Generous federal aid to US airlines during the pandemic delayed and deferred the industry restructuring that had just started as the crisis began, startup Avelo’s new CFO says, arguing that as the industry restructures, even more opportunities for new entrants exist. “I don’t want to use the word ‘disrupt,'” Hunter Keay, who took Avelo’s financial helm on February 23, said. “The [Payroll Support Program] deferred a lot of potential restructuring that we’ll see over the next few years; there will be a few pieces moved around the chessboard.” Federal aid through 2020’s CARES Act and subsequent coronavirus aid packages required airlines that took the funds to pledge not to furlough or lay off employees and to continue operating to all their pre-pandemic destinations. In practice, most airlines offered voluntary buyouts and separation to employees, and several applied for temporary exemptions to drop service to cities already well connected by other airlines, or from nearby airports. When the aid expired on September 30 last year, airlines began to rationalize their networks, cutting flights to dozens of cities. When Avelo launched last year, CEO and founder Andrew Levy said the changing industry landscape was the perfect opportunity to launch a new airline. Aircraft were available and cheap. The buyouts opened a large pool of airline talent. And slots at airports were easier to come by, he said. The end of federal air only will accelerate the industry’s transformation. Story has more.<br/>
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Latvian carrier Air Baltic has decided to withdraw from serving Russia “until further notice” as it steps up its strategic response to the military action in Ukraine. Latvia is an EU and NATO member, and a vocal supporter of Ukraine in its fight against the Russian invasion. “We have made a decision to leave the Russian market,” Air Baltic CE Martin Gauss wrote on Twitter today. “Following the suspension of flights earlier, we have now cancelled all future flights to and from Russian destinations.” State-owned Air Baltic had already suspended flights to Russia through to the end of May 2022 and is currently unable to serve the country regardless, due to a ban on EU carriers entering Russian airspace. Cirium schedules data shows Air Baltic was serving Moscow Sheremetyevo and St Petersburg airports from Riga in January 2022, with 36 return flights across the month. Those flights were a tiny proportion of the carrier’s capacity, at around 2% of available seat kilometres, in a network that is focused on services to dozens of other European destinations. Alongside Latvia, Air Baltic has bases in Estonia and Lithuania – the trio of Baltic states that border Russia.<br/>
Norwegian Air had a ten-fold increase in February passenger traffic compared to the same month last year and bookings rose to their highest since the COVID-19 pandemic reached the Nordic region two years ago, it said on Friday. The company is closely monitoring the impact from the Russian invasion of Ukraine and the subsequent spike in oil prices and thus on fuel costs. The budget airline said it carried 643,000 passengers last month, up from 61,000 in February 2021, and the load factor of its planes in operation rose to 81% in February from 38% a year ago. Norwegian last week reported a full-year profit for 2021 in a turnaround from losses suffered the previous year, and said booking trends point to busier travel ahead for Europe. “When travel restrictions were lifted, we immediately noticed increased demand for flights. We will have a comprehensive summer program this year to meet this demand,” CE Geir Karlsen said. “The company has noted a very positive development in future bookings over the last period, and monitors closely the uncertain situation in Europe, the turmoil in the financial markets and the change in oil prices,” Norwegian said. The pandemic sent the airline into bankruptcy proceedings from which it emerged in a slimmed-down version in May with no long-distance network and a smaller fleet, and with a sharp reduction of its debt.<br/>
Israel and the United Arab Emirates agreed a security arrangement that will allow Israeli airlines to resume a full schedule of flights to Dubai, the Shin Bet security agency said Friday. A dispute over airport security in Dubai had forced them to cut back services and without a resolution all flights would have been halted by March 8. Shin Bet said an agreement was reached with Emirati counterparts. "Shared working principles and security arrangements were agreed upon that will allow Israeli airlines to once again fly to Dubai on a regular basis," it said. Nonstop flights from Tel Aviv to Dubai were among the fruits of a landmark 2020 deal establishing ties between Israel and the UAE. Hundreds of thousands of Israelis have visited the UAE and Gulf commercial hub since. El Al welcomed the resolution and said it would immediately return to operating up to three or four flights a day to Dubai. Israel's Shin Bet security service had previously voiced concerns - which it did not publicly detail - about arrangements at Dubai International Airport. El Al and two smaller rivals that fly to Dubai had said that one issue had been securing enough security tags for personnel to allow them to handle a full flight schedule.<br/>
El Al is pushing back delivery of its final Boeing 787 at least until March next year, three years beyond its original introduction date. The airline says the 787-8 – one of four of the variant – was supposed to be accepted in March 2020, just as pandemic-related disruption to the air transport sector began to emerge. Delivery of the Rolls-Royce Trent 1000-powered twinjet has been postponed a number of times. El Al remarks, in its full-year financial statement, that Boeing has agreed to defer the aircraft until March 2023. Repayment of a $31m loan from a financial institution to support advance payments on the aircraft has been put back to December this year. “The company continues to explore long-term financing alternatives for funding the aircraft,” the carrier says. El Al has frozen a number of projects, including fleet investments, as part of its financial recovery efforts. It has 15 other 787s comprising 12 787-9s and the three 787-8s already delivered.<br/>
Lessor Avation has observed improving conditions as the airline sector starts to emerge from the coronavirus pandemic, and provides updates on customer Philippine Airlines. “The company is seeing an increased number of positive data points that support increased optimism in the aircraft leasing sector,” says Avation executive chairman Jeff Chatfield. “We are seeing increased interest from airlines to buy or lease aircraft at sustainable lease rates, more senior lenders willing to lend against aircraft assets, aircraft orders from airlines and improved utilization of aircraft. These factors all support the emergence of the industry from the pandemic.” Aviation manages 42 aircraft, the majority of which (26) are ATRs. The balance of its flee comprises narrowbody jets and two widebodies – an Airbus A330-300 and a Boeing 777-300ER. In regard to PAL, which leases the 777-300ER, Avation notes that the carrier has exited bankruptcy and that its restructuring plan became effective as of 31 December 2021. Avation collected monthly rent from PAL from 3 September with charges based on hourly utilization rates, and that the carrier is up to date with payments. Avation also received a cash payment for the period from 1 September 2020 to 3 September 2021, as well as other compensation. From 1 March, the lease of the aircraft will revert to a fixed rate. As for its results, Avation’s net loss for the six months ended 31 December narrowed to $15.9m from $61m a year earlier, while revenue fell 6% to $57.9m.<br/>