International market: US TSA may be privatized; Boeing increases 737 production speed
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Civil Aviation Resources Network, May 25, 2025: What are the latest developments in the international aviation market this week (May 17-May 23)? Civil Aviation Resources Network takes you through the relevant news of the past week, so that you can have a clear view of the important information.
Market Dynamics
US airlines prepare for Memorial Day weekend and summer
The US aviation industry is expected to usher in another record-breaking Memorial Day weekend and summer, indicating that demand may be back on track. The Federal Aviation Administration (FAA) said that the peak flight for Memorial Day weekend was on May 22, when the flight volume was nearly 54,000. The FAA expects that the number of flights will grow steadily this summer and peak in late July.
American Airlines said it will operate 38,000 flights during the Memorial Day weekend, with the 22nd and 23rd being the busiest two days. American Airlines' flight plan this summer will increase by 5%, and will open new routes such as Athens, Madrid, Milan and Rome. United Airlines expects to carry 3.8 million passengers over Memorial Day weekend, about 300,000 more than last year. United Airlines expects to carry about 50 million passengers this summer, about 3 million more than last year.
DOT: U.S. flight volume increased in January, cancellation rate decreased
According to the latest Air Travel Consumer Report from the U.S. Department of Transportation (DOT), U.S. airlines operated more domestic flights in January than in January 2024, while cancellation rates decreased. In January, U.S. airlines operated nearly 580,300 domestic flights, an increase of nearly 3.6% year-on-year. However, this number is lower than the 627,400 flights in December 2024.
The flight cancellation rate in January was 3.1%, lower than 3.8% in January 2024, but higher than 0.7% in December 2024. U.S. airlines handled 37.3 million bags in January, with a mishandled baggage rate of 0.66%, down from 0.75% in January 2024, but up from 0.60% in December 2024.
Policy Management
FAA sets limit on Newark Airport: 56 flights per hour
The Federal Aviation Administration (FAA) issued new temporary restrictions on flights in and out of Newark Liberty International Airport on May 20 after various disruptions caused severe flight delays and cancellations at the airport. Newark has suffered a series of technical failures in recent weeks, including sudden failures of radio and radar systems last month, insufficient air traffic controllers, and runway construction, which have not only caused flight delays, but also led to growing public concerns about passenger safety.
The latest plan released by the FAA after talks with representatives of major airlines shows that flights at Newark Airport will be limited to 28 outbound flights and 28 inbound flights per hour before June 15 and every weekend from September to December. Starting June 15, the number of flights per hour will be limited to 34 outbound flights and 34 inbound flights until October 25.
U.S. court approves Gol Airlines' restructuring plan
Gol Airlines of Brazil said on May 20 that its restructuring plan under Chapter 11 bankruptcy proceedings has been approved by a U.S. court, paving the way for it to exit bankruptcy protection on June 6. Gol Airlines faces many challenges due to high debt, falling passenger traffic caused by the new crown pandemic and delayed delivery of Boeing aircraft, which led it to file for bankruptcy protection in the United States in early 2024.
Gol Airlines said it will hold a shareholders' meeting at the end of the month to approve a capital increase plan. Gol Airlines expects to achieve sustainable growth after exiting Chapter 11 bankruptcy proceedings.
U.S. airport security agency does not rule out the possibility of privatization
Ha McNeill, acting director of the U.S. Transportation Security Administration (TSA), said on May 20 that the agency does not rule out considering privatization plans, and he also defended a proposal to reduce security personnel. Some Republican senators want to privatize the TSA, which was created by Congress after the September 11 attacks in 2001.
"Nothing is off the table," McNeill said at a hearing of the U.S. House of Representatives Appropriations Committee. "If new privatization options are reasonable, then we are open to discussions… There may be some airports that choose to privatize, and there may be some that do not."
Brazil government not considering specific aid for Azul
The Brazilian government is not considering specific aid for financially troubled Azul airline, but the airline will soon be able to access money from a local fund, Tourism Minister Celso Sabino said on May 19. "The Brazilian government is not looking to provide any kind of grants to specific companies. The government is thinking about the entire industry," Sabino said on the sidelines of an event in Rio de Janeiro.
The so-called "National Aviation Fund" is expected to be ready in the first half of 2025, Sabino added, and the move will provide local airlines with "billions of reais" in funding. The fund could be used to help guarantee loans for airlines to buy new aircraft and engines.
Airline airport
US airline CEO: air traffic control system has let Americans down
The CEOs of major US airlines collectively called on Congress on May 21 to approve billions of dollars in funds to modernize the country's aging air traffic control system, calling it "a system that has let Americans down." In a joint letter, they cited recent glitches involving Newark Airport and said the Federal Aviation Administration's (FAA) technology was "extremely outdated."
Problems with the FAA's air traffic control network have existed for years. However, a series of recent high-profile accidents, dangerous close encounters and a fatal crash involving an American Airlines regional jet in January have raised public alarm and prompted renewed calls for action.
Newark Airport demand and traffic fell after multiple glitches
Passenger traffic and demand at Newark Liberty International Airport fell sharply as a series of air traffic control disruptions led cautious travelers to choose to travel through nearby airports, according to data from two travel companies. Kayak data shows that since April 28, the number of passengers choosing Newark as an arrival airport has dropped by 19%, and the number of passengers choosing Newark as a departure airport has dropped by about 15%.
Due to multiple communication failures, passengers are now willing to choose longer commutes to avoid Newark Airport, the second largest of the three airports in the New York metropolitan area. Data from social media analysis company Sprout Social shows that among the thousands of social media conversations about Newark Airport every day, 98% are negative. The data shows that the safety reports have affected passenger behavior.
Average fares fall 7%, Ryanair's annual profit falls 16%
European budget airline Ryanair's annual after-tax profit fell 16% due to a 7% drop in average fares (from 50 euros in the 2023-2024 fiscal year to 46 euros last year). Ryanair said it achieved a after-tax profit of 1.61 billion euros in the fiscal year ending March 31, 2025, down from 1.92 billion euros in the previous year.
In contrast to the decline in profits, Ryanair's total passenger volume rose 9% year-on-year, breaking the 200 million mark. Ryanair's annual total revenue also increased by 4% to 13.95 billion euros, and ancillary income increased by 10% to 4.72 billion euros, mainly due to increased passenger volume.
After a 16-year hiatus, Scandinavian Airlines resumed direct flights to Seattle
After a 16-year hiatus, Scandinavian Airlines resumed direct flights from Copenhagen to Seattle on May 21. The route will resume five times a week with Airbus A350s. With Seattle, Scandinavian Airlines now connects 11 North American destinations from Copenhagen.
Since exiting Chapter 11 bankruptcy protection and joining Star Alliance last September, Scandinavian Airlines has been rapidly expanding its route network, and last month it announced the restoration of business class on European flights.
Bookings strong, easyJet confident of summer demand
EasyJet said on May 22 that it was facing strong demand for its flights and vacations, and that summer bookings were better than last year, giving it confidence to meet its annual profit forecast. EasyJet is the latest European airline to reassure the market that consumer travel demand remains strong amid concerns about economic headwinds caused by US tariffs.
In addition, airline costs this year are expected to benefit from lower oil prices. For the crucial summer season, easyJet said demand for both its flights and its rapidly growing vacation business was "up."
Luxair challenges EU approval of Lufthansa-ITA merger
Luxair said on May 21 that it had filed a legal challenge at the EU General Court against the European Commission's approval of the Lufthansa-ITA merger. Luxair said it had no objection to the merger itself, but pointed out that small airlines like Luxair were marginalized in the allocation of landing slots at Milan Linate Airport among the remedies offered by Lufthansa.
In November, the European Commission approved a package of remedies proposed by Lufthansa for its acquisition of a minority stake in Italy's ITA Airlines, in which easyJet, International Airlines Group (IAG) and Air France-KLM will receive more routes.
Strong demand drives Etihad Airways' first-quarter profit up 30%
Etihad Airways said on May 21 that its first-quarter profit after tax rose 30% to 685 million dirhams ($186.52 million) due to strong demand and improved operational efficiency.
Etihad Airways' total revenue rose 15% thanks to growth in passenger and cargo operations. Among them, passenger revenue increased by 16% to 5.5 billion dirhams (US$1.5 billion), driven by increased capacity, continued network expansion and increased flight frequency.
Qatar Airways' net profit increased by 28%, and strong demand is expected to continue
Qatar Airways announced on May 19 that it achieved a record annual net profit of 7.8 billion riyals (US$2.1 billion) in the 2024 fiscal year ending March 31, an increase of 28% year-on-year. Qatar Airways expects strong demand to continue in the future.
In the face of a global downturn, demand in the Gulf region has continued to grow. Although Western markets have been affected by trade tensions, exchange rate fluctuations and recession concerns, flight bookings for airlines in the Gulf region have remained stable. In fiscal 2024, Qatar Airways' revenue and other operating income increased by more than 6% to 86 billion riyals; passenger volume exceeded 43 million, a year-on-year increase of 7.8%; network capacity increased by 4% year-on-year.
El Al's net profit increased by 19% to $96 million in the first quarter of 2025
Although many foreign airlines have gradually resumed flights to Tel Aviv Ben Gurion Airport, El Al's net profit in the first quarter of 2025 still increased significantly by 19% to about $96 million, up from $80.5 million in the same period last year. Revenue increased by 5% year-on-year to $774 million.
In the first quarter, El Al's passenger market share fell to 44%, down from about 62% in the same period last year; the passenger load factor rose from 92.6% to 94.3%.
Products and Services
United Airlines cancels new annual Wi-Fi subscription service
United Airlines recently announced in an email to United for Business users that it will no longer provide annual subscriptions for in-flight Wi-Fi services. Passengers' existing subscriptions will remain valid until one year from the date of purchase, but will not be renewable thereafter. The reason for this change is that United Airlines is preparing to provide free Wi-Fi service to MileagePlus members.
United Airlines is installing Starlink Wi-Fi on its fleet, and for flights that don't yet have it, passengers can still purchase Wi-Fi service in advance or on the flight. Monthly subscriptions are still available, starting at $49 or 7,500 MileagePlus account points, and daily passes are also available for flights without Starlink, starting at $8 for domestic flights.
Aircraft Manufacturing and Fleet
Boeing increases 737 production rate as quality and safety culture improve
Doug Ackerman, vice president of quality for Boeing's commercial aircraft division, told reporters on May 20 that Boeing expects to stabilize 737 MAX production at 38 per month in the coming months. The Federal Aviation Administration (FAA) limited aircraft production to 38 per month after a nearly new 737 had a door plug fall off in the air in January 2024.
Prior to this, Boeing's monthly production of the 737 MAX fluctuated between a dozen and three dozen, but Boeing struggled through a series of crises and controversies that hit its finances hard, depressed employee morale, and reduced public trust. After losing nearly $12 billion last year, the U.S. aircraft manufacturer needs to increase 737 production to bring in more cash.
Wizz Air becomes first airline to operate Airbus A321XLR with Pratt & Whitney engines
Hungarian low-cost carrier Wizz Air has received its first A321XLR aircraft, Airbus announced on May 20, becoming the world's first airline to operate the ultra-long-range aircraft with Pratt & Whitney GTF engines.
Wizz Air, which has an all-Airbus fleet, has ordered 47 239-seat single-aisle A321XLR aircraft.
Airbus in talks with Malaysian airlines for A220 aircraft
Airbus is in talks with Malaysian airlines for its A220 aircraft, Malaysian national news agency Bernama quoted Airbus executives as saying on May 19. Anand Stanley, president of Airbus Asia Pacific, said Airbus sees potential for the A220 in Malaysia, where about 150 other Airbus commercial aircraft are in operation and Airbus expects to order about 400 more in the future.
Stanley added that Malaysia is Airbus' third-largest market in the Asia-Pacific region after China and India. Low-cost carrier AirAsia is already a major customer for Airbus A320 and A330 aircraft, while Malaysia Airlines operates a fleet of Airbus wide-body aircraft.
Others
More than 40 reports of radar, radio problems at U.S. airports since 2022
In the years before the recent communications outage at Newark Liberty International Airport caused widespread chaos, air traffic controllers and pilots across the United States had multiple reports of equipment failures that left them desperately trying to avoid mid-air collisions and other disasters.
More than 40 reports of radar and radio problems were filed with NASA's aviation safety reporting system since 2022, involving dozens of airports across the country, a CNN review found. This shows that the problem of system aging is not only present at Newark Airport, and the actual situation is worrying.