Akasa Air signs sale and leaseback contract of 5 B737 MAX with Griffin

Akasa Air has signed a contract with Irish leasing company Griffin Global Asset Management for the sale and leaseback of five Boeing 737 Max aircraft, a statement said on Thursday, June 9.

Under the sale and leaseback model, the airline sells its planes to a leasing company and then leases them back. This frees up the cash that the airline has spent on buying the aircraft.

Sale and Leaseback, often known as junk financing, involves removing an asset from the lessee's books and receiving upfront cash that can be used to pay down existing debts. As a result, the lessee's existing lines of credit are not affected.

Akasa Air signs sale and leaseback contract of 5 B737 MAX with Griffin

Businesses can use Sale and Leaseback deals to get finance for an amount that corresponds to the asset's fair market value, which may be significantly higher than its book value. In India, there may be tax ramifications. However, by allowing a high-cost debt to be substituted with a low-cost lease duty, Sale and Leaseback may provide a financial gain.

ALSO READ - Akasa Air signs deal for 72 Boeing 737 Max planes

Akasa Air had signed a deal with Boeing to purchase 72 Max aircraft on November 26, 2021, approximately three months after the Directorate General of Civil Aviation (DGCA) gave the green light to Max planes.

Akasa Air is scheduled to receive its first Max aircraft this month and is planning to launch its commercial flight operations in July.

ALSO READ - Akasa to receive the first aircraft in mid-June, commercial operations by July

Akasa Air is scheduled to receive its first Max aircraft this month and is planning to launch its commercial flight operations in July.

“We have introduced to Akasa Air’s management team over a year ago and have watched with excitement as they skillfully built the airline from the ground up. We are honoured to enter into this long-term relationship right from Akasa’s launch. They have developed a business strategy that addresses a need in the market and assembled a very impressive team to execute that plan."Ryan McKenna, CEO, Griffin Global Asset Management

A statement by Griffin Global Asset Management said it "is pleased to announce the mandate for purchase and leaseback of five Boeing 737-8 aircraft with Akasa Air, a new airline based in India".

The airline, which is backed by ace investor Rakesh Jhunjhunwala and aviation veterans Vinay Dube and Aditya Ghosh, received the no-objection certificate (NOC) from the Ministry of Civil Aviation in August 2021 to launch commercial flight operations.

"We are pleased to have Griffin as our partners in growth as we embark on our aviation journey. The high degree of confidence and endorsement from the Griffin team is a testimony to Akasa Air's robust and sustainable future."Vinay Dube, Founder, Managing Director and CEO, Akasa Air

Griffin is a commercial aircraft leasing and alternative asset management business. Griffin works closely with airlines, OEMs, financiers, and other lessors to deliver customized fleet solutions and financings across the industry. Griffin’s long-term capital base is designed to support airlines through industry cycles.

In a positive step of reconsigning the trans community, Air Vistara and AirAsia airlines have made their ticket booking gender-neutral by adding a third option.

This decision is believed to be the outcome of an online petition started in 2020, by Inderjeet Ghorpade, a member of the LGBTQIA+ group ‘YesWeExist’.

While booking an airline ticket for his friend who is a trans, non-binary person, he realised that none of the airline companies in India offered any “gender-neutral titles”.

In a positive step of reconsigning the trans community, Vistara and AirAsia have made their ticket booking gender-neutral by adding a third option.

“Many members of the LGBTQI community prefer using the ‘MX’ title. But, I was shocked to see that the ‘MX’ option was not available while booking air tickets in India. To make air ticket booking gender-neutral, I started a petition on Change.org called Change.org/StopPinkWashing,” Mr. Ghorpade said.

He then started speaking about the issue on social media and garnered support for his cause. He also wrote emails to airlines to alert them on the issue and sensitize them about the community’s demands. Over 33,000 people signed his petition and supported the cause.

The online petition mentions, “The Transgender (Protection of Rights) Act, 2019 mentions that transgender persons should not be denied or unfairly treated about the right to movement and access to services. All airlines in India violate this Act. Four years ago, Indian Railways updated their booking form and added transgender as an available gender option. 

Alaska Airlines changed its policies to allow more freedom and flexibility to its staff in individual and gender expression by relaxing rules for makeup, hairstyle, and footwear regardless of gender identity.

While this is certainly a good start, Ghorpode believes that the fight for inclusivity has much more to achieve.

He explains, “Indian airports continue to view gender as binary even though the Indian law does not. There are no gender-neutral washrooms at Indian airports and the security check procedures too, segregate passengers as Male and Female.”

Indrajeet is hopeful that soon Air India will also make the change, now that the Tatas own both Air India and Air Vistara.

There are no gender-neutral washrooms at Indian airports and the security check procedures too, segregate passengers as Male and Female

"Once these three big airlines have made the change in their booking platform, then hopefully airline authorities will work towards making airports more queer-friendly. At least that will be my next action plan."

Globally, the aviation industry is increasingly starting to identify the gaps in its approach to inclusivity for people of all genders and sexualities and making changes in several age-old practices.

In March, the US's Transportation Security Administration (TSA) announced new standards for screening transgender, non-binary, and gender-nonconforming airline passengers at checkpoints to improve the screening experience for all.

Many airlines such as Lufthansa, Japan Airlines, and British Airways have also switched to gender-neutral greetings.

In March, Alaska Airlines changed its policies to allow more freedom and flexibility to its staff in individual and gender expression by relaxing rules for makeup, hairstyle, and footwear regardless of gender identity.

Many airlines such as Lufthansa, Japan Airlines, and British Airways have also switched to gender-neutral greetings.

For instance, instead of calling passengers' ladies and gentlemen,' they now refer to them as 'guests' or greet them with phrases such as, "Good morning everyone," "Good morning here onboard," or "Attention all passengers."

India’s aviation regulator the Directorate General of Civil Aviation (DGCA) has mandated the use of masks in flights and airports as Covid19 cases are on the rise again. In the order, the regulator said passengers who don’t comply will be treated as “unruly” and be deboarded if need be, before departure.

“In case any passenger on board an aircraft refuses to weak mask on the aircraft or violates “Covid19 protocol for passengers” even after repeated warnings, during the flight, such passenger may be treated like an unruly passenger,” said the regulator.

The court had asked the DGCA to give directions to all airlines to authorise the staff at airports and in aircraft, including air hostesses, captains, pilots and others to take strict action against violators.

ALSO READ - Delhi HC advises DGCA to strictly enforce COVID-19 regulations at airports and in aircraft

DGCA mandates masks in flights and airports as Covid-19 cases surge

The order is in line with a recent Delhi High Court mandate, he added. The airlines have been instructed that a passenger that refuses to comply shall be deboarded before the departure. Violators of the new rules can be put on the ‘no-fly list’.

The latest order comes at a time when daily coronavirus infections in India have crossed 5,000 after more than three months. A total of 5,233 infections were recorded in 24 hours with seven fatalities.

The regulator said all airlines should ensure that face masks are worn in flight, should supply masks and sensitize passengers. Airports should have repeated announcements on the same. The government banned all domestic and international flights during the first wave.

Violators of the new rules can be put on the ‘no-fly list’.

The DGCA issued a similar order in March last year, but between March and April this year, several States removed the mask mandate, creating confusion among travellers.

While initially airports and airlines were also required to ensure social distancing, this requirement has been dispensed with, a government official confirmed.

The Directorate has also instructed airports to ensure surveillance. Those who disobey could face fines as per the laws in the State and could also be handed over to the security agencies.

Vistara is in initial discussions with Air India on synergies on procurement of parts and may in future look at synergies in training, its CEO said Wednesday, June 8.

The airline also plans to lease 4-5 Boeing Dreamliner planes, as the American plane maker is running slower-than-expected on deliveries, a person in the know said.

ALSO READ - Vistara in talks with lessors to fill long-haul gap in the wake of B787 delays

Vistara is waiting to receive four aircraft from Boeing’s 787 production line, but deliveries have been frozen globally since May 2021 due to quality-control shortcomings.

Vistara plans to collaborate with Air India on procurement of parts

“Procurement is certainly one of the areas we are discussing,” said Vinod Kannan, adding that on the customers’ and operations’ side they will continue to be competitors.

Vistara is the Tata group’s joint venture with Singapore Airlines. The aviation-to-automobile conglomerate last year bought Air India after it was put on the privatisation block by the government.

Kannan didn’t elaborate on how the synergies would pan out but said cost efficiencies would be on the top of the list. Vistara has a fleet of 53 planes and currently operates 250 flights to 41 destinations.

Vistara's aircraft fleet include two 787-9s received before the delivery suspension and a mix of Airbus and Boeing narrow-body airliners. It plans to take 20 more aircraft by the end of 2023, mostly A320s to be used domestically and for nearby international destinations.

Vistara has a fleet of 53 planes and currently operates 250 flights to 41 destinations.

Expanding its footprint globally is a priority for Vistara, which began operations in 2015 but has not yet made a profit. India’s domestic market is dominated by low-cost carriers, such as IndiGo. International flying offers stronger pricing.

“The airline was supposed to get its third Dreamliner in October and a few more in the next six months. But Vistara will lease a few more in the interim to expand on its international operations,” said the person cited above. The airline recently started operations in Jeddah and Male.

ALSO READ - Vistara may merge with Air India, decision expected by end of 2023

(With Inputs from The Economic Times)

Naresh Goyal and his wife Anita Goyal, the original promoters of Jet Airways, have moved court, challenging a decision by the country's largest lender State Bank of India to club them with the airline they founded in the list of 'fraud accounts'.

While the Goyals were neither guarantors nor direct borrowers, including them in the 'fraud' list could trigger criminal proceedings and put them under the lens of government investigative agencies.

The Goyals have filed separate writ petitions before the Bombay High Court because they were neither served show-cause notice nor heard by the bank. The law firm Naik Naik & Co is representing the Goyals.

Naresh Goyal along with his wife moves court to contest the 'fraud account' tag by SBI

The matter is expected to come up for hearing this week. SBI has the largest exposure to Jet Airways which now has a new set of investors whose resolution plan for the debt-laden airline was approved by the bankruptcy court in 2021.

The legal tussle with SBI is brewing at a point when some banks, under a separate proceeding, are preparing to take a final call on classifying the Goyals as 'wilful defaulters'.

According to the Reserve Bank of India's master directions on classification and reporting of frauds, "…the penal provisions as applicable to wilful defaulters would apply to the fraudulent borrower including the promoter director(s) and other whole-time directors of the company insofar as raising of funds from the banking system or from the capital markets by companies with which they are associated is concerned, etc."

The Goyals have filed separate writ petitions before the Bombay High Court because they were neither served show-cause notice nor heard by the bank.

Typically, a borrowal account is categorised as a 'fraud account' after it is red-flagged based on practices like fund diversion (even if there is no siphoning of money from the company).

Interestingly, the legal action by the Goyals came almost a year after SBI had informed them (in July 2021) that following the classification of Jet as a 'fraud account', the bank's appropriate committee has also identified Goyals' accounts as a fraud based on the scrutiny it had undertaken.

What probably drove the Jet founders to file writs was media reports in March 2022 that the Central Bureau of Investigation (CBI) is likely to file a first information report against the Jet promoter.

SBI has the largest exposure to Jet Airways which now has a new set of investors whose resolution plan for the debt-laden airline was approved by the bankruptcy court in 2021.

A bank is supposed to report the fraud to RBI within 21 days of its detection as well as report it to the CBI or the economic offences wing of the police depending on the amount involved.

Banks are yet to share the forensic report - based on which they probably plan to tag the account and the promoter as a fraud account and wilful defaulter - with the Goyals.

Besides examining the regulatory scope for classifying the earlier promoter under the fraud account list (along with the company), the high court may look into whether the principles of natural justice (in general) or the opportunity to show cause (in particular) must be read into the relevant provision of the RBI circular.

Banks are yet to share the forensic report - based on which they probably plan to tag the account and the promoter as a fraud account and wilful defaulter - with the Goyals.

The Telangana High Court, in a separate matter, had observed that the petitioner deserves to be granted an opportunity to show cause after being acquainted with the material (such as a forensic report) used against it. The case is pending before the Supreme Court.

Meanwhile, in a recent meeting the industry body Indian Banks’ Association decided to make a representation to the regulator to relook at the sweeping definition of ‘fraud’ as labelling a borrower as a ‘fraud account’ can severely hurt the functioning and fortunes of the company.

Unlike in the case of naming a wilful defaulter, a bank does not have to follow the process while including a borrower in the ‘fraud account’ list.

(With Inputs from The Economic Times)

Representative | 19FortyFive

The categorization of fighter jets into various generations has long been a topic of debate. Following is the most agreed upon classification:

Generation 1 : Jet propulsion (F-80, German Me 262)Generation 2 : Swept wings; range-only radar; infrared missiles (F-86, MiG-15)Generation 3 : Supersonic speed; pulse radar; able to shoot at targets beyond visual range (“Century Series” fighters such as F-105; F-4; MiG-17; MiG-21).Generation 4 : Pulse-doppler radar; high manoeuvrability; look-down, shoot-down missiles (F-15, F-16, Mirage 2000, MiG-29).Generation 4+ : High agility; sensor fusion; reduced signatures (Eurofighter Typhoon, Su-30, advanced versions of F-16 and F/A-18, Rafale).Generation 4++ : Active electronically scanned arrays; continued reduced signatures or some “active” (waveform cancelling) stealth; some supercruise (Su-35, F-15SE)Generation 5 : All-aspect stealth with internal weapons, extreme agility, full-sensor fusion, integrated avionics, some or full supercruise (F-22, F-35)Generation 6 : Conceptual at this point although touted to be more advanced than generation 5 that are currently in service and development. (SOURCE: airforcemag)

If sources are to be believed, the US has already moved a step forward in what we might see as the world’s first sixth-gen fighter jet. The fifth-gen fighter jet program is the current best, with 2 from the US and 1 from China and Russia respectively.

Representative | Source

Reportedly, the Air Force’s sixth-generation fighter has officially entered development- news confirmed by the Air Force’s top official on June 1.

We have now started an engineering, manufacturing and development program to do the development aircraft that we’ll take into production. We think we’ll have the capability by the end of the decadeAir Force Secretary Frank Kendall said during an event at the Heritage Foundation

The United States Air Force (USAF) commissioned the Next Generation Air Dominance program (NGAD) initiative to develop the world’s first sixth-generation stealth fighter and is scheduled to replace the ageing F-22s. The F-22 Raptor was the world's first fifth-generation fighter craft to be put into service.

Although planned upgrades will keep the F-22s flying for more than a decade, the NGAD will likely unveil a host of capabilities, never before seen in a fighter aircraft.

F-22 Raptor | Representative | The Chainsaw

Apparently, the NGAD has progressed beyond the prototype stage and has entered the development stage.

The U.S. Air Force basically had an X-plane program, which was designed to reduce the risk in some of the key technologies that we would need for a production program. Previously the Air Force has done a quick demo, and then we have to start an EMD or development program and wait several more years because we didn’t start the development functionKendall explained

What could be the possible features of the next-generation fighter craft?

Building on the features of its predecessor, Gen 6 could be far stealthier, it may be capable of "wing-morphing"- which in other words refers to the capability of wings to alter shape mid-air, in-flight retunable engines for a far more efficient supersonic or subsonic cruise, well, the options are galore.

Representative | National Defense Magazine

The Adaptive Engine Transition Program (AETP), unaffordable for the F-35s as some belief, could also be a part of the Generation 6 aircraft.

Directed energy weapons (DEW), or high-powered microwaves and lasers could be used to counter incoming missiles or as offensive weapons themselves.

Directed Energy Weapons (DEW) | Representative | Observer Research Foundation

Directed energy weapons could play a big role in deciding how agile a sixth generation fighter would have to be. “Speed of light” weapons  could “negate” the importance of “the maneuverability we see in today’s fashionable fighters.” There won’t be time to maneuver away from a directed energy attackPaul K. Meyer, vice president and general manager of Northrop Grumman’s Advanced Programs and Technology Division

Darryl W. Davis, president of Boeing’s advanced systems division, mentioned that vast amounts of data would be available to the pilot, who may or may not be on board the aircraft, and this is where Fiber optics could play a significant role.

You could have fewer wires. You’re on a multiplexed, fiber-optic bus … that connects all the systems, and because you can do things at different wavelengths of light, you can move lots of data around airplanes much faster, with much less weight in terms of … wire bundlesDavis

Although sceptical about the availability and timely implementation, hypersonics has always been attributed as a feature of Gen 6 fighter crafts.

It entails a whole new range of materials development, due to … sensors, fuzes, apertures, etc. all of which must operate in that intense heat environment at … Mach 5-plusMeyer

The NGAD is also being touted as a 'family of systems' that could see a lot of unmanned aircraft equipped with a wide variety of sensors and payloads being deployed alongside the manned planes.

The Air Force had already built and flown a full-scale flight demonstrator in the real world. The plane is still years away from full production, but has created ripples in the defence industry across the globeAssistant Secretary of the Air Force -Will Roper

According to Richard Aboulafia- an aerospace analyst with AeroDynamic Advisory, Lockheed Martin, Boeing and Northrop Grumman are all possible contenders in building the next generation fighter although  Northrop’s current project on producing the B-21 bomber makes it an unlikely choice to lead the project.

Due to the sensitive nature of the project, much about NGAD remains classified to the general public.

SOURCE(s)

COVER: Popular Mechanics