Spirit Airlines on Monday forecast a loss in the second quarter as its earnings continue to reel from the grounding of a number of its aircraft as well as bloated industry capacity in key markets. Its shares were down 11.4% in afternoon trade. The ultra-low-cost carrier has been losing money despite booming travel demand, raising questions about its ability to manage debt that is due to mature in 2025 and 2026. The company said it has had "constructive" discussions with its bond holders and is aiming to have a resolution this summer. Spirit is among the carriers hardest hit by a snag with RTX's Pratt & Whitney Geared Turbofan (GTF) engines, which is expected to ground 40 of its aircraft this year. In 2025, the situation is projected to get worse as the airline estimates to have about 70 jets out of service. It is not only hurting its growth plans, but also leaving the airline overstaffed and driving up operating costs. While Pratt & Whitney has agreed to compensate the airline, Spirit Chief Financial Officer Scott Haralson said the issue is still hurting the company's earnings. "The impact on our business associated with these Pratt engine issues cannot be understated," Haralson said on an earnings call. Spirit has announced plans to furlough up to 260 pilots in September and to roll out more measures to cut its costs by $100m this year. Last month, it reached a deal with planemaker Airbus to postpone all aircraft deliveries scheduled from the second quarter of 2025 through 2026.<br/>
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Struggling US regional airline company Mesa Air Group remains at risk of de-listing on the Nasdaq stock exchange, needing to show that its listing price can consistently close higher than $1. The Phoenix-headquartered parent of Mesa Airlines on 6 May disclosed that it had transferred its common stock to a tier of the Nasdaq stock market with less stringent financial and liquidity requirements. Mesa stock has transferred from the Nasdaq Global Select Market to the Nasdaq Capital Market – basically, from the tier with the highest minimum qualifications to the one with the lowest. It will continue trading uninterrupted under the symbol “MESA”, according to a filing with the US Securities and Exchange Commission. In November, Mesa received a notice of non-compliance with the Nasdaq’s listing rules because its listing price had closed below $1 for 30 consecutive business days. The company was granted an 180-day grace period in which to regain its standing, which passed on 1 May without success. Being newly listed on the Nasdaq Capital Market grants Mesa another 180-day grace period. Its stock price needs to close higher than $1 for 10 consecutive business days in order to meet the minimum requirement. The grace period ends on 28 October. If that deadline passes without proof of compliance, Mesa would face de-listing and a likely appeals process, including a hearing. ”The company intends to closely monitor the closing bid price for its shares of common stock and consider all available options to timely remedy the bid price deficiency,” Mesa says, adding that it can ”give no assurance that it will regain or demonstrate compliance” during the second grace period. <br/>
US discount carrier Frontier Airlines has received approval to use the new trade name “Frontera” for at least some of its operations, though details about carrier’s plans remain unclear. In a 6 May notice, the US Department of Transportation (DOT) said Frontier had on 16 April “requested that the department register the trade name ‘Frontera’ for use in certain of its air transportation operations”. “The department acknowledges and approves the registration of the trade name ‘Frontera’ for use in Frontier’s operations, effective immediately,” the notice adds. Frontier, a division of Denver-based Frontier Group Holdings, did not immediately respond to a request for comment, leaving many unanswered questions about its intentions for the trade name, which means “border” in Spanish. Airlines wishing to operate under alternative names must register those names with the DOT, which issues approvals. Frontier told the DOT that the name Frontera “raises no name similarity issues” with other airlines.<br/>
WestJet and the union representing its maintenance engineers reached a tentative agreement late Sunday, averting a work stoppage that could have started disrupting flights as early as Tuesday afternoon. The Calgary-based airline and the Aircraft Mechanics Fraternal Association (AMFA), which represents the engineers who maintain WestJet aircraft and other technical operations employees, announced the development shortly after 10:30 p.m. MT on Sunday. AMFA members still need to ratify the tentative agreement, which would establish the first collective agreement between the two parties, according to the joint statement. "After nine months of tough negotiating, we are proud to have reached a tentative agreement that will now be presented, through the ratification process, to the hard working Aircraft Maintenance Engineers and other Technical Operations employees who go above and beyond to maintain a best-in-class culture of safety for the WestJet Group," said AMFA director Will Abbott in the statement. The union and WestJet have been at the bargaining table since September 2023, negotiating pay, benefits and key provisions defining the work AMFA members must complete for WestJet. "We also have to make sure that we have language that protects the jobs that you do. You can have all the money in the world, but if you don't have the language to protect your job, you're not going to earn," Abbott told CBC last week. On Saturday, WestJet issued a 72-hour lockout notice to the union, which paved the way for a work stoppage to begin on Tuesday as early as noon MT. AMFA members had been in the midst of a weeklong strike vote, which began on May 2. The union had already been encouraging passengers to book travel on other airlines.<br/>
As Covid plunged the airline industry into chaos in 2020, the boss of Wizz Air made an audacious move. Sensing an opportunity for the European low-cost airline, József Váradi decided to expand — taking on new aircraft, scooping up take-off and landing slots and opening new bases — just as rivals were retrenching. “I actually quite liked it,” Váradi remembers. “Yes, of course, we were not immune from the impact and our employees were affected, our consumers were affected, our operation was affected. But the strategic opportunity, I think, enlightened all of us that, you know, this is our time. The industry is moving backwards, we need to push forward.” Váradi started his career in the “extraordinary, unprecedented opportunities” of the fall of communism in his native Hungary and spent 10 years working for US consumer goods company Procter & Gamble before briefly running his country’s state airline. The entrepreneurial spirit that ultimately led him to launch Wizz in 2004, with backing from US investors, was evident from a young age. Váradi excelled at maths at school, and remembers, aged about nine, selling the answers to the day’s tests to his classmates. “I bought my first soccer ball as a result, and I was so proud of it, because I don’t think the family could afford that. But I was able to buy it.” As London-listed Wizz expanded during the pandemic, it was dubbed “the last great growth story in European aviation” by one investment bank. In 2021, with its share price rising, the company offered Váradi a £100mn bonus if he could more than double the stock price and challenge Ryanair’s supremacy in Europe. Then, the problems started. Just as the rest of the industry was taking off again, Wizz was hit with multiple headwinds that combined to thwart its growth plans. “Too many black swans,” as Váradi puts it.<br/>
Iceland’s Bluebird Nordic has discontinued cargo operations, ending services on 30 April. The Reykjavik-based carrier says it has “voluntarily surrendered” its air operator’s certificate to the Icelandic civil aviation administration. Bluebird Nordic adds that it is returning all the aircraft in its fleet to their respective lessors. It was owned by Avia Solutions Group, which acquired the carrier in early 2020. The airline exclusively conducted cargo flights and primarily used 737 freighter variants – a mix of -800s and -400s – for its charter and wet-lease operations. But the carrier had reached lease agreements for three Boeing 777-300ER widebodies about two years ago, with the intention of converting them to freighters this year. Bluebird planned to use the aircraft in passenger configuration, offering them for such service as corporate shuttle work.<br/>
Etihad Airways would consider buying a small number of aircraft from Airbus and Boeing over the next five years if delivery slots opened up, its chief executive said on Monday. The Abu Dhabi's carrier plans to grow its fleet of narrow and wide-body aircraft to 150 over the next five years, up from around 80 jets today, which would mean adding around 10-15 new aircraft each year. Most of those new aircraft will be added through existing orders for Airbus A320s and A350s and Boeing 787s but some would need to be sourced from the leasing market and planemakers. CEO Antonoaldo Neves said Etihad was in talks with lessors and the planemakers in attempt to secure additional jets to supplement those that would be delivered from existing orders. He said the airline was interested in buying new aircraft directly from planemakers through delivery slots that had been cancelled or rescheduled by other carriers. But Neves said Etihad would not place a large order. "I'm a big believer in fleet flexibility. I don't like to lock in big orders," he told Reuters in an interview at the Arabian Travel Market tourism trade exhibition in Dubai. "I've learned the best thing we can do is have an order book that is sizeable but does not define the entire future." Planemakers have a huge backlog of aircraft still to be delivered, while airlines have in recent years placed massive orders for aircraft that will not be delivered for many years. Both Airbus and Boeing have struggled to meet delivery schedules due to supply chain issues, while Boeing's production has slipped on increased quality checks and regulator audits.<br/>
Riyadh Air plans to expand its fleet with additional aircraft orders following its initial purchase of Boeing long-range jets last year, as the startup Saudi carrier seeks to establish itself alongside regional incumbents like Emirates and Qatar Airways. “We need a very large fleet, we’re going make a number of additional orders,” CEO Tony Douglas said in an interview with Bloomberg Television on Monday. “We will be making a narrowbody order, we’ll probably be doing another large order after that to build us up to scale.” Backed by Saudi Arabia’s wealth fund, the airline plans to start operations in a year’s time. Riyadh Air already bought 39 Boeing 787-9 jets, with options for 33 more, last year, and the carrier introduced its concept at the 2023 Paris Air Show, including its dark purple aircraft livery. Saudi Arabia is seeking to expand its aviation industry and pull in more tourists, expanding its airline capacity beyond the pilgrimage travel that now forms the backbone of the country’s inbound travel. Douglas, who previously ran Abu Dhabi flag carrier Etihad Airways, said he’s “very conscious” of possible delays to aircraft deliveries, as both Boeing and Airbus SE struggle with production amid record demand and supply issues at the two planemakers. Boeing, in particular, has been forced to reduce output following an accident on an airborne aircraft earlier this year. Douglas said the overhaul being done at the US manufacturer will act as a reset for leadership, adding that a new management team “has to stay absolutely focused and get back to basics.” <br/>
Administrators determining the future of the troubled airline Bonza are bracing for as many as 20,000 out-of-pocket customers to join a creditors meeting this week with the federal court hearing that online voting options are being considered. On Tuesday lawyers representing Hall Chadwick, the administrators controlling Bonza after its planes were abruptly repossessed a week ago, appeared before the federal court justice Elizabeth Cheeseman seeking orders to streamline the process for the first creditors meeting on Friday. It will be held amid ongoing efforts to find a new owner for the budget carrier. Cheeseman, sitting in Sydney, heard that 57,933 customers who had future bookings with the airline for flights that had not yet been cancelled – and for which refunds were not available – would be considered contingent creditors for the administration process, along with 120 trade creditors and 323 employees. James Hutton SC, one of the barristers representing the administrators, told Cheeseman there were “serious practical difficulties” preparing for the first meeting scheduled for Friday in Sydney. The court heard that there would be the option for creditors to join virtually and appoint proxies.<br/>