Friday, 12 August 2011
Pegasus negotiating massive order to triple fleet size
Turkish low-cost carrier Pegasus Airlines is negotiating with Boeing and Airbus over an order totalling more than 100 aircraft, CFO Serhan Ulga has revealed to Aviation Exchange. The airline, which currently has a fleet of 39 mostly Boeing aircraft, hopes to reach an agreement by the end of the year. It has not yet decided whether to select one manufacturer or place a split order for jets.
"We are in the negotiation process for a big order with both manufacturers," Ulga told this news service. "We are seriously considering the best alternative. We'll go with whatever is the best economic equity value for our entire order."
Thursday, 11 August 2011
AerCap ramps up share repurchasing as acquisitions take a backseat
Dutch lessor AerCap is actively buying stock under its USD 50m share repurchase programme, as newly appointed CEO Aengus Kelly tightens the company's funding structure amid uncertainty in the global economy. Having reduced the average age of its 335-aircraft fleet to 5.4 years, the lessor is tempering asset acquisitions in order to focus on shareholder returns, Kelly told Aviation Exchange.
Proceeds from the sale of aircraft teardown subsidiary AeroTurbine, bought by ILFC earlier this month for USD 228m, have yet to be earmarked for specific transactions, but the windfall could be used for further share repurchases. "We are not here for growth for growth's sake. We are here to increase shareholder value," the CEO said. "When we look at an asset acquisition opportunity it has to be a better deal than buying back our own shares."
Monday, 1 August 2011
Full article in JPG format
EgyptAir is no longer in crisis mode. Having lost $140 million in the aftermath of Hosni Mubarak’s overthrow, the flag carrier is bouncing back with a two-phase summer programme which has restored capacity to above 2010 levels. Though its fortunes remain entwined with political events beyond his control, Hussein Massoud, chief executive of EgyptAir Holding Company, is tentatively steering the airline back onto the path of expansion.
“Immediately after the revolution we had a very hard time during February and March,” Massoud tells The Gulf. “There was no previous planning [for civil unrest], and you had a situation where, in just one day in February, we also had to fly home 9,000 Egyptians from Libya.”
The uncertainty that engulfed North Africa led to an immediate drying up of passenger demand. Footfall in Egypt’s airports fell by two thirds as tourists, business people and the country’s diaspora postponed their travel plans, opting to wait until the political situation became clearer. EgyptAir’s revenues plummeted by 80 per cent, and Massoud took the exceptional step of grounding one third of his fleet...
Friday, 22 July 2011
Virgin America tempers 2012/13 delivery schedule over fuel concerns
Virgin America will consider postponing up to 13 Airbus A320 deliveries previously slated for the latter half of 2012 and the first half of 2013, CEO David Cush has told this news service. The US low cost carrier, which has rapidly expanded its fleet to 39 jets since launching in 2007, is “still in a growth trajectory” and remains on-track to reach 111 aircraft by 2019, Cush said.
“We have significant flexibility on the size of our fleet over the next 24 months,” the CEO told Aviation Exchange. “We have not entered into agreements for aircraft that had been contemplated for the second half of 2012 [six jets] and first half of 2013 [seven jets] and, therefore, have the fleet size flexibility necessary to make adjustments.”
Thursday, 7 July 2011
Consolidation on the cards as Kenya Airways launches ten-year plan
Kenya Airways is open to the prospect of merging with "like-minded carriers" in order to deliver on its ambitious ten-year growth plan, CEO Titus Naikuni has told Aviation Exchange. The industry veteran, who was last month appointed to IATA's 31-strong board of governors, said that closer cooperation with partners is a logical next step as codeshare agreements had fuelled the airline's rapid expansion.
"Kenya Airways sees benefits in consolidation with like-minded carriers," he told this news service. "This should come progressively, perhaps through cooperation initially."
Friday, 1 July 2011
Full article in JPG format: page 56/57 & page 58
If there’s one thing that haunts Gulf airlines as they continue their indomitable march along the path of expansion, it’s the ever-present suspicion that they – unlike rivals in Europe and beyond – somehow enjoy unfair competitive advantages at their home bases.
Accusations typically centre on supposed government subsidies and access to cheap fuel. Despite opening its accounts to auditors PwC, Dubai-based Emirates has never fully shed this reputation. But its latest attempt is the most comprehensive to date, ushering in the services of research firm Oxford Economics, an affiliate of Oxford University, to set the record straight once and for all.
The findings of the consultancy, whose clients include numerous governments and central banks, go beyond affirming the primacy of air connectivity in the Gulf. They conclude that Emirates' growth has its roots in operational efficiency, open competition, acute market awareness and benign geography...
Thursday, 30 June 2011
Santander, the only bank currently arranging Spanish Operating Leases (SOLs), has told Aviation Exchange it is pitching to potential clients in the Middle East and Asia as it witnesses growing demand for the tax leases. The structures, originally developed by Caja Madrid, allow lessees to receive tax benefits through accelerated depreciation and have previously only been closed in Latin America and Europe.
Spanish flag carrier Iberia secured the first ever aviation SOL in September 2005 after going on the hunt for alternatives to Japanese Operating Leases (JOLs). Caja Madrid provided 21% equity while RBS financed 79% debt, delivering savings of 6.5% through a reduced rental stream on two Airbus A340s.
The JOLs previously favoured by Iberia tended to deliver larger savings, but according to Gregorio Herrera, Santander Global Banking & Markets, Europe, there are several additional benefits entailed within SOL structures.
Tuesday, 7 June 2011
Full article on huffingtonpost.com
America's airlines are at it again. Barely a year after quashing European efforts to reform the transatlantic Open Skies treaty -- a lop-sided agreement which gives U.S. carriers unfettered access to Europe, while barring our airlines from operating domestic flights in the U.S. -- America is now bellyaching about EU efforts to curb global warming.
When Phase II of the EU's Emissions Trading Scheme (ETS) comes into force next year, it will at long last hold the aviation sector accountable for its CO2 emissions. The scheme has gradually been rolled out across Europe since 2005, allocating carbon permits to large companies and forcing them to purchase extra credits if they exceed their allowance. By attaching a financial incentive to energy efficiency, the ETS is estimated to have delivered annual emissions reductions of 2.5 to 5 percent since its launch...
Wednesday, 1 June 2011
Full article in JPG format: page 32/33 & page 34
To most casual observers, the challenges faced by Etihad chief executive James Hogan during 2011 would appear quite exceptional. In the space of a few short months the Abu Dhabi-based carrier – still only seven years old – has been forced to contend with a dramatic oil price rise, civil unrest on its doorstep, and a combined tsunami-cum-nuclear crisis which sent shockwaves around the globe.
But for a man whose résumé includes breakneck expansion in the face of countless prior crises – including the SARS pandemic, the global financial crisis, and aviation-related terrorism, to name just three – the turbulence of the past few months is nothing out of the ordinary.
Hogan was drafted in to head up Etihad in 2006, having served prior senior management stints at Bahrain’s national carrier Gulf Air and the UK airline, bmi. With more than 35 years of industry experience to his name, the Australian native understands the cyclical nature of aviation better than most. His business model is the stuff of nightmares for Etihad’s legacy rivals...
Full article in JPG format
When FlyDubai began operations in June 2009, chief executive Ghaith al Ghaith said he was bringing a "low-cost alternative" to residents of the Middle East. His choice of words might seem clichéd to European travellers, who have long been accustomed to the cut-throat, no-frills model pioneered by Ryanair. But in the Gulf, low-cost air travel has always been a notoriously elusive creature.
Take Air Arabia, the region’s first low-cost carrier (LCC), which took to the skies in 2003. Despite being in the business of no-frills travel, its passengers can check in a bag weighing up to 30 kilos free of charge – generosity which is quite literally unheard of in western no-frills markets. In Europe, hapless travellers who turn up to the airport with the same piece of luggage face fees of up to EUR 250 ($350)...