unaligned

Azul’s shares jumped 16% in Sao Paulo trading after the Brazilian air carrier reached an agreement with its lessors and parts suppliers that helps cut its debt load. The deal allows the airline to slash 3b reais ($547m) of debt in exchange for 100m new preferred shares, according to a regulatory filing. “This agreement with lessors should ease the negotiations with other creditors,” Bradesco BBI analyst Victor Mizusaki writes in a note. “The next steps for Azul’s liability management include the raising of additional capital and possibly lengthening the bond maturities.” Azul has been attempting to manage higher debt levels and expenses inflated by a weaker Brazilian real, including dollar-denominated lease payments and fuel costs tied to the greenback. Investors have dumped the company’s stock this year, with shares dropping about 53%, according to data compiled by Bloomberg. The troubled carrier has been mulling several options to address its near-term debt obligations, which went from an equity offering to contemplating a Chapter 11 bankruptcy filing. It has tried to avoid seeking protection from creditors. Azul’s ratings were downgraded by Fitch Ratings in September to CCC from B-, citing heightened refinancing risks and weaker cash flow amid a depreciation of the Brazilian real. Moody’s Ratings and S&P Global Ratings have also downgraded Azul in the last month. “The successful renegotiation of liabilities will help strengthen both Azul’s cash generation and capital structure, allowing the company to seek to reach break-even, initially expected for 2024, but delayed due to the macroeconomic scenario, mainly influenced by oil prices and exchange rates,” said Ygor Araujo, an analyst at Genial Investimentos. <br/>

Gulf Air said engine maker Rolls-Royce must quickly fix the durability issues on the Trent 1000 engines powering its Boeing 787-9 wide-body aircraft, which are imposing constraints on the airline as it maps out network expansion. The Manama-based airline has undertaken a network revision that will result in axing unprofitable routes and 25% more destinations being added in the next five years, Jeffrey Goh, CE of Gulf Air Group Holding, told The National on the sidelines of the Routes World conference in Bahrain. However, Gulf Air has had to reduce flight frequencies and cancel or delay some flights as a result of the persistent engine issues that are grounding some of its wide-body aircraft while the engines are in the repair shop, he said. The airline called on the UK engine builder to address its issues as more predictability and efficiency is required to plan the growth of its network. “Rolls-Royce doesn't have a solution for its Trent 1000 engines, which means there has been frequent grounding of aircraft. We are not the only airline,” Goh said. “Rolls-Royce has to expedite a solution.”<br/>

Etihad Airways plans to return its seventh Airbus A380 superjumbo to the skies, boosting capacity on key international routes in response to better-than-expected travel demand as the airline waits for delayed aircraft deliveries. The Abu Dhabi-based airline will fly its seventh double-decker aircraft on a route that has never before had an A380 service, Arik De, chief revenue and commercial officer of Etihad Airways, told the Routes World conference in Bahrain. Etihad Airways' initial plans were to reintroduce five of its 10 A380s to its fleet after they were grounded by the Covid-19 pandemic in 2020 when global air travel came to a near-standstill. These A380s are operating to London Heathrow and New York JFK, with the introduction of the double-decker to Paris from November 1. Etihad Airways will also start flying an A380 to Singapore from February 1, 2025. “The seventh A380 comes in June. So it's going to be London, New York, Paris, Singapore and one other destination that I won't tell you now. Wait and see. It has never seen A380s before, that's my only hint,” he said. Antonoaldo Neves, CE of Etihad Aviation Group, told The National in August that the airline is studying “eventually” returning more of its A380 superjumbos to the skies, depending on market conditions. The move comes as the Abu Dhabi-based airline is facing late aircraft handovers from both Boeing and Airbus. While these delays will not curtail its growth, it could have expanded further if it had received the additional capacity on time, Neves said at the time.<br/>

Russian carrier S7 Airlines has become the first in the country to sign up for a domestically-developed network offering the ACARS aircraft communication and reporting service. S7 reached the agreement with state technology firm Rostec’s Infocom-Avia division. “We believe it is important to expand methods of data exchange,” says S7 deputy general director for flight safety Igor Bocharov. He says ACARS “significantly simplifies” pilots’ work and allows quicker deliver of information to the crew. Infocom-Avia, which operates the network, says it has undertaken testing for two years to enhance its performance. “Now we are moving on to commercial operation,” says general director Viktor Solomentsev, adding that the company believes the network is “in demand” from airlines. The network features base stations, each with a 300km coverage radius, and 10 have been established along the primary S7 flight routes. Infocom-Avia aims to expand the network to 55 stations by 2026. S7 says the system will enable transmission of real-time data on aircraft condition, weather, traffic, and other operational information – supplementing the communication channel between crews and air traffic control.<br/>

SpiceJet is to lease seven more aircraft and reactivate another three by the end of November, as it wraps up a round of fundraising amid ongoing regulatory and legal woes. The seven aircraft - details of which have not been disclosed - will be inducted by 15 November. Two of these have already arrived in India, states SpiceJet. Three parked Boeing 737s will be returned to service before end-November, as part of a wider, phased un-grounding. SpiceJet is predominantly a 737 operator, with a mix of -700s, -800, -900ERs and Max 8s in its fleet. According to Cirium fleets data, it has 22 aircraft in service and 32 in storage. SpiceJet recently raised about Rs30b ($357m) through a qualified institutional placement, which it claims saw “overwhelming response” from investors. States SpiceJet: “The fresh capital raised will play a key role in ungrounding SpiceJet’s existing aircraft, acquiring new planes, investing in technology, and expanding into new markets.” SpiceJet chief Ajay Singh adds: “This addition is crucial as we continue to meet the growing demand for air travel while strengthening our operational capabilities. With the capital raised, SpiceJet is well-positioned to offer improved services and an expanded route network.” <br/>

The Airlines Association of Thailand (AAT) says a request from Thai Vietjet to allow foreign pilots to fly domestic routes via a wet lease arrangement is acceptable because it is temporary, but an AirAsia executive is strongly opposed to it. "I see wet lease arrangements as a win-win situation, as airlines can temporarily increase flight capacity to meet passenger demand whenever they want," said AAT president Puttipong Prasarttong-Osoth. Two months ago, Thai Vietjet held a discussion with the Employment Department, the Civil Aviation Authority of Thailand (CAAT) and the Thai Pilots Association, asking for permission for foreign pilots to fly domestic routes via wet lease arrangements for two aircraft. These contracts cover a combined package of pilots, crew, maintenance and insurance. As flying domestic routes is reserved for Thai pilots, according to labour laws, the arrangement requires government approval. Puttipong said the association is not opposed to the plan if the authority agrees to it, as each airline is allowed to manage its own business. However, the issue in the aviation sector now is an aircraft shortage, not a pilot shortage. He said dry leasing without a foreign pilot or crew requires airlines to operate with those aircraft for 5-6 years, unlike a wet lease that requires only 3-6 months, allowing more flexibility, and should not impact the pilot job market.<br/>