unaligned

Before its shutdown this week, Lynx Air hoped to pay off some of its debt to a top investor through a purchase by rival discount carrier Flair Airlines. According to documents filed with the Alberta Court of King’s Bench, proceeds from a tentative deal with Flair would have gone toward Lynx’s $124.3m debt to Indigo Partners, the U.S. private equity firm run by Bill Franke that owns one-quarter of Lynx. The 1,275-page filing refers to Flair dozens of times, including to a planned “transaction” and a non-binding agreement signed on Jan. 11. Lynx and Flair did not immediately respond to requests for comment. When it filed for creditor protection on Thursday, Lynx also owed $25.6m in unpaid taxes to the federal government and $47.8m to various trade creditors, according to court documents. The filings state it has $600m in liabilities and $429m in assets — the vast majority of them leases for nine Boeing 737 Max 8 jets. Judge John Gill granted Lynx protection under the Companies’ Creditors Arrangement Act last week, which allows firms to restructure their financial affairs and pay off lenders, typically for pennies on the dollar. “The corporate entity that we know today as Lynx will not exist coming out of CCAA, based on what they’ve publicly stated,” said Duncan Dee, Air Canada’s former CCO. “What it appears they’re doing is liquidating their assets.” The 21-month global grounding of the Max 8 along with COVID-19 travel restrictions and jet fuel price hikes delayed Lynx’s inaugural flight by more than two years to April 2022 and hampered ticket sales to the point it could no longer pay its creditors, the ultra-low-cost carrier (ULCC) said in a brief to the court.<br/>

Mexican ultra low-cost carrier Volaris reported a full-year profit of $8m as the company resized operations and capitalised on strong demand. The Mexico City-based carrier said on 26 February that full-year revenue was $3.26b, up 14% from 2022. Expenses for the 2023 rose 8.3% year on year to $3.01b. For Q4, the company posted a $112m profit on $899m of revenue, up 9.6% from the same period in 2022. “Throughout 2023, we gained valuable lessons…and turned a very complex situation into a solid financial result for the fourth quarter,” says CE Enrique Beltranena. “Our performance demonstrated resilience in the face of the challenges encountered throughout the year, such as the extended FAA downgrade of Mexico to Cat 2 [safety status], Pratt & Whitney’s engine preventive accelerated inspections, and slot reductions at the Mexico City International airport.” The Mexican government has been reducing capacity at the older airport in that nation’s capital, in favour of the newer but more distant Felipe Angeles International airport. In addition, the US FAA only in September returned Mexico’s safety status to Category 1 from Category 2, after more than two years. That change allowed airlines to add flights between the USA and Mexico.<br/>

Lufthansa Group’s newly-established operator, Lufthansa City Airlines, has identified initial destinations which will feature on the carrier’s network. The airline will fly domestically from Munich to Berlin, Hamburg, Bremen, Dusseldorf and Cologne and Hanover. It will also serve international routes to Birmingham, Manchester and Bordeaux. Two Airbus A319s – out of a fleet of four for the airline – have already been painted in Lufthansa City colours ahead of first flights in summer this year. The carrier says passengers will be able to book services towards the end of April. “In the following months, Lufthansa City Airlines will gradually expand its network and offer further destinations in Europe,” it adds. “Competitive strengthening of the short-haul network is essential for strengthening the Lufthansa Group’s market position and the planned growth of Lufthansa long-haul routes.” Lufthansa City eventually aims to operate a fleet of Airbus A220-300s, and plans to take up to 60 of the type.<br/>

Ryanair Holdings Plc agreed to team up with online travel agent On the Beach Group Plc, bringing an end to a long-running spat between the two companies over market competition. The deal, coming four months after Ryanair accused the aggregator of issuing a “hypocritical press release” calling for fair play, allows On the Beach to list Ryanair flights on its website without markups, according to a statement on Tuesday. The move marks Ryanair’s fourth online travel-agency deal this year and follows partnerships with Loveholidays, Kiwi.com and TUI. All of the accords have been made under similar conditions that customers aren’t overcharged for fares. On the Beach rose as much as 12% to 157.6 pence in London trading, the biggest gain since early Dec., 2023. Ryanair was little changed in Dublin. On the Beach has been embroiled in a legal battle with Ryanair after the package holiday provider sued the airline in 2021, accusing it of anti-competitive behavior. Ryanair was ordered to pay more than GBP2m last year to holiday service providers including On the Beach for flight cancellation refunds during the pandemic. “This agreement enables both parties to move on from outstanding litigation and we look forward to working closely with our new partner,” Shaun Morton, the CEO of On the Beach, said in the statement.<br/>

Aer Lingus has told An Bord Pleanála that the planned E40m Ryanair maintenance facility for Dublin Airport “will have fundamental impacts on Aer Lingus’s ability to carry out their daily operations”. That is according to an appeal lodged by consultants for Aer Lingus with the planning board that has stalleds plans by Ryanair to construct a four-bay aircraft maintenance hangar at Dublin Airport. The planned hangar is located 820 metres northeast of Terminal 1 and the major investment by Ryanair would create more than 200 jobs for engineers and mechanics, it has been estimated. Planning consultant for Aer Lingus, Kevin Hughes, told An Bord Pleanála that Aer Lingus was not against Ryanair’s plan to construct a new hangar within Dublin Airport. However, he went on to say that it had “a number of concerns and questions regarding the new hangar in its current format that remain unchallenged and have not been addressed”.<br/>

Norwegian low-cost airline Norse Atlantic is heading for Nigeria. The addition of the West African nation is unusual for the carrier, which usually flies from Europe to the United States and the Caribbean. The new service will link Lagos to London and operate as a charter for Nigerian airline Air Peace. Known in the industry as an ‘ACMI’ contract, it provides the airplane, crew, maintenance, and insurance to the charter client. The move has been described by Norse as marking “the beginning of a strategic partnership” between the two companies. The Norwegian airline has an all-Boeing fleet of 15 787 Dreamliners, however it is not flying all of them. The carrier has entered into various sub-leasing deals, including with Spanish operator Air Europa to better leverage its assets. Norse signed a long-term aircraft leasing contract on very favorable terms during the peak of the pandemic. The airline says this low cost-base allows it to be more nimble and park planes during quieter periods. In recent months, it has trimmed back its flying program, with cuts to some transatlantic destinations and a renewed focus on core markets such as New York and Florida.<br/>

The sudden resignation of the CEO of Virgin Australia (VA, Brisbane International) has scuttled the likelihood of any IPO in the short to medium term, according to Australian business media. Bain Capital, the owners of Australia's second-largest scheduled passenger carrier, had initially hoped to partially float the airline last year. Instead, with changed market conditions and the exit of CEO Jayne Hrdlicka, Bain is reportedly looking at a trade sale. Bain acquired Virgin Australia for A$3.5b Australian dollars (US$2.28b), including liabilities, in late 2020 after the carrier collapsed earlier in the year. The airline is now profitable but is struggling to claw additional market share from Qantas Group and is experiencing significant reliability issues. In a statement dated February 20, 2024, Virgin Australia said Hrdlicka had "decided now is the time to transition on from the role of CEO." However, The Australian newspaper later reported that Bain Capital had been unhappy with Hrdlicka's performance for 12 months, including her failure to capitalise on rolling problems at Qantas in 2023. Hrdlicka's side hustle as Tennis Australia chairwoman and her consequent time-consuming involvement in the Australian Open also reportedly left Bain underwhelmed. On February 19, Bain told Hrdlicka her time was up.<br/>