Five global airlines are to start offering passengers use of a digital health pass to certify they are Covid-free before travel, as the sector seeks to navigate its way out of a historic collapse in passenger demand. United, Lufthansa, Virgin Atlantic, Swiss International Air Lines and JetBlue will begin rolling out the so-called CommonPass to passengers on some flights from December. The project, developed by non-profit group The Commons Project and backed by the World Economic Forum, uses a digital certificate downloaded to a mobile phone to show a passenger has tested negative for Covid-19. Users can then use the certificate as proof of a negative test if the country they are visiting requires one. The airlines are not making the CommonPass mandatory, but in time it will also be used to provide proof of vaccination. Passengers crossing most international borders currently face lengthy quarantine periods upon arrival but several countries including the UK are moving towards using testing to shorten and potentially eliminate the need for self-isolation. “Reliable testing, combined with digital health passes, is another way to restore customer confidence and safely restore air travel,” said Joanna Geraghty, JetBlue president. Airline industry group IATA is also working on a digital health pass alongside BA owner IAG, with a launch expected in the first quarter of next year. On Tuesday Iata warned that global airlines faced combined losses of $118.5b this year, deeper than the $84.3b forecast in June, and $39b next year. Passenger numbers are forecast to fall 60% on last year to 1.3b. “We need to get borders safely reopened without quarantine so that people will fly again,” said Alexandre de Juniac, IATA CE. “And with airlines expected to bleed cash at least until the fourth quarter of 2021 there is no time to lose.”<br/>
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Chief executives of JetBlue, KLM and Lufthansa Group have insisted that corporate travel will rebound once passengers feel comfortable flying again. “Business travel will take longer to come back, but it will come back in a big way”, JetBlue CE Robin Hayes told the closing press conference of IATA’s AGM. However he concedes that the corporate travel market may function “in different ways” post-pandemic. He cites the potential demand from work-from-home employees who meet occasionally for corporate events or get-togethers. “The way I think about this is that [business travel] may well change, but… we all will be pleasantly surprised how quickly this industry can come back.” Carsten Spohr, CE of Lufthansa Group, bemoaned the use of video call technology as lacking the same benefits of in-person meeting. “In the first months of this crisis we were all getting excited about video conferences… in the last weeks I hear about people being tired of video conferences,” he comments. “I think we have experienced the limits of technology.” Comparing this year’s virtual IATA AGM with last year’s in-person event, he complains that the technology’s limitations meant that it “did not compare”, restricting the number of new people he was able to meet and the breadth of interaction between delegates. “Let’s be honest, this technology is better than maybe we all knew before [the pandemic], but it’s nowhere good as what airlines provide”.<br/>
Aegean Airlines incurred a net loss of E28.3m in Q3, and expects to operate less than 20% of the last winter’s capacity in the coming months. The Greek carrier, which is in line to receive up to E120m in state support as part of a wider capital increase, says it operated 49% fewer flights in Q3 than in the same period last year. Passenger traffic was down 62% and load factor fell to 65.7% from 87.7%. Revenue declined 70% to E155m. For the nine-month period ended 30 September, Aegean reported a E187m net loss, compared with a E77m net profit a year earlier. “For the winter 2020/21 season, the second wave of the pandemic, renewed travel restrictions and, recently, lockdowns across Europe and Greece will limit our activity to levels lower than 20% of the respective 2019 period,” states Aegean CE Dimitris Gerogiannis. “The possibility of the initiation of vaccine distribution in early 2021, as well as the adoption of common travel protocols, could potentially allow for a gradual and partial recovery as 2021 progresses.”<br/>
Lufthansa is set to raise E1b through its first conventional bond issue since the onset of the coronavirus crisis, a lead manager said. The German airline operator’s five-year bond was set to be priced on Tuesday at a yield of 3.125% after demand totalling more than E4.25b, the lead manager told Reuters. After the pandemic first swept through Europe, Lufthansa needed a E9b German government bailout. Its return to the conventional bond markets adds to the E600m that Lufthansa raised through a convertible bond issue this month. The two deals cement Lufthansa’s access to markets and ability to raise working capital after the crisis, which has crippled airlines and the global travel sector.<br/>
Singapore Airlines has raised S$500m ($373m) from a private placement of new 10-year, 3.5% bonds. The offer was launched at S$300m and upsized to S$500m, “after a strong appetite was apparent from a select group of private investors”, says the group. Proceeds net of issue expenses will be used for general corporate or working-capital purposes, including the refinancing of existing borrowings. The bonds are set to be issued on 2 December and come under SIA’s Multicurrency Medium-Term Note Programme, which has been doubled from S$5 billion to S$10b, the group disclosed on 17 November. Referring to this issue and a recently concluded S$850m convertible bond issue placed with institutional investors and other investors, CE Goh Choon Phong states: “These reflect the strong confidence that investors have in the ability of Singapore Airlines to navigate the near-term challenges, and emerge as a leader in the airline industry.” SIA says that including the latest bond issue, it has raised approximately S$12.7b in additional liquidity since the start of the financial year ending 31 March 2021.<br/>
The boss of Air New Zealand says the development of a vaccine and other mechanisms to control Covid-19 increasingly seem like the only solution to opening up borders for international travel. Air New Zealand CE Greg Foran told the IATA that when a vaccine did become available it would be advantageous if everyone followed the same protocols in relation to traveller processes. ”However, it is likely that for some time we will need to be flexible,” Foran said. On Tuesday news broke that Oxford University researchers had developed an effective Covid-19 vaccine, the third vaccine announcement in less than two weeks, providing fresh hope that the coronavirus pandemic may soon be brought under control. Foran told IATA that Air New Zealand’s domestic network was operating at 75% capacity making it one of the strongest domestic networks in the world. “New Zealand initially got on top of Covid-19 much more quickly than other countries, but we need the world’s economy to be moving as well – no country operates in a silo.” He said it was hard to determine forward-looking demand with any degree of certainty.<br/>