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Covid-19: Airlines seek emergency aid as coronavirus brings industry to near-halt

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Avolon cancels order for 75 Boeing MAX jets, 4 Airbus A330neo

DUBLIN (Reuters) - Aircraft lessor Avolon on Friday announced the cancellation of an order for 75 Boeing (BA.N) 737 MAX planes that were due to be delivered by 2023, saying it was adjusting its order book to the disruption caused by the coronavirus pandemic.

More: https://www.reuters.com/article/us-health-coronavirus-avolon/leasing-company-avolon-cancels-order-for-75-boeing-max-jets-4-airbus-a330s-idUSKBN21L1UK

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Khazanah committed to support Malaysia Airlines

KUALA LUMPUR: Khazanah Nasional Bhd has reaffirmed its commitment that it will continue to support Malaysia Airlines Bhd, via its parent company Malaysia Aviation Group Bhd.

A source from Khazanah said the support is deemed as ‘strategic needs’ of Malaysia to maintain air links amid the Covid-19 crisis.

https://www.nst.com.my/business/2020/04/581692/khazanah-committed-support-malaysia-airlines

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Changi Airport T2 operations to be suspended for 18 months amid coronavirus outbreak

https://www.straitstimes.com/politics/operations-at-changi-airport-t2-to-be-suspended-for-18-months-amid-coronavirus-outbreak

> Terminal 2 will be closed for 18 months. All F& B and retail outlets will be closed too. The closure will also speed up T2 refurbishment by up to a year.

> All remaining airlines operation will be consolidated at remaining terminals: T1 & T4.

> Singapore Airlines only- operation all at T3.

Edited by JuliusWong

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2 hours ago, JuliusWong said:

Changi Airport T2 operations to be suspended for 18 months amid coronavirus outbreak

https://www.straitstimes.com/politics/operations-at-changi-airport-t2-to-be-suspended-for-18-months-amid-coronavirus-outbreak

> Terminal 2 will be closed for 18 months. All F& B and retail outlets will be closed too. The closure will also speed up T2 refurbishment by up to a year.

> All remaining airlines operation will be consolidated at remaining terminals: T1 & T4.

> Singapore Airlines only- operation all at T3.

Smart move to take advantage for the crisis. If in other country, T2 refurbishment is likely defer.

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24 minutes ago, KK Lee said:

Smart move to take advantage for the crisis. If in other country, T2 refurbishment is likely defer.

Typical move from Singapore - in the 1997 and 2008 downturns, they spent lots of money keeping the economy going by building and extending the MRT.

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9 hours ago, JuliusWong said:

Khazanah committed to support Malaysia Airlines

KUALA LUMPUR: Khazanah Nasional Bhd has reaffirmed its commitment that it will continue to support Malaysia Airlines Bhd, via its parent company Malaysia Aviation Group Bhd.

A source from Khazanah said the support is deemed as ‘strategic needs’ of Malaysia to maintain air links amid the Covid-19 crisis.

https://www.nst.com.my/business/2020/04/581692/khazanah-committed-support-malaysia-airlines

That's a shame. I was rather looking forward to foreign airlines (e.g LH, QF, NZ, AF, etc) filling the void and our trillion-RM debt disappearing overnight.

Edited by Chris Tan

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Malaysian firm bids US$2.5 bil for national carrier Malaysia Airlines, funded by European bank

KUALA LUMPUR, April 4 (Reuters) - A Malaysian company has proposed a fresh capital injection and to assume the debts of Malaysia Airlines (MAS), in a formal takeover bid of the ailing national carrier, according to a report by The Edge Malaysia.

The Malaysian government has been seeking a strategic partner for its national airline, which has struggled to recover from two tragedies in 2014 - the mysterious disappearance of flight MH370 and the shooting down of flight MH17 over eastern Ukraine.

Golden Skies Ventures Sdn Bhd (GSV), a firm set up earlier this year by ex-MAS employees and private individuals, has offered a capital injection of 11 billion ringgit ($2.53 billion) and to assume the airline’s full outstanding Islamic bonds or sukuk, its chief executive Shahril Lamin was quoted as saying by The Edge.

See:

https://www.reuters.com/article/malaysia-airlines-ma/firm-plans-2-5-bln-capital-boost-in-malaysia-airlines-takeover-bid-report-idUSL4N2BS01E

https://www.theedgemarkets.com/article/malaysian-firm-bids-us25-bil-national-carrier-co-funded-european-bank

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Not much news on this GSV...but found this:

https://www.theedgemarkets.com/article/new-firm-proposes-plan-save-malaysia-airlines-hopes-meet-pm

"They include corporate lawyer Shahril Lamin; Ravindran Devagunam, former Performance Management and Delivery Unit’s anti-corruption director; economist Dr Puvaneswaran Sanjivee; S Suppiah, former MAS executive vice-president of group finance; Sitham Nadarajah, former MAS vice-president of engineering; and Shulhameed Marican, former general manager of flight operations (services and infrastructure)."

The aviation industry has changed tremendously since their days, hope they know what they are doing. Tan Sri Abdul Aziz Abdul Rahman, former chief executive officer (CEO) who were supposed to be their adviser has passed on too.

And Shahril Lamin who is a corporate lawyer also uploaded their proposed new livery for Malaysia Airlines. Omg, that's a copy of Singapore Airlines! 
https://www.linkedin.com/in/shahril-lamin-325a4941/?originalSubdomain=my

 

Edited by JuliusWong

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2 hours ago, flee said:

Malaysian firm bids US$2.5 bil for national carrier Malaysia Airlines, funded by European bank

KUALA LUMPUR, April 4 (Reuters) - A Malaysian company has proposed a fresh capital injection and to assume the debts of Malaysia Airlines (MAS), in a formal takeover bid of the ailing national carrier, according to a report by The Edge Malaysia.

The Malaysian government has been seeking a strategic partner for its national airline, which has struggled to recover from two tragedies in 2014 - the mysterious disappearance of flight MH370 and the shooting down of flight MH17 over eastern Ukraine.

Golden Skies Ventures Sdn Bhd (GSV), a firm set up earlier this year by ex-MAS employees and private individuals, has offered a capital injection of 11 billion ringgit ($2.53 billion) and to assume the airline’s full outstanding Islamic bonds or sukuk, its chief executive Shahril Lamin was quoted as saying by The Edge.

See:

https://www.reuters.com/article/malaysia-airlines-ma/firm-plans-2-5-bln-capital-boost-in-malaysia-airlines-takeover-bid-report-idUSL4N2BS01E

https://www.theedgemarkets.com/article/malaysian-firm-bids-us25-bil-national-carrier-co-funded-european-bank

 

1 hour ago, JuliusWong said:

Not much news on this GSV...but found this:

https://www.theedgemarkets.com/article/new-firm-proposes-plan-save-malaysia-airlines-hopes-meet-pm

"They include corporate lawyer Shahril Lamin; Ravindran Devagunam, former Performance Management and Delivery Unit’s anti-corruption director; economist Dr Puvaneswaran Sanjivee; S Suppiah, former MAS executive vice-president of group finance; Sitham Nadarajah, former MAS vice-president of engineering; and Shulhameed Marican, former general manager of flight operations (services and infrastructure)."

The aviation industry has changed tremendously since their days, hope they know what they are doing. Tan Sri Abdul Aziz Abdul Rahman, former chief executive officer (CEO) who were supposed to be their adviser has passed on too.

And Shahril Lamin who is a corporate lawyer also uploaded their proposed new livery for Malaysia Airlines. Omg, that's a copy of Singapore Airlines! 
https://www.linkedin.com/in/shahril-lamin-325a4941/?originalSubdomain=my

 

Doubt any well managed banks would fund loss making airlines acquisition at this time.

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1 hour ago, KK Lee said:

Doubt any well managed banks would fund loss making airlines acquisition at this time.

Apparently, this financing was discussed a month ago. Not sure if the European banks will proceed now that Covid-19 is nearing its peak. However, Europe is in a bad state now and good investments are more likely to come from outside Europe.

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1 hour ago, KK Lee said:

 

Doubt any well managed banks would fund loss making airlines acquisition at this time.

Unless there's a govt guarantee, which is likely. In which case if the company goes under again it'll be the good ol' taxpayers coming to the rescue..

 

3 hours ago, JuliusWong said:

Not much news on this GSV...but found this:

https://www.theedgemarkets.com/article/new-firm-proposes-plan-save-malaysia-airlines-hopes-meet-pm

"They include corporate lawyer Shahril Lamin; Ravindran Devagunam, former Performance Management and Delivery Unit’s anti-corruption director; economist Dr Puvaneswaran Sanjivee; S Suppiah, former MAS executive vice-president of group finance; Sitham Nadarajah, former MAS vice-president of engineering; and Shulhameed Marican, former general manager of flight operations (services and infrastructure)."

The aviation industry has changed tremendously since their days, hope they know what they are doing. Tan Sri Abdul Aziz Abdul Rahman, former chief executive officer (CEO) who were supposed to be their adviser has passed on too.

And Shahril Lamin who is a corporate lawyer also uploaded their proposed new livery for Malaysia Airlines. Omg, that's a copy of Singapore Airlines! 
https://www.linkedin.com/in/shahril-lamin-325a4941/?originalSubdomain=my

 

Seems like a group of people who was active in the aviation industry 20 years ago. Lots have changed in the last 20 years..  growth of LCCs, airline deregulation, e-commerce just to name a few. The team does not instill confidence in me.. but as long as taxpayer's money is not used to bail them out in the future, I am okay with it. Wish them all the best..

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58 minutes ago, flee said:

“Plus their (Golden Skies') original proposal relied 100 per cent on debt funding from third parties. They do not have any equity of their own,” Shahril told the New Straits Times (NST) today.

It seems this type of financing structure is typical and popular in this country.

Edited by KK Lee

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Lufthansa Group decides on first restructuring package

https://newsroom.lufthansagroup.com/english/newsroom/all/lufthansa-group-decides-on-first-restructuring-package/s/0695cc64-1a64-4939-b409-7da5d5b2c0d3

1. Lufthansa- Six Airbus A380s, seven A340-600s, five Boeing 747-400s- Permanently decommissioned. 

  • A380s already scheduled for sale to Airbus in 2022. 
  • B747-400s and A340-600s withdrawal taken due to environmental as well as economic disadvantages of those type. Lufthansa will be reducing capacity at its hubs in Frankfurt and Munich.

2. Lufthansa- Eleven Airbus A320s will be withdrawn from short-haul operations.

3. Lufthansa Cityline- Withdraw three Airbus A340-300 aircraft.

4. Eurowings- Withdraw an additional ten Airbus A320s.

5. Eurowings long-haul business- will also be reduced.

6. Germanwings flight operations- will be discontinued. 

7. Restructuring programs already initiated at Austrian Airlines and Brussels Airlines will be further intensified. Both airlines will reduce fleet type.

8. SWISS International Air Lines- will adjust its fleet size by delaying deliveries of new short haul aircraft and consider early phase-outs of older aircraft.

8. Lufthansa Group airlines have already terminated almost all wet lease agreements with other airlines.  

Confirmed number of aircraft being removed= 42, minus Austrian Airlines, Brussels Airlines and SWISS International Air Lines.

Currently LH Group has 757 aircraft:

A220- 29

A319- 108

A320- 226

A321- 88

A330- 53 (10 A330-200 & 43 A330-300)

A340- 43 (26 A340-300 & 17 A340-600)

A350- 16

A380- 14

B737- 6

B747- 32 (13 B747-400 & 19 B747-8i)

B767- 6

B777- 25 (6 B777-200ER & 12 B777-300ER)

Dash 8- 27

ERJ-190- 43 (9 ERJ-190 & 34 ERJ-195)

MD-11F- 6

Source: https://www.planespotters.net/airline/Lufthansa-Group

Fleet to be removed prediction (some already announced above): Older A319/320/321ceo family, some/if not all A340 & A380, B737, some/ if not all 747-400, B767, older B777, all MD-11F, some/if not all ERJ-190

Edited by JuliusWong

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Korean Air puts 70 per cent of staff on leave

https://www.thestar.com.my/news/regional/2020/04/08/korean-air-puts-70-per-cent-of-staff-on-leave

  • 70 per cent of its 19,000 staff on furlough
  • Most of its staff will go on leave from April 16 for six months
  • According to normal South Korean practice, the workers will receive 70 per cent of their normal pay, with most of it -- reportedly up to 90 per cent -- funded by a government scheme for industries in need of special assistance due to the coronavirus.
  • Korean Air's labour union agreed to participate as part of a "burden-sharing" initiative, the company said -- executives have also agreed to take pay cuts.

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Airbus chief: Crisis likely to be ‘a long one’

Airbus is expecting to review its production rates every month after reducing its output by a third in response to the coronavirus impact.

Chief executive Guillaume Faury, speaking on 8 April, was unable to estimate when rates would be restored but said he thought the crisis would “probably be a long one”

The airframer has already been taking steps to reinforce liquidity and to adjust operations at certain plants as governments put measures in place to contain the outbreak.

But Faury says the production rate cuts are intended to provide the “best balance” between the effects of the downturn and the appetite for aircraft.

He says the initial cutting of rates for the A320, A330 and A350 provide a definite plan to which the airframer can align its workforce, but adds that it could need adjustment and will probably be reviewed on a monthly basis.

See:

https://www.flightglobal.com/air-transport/airbus-chief-crisis-likely-to-be-a-long-one/137821.article

https://www.airbus.com/newsroom/press-releases/en/2020/04/airbus-provides-update-on-march-commercial-aircraft-orders--deliveries-and-adapts-production-rates-in-covid19-environment.html

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4 hours ago, JuliusWong said:

Mavcom gives leeway to airlines in resolving refund requests

https://www.malaymail.com/news/malaysia/2020/04/08/mavcom-gives-leeway-to-airlines-in-resolving-refund-requests/1854801

Good luck to all AK, MH and OD passengers! 

Another reason for me to criticise Mavcom - they really don't protect consumers much! The least they can do is to ask the airlines to pay interest on these refunds - they are already in breach of contract as the flights were cancelled. Now they have an interest free loan? 

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Air industry bodies call for UK government support

Air industry bodies have called on the UK government to expand support for the sector, which is reeling due to the coronavirus crisis.

They say providing more help for aviation, and extending the duration of that help, will stave off job losses.

The Department for Transport said aviation firms could already draw on an "unprecedented" government aid package.

And Greenpeace said the UK shouldn't "open the cheque book" for "polluting" sectors.

Bodies representing the UK's aerospace industry, airlines and airports claim that if action isn't taken now, the aviation sector in Britain could be left behind when an economic recovery comes.

At present, hundreds of aircraft are grounded, airports are operating at minimal capacity, and aerospace production has slowed.

But industry groups ADS Group, Airlines UK and the Airport Operators Association warned this could just be the beginning.

The groups, whose members include Airbus, BAE Systems, British Airways, Ryanair and Virgin Atlantic, said they didn't expect demand for flights to recover quickly, meaning that much of the aviation workforce may not be needed for months to come.

More: https://www.bbc.com/news/business-52247511

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Dragged by MCO’s travel restrictions, MAHB passenger traffic plunges 63.6% in March

KUALA LUMPUR (April 10): Passenger volume at the 39 airports that Malaysia Airports Holdings Bhd (MAHB) operates in Malaysia plunged 63.6% annually to 3.24 million in March, due to the unprecedented travel restrictions imposed by the government since March to curb the spread of the Covid-19 pandemic. 

This is the second straight month the airport operator recorded contraction in terms of passenger traffic. In February, MAHB reported a 23.4% year-on-year (y-o-y) slump in passenger numbers to 6.24 million passengers from 8.15 million passengers last year. 

Prior to this, it posted a 6.66% y-o-y increase in passenger traffic to 8.93 million in January this year, from 8.37 million passengers a year ago. 

On the local front, the airport operator handled 3.24 million passengers in March this year, falling 63.6% compared with 8.89 million passengers in the same period in 2019.

March's figure brings the year-to-date number (1Q2020) to 25.5 million, registering a 23.9% y-o-y decrease from 33.55 million passengers previously.

Full report: https://www.theedgemarkets.com/article/dragged-mcos-travel-restrictions-mahb-passenger-traffic-plunges-636-march

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Pontifications: Airlines, OEMs step up in virus crisis

April 13, 2020, © Leeham News: There are plenty of stories and photos floating around the Internet about airlines flying empty or nearly so.

Schedules have been pared back up to 95% across the globe.

Spot-check Flightradar24 at any given moment and there are a lot air freighters flying.

But the passenger airlines are also flying some airliners dedicated to cargo. Some are flying cargo in the below-deck holds only. Others installed plastic protection over the passenger seats and loaded box after box after box of protective masks for shipment. Still others removed the passenger seats entirely and loaded the main deck with lighter-weight cargo.

This article summarizes many airlines that stepped up to fly supplies throughout the world.

https://leehamnews.com/2020/04/13/pontifications-airlines-oems-step-up-in-virus-crisis/

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