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LATEST NEWS
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Wednesday, December 7th, 2022
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Airbus has admitted that owing to a complex operating environment at the moment, it is likely to miss its targeted delivery of “around 700” commercial aircraft this year, albeit marginally.
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This month its deliveries totalled 68 units, bringing the total deliveries for the year to 565 aircraft. For 2023 and 2024 the European planemaker anticipates delivering 65 units per month, and is targeting a ramp-up to 75 unit by 2025. In the meantime, Airbus has not changed its guidance presented with the nine-month 2022 results, which basically means guidance for EBIT Adjusted and Free Cash Flow before M&A and Customer Financing remains unchanged.
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The full year 2022 Airbus commercial aircraft orders and deliveries will be disclosed - after audit - on January 10, 2023. Full Year results will be disclosed on February 16, 2023. In November 2022 Airbus also registered 29 new orders and 14 cancellations bringing the backlog to 7,344 aircraft.
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Tiger Infrastructure Partners (Tiger), a private equity infrastructure investor, has announced the acquisition of International Aerospace Coatings (IAC) Group, which includes Eirtech Aviation Services. IAC Group is one of the world's leading aviation services providers headquartered in Shannon, Ireland and Irvine, California.
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IAC’s portfolio of 18 aircraft hangars is strategically located at seven airports and two customer sites in the United States and Europe, providing essential services to customers in the global aviation industry, including aircraft manufacturers, commercial airlines, aircraft leasing companies, air cargo carriers and governments. IAC Group employs more than 1,000 people worldwide, including more than 250 in Shannon, Ireland.
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“As a growth-oriented infrastructure investor, we were attracted to IAC because of its compelling growth prospects, leading market position, substantial asset base and stakeholder relationships along with its strong balance sheet,” said Emil W. Henry, Jr., CEO of Tiger Infrastructure.
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“With operations in both the United States and Europe, IAC aligns well with Tiger’s trans-Atlantic footprint and capabilities, which are a source of competitive advantage for us in the markets in which we operate.” Tiger invests in sectors such as Digital Infrastructure, Energy Transition and Transportation in North America and Europe.
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The International Air Transport Association (IATA) expects a return to profitability for the global airline industry in 2023 as airlines continue to cut losses stemming from the effects of the COVID-19 pandemic to their business in 2022.
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In 2023, airlines are expected to post a small net profit of US$4.7 billion—a 0.6% net profit margin. It is the first profit since 2019 when industry net profits were US$26.4 billion (3.1% net profit margin).
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In 2022, airline net losses are expected to be US$6.9 billion (an improvement on the US$9.7 billion loss for 2022 in IATA’s June outlook). This is significantly better than losses of US$42.0 billion and US$137.7 billion that were realised in 2021 and 2020 respectively.
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Resilience has been the hallmark for airlines in the COVID-19 crisis. As we look to 2023, the financial recovery will take shape with a first industry profit since 2019. That is a great achievement considering the scale of the financial and economic damage caused by government imposed pandemic restrictions. But a US$4.7 billion profit on industry revenues of US$779 billion also illustrates that there is much more ground to cover to put the global industry on a solid financial footing. Many airlines are sufficiently profitable to attract the capital needed to drive the industry forward as it de-carbonises. But many others are struggling for a variety of reasons. These include onerous regulation, high costs, inconsistent government policies, inefficient infrastructure and a value chain where the rewards of connecting the world are not equitably distributed,” said Willie Walsh, IATA’s Director General.
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Improved prospects for 2022 stem largely from strengthened yields and strong cost control in the face of rising fuel prices.
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Passenger yields are expected to grow by 8.4% (up from the 5.6% anticipated in June). Propelled by that strength, passenger revenues are expected to grow to $438 billion (up from US$239 billion in 2021).
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Air cargo revenues played a key role in cutting losses with revenues expected to reach US$201.4 billion. That is an improvement compared with the June forecast, largely unchanged from 2021, and more than double the US$100.8 billion earned in 2019.
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Overall revenues are expected to grow by 43.6% compared to 2021, reaching an estimated US$727 billion.
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Most other factors evolved in a negative manner following a downgrade of GDP growth expectations (from 3.4% in June to 2.9%), and delays in removing COVID-19 restrictions in several markets, particularly China. IATA’s June forecast anticipated that passenger traffic would reach 82.4% of pre-crisis levels in 2022, but it now appears that the industry demand recovery will reach 70.6% of pre-crisis levels. Cargo, on the other hand, was anticipated to exceed 2019 levels by 11.7%, but that is now more likely be moderated to 98.4% of 2019 levels.
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On the cost side, jet kerosene prices are expected to average $138.8/barrel for the year, considerably higher than the US$125.5/barrel expected in June. That reflects higher oil prices exaggerated by a jet crack spread that is well-above historic averages. Even with lower demand leading to reduced consumption, this raised the industry’s fuel bill to US$222 billion (well above the US$192 billion anticipated in June).
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That airlines were able to cut their losses in 2022, in the face of rising costs, labor shortages, strikes, operational disruptions in many key hubs and growing economic uncertainty speaks volumes about peoples’ desire and need for connectivity. With some key markets like China retaining restrictions longer than anticipated, passenger numbers fell somewhat short of expectation. We’ll end the year at about 70% of 2019 passenger volumes. But with yield improvement in both cargo and passenger businesses, airlines will reach the cusp of profitability,” said Walsh.
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In 2023 the airline industry is expected to tip into profitability. Airlines are anticipated to earn a global net profit of US$4.7 billion on revenues of US$779 billion (0.6% net margin). This expected improvement comes despite growing economic uncertainties as global GDP growth slows to 1.3% (from 2.9% in 2022).
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Despite the economic uncertainties, there are plenty of reasons to be optimistic about 2023. Lower oil price inflation and continuing pent-up demand should help to keep costs in check as the strong growth trend continues. At the same time, with such thin margins, even an insignificant shift in any one of these variables has the potential to shift the balance into negative territory. Vigilance and flexibility will be key,” said Walsh.
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TA Aerospace has selected Wencor as an authorised distributor supporting the global commercial aftermarket and OEM market segments, as well as selecting Wencor as the preferred channel for defence. The multi-year agreement allows Wencor to support these channels through its global stocking facilities and on-site service locations at key customers.
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The global agreement includes TA’s full suite of metallic and elastomer clamping systems, moulded grommets, and thermal fire barrier insulation solutions for the worldwide aerospace and defence markets.
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Etihad Cargo, the cargo and logistics arm of Etihad Aviation Group, has reinforced its commitment to the Chinese and Indian markets, reinstating a twice-weekly freighter service from Shanghai to Abu Dhabi via Chennai starting December 8. The additional freighter service will provide additional capacity into two key global markets.
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This latest addition to Etihad Cargo’s network follows the introduction of twice-weekly direct flights to Guangzhou. With the introduction of this destination to the carrier’s network, Etihad Cargo became the first international airline to operate long-haul cargo and passenger services to the top three Chinese gateways — Shanghai, Beijing and Guangzhou — since the beginning of the pandemic.
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In addition to expanding operations in China and India, Etihad Cargo has continuously reviewed its global network, adding destinations and frequencies, and is optimising freighter utilisation to support key trade lanes and customer demand.
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Complete Aircraft Services GmbH (CAS) will start operations as part of the AeroVisto Group on January 1, 2023. At the same time, Jürgen Sehne will assume the role of Managing Director.
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After studying aerospace and industrial engineering in the 90s, Sehne worked for several well-known aviation companies, including Dornier, Airbus, Lufthansa, Condor and SWISS. During this time, he gained a great deal of experience in various areas of the aviation industry - from aircraft development, engineering and controlling to operational planning and production management. In various management positions over the past 25 years, he has already built, led and developed several teams and has profound knowledge of both commercial aviation and private and business aviation.
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Sehne will take over the management of a successful and well-organised company and work with an experienced and high-performing team. Thus, from the very beginning, he can focus on leveraging the existing growth potential of CAS and ensuring its further positive development as part of the AeroVisto Group.
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AELS has released that it completed the acquisition of a Boeing 737-800 airframe (MSN 34692, OO-JLO), previously owned and operated by TUI Belgium. This acquisition is realised with the support of Skytech-AIC, that acted as Marketing Agent for TUI.
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This is the third airframe that AELS purchased from TUI, testifying that AELS is a competent partner to dismantle its aircraft in a responsible and sustainable manner. The aircraft was purchased without the engines and is located at Prestwick Airport. Since the aircraft is unable to fly to the AELS’ facility and the airport has limitations, a creative solution was developed. Approximately 1,000 parts, including the landing gear, will be added to the AELS’ inventory, ready to continue their way to their customers.
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Since 2006 AELS has been buying end-of-life Boeing and Airbus aircraft that the company disassembles at its own facility. AELS is the only company in Europe that handles the entire supply chain for aircraft that reach end-of-life, from disassembly and dismantling, component management to material recycling.
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Daher is in the process of acquiring Transports Chabrillac, the satellite and launcher transporter specialist, to further reinforce its status as a leader in special and multi-modal transportation for the aerospace industry.
For more than 60 years, Toulouse, France-based Transports Chabrillac has specialized in providing transportation services for the space industry, serving leading European companies – including Airbus, ArianeGroup and Thales.
The acquisition will consolidate Daher’s status as a specialist in multi-modal solutions for the aviation, defence and space industries. This injection of new expertise will further extend the diverse range of global transportation solutions offered by Daher, from freight forwarding and road transportation to logistics consultancy and project management. Once the acquisition is completed, the Daher Group will be fully capable of supporting its customers operationally and in export markets.
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