Jet Airways in advanced talks to order 50 Airbus A220

Jet Airways is in advanced talks to order about 50 Airbus SE A220 aircraft, according to people familiar with the matter, marking what could be a fresh beginning for the bankrupt carrier that’s attempting to make a comeback.

Deliveries of the new aircraft will start in 2025, the people said, asking not to be identified because the discussions are confidential.

A deal for 50 such planes would probably be valued at around USD 1.8 billion after usual discounts, according to figures from leading aircraft appraiser Avitas. It’s unclear whether the planes will be bought outright by the airline or leased, or a mixture of both.

Jet Airways is in advanced talks to order 50 Airbus A220

ALSO READ - Jet Airways nearing a deal to buy 50 A220 jets from Airbus

The deal is still being finalized and is yet to be signed. The airline, once India’s top private carrier, is undergoing a court-monitored restructuring and seeking to reenter a market notorious for cut-throat fare wars and some of the world’s costliest jet-fuel prices.

IndiGo, operated by InterGlobe Aviation, is the clear leader, controlling over 50% of the domestic market while more than half a dozen carriers fight for the rest.

ALSO READ - Jet Airways to lease 6-8 aircraft by December; in talks with aircraft manufacturers and lessors

Deliveries of the new aircraft will start in 2025

Jet Airways, planning to return with a mix of premium and no-frills services, is also in separate talks with Boeing Co. and Airbus to potentially place a “sizable” order from the 737 Max or A320neo families of jets. In fact, before going bankrupt, the carrier had a massive order for the 737 MAX 8 of 125 units and had received eight of them.

Dubai-based, Indian-origin businessman Murari Lal Jalan and Florian Fritsch, the chairman of London-based financial advisory and alternative asset manager Kalrock Capital Management Ltd., are in the process of taking over Jet Airways.

The airline is “in the very final stages of discussions” with lessors and planemakers for aircraft, as well as for engines, a representative for Jalan and Kalrock said in a statement.

Before going bankrupt, Jet Airways had a massive order for the 737 MAX 8 of 125 units and had received eight of them.

“We will announce our aircraft choice, sourcing, and fleet plan when the process concludes.” A representative for Airbus said the planemaker is “always in discussions with all its existing and prospective customers to understand and support their fleet requirements.”

ALSO READ - Jet Airways to only operate domestic flights as it resumes operations

Jet Airways will initially start operations with leased aircraft considering plane manufacturers with limited production capacity are usually sold out years in advance, they said.

Because planemakers have such long lead times for delivery, so-called pre-delivery payments are made in instalments, with as little as 1% of the aircraft value actually forked out at the time of the order.

Jet Airways will initially start operations with leased aircraft considering plane manufacturers with limited production capacity are usually sold out years in advance

Before folding in 2019, the Delhi-based carrier operated a fleet of mostly Boeing 737 narrowbodies. However, following the restructuring, it currently has nine aircraft listed in its fleet.

Three are Boeing 737-800s, one a 737-900, and the remaining five are 777-300ER widebodies. It has an average fleet age of 16 years; though an extensive expansion is required if it plans to rebuild its previous network.

Any revival of Jet Airways, which collapsed under a pile of debt in 2019 and became the first airline to enter a reformed insolvency resolution process, would be a landmark moment for India’s bankruptcy laws.

(With Inputs from Bloomberg)

Low-cost airline SpiceJet on Wednesday, August 31 declared losses of INR 1,725 crore for the full year of FY 22. The airline also reported a loss of INR 783.60 crore for April-June of FY 23 as compared with a loss of INR 729 crore in the year-ago period.

The airline had delayed results due to a ransomware attack the company faced in April. The company’s freighter division however registered a profit of INR 18 crore for the first quarter of FY 23.

ALSO READ - SpiceJet under attack by ransomware; morning flights affected

SpiceJet also said that Chief Financial Officer Sanjeev Taneja has resigned and the company will be appointing a replacement in September.

SpiceJet declared losses of INR 1,725 crore for the full year of FY 22.

Shares of SpiceJet fell as much as 14.7% on Thursday, September 1 after the low-cost carrier posted a bigger loss due to high fuel costs and unfavourable foreign currency rates, and said its chief financial officer had resigned.

The cash-strapped airline, which announced delayed salary payments to employees, has also passed a board resolution to appoint bankers to raise capital of USD 200 million (INR 1,591 crore).

“We are optimistic about our future and our continued recovery and to achieve our future plans the Board has mandated fresh capital issuance and the Company will be shortly engaging with investment bankers for a potential raise of up to the USD 200 million."

Total revenue for the quarter under review came at INR 2,478 crore, as against INR 1,266 crore in the same quarter of the previous yea

At the end of FY 22, the company had cash and cash equivalents of INR 9.6 crore and bank balances of INR 50.72 crore.

Total revenue for the quarter under review came at INR 2,478 crore, as against INR 1,266 crore in the same quarter of the previous year, SpiceJet said in a regulatory filing. 

For the same comparative period, operating expenses stood at INR 3,267 crore as against INR 1,995 crore. On an EBITDA basis, the loss was at INR 379 crore for the reported quarter as against a loss of INR 244 crore for the quarter that ended June FY2022.

The auditors of the company have raised material uncertainty about the company’s ability to continue as a going concern but the company’s management has said that the company has levers through raising capital and fresh loans from lenders.

The airline further stated that its business was severely impacted by record high fuel prices and a depreciating rupee and discounting the forex loss

With the increase in passenger operation and yields, the company’s revenue has increased. The company is in further discussions with banks to raise additional funds under ECLGS 3.0 extension scheme and such discussions are in an advanced stage.

The Board of Directors has also approved the raising of fresh capital through the issue of eligible securities by applicable law. Based on the foregoing and its effect on business plans and cash flow projections, the management is of the view that the Company will be able to achieve positive cash flow from operations and raise funds as necessary, to meet its liabilities.

“Record high ATF prices and depreciating Rupee were the major contributors. Despite the complex operating environment and highest ever input costs, SpiceJet has been able to sustain its operations with the confidence shown by our partners and passengers. Last year was a period of restructuring and settlements and we successfully completed and implemented settlements with most of our major partners.As we move ahead we are encouraged with the strong travel demand and our focus for the next year would be to induct more fuel efficient Boeing 737-8 MAX aircraft and concentrate on our regional and international routes."Ajay Singh, Promoter and CMD, SpiceJet

The airline further stated that its business was severely impacted by record high fuel prices and a depreciating rupee and discounting the forex loss, the company would have reported a much-reduced loss of INR 420 crore in Q1 FY 23.

ALSO READ - Cash-strapped SpiceJet plans to take delivery of 7 Boeing 737 Max

Singh said that the company will be inducting fresh capacity enhancement in both passenger and freighter business.

SpiceJet CMD Ajay Singh said that the company will be inducting fresh capacity enhancement in both passenger and freighter business.

Even as forecasts for India’s aviation sector look brighter with local traffic surging 94% in July, SpiceJet, which has slipped from No 2 to No 5 in the rankings, may find it difficult to make a comeback. Jet Airways is planning to resume flying by September and Air India is headed for a revamp under Tata Sons’ management.

ALSO READ - DGCA orders SpiceJet to operate only 50% of approved flights

SpiceJet faces several challenges. India’s aviation regulator has capped the number of seats the carrier can sell at 50% for eight weeks after it reported a string of mid-air malfunctions. The regulator has said the airline failed to build “safe, efficient and reliable” air services and in July summoned it to explain the incidents.

ALSO READ - Spicejet looking for a “knight in shining armour” to help with financial distress

The pilots and flight crew members have often flagged stress issues due to financial irregularities.

SpiceJet incurred net losses of INR 316 crore, INR 934 crore, and INR 998 crore in FY19, FY20, and FY21, respectively. On August 23, Singh had said that the airline was exploring multiple options, including a stake sale to other airlines, to raise to INR 2,000 crore.

ALSO READ - SpiceJet in active discussion with a Middle Eastern carrier for a possible stake sale

2 more aircraft deregistered

Aviation regulator DGCA on Wednesday, August 31 deregistered two more Boeing 737 planes of SpiceJet following non-payment of dues to lessors. With the latest deregistration, a total of six Boeing 737 aircraft of the budget carrier have been deregistered in August.

ALSO READ - SpiceJet likely to de-register 2 more Boeing 737s

Boeing 737-800 aircraft VT-SPU and Boeing 737-900ER aircraft VT-SGQ have been deregistered under IDERA on August 31, according to a senior official at the Directorate General of Civil Aviation (DGCA).

DGCA on August 31 deregistered two more Boeing 737 planes of SpiceJet following non-payment of dues to lessors

Under the Cape Town Convention, lessors and lenders can seek deregistration of a leased aircraft in case there is a default. Such requests are done under Irrevocable De-registration and Export Request Authorisation (IDERA).

ALSO READ - Lessor wants 3 SpiceJet aircraft deregistered over unpaid dues

In recent months, SpiceJet has been facing turbulent times, including financial headwinds. The pilots and flight crew members have often flagged stress issues due to financial irregularities.

SpiceJet delays salaries again

Meanwhile, SpiceJet employees alleged delay in the disbursal of salaries for the second straight month, with the budget airline saying the payments were being made in a "graded format".

In recent months, SpiceJet has been facing turbulent times, including financial headwinds.

There was a delay in disbursal of salary for staff, including flight crew, for July and many are yet to get Form 16 for the financial year 2021-22 as well, SpiceJet employees claimed.

ALSO READ - SpiceJet revises its pay scales, 10-20% increase expected

"The salary disbursal was timely for June. Also, the salaries are yet to match the pre-COVID-19 levels. The salaries being disbursed to captains and first officers are not even 50% of what they used to be before the pandemic outbreak in March 2020," a staff told news agency PTI.

However, SpiceJet claimed it has started salary disbursal in a "graded format". "We have started crediting salaries from today. Like the previous month, salary will be credited in a graded format," the airline said in a statement.

The country's largest airline IndiGo and British carrier Virgin Atlantic on Wednesday, August 31 announced a codeshare agreement. Passengers can book codeshare flights this week for travel from September 27, subject to government approval.

The agreement will allow Virgin Atlantic to sell seats to passengers connecting onto IndiGo flights. The codeshare agreement will help both airlines in expanding their access to customers flying to destinations which are serviced by either of them.

https://twitter.com/IndiGo6E/status/1564934918345355264

The initial codeshare destinations in India include Chennai, Bengaluru, Hyderabad, Kolkata, Ahmedabad, Amritsar, Goa, Delhi and Mumbai.

The additional destinations will include Kochi, Chandigarh, Jaipur, Pune, Coimbatore, Nagpur, Vadodara, Indore and Visakhapatnam, a release said.

Under the codeshare partnership, customers booking a Virgin Atlantic ticket can fly on the airline's London Heathrow to Delhi and Mumbai flights and connect to and from 7 additional cities in India.

“We’re thrilled to launch a new codeshare partnership with IndiGo. This summer marks our largest ever flying programme from India with three daily direct services to London and our new partnership takes our commitment to even greater heights. IndiGo is India’s largest airline and its extensive network will offer Virgin Atlantic customers even more choice when travelling between the UK and India, as well as offering seamless connections for the onward travel across our extensive US route network. It’s great news for our Flying Club too, by providing more opportunities for members to earn valuable points. This new partnership aims to respond to the large, fast-growing demand for visiting friends & relatives, leisure as well as business travellers looking for more choice between UK and India.”Juha Jarvinen, Chief Commercial Officer, Virgin Atlantic

Later this year, the release said the release will expand the agreement to cover 16 destinations throughout India, as well as connections onto Virgin Atlantic's extensive US network operated via London Heathrow.

Meanwhile, IndiGo passengers will be able to connect to Virgin Atlantic's extensive United States network operated from London. Virgin Atlantic currently serves San Francisco, Los Angeles, Seattle, Atlanta, Las Vegas, Austin, Tampa, Orlando, Miami, New York, Boston, and Washington D.C.

“We are pleased to announce our codeshare with Virgin Atlantic to provide enhanced connectivity to the passengers. This will not only help offer a seamless travel experience from London to as many as 16 destinations in India, but also open up international trade opportunities throughout the country via enhanced accessibility. We look forward to having Virgin Atlantic’s customers on our lean clean flying machine, as we extend our on-time, affordable, courteous and hassle-free travel experience.”Ronojoy Dutta, Chief Executive Officer, IndiGo

Codesharing allows an airline to book its passengers on its partner carriers and provide seamless travel to destinations where it has no presence.

IndiGo and Virgin Atlantic sign codeshare agreement

As part of the codeshare, Virgin Atlantic will also offer free-of-cost shuttle services between different terminals at Delhi airport for its customers.

ALSO READ - Air France-KLM and IndiGo officially launch their codeshare agreement

IndiGo already has codeshare agreements with Air France-KLM, Turkish Airlines, Qatar Airways, American Airlines and Qantas.

ALSO READ - IndiGo officially launches codeshare agreement with American Airlines

ALSO READ - Qantas announces direct flights between Sydney-Bengaluru, finalises codeshare with IndiGo

The airlines have been charging excessive, unreasonable, and prohibitive prices for travel from countries in the Gulf region to Kerala, and the rest of India claims the Court's argument.

The Delhi-based political group Kerala Pravasi Association filed a petition challenging Rule 135 of the 1937 Aircraft Rules because it is arbitrary, vague, and unconstitutional.

The Delhi High Court asked the DGCA for a statement on Monday, August 29 to hear a writ petition challenging the high cost of airline tickets on flights between the Middle East countries and India.

According to the petition, this has led to severe obstacles for Indian people who want to travel to and from these nations, primarily for jobs, businesses, and education.

Expat group sues airlines for "obscenely high" airfares between India and the Middle East at Delhi HC

The appeal also stated that such excessive and unreasonable prices restrict air travel as a form of transportation, violating the constitutional rights of Indian passengers travelling to or from Gulf countries.

Each air transport company subject to sub-rules (1) and (2) of Rule 134 shall establish a tariff by Rule 135 of the 1937 Aircraft Rules that take into account all pertinent factors, including the cost of operation, the features of the service, a reasonable profit, and the generally accepted tariff.

According to the petition, although Rule 135(4) of the Aircraft Rules, 1937 gives DGCA the authority to give instructions to an airline if it has established an excessive tariff in violation of Rule 135(1) or has engaged in oligopolistic behaviour, the said provision is rendered ineffective due to the arbitrary and unrestrained powers granted to the airlines to establish tariff under Rule 135(1) of the Rules.

Kerala Pravasi Association, the petitioners, requests the revocation of Rule 135 or an immediate preliminary remedy concerning airline costs. The senior members of the NRI association assert that this may be the first time a writ petition contesting Rule 135(1) has been filed.

The Kerala Pravasi Association is a political organization with chapters worldwide, including in the United Arab Emirates. The organization is registered with the Indian Election Commission. Kuriakose Varghese, a managing partner at KMNP Law and a Supreme Court attorney, filed the case on behalf of the NRI group.

According to Rajendran Vellapalath, the chairman of the Kerala Pravasi Association, the flights to Kerala are among the most expensive. Depending on the sector the traveller is flying, peak season airfares between India and the UAE might increase from Dh 1,500 to Dh 3,000. The writ challenges Rule 135 (1) of the 1937 Aircraft Rules, according to Varghese.

He added that certain reasonable restrictions must be followed while determining airfare costs. He also affirmed that his organization wouldn't locate a representation for the DGCA based on the Court's decision and will take further actions from there.

According to Varghese, basing fares on the market makes it highly lucrative and arbitrary. We are pleased that the High Court did not dismiss our petition, Vellapalath said. We've been invited to communicate with the DGCA instead.

Based on their response, he added that the political organization is prepared to appeal to the Supreme Court of India. Even though similar petitions have been submitted in the past, Varghese said that courts rarely take on such complex cases. This is a situation where economics and law are intertwined.

He noted that stakeholders typically adopt a take it or leave it approach, particularly during peak travel times, it is a very grey area of operation, and there is no transparency on the subject. To no avail, this matter has also been brought up by several members of the Indian Parliament, community organizations in the UAE, travel agents, and other non-profit organizations.

In bilateral negotiations, when two countries are engaged, the civil aviation regulatory authority can decide what kind of charge needs to be assessed on passengers travelling between the sectors, Vellapalath continued.

The government may cap the price of the tickets at either a minimum or maximum. During peak Covid-19, the government set a ceiling on domestic airfare prices.

Vellapalath questioned, why can't the same be done for overseas airlines. Airlines have reportedly kept their peak-season operations capacity lower between Gulf areas and India.

The public cannot be taken advantage of, claimed Vellapalath. The government should not enable airlines to create profiles of its citizens. Let them increase it if there is a capacity crunch.

ALSO READ - International flights likely to get cheaper as India signed a pact with 116 countries

(With Inputs from The Economic Times)

The first vertiport in Australia will be located in Melbourne and serve the developing electric air taxi market. The vertiport, which was created by Contreras Earl Architects and was intended for Caribbean Park in Melbourne's east, was unveiled by Skyportz.

Skyportz

 To develop a modular design for a vertical takeoff and landing (VTOL) airport, Contreras Earl Architects, To70 Aviation, Arup, and Microflite partnered with Skyportz Chief Executive Clem Newton-Brown.

Skyportz Chief Executive Clem Newton-Brown | Source

Several aviation corporations are investing literally billions of dollars in the creation of air taxi prototypes. Along with new competitors like Kittyhawk, Archer, Joby, Lilium, Volocopter, and Electra Aero, some of the greatest names in aviation and automotive are competing, including Bell, Embraer, Boeing, Airbus, Hyundai, and Toyota.

Air-One Vertiport in England | Representative | News NCR

There is no denying the impending arrival of Advanced Aerial Mobility. Since many prototypes have already taken to the air, it is anticipated that the front-runners will have passenger-carrying aircraft that have received commercial certification very soon.

With conventional aviation, if you build a new plane, you already have places to take off and land it.With AAM, everything is being built from scratch. It’s a catch-22. If you don’t have the infrastructure, you can’t get the industry off the ground, and if you have the landing sites but no aircraft, same thing. But eVTOL development is out in frontexplained Sergio Cecutta at Arizona-based SMG Consulting

Representative | Source

The location of the airplane's landing will be the final component of the ecosystem after the aircraft are in the air. And that’s where the Skyportz network of vertiports comes in.

For this industry to succeed it needs to have policymakers pushing the envelope to support new ‘mini airports’ in locations people want to go. Electric air taxis will be a new era in aviation where clean, green and quiet small aircraft can take people to places they want to go. However, community support is going to be the key to the development of these services. The community is going to have to see the benefitsA roadmap for the implementation of advanced air mobility (AAM) in Australia was recently announced by the federal regulator Civil Aviation Safety Authority. It is projected that commercial certification for electric vertical takeoff and landing aircraft could occur as early as 2024.Skyportz chief executive Clem Newton-Brown said

 We are proud to have designed Australia’s first vertiport—a beautiful, sculptural, ground-breaking terminal that contributes to the evolution of architecture and to the future of our communities and cities. Using advanced technology, we developed an efficient modular design made with recyclable aluminium. The system is lightweight, prefabricated and assembled on site, so that it can be adapted and configured for a broad range of settings and scaled for mass productionContreras Earl Architects director Rafael Contreras said

After Skyportz stated it would build a transportation hub north of Brisbane and manufacture the aircraft in Queensland, flying taxis might carry athletes around the 2032 Brisbane Olympics in Queensland.

SOURCE(s)

COVER: The Urban Developer

Taiwan's China Airlines Ltd said on Tuesday, August 30 it would buy 16 Boeing Co B787 widebody planes to replace its ageing fleet of Airbus A330s following a widely watched contest held against the backdrop of regional tensions.

The politically sensitive deal worth USD 4.6 billion at list prices was announced by the government-backed carrier weeks after a visit to Taipei by U.S. House of Representatives Speaker Nancy Pelosi angered Beijing and stoked Sino-U.S. trade tensions.

U.S. flagship planemaker Boeing had been widely expected to win the deal as talks by the government-backed carrier to renew its fleet coincided with attention to security partnerships amid what Taipei has called its worst tensions with China for 40 years.

Taiwan's China Airlines orders 16 Boeing 787 Dreamliners

This will be the first time China Airlines operates the Dreamliner and the second Taiwanese carrier to do so after EVA Air, which currently operates 10 Dreamliners and awaits delivery of a further 11 planes.

Less certain, however, is how the deal may impact Boeing's relations with China, which typically accounts for about a quarter of its commercial sales, analysts said.

Boeing has been waiting for months for approval to resume 737 MAX deliveries to China despite the jet having been declared safe by Chinese authorities after a safety crisis.

ALSO READ - China gives green light to Boeing 737 Max after “corrective actions”

Boeing has been waiting for months for approval to resume 737 MAX deliveries to China

While Beijing has in the past withdrawn or postponed high-profile business deals in response to U.S. or European arms sales to self-ruled Taiwan, which Beijing regards as a renegade province, civil airplane deals tend not to cause such a stir.

Boeing, which is usually quick to follow up airline order announcements with its release, said hours later that it was pleased that China Airlines had selected the 787 and was working with the carrier to finalise the order.

“We are pleased that China Airlines has selected the 787 Dreamliner to modernize their world-class fleet and look forward to working with the airline to finalize the order," Boeing said in a statement.

The Dreamliner will become an integral part of China Airlines' medium and long-haul network, while the carrier also noted its spacious cargo capacity in the belly will further add to its value.

Boeing was pleased that China Airlines had selected the 787 and was working with the carrier to finalise the order.

ALSO READ - Boeing to resume 787 Dreamliner deliveries

Deliveries are set to begin in 2025 as Boeing scrambles to clear its backlog having only resumed Dreamliner deliveries earlier this month.

Industry sources have said that the U.S. planemaker sought to distance itself from Pelosi's visit, refraining from using it as an opportunity to lobby for a U.S. deal, but would be wary of acting against its own deeper economic interests in China.

China tends to balance jet purchases between trans-Atlantic industrial powers Airbus and Boeing over time but has effectively been off the market for five years, with demand hampered first by trade tensions and then by the pandemic.

China tends to balance jet purchases between trans-Atlantic industrial powers Airbus and Boeing over time

ALSO READ - Chinese airlines orders 292 Airbus A320neo aircraft

In July, Chinese state airlines announced a deal for 292 smaller narrowbody jets with Airbus, in what sources called a carefully timed announcement, months after the deal was agreed.

Boeing has long been seen as a contender to win a Chinese order for widebody jets like the 787 once trade tensions ease.

Boeing shares closed 1.9% lower on Tuesday, August 30.

Boeing Chief Executive Dave Calhoun said last month that 737 MAX deliveries to China remained blocked by COVID-19 and a "geopolitical overhang," in a reference to simmering trade tensions between the world's two biggest economies.

Boeing has long been seen as a contender to win a Chinese order for widebody jets like the 787 once trade tensions ease.

The order from Taiwan, however, is the latest sign of a long-awaited pickup in widebody demand and a boost for the U.S. planemaker weeks after it resumed deliveries of its premier long-haul model following a 15-month halt over production issues. 

China Airlines said the 787s would allow it to phase out its fleet of 22 older A330s.

The carrier, one of the world's biggest freight airlines, cited the 787's cargo-carrying capacity as one of the reasons behind its selection in a contest that industry sources said pitted the 787 against the A330neo.

China Airlines, which has been profitable during much of the pandemic because of a shift to cargo services, is now gearing up for a rebound in passenger travel when Taiwan lifts quarantine rules for arrivals.

China Airlines said the 787s would allow it to phase out its fleet of 22 older A330s.

The agreement with Boeing also includes rights to convert parts of its order to the Boeing 787-10 Dreamliner variant. The 787-10 is the largest variant in the Dreamliner program and the least popular in terms of sales at 182 orders, falling short of the 787-9 (890 orders) and 787-8 (416 orders).

As for China Airlines' Airbus A330-300 fleet, the carrier has 22 of the type with an average age exceeding 14 years. The vast majority of its A330 fleet is on the lease, with the first aircraft arriving back in 2004.

The Taiwanese airline has been busy renewing its fleet in recent years. This includes welcoming the Airbus A321neo to replace its Boeing 737-800s, along with the addition of the Boeing 777-300ER and Airbus A350-900 in the last half-decade.

(With Inputs from Reuters)