star

SAS said Tuesday it is getting an aid package worth 14.25b kronor ($1.5b) after an agreement with its main shareholders, securing the carrier’s survival amid the COVID-19 crisis. The governments of Sweden and Denmark, which own shares in the airline, were partly financing the recapitalization plan, SAS said. The aid package was also financially supported by its third main owner, the Knut and Alice Wallenberg Foundation, a Swedish public and private foundation. The package includes issuing new shares and converting bonds into shares. SAS said that amid the global travel restrictions caused by the pandemic it had taken measures “to radically reduce costs as a result of the decline in demand, which is not expected to return to pre-COVID-19 levels before 2022.” The recapitalization plan is subject to approvals by a shareholders' meeting and the EC. SAS CFO Torbjorn Wist told a webcast news conference that he expects approval by the Commission of the Danish and Swedish government aid. Sweden holds nearly 15% and Denmark some 14% of the shares. CEO Rickard Gustafson said the COVID-19 crisis will affect aviation demand for years to come. In April, SAS’ seat capacity was down 95% and 90% of staff were on temporary lay-offs, the airline said. “In early March, overnight we had a different world to manage,” Gustafson said. “It is a different game now.”<br/>

A fan blade on a United jet engine that snapped off in flight in 2018, showering the plane with shrapnel, had shown signs of cracking that were missed in previous inspections. The US NTSB on Tuesday released a final report on the Boeing 777-200 engine failure, concluding Raytheon Technologies’ Pratt & Whitney division didn’t create adequate test standards. Inspections of the fan blade that failed -- using technology to spot imperfections within the titanium structure -- had shown evidence of weakening metal in 2010 and 2015, but an inspector attributed them to the way they were painted, the NTSB concluded. Because the company had designated the inspections as a new and emerging technology, it never created specific training for inspectors or certified how they performed the work, the NTSB added. The engine was a Pratt & Whitney PW4077. The incident on a flight from San Francisco to Honolulu on Feb. 13, 2018, was one of several in recent years raising safety concerns about how engines are designed. The NTSB last November called on aircraft manufacturers to strengthen the material at the front of jet powerplants after debris on a Southwest flight in 2018 blew into a window, causing the death of a woman. That engine was made by CFM International, a joint venture between General Electric and France’s Safran.<br/>

Air Canada said Tuesday it would suspend flights on 30 domestic routes hit by persistent weak travel demand due to the COVID-19 pandemic. The carrier forecast Q3 capacity would decline at least 75% from a year ago and warned that travel restrictions and border closures were dimming prospects for a near-to-mid- term recovery. The company said it has reduced its workforce by about 20,000 employees, which represents more than 50% of its staff, and has permanently removed 79 aircraft from its fleet as it struggles with the fallout from the coronavirus outbreak. Air Canada added that it was closing eight stations at regional airports in Canada. <br/>

TAP Air Portugal has disclosed plans to further reduce its fleet after first-quarter net losses almost quadrupled to E395m amid the Covid-19 pandemic. The Portuguese carrier says it is analysing capacity and that “a restructuring of the fleet may result”. TAP has already confirmed the exit of three Airbus A319s, one A320, one A321 and a single Embraer 190. “In addition to these, further aircraft exits are being analysed in order to align with the fleet plan currently under revision,” says the airline. It ended Q1 with a fleet of 107 aircraft. TAP’s E395m Q1 net loss compares with a E107m reverse in the same period a year ago. Operating income for the three months ended 31 March 2020 was down 5% at E583 million as costs rose 3.3% to E739m. The first two months of 2020 maintained the “positive trend” seen in H2 of 2019, says the Lisbon-based carrier, but these improvements were thrown off course in March when the Covid-19 crisis battered operations. “The month of March was already significantly impacted by the containment measures adopted by domestic and international authorities that resulted in a significant fall in demand and led TAP to decrease its operating capacity, translating into a progressive deterioration of activity throughout the month,” says TAP. Passenger numbers more than halved in March compared with the same month in 2019 and capacity was reduced 34%, resulting in a 17.2 percentage-point decrease in load factor, to 62.7%. <br/>

Ethiopian Airlines Group, Africa’s largest and only consistently profitable carrier, expects to stay in the black for the fiscal year that ends next week, even after the coronavirus upended the global aviation industry. “We may not be as profitable as we expected but we registered some profit,” CEO Tewolde Gebre-Mariam said. “The first half of the year was good and the cargo business has also done very well.” Revenue generated from the transportation of goods has allowed Ethiopian to keep up monthly fixed payments of $120m to $150m, including servicing loans, aircraft leases, salaries and rentals, the CEO said. The carrier is still flying about 40 charter repatriations a week while commercial flights are mostly grounded. The airline still expects to be down almost $1 billion in ticket revenue for the year ending July 7. Negotiations between Ethiopian and Boeing over compensation for the Max jet may be finalized in the next two months, Tewolde said. The model was grounded around the world last year following a second fatal crash outside Addis Ababa in March 2019. “We want the compensation as soon as possible,” the CEO said.<br/>

Chairman of EgyptAir Holding Roshdi Zakaria stated that the airline operated 425 exceptional flights to repatriate around 77,000 passengers, who got stuck abroad due to COVID-19 outbreak and the suspension of international passenger flights as a protective measure. Roshdy said that the company was ready to carry home more citizens if requested. EgyptAir announced on Wednesday the schedules of its international flights after the State’s decision to resume the aviation movement as of July 1. Egypt’s national carrier said on its website that its flight schedules from July 1 to 7 will include the destinations of Sharqa, Abu Dhabi, Athens, Addis Ababa, Iraq’s Erbil, Amsterdam, Paris, Berlin, Brussels, Budapest, Beirut, Toronto, Juba, Dubai, Rome, Frankfurt, Vienna, London, Milan, Munich, New York and Washington. "The flights' destinations from July 8 to 14 will include Baghdad, Guangzhou, Geneva and Copenhagen," it added. EgyptAir noted that flights' destinations as of July 15 would cover Barcelona, Dar Essalam and Madrid.<br/>

Lufthansa said CE Carsten Spohr will assume additional responsibility for the airline’s finances after the departure of fellow executive board member Thorsten Dirks. Lufthansa said last week that Dirks, who was responsible for digitisation and finance, would be leaving following negotiations for a government bailout. On Tuesday, the carrier said the position of CFO would be filled again over the next few months. Board member Christina Foerster, in charge of marketing among other roles, will assume additional responsibility for digitization. Responsibility for human resources development would shift from Foerster to follow-board member Michael Niggemann, Lufthansa added.<br/>