFO Brian West and his predecessor Gregory Smith.<br/>
The FAA said Wednesday that its previously announced audit of Boeing 737 MAX manufacturing will look at all elements of production at Boeing and fuselage production at Spirit AeroSystems'. The FAA said a team of two dozen aviation safety inspectors will conduct the audit at the Boeing 737 facility in Renton, Washington, and at Spirit in Wichita, Kansas. The audit will also examine how Boeing transfers unfinished work from suppliers to its production lines. The FAA announced the audit on Jan. 13 after the agency grounded 171 MAX 9 planes due to a mid-air cabin panel blowout on a new Alaska Airlines MAX 9. The FAA last week allowed the planes to fly again. The FAA said it is conducting enhanced oversight of Boeing and "will regularly assess trends, corrective actions and the effects of any changes to the quality system." The FAA did not say how long the greater scrutiny would last. FAA Administrator Mike Whitaker told Reuters this month the Boeing production audit would begin with the 737 MAX and extend to other planes as warranted by data. Whitaker said the FAA audit "is to look at the system, look at how the inspections are done, where they're done, how the interaction is with the suppliers, how the handoff happens, just the whole process to really understand how it works and where the faults might be."<br/>
Laser strikes aimed at aircraft including airline planes surged 41% last year to a record high, according to federal officials. The FAA said Wednesday that it received 13,304 reports from pilots about laser strikes last year, erasing a record set in 2021. “Aiming a laser at an aircraft is a serious safety hazard that puts everyone on the plane and on the ground at risk,” FAA Administrator Mike Whitaker said in a video posted by the agency. The FAA said pilots have reported 313 injuries since the agency started keeping records in 2010. Each of the last five months of 2023 surpassed the previous high month, November 2021. The full-year rise over 2022 numbers easily topped the 28% increase in reported incidents from 2016 to 2022. Authorities blame the surge in attacks on factors including the widespread sale of inexpensive lasers in stores and online, stronger devices that can hit planes at higher altitudes, and the increased awareness among pilots to report incidents. The FAA said it can fine violators $11,000 for each violation, up to $30,800, and federal, state and local law enforcement agencies can file criminal charges.<br/>
New York City-area airports recorded their busiest year of all time in 2023 with about 144.2m passengers, the Port Authority of New York and New Jersey announced Wednesday. LaGuardia Airport saw a new high of 32.4m passengers, a 4% jump from its 2019 record, while at John F. Kennedy International Airport there were about 62.5m passengers. Newark Liberty International Airport recorded its most significant jump at 49.1m passengers in 2023. The Port Authority of New York and New Jersey, which operates the region’s airports, is undertaking about $30b worth of airport redevelopment initiatives. “Demand for air travel has not only returned but has surpassed pre-pandemic levels. We are delighted to provide new world-class facilities to this record-breaking number of travelers,” Port Authority Executive Director Rick Cotton said in a statement. Across the US, the passenger-traffic rebound has accelerated airport construction and renovation plans. <br/>
Dallas Fort Worth International, the world’s second-busiest airport, is building its own electric capacity amid concerns the Texas’ grid will continue to be plagued by power crises. The plans include construction of a new utility plant as well as a solar-powered microgrid, said DFW International CEO Sean Donohue. The Electric Reliability Council of Texas, known as Ercot, oversees the power infrastructure that serves the vast majority of Texas’ 30m residents. “One of the challenges we’ve identified in the future is will Ercot be able to keep up with our power requirements,” Donohue said during an interview with Bloomberg on Wednesday. “As we forecast our power needs at the airport, they could double in the next five to 10 years.” Ercot has for years struggled to maintain power deliveries to homes and businesses across the second-largest US state during heatwaves and winter storms that spike demand. Break-neck population growth has strained the grid’s ability to cope several times in recent years, including a deadly February 2021 disaster that shut off lights, heat and water for millions of residents for the better part of a week. DFW’s new central utility plant will be fully electric and designed to meet increased demand as it constructs a new terminal and tears down and rebuilds another, Donohue said. The solar-powered microgrid at its rental-car center will be capable of supercharging EVs in a short time. <br/>
The lack of certainty over the annual passenger cap at Dublin Airport may compel carriers at one of the world’s largest airline groups to focus on other airports if a decision is delayed. That is the warning from Jordi Pla Pintre, a director at low-cost Spanish airline Vueling, who is one of a number of airline executives to call on Fingal County Council to raise the current 32m passenger per annum cap at Dublin Airport to 40m. Vueling is part of the IAG Group that also owns Aer Lingus, British Airways and Iberia. In a submission, Pla Pintre on behalf of Vueling said that “retaining the existing cap” of 32m “restricts airlines’ ability to grow volumes into Dublin”. “The lack of certainty over the cap makes it challenging to forecast effectively and may compel IAG carriers to focus on other destinations or airports if a decision is delayed,” he said. “Fingal County Council should consider granting an immediate interim increase in the passenger cap at Dublin Airport pending the consideration of the full planning application.”<br/>
Aircraft leasing firms have secured settlements with Russia totalling more than $2.5b for over a quarter of the roughly 400 aircraft stuck in the country since Moscow's invasion of Ukraine in 2022. In return, international lessors are handing ownership of the planes to state insurance company NSK, which will transfer them to Russian airlines. NLK-Finance, a subsidiary of NSK, has been allocated 296.8b roubles ($3.31b) to date to buy out aircraft that have been the subject of a stand-off between international lessors and insurers, Russia's finance ministry said this month. The impact of these settlements on lawsuits launched by lessors against Western insurers was unclear, the heads of aircraft lessors DAE Capital and Aircastle Advisor told the Airline Economics conference in Dublin this week. Lessors have been suing dozens of insurers over losses of at least $8b over the trapped planes, with vast court trials scheduled in Dublin in June and London in October. Some are also being heard in U.S. states. In separate litigation, groups of lessors are trying to prevent reinsurance cases worth more than $4b from being heard in Moscow, a court filing shows. Story features details of settlements reached to date between lessors and Russia.<br/>
Nigeria's central bank said it had cleared the entire backlog of verified claims owed to foreign airlines whose payments had been blocked in the country, but airline association IATA said another $700m of owed money remained in Nigerian banks. Dollar shortages have since 2016 made it hard for some foreign airlines that sold tickets in the naira to get their money out of Nigeria, with IATA saying last year some $743m in revenue earned by international carriers there was still blocked. Central Bank of Nigeria spokesperson Hakama Sidi Ali said on Tuesday that all verified claims by airlines had been cleared after the bank released an additional $64.4m of foreign exchange owed to them, bringing total payments to $136.7m. The IATA said late on Tuesday however that while it welcomed the CBN's announcement of the release of blocked airline funds, there was "a considerable journey ahead in fully addressing the issue". "While this development is encouraging, it's crucial to recognize that approximately $700m remains blocked with Nigeria's commercial banks," the world's largest airline association said in a statement. Commercial banks have to source dollars from the central bank to repatriate airline funds due to a broad shortage of foreign currency in Nigeria. IATA added that the trapped revenue issue has been made worse by the devaluation of the Nigerian currency, which has lost more than 40% of its value against the U.S. dollar this month after shedding a third of its value last year.<br/>
India's fast-growing airline industry faces higher leasing bills unless the country clarifies its insolvency laws, the head of major leasing firm Aviation Capital Group (ACG) said on Wednesday. Foreign lessors, including an Irish subsidiary of U.S.-based ACG, were blocked from recovering jets caught up in the bankruptcy of budget carrier Go First last year and many are still embroiled in a legal battle to recover their assets. India amended its insolvency laws last October to exclude leased aircraft from assets that can be frozen in a bid to address discrepancies between local and global rules, including the 2001 Cape Town Convention. India has ratified but not fully implemented the treaty, which is designed to encourage lessors that control half the world's fleet to rent jets in exchange for a mechanism allowing them to take back relatively easily when airlines default. ACG CE Thomas Baker said lessors were still searching for clarity, despite the Indian government's move. "It's incredibly frustrating. They always find a way to continue to delay the process. The government clarified it in the fall that it (the Cape Town Convention) should apply to existing aircraft but unfortunately, no, no clarity," Baker told Reuters in an interview. "I think it fundamentally impairs the Indian aviation market and they need to fix it. I think it fundamentally changes the way we price risk in that market. They're hurting themselves."<br/>
China’s airlines are stepping up deliveries of Boeing Co. 737 Max jets at an opportune time for the reeling US planemaker, whose commercial activity had been largely frozen in one of its largest international markets until recently. China Southern, Air China and Kunming are either flying or preparing to ferry newly acquired Boeing 737 from Seattle on Wednesday, according to FlightAware. The airlines filed plans bearing their own flight codes for journeys to Honolulu, the first stop across the Pacific and an indication they’ve already taken possession of the Max aircraft from Boeing. The delivery flurry comes a week after a China Southern 737 Max took wing over the Pacific, ending a nearly five-year halt to imports of Boeing’s workhorse jets. Analysts and the planemaker’s executives increasingly think China’s airlines could be a “catalyst for Boeing to burn off its inventory” of undelivered jets this year, said Sheila Kahyaoglu of Jefferies. “The first deliveries to China potentially open the way for additional approvals and an acceleration,” the analyst said in a note to clients Wednesday following Boeing’s earnings call. But she noted one worrying sign: the number of Max scheduled to go to China this year fell by more than 50% in just the past week, to 31 aircraft. Such deliveries — if they continue — figure to be an important source of cash for Boeing at a time when its production of new models is uncertain amid a quality crackdown by US regulators and irate customers. Both have vowed to send teams of auditors into Boeing’s factories after a new Alaska Airlines Max suffered a near-catastrophic blowout earlier this month.<br/>
Menzies Aviation, one of the world’s largest aviation services companies, is targeting expansion in China that could generate a revenue increase of around 20%, according to CEO Philipp Joeinig. London-headquartered Menzies is weighing new business opportunities on the mainland via joint ventures, Joeinig said in an interview this week after the company made its first big push into Hong Kong. Menzies earlier this month agreed to acquire Jardine Matheson Holdings Ltd.’s 50% stake in aviation services company — Jardine Aviation Services Group. The Hong Kong-based business offers a slew of check in and baggage handling services at Hong Kong International Airport. No price was disclosed. “The first step is to do Hong Kong right, to prove to the market we can add value,” Joeinig said. “The second step is to sit down with CNAC and look at opportunities,” he said, with reference to China National Aviation Corp., which owns the other half of Jardine Aviation Services Group. CNAC itself is part of a broader company that has a controlling stake in Air China Ltd. CNAC and Menzies also operate a separate venture at Macau airport. China has been slow to restore international flights after Covid, in part due to a lack of airport workers and ground handling staff. “The opportunities in China are in the scale of zero dollars to $500m depending on how much we want to invest, how willing we are to take risks and how many things we do at the same time,” Joeinig said.<br/>
Asia-Pacific operators are set to fully recover their international passenger traffic in the coming months, even as uncertainties – including the “potential erosion” of consumer sentiment – loom ahead. Director general of the Association of Asia Pacific Airlines (AAPA) Subhas Menon says this year “promises to be another good year” for the region’s carriers. “International passenger traffic is poised to return to pre-pandemic levels in the coming months, buoyed by the return of tourism and resilient expansion of the region’s economies. However, there remain some uncertainties, including the potential erosion in business and consumer sentiment amid rising geopolitical risks,” says Menon. His comments come as AAPA traffic data for 2023 show “robust growth” in demand: the region’s airlines carried about 279m international passengers during the year, more than twice the number in 2022. The figure is also around 72% of pre-pandemic levels, the association states. <br/>
Airlines could struggle to reach their near-term climate goals, according to Kristof Van Passel, head of procurement operations and development at Cathay Pacific. That’s because the supply of lower-carbon sustainable aviation fuel (SAF) is “coming online slower than anticipated,” said Van Passel during the BloombergNEF summit in San Francisco on Wednesday. Hong Kong-based Cathay Pacific, like most other major airlines, has pledged for 10% of their fuel to be sustainable by 2030. But the supply of SAF is likely to be 30% to 40% below the demand from airlines by the end of the decade, said Van Passel. “And we expect that gap to widen,” he added. The lower-carbon fuel is typically derived from animal fats, used cooking oil and other feedstocks. A number of startups are also trying to make the fuel from sources such as captured carbon dioxide. Reaching Cathay and other airlines’ 10% SAF target in six years is a massive challenge. SAF accounted for 0.03% of Cathay Pacific’s overall fuel consumption in 2022. Globally, SAF is about 0.1% of airlines’ fuel consumption today. Another key challenge will be bringing down the cost of SAF, according to Van Passel, who said the lower-carbon fuels are two to three times more expensive than conventional jet fuel. “Given the magnitude of the cost, it would drive any airline into losses within a matter of months,” he said.<br/>