International market: Lufthansa lost 350 million euros due to strikes; Delta announced NDC strategy
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News from Civil Aviation Resources Network on April 21, 2024: What are the latest developments in the international aviation market this week (4.13-4.19)? The Civil Aviation Resource Network takes you through the relevant news of the past week, allowing you to have a clear overview of important information.
Market dynamics
ARC: Corporate travel agency ticket sales fall for first time since 2021 in March
The number of passenger tickets sold by U.S. corporate travel agencies and settled through ARC fell 5% year-over-year in March, the first decline since March 2021, according to data from American Airlines Reporting Corporation (ARC). Air tickets sold by U.S. corporate travel agencies began to recover in April 2021 and showed stable year-on-year double-digit or triple-digit percentage growth until March 2023, when the changes stabilized.
In March 2024, the total ticket sales of travel agencies in the United States was nearly US$9.4 billion, a year-on-year decrease of 2.7%, but a month-on-month increase of 4.7%. The total number of trips exceeded 25.5 million, a year-on-year decrease of 1%, but a month-on-month increase of 5%.
Business travel rebounds, supporting U.S. airlines' profit outlook
U.S. airlines have benefited from a travel boom over the past three years, but until the first quarter of this year, big-spending business travelers had largely yet to return.
Now, those business travelers are back in full force, boosting airline profits in the typically slow first quarter. U.S. airlines that have reported results so far, including Delta Air Lines, United Airlines and Alaska Airlines, have reported a sharp rebound in business travel.
policy management
U.S. government agency to investigate unfair practices in airline loyalty programs
Spokespersons for the U.S. Department of Transportation and the U.S. Consumer Financial Protection Bureau said on April 15 that in order to protect consumers from deceptive and unfair practices, the two government agencies will hold public hearings to investigate airline loyalty degree plan.
The May 9 hearing will include regulators, airline executives, consumer advocates and bank officials. The U.S. Department of Transportation said in December that it was reviewing the frequent flyer programs of major U.S. airlines to look for potentially deceptive or unfair practices.
Italian regulator orders Ryanair to stop restricting travel agents' ticket sales
Italy's antitrust regulator (AGCM) ordered Ryanair on April 15 to stop restricting or preventing travel agents from selling its tickets as it investigates whether the Irish budget carrier abused its dominant market position. AGCM said in a statement that Ryanair has eight days to submit a rebuttal and request a hearing.
Ryanair, now Italy's largest airline, is urging customers to book the cheapest tickets directly on its website to make it easier to manage changes and apply for refunds. Ryanair said unauthorized online travel agents add fees and do not share booking details with Ryanair.
Lufthansa offers concessions to win EU approval for ITA Airways acquisition
The latest information on the European Commission website shows that Lufthansa has offered concessions to obtain EU antitrust agency approval for its acquisition of a minority stake in Italian airline ITA. The European Commission did not provide details about the remedies and is expected to seek feedback from Lufthansa's competitors and customers before it approves the deal or makes further requirements.
Lufthansa's remedies could include ceding airport slots, traffic rights and aircraft to rivals, similar to measures approved by the European Commission in Korean Air's takeover of Asiana Airlines, a person familiar with the matter said.
aviation airport
Alaska Airlines: First-quarter corporate revenue growth 'phenomenal'
The first quarter got off to a bad start for Alaska Airlines, which experienced a weeks-long grounding of its Boeing 737 Max 9 aircraft following a door jam detaching on Flight 1,282 in January. Alaska Airlines President and CEO Ben Minicucci said during a quarterly earnings call on April 18 that the two incidents caused a loss of $162 million to the company, "and Boeing has fully compensated us."
But Minicucci said that excluding the impact of the grounding of Boeing aircraft, Alaska Airlines achieved "positive results" due in part to the return of business travel on the West Coast, especially among technology companies. Alaska Airlines chief commercial officer Andrew Harrison said company-managed business travel revenue increased 22% year over year in the first quarter, with about 50% coming from revenue and 50% from travel volume.
Lufthansa Group suffers financial losses of 350 million euros due to strike
Recent employee strikes cost Lufthansa Group about 350 million euros in the first quarter of this year, leading the European aviation giant to cut its 2024 profit forecast. Lufthansa suffered a series of disruptive strikes at the start of the year involving ground staff and cabin crew. Although the disputes have now been resolved, Lufthansa revealed that the strike had an "impact" of around €350 million on earnings in the first quarter.
Lufthansa said its adjusted loss before interest and tax in the first quarter of 2024 was 849 million euros, compared with a smaller loss of 273 million euros in the same period last year. Lufthansa also said it expected a further loss of 100 million euros in the second quarter due to the strike's impact on short-term travel demand.
Faced with slow recovery in capacity, Lufthansa evaluates new China routes
Lufthansa CEO Jens Ritter said on April 19 that Lufthansa's capacity on routes to and from China has returned to 70% of pre-epidemic levels, and it is evaluating new routes to China.
However, Ritter said Lufthansa would like to see stronger demand and would need to address aircraft delivery delays. Ritter said: "We are very confident in the Chinese economy and we are eager to increase flight capacity in China." Lufthansa has found that Chinese passengers are traveling more individually, rather than the large group tours that were more common before the epidemic, and passengers are buying business trips for more comfort. There is a stronger willingness to buy first-class or premium economy class tickets. Business travel demand is also picking up.
EasyJet cuts winter losses by £50m
EasyJet said it expects air fares to rise this summer. Previously, the European low-cost airline announced a smaller-than-expected loss for the half-year financial report ending March 31, 2024. In a financial update on April 18, easyJet said seasonal losses had reduced by more than £50 million year-on-year, driven by increased demand and "targeted" capacity increases.
EasyJet expects pre-tax losses in the first half of fiscal 2024 (from October 2023 to the end of March 2024) to be between 340 million and 360 million pounds, with total group revenue of 3.3 billion pounds, up from 27 in the same period in 2023. billion pounds. Its ancillary services and passenger revenue increased year-on-year to £910 million and £2.1 billion respectively. Passenger revenue per seat increased by 5% year-on-year to £48.34, while ancillary services revenue per seat increased by 6% year-on-year to £21.53.
Spanish airlines increase capacity, predict record summer demand
Javier Gandara, president of the Spanish Airlines Association, said on April 16 that Spanish airlines expect to usher in a record travel season this summer and will add 13% more capacity than last year. They believe that despite consumer spending Faced with inflationary pressures, they will continue to travel.
From the beginning of April to the end of October, the association's member airlines plan to arrange up to 758,000 flights, an increase of 9% over the same period in 2023, with a total capacity of up to 240 million seats. Demand for leisure travel, which has boomed since pandemic restrictions were lifted, remains strong even as household incomes face a squeeze.
Aircraft manufacturing and fleet
Ryanair expects to take delivery of 40 Boeing aircraft by mid-July
Ryanair CEO Michael O'Leary said on April 17 that Ryanair expects Boeing to deliver 40 new aircraft by mid-July, a number that is basically consistent with its previously announced revised delivery plan.
O'Leary said Ryanair is preparing to take delivery of 35 aircraft from Boeing by the end of June and another five in the first two weeks of July. Ryanair said in March that while it was originally scheduled to take delivery of 57 Boeing MAX 8200 aircraft by the end of April, Boeing's deepening crisis means it can only deliver 40 aircraft by the end of June.
Aegean Airlines orders four Airbus A321neo aircraft with extended range capabilities
Aegean Airlines, Greece's largest airline, said on April 17 that it would order four new Airbus A321neo aircraft with extended range capabilities to cover existing and new routes in Central Africa, the Middle East and Asia.
Aegean Airlines said the four specially configured new A321neo aircraft will be equipped with additional fuel tanks and can fly for up to 7.5 hours. The new aircraft are expected to be delivered by 2027.
United says FAA review imposes restrictions on flying new planes
United said on April 17 that it was unable to put new aircraft into service due to an ongoing review of its operations by the Federal Aviation Administration (FAA). The review follows several safety emergencies at United Airlines in recent weeks.
United said a handful of aircraft scheduled to enter service this quarter will be delayed until the third quarter. United expects the change to have a small impact on its growth plans this year.
Boeing claims no fatigue cracks found on 787 aircraft in service
Boeing said on April 15 that it had not found fatigue cracks on its in-service 787 aircraft that had undergone extensive repairs, as it defended its twin-aisle aircraft program ahead of a U.S. Senate hearing to be held on the 17th.
Last week, an internal Boeing whistleblower claimed that Boeing ignored safety issues in the assembly of its 787 and 777 aircraft that fly international routes. The whistleblower, Boeing quality engineer Sam Salehpour, will testify at a Senate hearing on Boeing's safety culture. Salehpour alleges that Boeing failed to adequately fill or use a thin sheet of material to fill a tiny gap in the manufactured product, an omission that could have caused premature fatigue failure in certain areas of the Boeing 787 Dreamliner.
Alaska Airlines pays more attention to quality, safety of Boeing aircraft than production speed
Alaska Airlines Chief Financial Officer Shane Tackett said on April 18 that Alaska Airlines is not concerned about the production speed of Boeing 737 MAX aircraft because it pays more attention to the quality and safety of the aircraft.
Alaska Airlines had to ground its MAX 9 fleet for several weeks after a mid-air door jam broke off a Boeing plane in January. The grounding cost Alaska Airlines $162 million in the first quarter, resulting in a quarterly loss. Tackett said that since the incident, Alaska Airlines has stationed more inspectors at Boeing factories to ensure that Boeing is producing the highest quality aircraft that it can fly with confidence and safely.
distribution technology
Delta Air Lines unveils NDC strategy, focusing on 2025
Sara Reid, director of sales technology and global sales support at Delta Air Lines, recently revealed that Delta is working with multiple partners to build its NDC solution and plans to release some "milestone results" by the end of 2024 for "people who want to test it with us." and learning customers" use. "As we move into the first half of 2025, we will do some integration with the ecosystem and start working to create value with new products that we are ready to bring to market," she said.
Delta plans to achieve large-scale omni-channel service in the second half of 2025 and continue to enhance and improve innovations for the industry in 2025 and beyond. Reid reiterated that Delta is not currently prepared to follow the lead of other airlines in removing fares from the EDIFACT channel or imposing surcharges.
other
United Airlines says Boeing will compensate for US$200 million loss due to grounding of MAX 9
United said on April 17 it would receive a first-quarter financial hit from Boeing due to the grounding of its 737 MAX 9 aircraft. U.S. regulators grounded some MAX 9s in January for about three weeks for safety inspections after a door jam detached on a 737 MAX 9 aircraft operated by Alaska Airlines.
The incident forced United Airlines, a major customer of Boeing aircraft, to temporarily ground all of its 737 MAX 9 aircraft, a move that led to a $200 million loss in the first quarter.
UK airline carbon emissions set to reach record level by 2024
Carbon emissions from UK flights are rapidly returning to pre-pandemic levels, with aviation industry CO2 pollution set to reach record levels this year. The growth means the industry could undermine part of the UK government's Aviation Zero Carbon Strategy, which commits the industry to not exceeding 2019 carbon emissions levels on its way to net-zero carbon emissions by 2050. key criteria.
Analysis of UK and EU carbon reports and other flight data by campaign group Transport & Environment shows that many airlines are now emitting their highest levels of carbon emissions ever. It estimates Ryanair's carbon emissions in 2023 will be 13.5% more than in 2019, easyJet 4.8% more and Jet2.com 26.3% more. British Airways remains the UK's most carbon-intensive airline, although its emissions are still 18% below 2019 levels.