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South Africa raises funds for state airline to US$1.1b

South Africa almost doubled the level of funding for South African Airways to ZAR16.4b (US$1.1b), cash that will go toward supporting a restructuring plan for the technically insolvent carrier. The bailout will be used to service and pay debt previously guaranteed by the state over the “medium term,” finance minister Tito Mboweni said in his budget speech Wednesday. The amount compares with ZAR9.2b earmarked for SAA in October. “It is the very sincere hope of many that this intervention will lead to a sustainable airline that is not a burden to the fiscus,” Mboweni said. While the planned shuttering of multiple domestic routes at the end of this month has drawn opposition from president Cyril Ramaphosa, the government intends to respect the authority of the business-rescue process.
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Korean airlines suspend more flights amid virus fears

South Korean airlines are suspending more flights on international routes as people opt not to travel amid growing fears over the fast-spreading coronavirus outbreak, industry officials said Wednesday. With no end in sight to the COVID-19 outbreak, local airlines began to reduce the number of flights ― or stop them altogether ― on some mid- and long-haul routes in late January to minimise the impact of the virus on their earnings. Korean Air now plans to use smaller planes on routes to Atlanta, Los Angeles and New York next month to reflect declining travel demand. "The company may reorganise further flight schedules depending on coronavirus developments," a spokesman said. Korean Air said Tuesday it will extend flight suspensions to China by one month through April 25.
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Emirates will not fly Umrah pilgrims

Emirates airline said it would no longer carry to Saudi Arabia passengers with Umrah pilgrimage visas or tourists from nearly 2 dozen countries until further notice, in compliance with a Saudi government directive to contain the coronavirus outbreak. Holders of Saudi tourist visas travelling from China, Japan, Italy, Iran, India, Pakistan and a number of other countries will be barred from boarding Emirates flights with Saudi Arabia as the final destination, the airline said. Saudi Arabia has temporarily suspended as of Thursday entry to the kingdom for the purpose of Umrah and visiting the Prophet’s Mosque in response to the global coronavirus outbreak. Entry has also been suspended for those coming from countries in which the spread of the virus is a danger, based on health authority criteria.
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Boeing reaches deal with 737 MAX engine suppliers

Boeing has agreed to cover payments for jet engines made for its grounded 737 MAX, easing the burden of the production delay on suppliers General Electric and Safran. The MAX jet is powered by LEAP-1B engines made by CFM, a joint venture of the two companies. Executives at Safran disclosed the Boeing agreement, reached this week, during the company’s earnings call Thursday. “All the engines which are going to be delivered in 2020 will be fully paid, net paid,” said Safran CE Philippe Petitcolin. He also said Boeing will cover payments for engines that were delivered in 2019, many of which have been stuck on MAX aircraft that Boeing assembled but cannot deliver. Normally, CFM gets paid as the engines are produced but doesn’t get its final payment until the plane is delivered to an airline.
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Air Canada was the world's best airline stock 2 months ago. Now it's the worst

Two months ago, it was the world’s hottest airline stock. Now, investors are shunning it. Air Canada lost C$39b (US$3b) in market capitalisation from its January peak, making it the worst-performing airline on the Bloomberg World Airlines Index this year. Its shares have slumped 28% on deepening fears that the spread of the coronavirus will hinder travel. Tuesday, the carrier extended the cancellation of all flights between Canada and China to April 10 over concerns about the virus known as Coved-19. It also stopped daily non-stop flights between Toronto and Hong Kong until April 30 due to reduced market demand. Air Canada still has a positive longer-term outlook despite facing near-term pressure from coronavirus risk, Canadian Imperial Bank of Commerce analyst Kevin Chiang said.
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AirAsia slips to full-year loss

AirAsia Group has reported a full-year net loss of MYR286m (US$67.9m) for 2018, after a MYR1.7b net profit the previous year. The airline group says the negative result was due partly to “accounting treatment” associated with its move from owning to leasing aircraft, and partly to losses at AirAsia India. Revenue rose 17% to MYR12.4n. The group narrowed its Q4 net loss to MYR385m from MYR457m in the corresponding period of 2018. Q4 revenue was up 19% at MYR3.4b. AirAsia Philippines unit “turned profitable” in 2019 while losses narrowed at AirAsia Indonesia, the group notes. Acting CE Bo Lingam acknowledges that the coronavirus outbreak has made for a “challenging start to 2020”, but says the group is in a good position to recover quickly.
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CFM to build 10 737 Max engines weekly for 2020

CFM International is expecting to produce an average of 10 Leap-1B engines – the powerplant for the Boeing 737 Max – per week over the course of 2020, out of a total annual Leap production of 1,400. The forecast has been disclosed by CFM partner Safran in its full-year financial figures, which assumes that 737 Max deliveries will restart in mid-2020 following the production halt in January. Safran says it has implemented a hiring freeze, cost-saving efforts, and a reduction capital expenditure to help offset the impact of the Max situation. The Max crisis was reflected in powerplant order activity, with Leap orders and commitments reaching 1,968 last year compared with 3,211 for 2018. Safran says production levels over 2019 were nevertheless “stable”.
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Biting passengers on flight is no reason for cash compensation delay: EU court adviser

Air travellers cannot receive cash compensation if their flight is delayed by a passenger biting others and assaulting crew members, an adviser at the Court of Justice of the EU said Thursday. Such incidents were "extraordinary circumstances," advocate general Priit Pikamae wrote in a non-binding opinion, a form of guidance that is normally followed by the court. A traveller flying from Brazil to Norway via Portugal in Aug. 2017 with TAP sought E600 compensation in accordance with EU law, after his flight departed late from the Brazilian city of Fortaleza. The plane had to be diverted to disembark a passenger biting and assaulting crew members before it could land back in Brazil, delaying the following outgoing flight.
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Boeing taps Qantas IT chief as CIO

Boeing this week named a full-time replacement for former chief information officer Ted Colbert, who was promoted to lead the company’s parts and services business. Susan Doniz, currently CIO at Qantas Group, joins Boeing as CIO in May, reporting to CE David Calhoun. She succeeds interim CIO Vishwa Uddanwadiker, who took the role after Colbert was named CE of Boeing Global Services in October. Doniz will manage IT staff across 50 countries and lead digital initiatives such as Digital Enterprise, a companywide project to improve IT systems and processes, including those around enterprise resource planning. Doniz’s team also will be integral to a unit called Boeing AnalytX, which pulls together analytics and other capabilities across the company to provide insights internally and to its customers.
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Air NZ maintains profitability despite slowdown

Air NZ has maintained profitability even as it adapts to a lower growth environment, reporting a NZ$198m (US$124m) EBIT for the 6 months ended Dec 31, 2019, down from $217m in the year-ago period. “Our capacity discipline on existing routes, stimulation of leisure traffic with the domestic fare restructure and entrance into attractive new international markets has driven good revenue performance in the first half,” says chairman Therese Walsh. Operating revenue gained 3% to $3b, in tandem with 3.2% growth in the passenger segment that accounts for more than 85% of total revenues. The carrier attributes this to “solid demand” across its domestic and Pacific Islands networks, as well as new routes into Asia and North America.
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