general

Campaigners have urged the chancellor to start taxing jet fuel – with a report showing that charging duty at the same rate paid by motorists would raise up to GBP6b a year for the public finances. An analysis by the thinktank Transport & Environment (T&E) UK said introducing a “fair” equivalent to the fuel duty paid in other sectors could raise between GBP400m and GBP5.9b a year, based on the 11m tonnes of kerosene consumed by planes taking off from the UK in 2023. T&E UK said the current system meant a teacher driving to school would pay more fuel duty than a private jet owner would to fly away on holiday. Airlines pay no tax on fuel, although other taxes on flights, including air passenger duty, are levied in the UK. The report said it was a “common myth” that aviation fuel could not be taxed, with the UK having the right to tax domestic flights and, post-Brexit, flights to the EU. These account for 80% of departures. Securing the full revenues would require an “anti-tankering” law to ensure airlines bought 90% of the fuel for outbounds flight in the UK. Fuel duty on diesel or petrol at the pumps is levied at 52.95p a litre, and many expect Labour to raise the level by scrapping the 5p cut made by the Conservatives in 2022. A lower rate of 11p is paid by farmers and rail operators for red diesel.<br/>

Dublin Airport was hit by a power outage on Sunday morning, causing traffic chaos at the airport and delays at check-in and at US pre-clearance in Terminal 2 for a period of time. The power failure knocked out backup generators that are designed to ensure the airport can operate in the event of more general loss of power in the area around the airport. A spokeswoman for DAA said 15 flights were delayed this morning due to the power outage. A spokesman said the operation at Terminal 2 has now returned to normal, although check-in, security screening and boarding processes are all now slower than usual due to a large number of passengers needing to be processed. “Delays are expected in T2 this afternoon, but flights from T1 are not impacted. Passengers due to fly this afternoon are advised to travel to the airport as normal,” he said. DAA said this morning’s outage, which occurred at around 7.50am in north Co Dublin, was caused by an under voltage in the ESB Network. It said this may have caused a control system failure that prevented Dublin Airport’s backup generator from kicking in, “as it always has during previous power outages”.<br/>

The Directorate General of Civil Aviation (DGCA) on Thursday proposed stricter norms for the oversight of wet-leased planes operated by Indian airlines. Faced with the grounding of a significant number of planes due to engine and supply chain woes, domestic carriers are utilising more wet-leased aircraft as a short-term measure to cater to rising air traffic demand. The watchdog has issued a draft for public consultation on the revised Civil Aviation Requirements (CAR) on wet/damp lease operations by Indian operators to strengthen the regulatory framework for safety oversight of wet/damp lease operations. Wet lease of an aircraft by an Indian carrier involves the leasing of foreign aircraft, along with crew, maintenance and insurance. The plane is also under the operational control of the foreign operator (lessor) and subject to regulatory requirements of the foreign civil aviation authority concerned. The safety oversight of such operations is also under the purview of the foreign authority concerned, and the role of Indian carriers is limited to commercial aspects of operations. "The enhanced regulatory framework and changes proposed in the draft CAR includes restricting the wet/damp lease only from the countries having a reliable safety oversights system as well as standardisation of DGCA surveillance on such operations," DGCA said in a release on Thursday.<br/>

The UAE’s General Civil Aviation Authority and Hong Kong-based green air mobility tech company Volar Air Mobility have signed an interim agreement to develop the Emirates’ first green aviation technology centre as the country pushes ahead with plans to boost environmental sustainability. The centre aims to promote clean energy, support research and development in sustainable aviation technologies, and foster collaboration among international stakeholders, regulators and innovators, the UAE’s aviation regulator said on Saturday. The UAE’s vision to become a world leader in green technology and reduce carbon emissions in the aviation sector, the statement added. “This reflects our commitment to advancing sustainable aviation and supporting the UAE’s national strategy to reduce carbon emissions,” Saif Al Suwaidi, director general of the GCAA, said. “The green aviation hub will play a pivotal role in developing cutting-edge solutions for a greener future.”<br/>

Thousands of Boeing workers went on strike on Friday after overwhelmingly rejecting a contract their union negotiated, a potentially costly disruption to the aerospace giant as it tries to recover from a series of safety crises. The strike, the first at Boeing in 16 years, brought airplane production to a halt in the Seattle area, home to most of Boeing’s commercial plane manufacturing. The slowdown could also disrupt the company’s supply chain. Boeing plays a substantial role in the U.S. economy. It employs almost 150,000 people across the country — nearly half of them in Washington State — and is one of the nation’s largest exporters. The company, which also makes military jets, rockets, spacecraft and Air Force One, is a global symbol of America’s manufacturing strength. The White House said on Friday that it was in touch with Boeing and the union, the International Association of Machinists and Aerospace Workers. And on Friday evening, a federal mediation service said it would convene talks between the company and the union early next week. Boeing’s stock tumbled 3.7% on Friday and has fallen nearly 40% this year. The company’s debt rating is also in jeopardy. Brian West, Boeing’s chief financial officer, said at a conference on Friday that the strike would affect production, deliveries and operations, and would “jeopardize our recovery.” “We want to get back to the table,” West added. Union leaders and company management had reached a tentative contract agreement on Sunday after months of talks. Union leaders said it was “the best contract we’ve negotiated in our history.” But it fell short of what the union initially sought, including bigger raises, and it was rejected on Thursday by 95 percent of the membership. A vast majority of the 33,000 workers governed by the contract are represented by District 751 of the machinists’ union, Boeing’s largest, and mostly work on commercial airplanes in the Seattle area. The dispute also involves workers in the Portland, Ore., area who are represented by the union’s smaller District W24. The union represents about a fifth of the company’s more than 170,000 employees worldwide.<br/>

Boeing's first strike in 16 years could further compound global shortages of jetliners that have been pushing up airfares and forcing airlines to keep older jets flying longer, industry executives and analysts said. The U.S. planemaker's West Coast workers went on strike at midnight on Friday after overwhelmingly rejecting a contract deal, halting production of Boeing's workhorse 737 MAX. It is Boeing's first strike since 2008, and Boeing Chief Financial Officer Brian West warned a prolonged walkout could hurt output and "jeopardize our recovery". "Boeing is a systemically important company for global aviation," Ross O'Connor, chief financial officer of Irish leasing company Avolon, told Reuters on Friday. A strike "could have an impact on production levels, which could exacerbate some of the supply shortages that are in the market at the moment for sure," he said after Avolon announced it had acquired a large portfolio of jets from Castlelake. Airlines have struggled to expand capacity to meet rising demand as supplies of jetliners are curtailed by parts shortages, industry-wide recruitment problems and overloaded maintenance shops. Analysts have been warning the most promising part of the industry's all-important business cycle could run out before airlines have a chance to enjoy the full benefits of demand. "It's going to be a significant amount of time before we see that balance. I'm starting to evolve the hypothesis that it won't be (extra) supply that corrects it, but instead a softening of demand," said Rob Morris, global head of consultancy at Cirium Ascend.<br/>

When thousands of Boeing employees rejected a new labor contract, precipitating a strike that began on Friday, they were at odds not just with management but also with the leaders of their union, who backed the proposed deal. Now, any attempt to reach an agreement must take account of the demands of the rank and file of the International Association of Machinists and Aerospace Workers. What they want — significantly larger pay raises and far more lucrative retirement benefits than their leaders and Boeing agreed to — may be too much for management. But labor experts said the strength of the strike vote — 96% in favor — should help the union get a better deal. “Those overwhelming numbers are kind of embarrassing, certainly from a public relations standpoint for the union,” said Jake Rosenfeld, a sociologist who studies labor at Washington University in St. Louis. “But they also simultaneously present the union with leverage when it does resume negotiations.” And Boeing is in a difficult spot after a slowdown in commercial jet production — required by regulators after a panel blew out of a passenger jet fuselage in January — led to big financial losses. A long strike at Boeing’s main production base in the Seattle area would add significantly to the losses and possibly tip its credit rating into junk territory, a chilling development for a company with nearly $60b in debt. The federal mediation service said on Friday that the union and Boeing management would resume talks in the coming days. “We’re going to go back to the bargaining table, and bargain for what our members deserve,” Jon Holden, the president of District 751, the part of the machinists’ union that represents most of the workers on strike, said in an interview. “We’ll push this company farther than they ever thought they’d go.” Asked whether union leadership had been out of step with the rank and file, Holden said the vote on the deal enabled members’ views to be heard. “You must never forget that the real power is within your membership,” he said.<br/>

Fitch and Moody's on Friday joined S&P Global Ratings in warning that a prolonged strike at Boeing's factories in U.S. West Coast may lead to a ratings downgrade, a headache for the planemaker that is saddled with massive debt. "If the current strike lasts a week or two, it is unlikely to pressure the rating. However, an extended strike could have a meaningful operational and financial impact, increasing the risk of a downgrade," Fitch Ratings said. Moody's warned of a downgrade if Boeing issues debt alongside any equity raised to meet its liquidity requirements, including the money it needs to retire about $12 billion of debt maturities between now and the end of 2026. Moody's currently rates the planemaker at "Baa3", while Fitch has "BBB-" rating — both a notch above the junk status. More than 30,000 workers walked off the job at Boeing on Friday after rejecting a contract deal, halting production of its 737 MAX jet, the company's main cash-cow. CFO Brian West did not directly answer when asked if Boeing may need to raise debt or equity by the year-end or early 2025. "First of all, we want to prioritize the investment grade credit rating. And secondly, we want to allow the factory and the supply chain to stabilize. That last objective just got harder based on last night," he said at a conference organized by Morgan Stanley. "We are perfectly comfortable to supplement our liquidity position to support these two objectives," West said.<br/>

Avia Solutions Group, which leases aircraft and provides related services, expects leasing rates to remain high for at least two more years, Chairman Gediminas Ziemelis said on Friday, allowing the group to further expand and increase profits. Lease rates have risen around 20-22% from pre-COVID 19 levels as airlines have taken fewer deliveries of new aircraft and increasingly extend leases on their fleets, Ziemelis said in an interview. Production delays by aircraft manufacturers have boosted carriers' demand for leased planes to meet a spike in travel demand. The need to service older planes and for additional pilots and crew members has also benefited Avia, which provides aircraft, crew, maintenance and insurance (ACMI). "We tripled our fleet (from pre-pandemic levels). We had more demand than we had aircraft this summer and potentially for next summer," Ziemelis said, adding that Avia expects to expand its fleet to 600 aircraft by 2027, from 220 currently.<br/>