Reunion’s Air Austral signs for A220s

Reunion carrier Air Austral has signed a purchase agreement covering three Airbus A220-300s.

The Indian Ocean territory operator primarily uses long-haul types including Boeing 777-300ERs and 787-8s.

It unveiled its agreement to take the A220s during an African airline event on Reunion. The first aircraft, powered by Pratt & Whitney PW1500G engines, is set to arrive at the end of next year.

Air Austral’s short-haul fleet comprises a pair of Boeing 737-800s and an ATR 72-500, all of which are about a decade old.

The airline has a partnership with Air Madagascar, in which it holds a substantial ownership stake.

Air Madagascar also has a short-haul fleet including Boeing 737s and ATR turboprops, some of which are allocated to its local operation Tsaradia.


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Twin hubs ‘suboptimal’, but necessary: Air Astana chief

Kazakh carrier Air Astana will remain with a twin hub operation for the foreseeable future, even though it entails “duplication of costs”.

Chief executive Peter Foster adds that the carrier has no plans — yet — to move to a single hub operation, given the way traffic is built around its two hubs.

Air Astana’s two main bases are at Almaty International Airport, as well as at Kazakh capital Nur-Sultan’s Nazarbayev International Airport. This operating system, Foster tells FlightGlobal, is “suboptimal”, as it means having to base two sets of crew and aircraft at both airport.

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Air Astana

But he quickly adds that it was a necessary move that should be seen in the context of how the country works.

Nur-Sultan, the newly-minted country capital is “more than just an administrative hub”, says Foster, while Almaty still remains its largest city with increasing passenger numbers. The latter city is also the country’s financial and economic centre.

“The route network has to reflect the fact [where] people want to go and depart from, and our network has to be built around that,” he adds.

To this end, Air Astana is also working to minimise the duplication of costs. For instance, its head office is only located in Almaty, with Nur-Sultan being an operational base only.

A TALE OF TWO HUBS

While the bulk of traffic passes through Almaty, Foster notes that the airport is “severely constrained” by terminal space. The airline has been mooting for terminal expansion, but not much has been done.

“The problem is that Almaty is privately owned. The owners, hitherto, have shown no inclination for these past years to invest in terminal expansion, which is limiting the growth of Almaty as a hub.

“I guess it is limiting the growth of the Almaty region as an economic centre consequently,” Foster says.

It is a stark contrast in Nur-Sultan, where a new international terminal opened its doors two years ago in time for the Expo 2017 Astana.

The airport is also starting construction of its second runway, a move which Foster says shows “the expansion potential is there”.

Foster adds that the carrier’s expansion strategy will not be a “binary question” of either Almaty or Nur-Sultan.

He points out Air Astana’s low-cost subsidiary FlyArystan — which counts Almaty as its hub — has recently inked agreements with Karaganda and Aktobe airports to establish bases there.

“We don’t see why it should be confined to two operational hubs of Almaty and Nur-Sultan.

“[If] an airport like Almaty is not able to meet the capacity that FlyArystan requires, it will merely go on and establish itself [elsewhere],” Foster says.


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Shanghai, Singapore on the cards for Air Astana A321LR

The longer-range variant of the Airbus A321neo will be a “driver of change” for Air Astana, as it looks to expand its international network with the aircraft.

Air Astana chief executive Peter Foster says that the A321LR combines range capabilities with “excellent narrowbody economics”.

“[The aircraft range] covers most of the routes which we aspire to fly in our network,” Foster told reporters.

Two “headline” points it is hoping to add with the A321LRs — of which it has ordered seven — are Singapore and Shanghai.

Other possible destinations include Prague, as well as Jeddah and Medina in Saudi Arabia.

At the moment, Air Astana has one A321LR, flying on Nur-Sultan-Moscow. It presented the aircraft at a ceremony at its Nur-Sultan hangar facility.

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Alfred Chua

The narrowbody will gradually replace its fleet of three Boeing 757s, which currently fly to points such as Kuala Lumpur, Bangkok, as well as Beijing.

The airline has experienced delays in aircraft delivery, as a result of problems with the Pratt & Whitney GTF engines, which power Air Astana’s A321LRs.

Foster discloses that the airline was to have four A321LRs by June, but only received its first last month. Still, he says, it is “better late than never” that the aircraft have arrived.

By the end of October, the airline will be taking delivery of its second A321LR. By next June, it will have four.

Foster has nicknamed the A321LRs the “Super Arrows”, adds that the aircraft will “take…to a different level” Air Astana’s product offerings.

The narrowbodies, configured to seat 166 passengers, feature an updated product in both business and economy classes, including lie-flat seats in business class.

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Alfred Chua

“With seven it means that…[the updated] level of product is extended not only to the entire long-haul network, but also to all of the key regional-haul markets like Moscow, Beijing and Dubai,” Foster says.

Air Astana, which already operates a fleet of 19 Airbus narrowbodies including three A321neos and another three A320neos, is the first Central Asian operator of the A321LR.


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Air Macau increases commitment to A321neos

Air Macau is to lease three more Airbus A321neos from late next year, under a fleet-modernisation plan.

The airline is to take the aircraft from AerCap, the Irish-based lessor states, with the first arriving in November 2020.

Air Macau will receive the other two aircraft by October 2021.

The Asia-Pacific carrier already operates the smaller A320neo and has previously signed for a pair of A321neos from Air Lease.

Air Macau increased its commitment to the re-engined aircraft family during a ceremony to mark the airline’s 25th anniversary.

No engine selection has been disclosed but the A320neo fleet is powered by Pratt & Whitney PW1100Gs and Air Macau’s other Airbus single-aisle jets are fitted with International Aero Engines V2500s.


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​Transat posts Q3 adjusted profit ahead of Air Canada takeover

Transat AT, parent company of Air Transat, reported adjusted net income of C$5.7 million ($4.3 million) for its third quarter of fiscal year 2019, an upward swing from an adjusted net loss of C$5.0 million in the same period in 2018.

But the company reported a C$11 million net loss when accounting for “unusual” items, including C$13.7 million in expenses related to a pending acquisition of Transat by Air Canada.

The mixed results come as the airline continues a broad fleet renewal that includes acquisition of new Airbus aircraft.

Revenue in the third quarter, which ended on 31 July, rose to C$699 million, up 5.2% from the same period in 2019.

The increase reflects higher average selling prices and improved load factors across all markets, chief executive Jean-Marc Eustache told analysts on the company’s quarterly earnings call on 12 September.

The Montreal-based tourism operator also says Air Canada’s planned acquisition of all issued and outstanding voting shares of Transat is on track to close by the second quarter 2020.

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Air Transat already operates two A321LRs, including this aircraft, and plans to acquire 15 of the type by 2022

Airbus

Air Transat, which took delivery of its first two A321LRs during the quarter as part of its fleet renewal programme, will increase that number to “three to four” in the winter, and to six by next summer, chief operating officer Annick Guerard adds.

Looking forward, Eustache says Transat’s fiscal fourth quarter 2019 results will be “slightly higher” than last year. Transatlantic demand, which accounts for a substantial portion of business in the summer season, is currently down 0.9% compared with last year, but selling prices are 2.1% higher.

“The impact of currency variations, combined with lower fuel costs in US dollars, will not result in a significant increase in operating costs if aircraft fuel prices remain stable and the [Canadian] dollar remains at its current level against the US dollar, the euro and the pound,” the company adds.

Guerard says Transat has seen lower demand from UK outbound travel, primarily attributable to the uncertainty around Brexit. However, Canada outbound traffic has made up the difference for the transatlantic market. She adds that Icelandic discounter Wow Air’s exit from the transatlantic market earlier this year did not result in a significant benefit for Transat.

On the “sun destinations” market outbound from Canada, for which summer is low season, 83% of capacity is sold and the load factors are 5.6% higher compared with 2018, with unit margins also slightly above those in 2018.

The winter season’s primary market, sun destination capacity is 9% higher than on the same date last year, Eustache says, adding it is too soon to draw conclusions about the winter results.

“Increased load factor and pricing are encouraging,” he says.

To date, 27% of sun destination capacity has been sold and load factors are 1.8% higher compared with 2019. Here again, the impact of lower fuel costs, combined with fluctuations of the Canadian dollar, will not result in a significant increase in operating costs if aircraft fuel prices remain stable and the dollar remains stable against the US dollar.

The company also says Air Canada’s planned acquisition, announced on 27 June, is on track to close by the second quarter of 2020 given all regulatory approvals and closing conditions.

In August, a 95% majority of Transat’s voting shareholders approved the agreement for Air Canada to buy the company for C$18 per share, which would make the cash transaction worth C$720 million.

“We are pleased with the massive support from the shareholders for our planned arrangement,” says Eustache.

A few days later, the transaction cleared its first regulatory hurdle by gaining approval from Quebec’s superior court.

Air Canada, that nation’s largest airline, has promised to maintain Transat employees and headquarters in Montreal. The carrier has said passengers would benefit from more destinations, connections and frequencies under the combination.

Air Transat, which specialises in vacation packages, would continue to operate flights under its own brand after the Air Canada deal closes. Transat offers vacation packages, hotel stays and air travel to 60 destinations in the Americas and Europe, which could give Air Canada a chance to counter tourism packages from competitors including Canada’s second-largest carrier WestJet.

In June, Montreal real estate developer Group Mach made a bid to acquire Transat, which was blocked by the Quebec Administrative Court of Financial Markets on grounds it was “abusive” and aimed at preventing the Air Canada takeover.

Air Canada’s proposed acquisition comes at a time when Transat seeks to return to profit through 2022 by investing in new aircraft and land for accommodations.

Earlier this year, Air Transat took delivery of the first two of 15 Airbus A321LRs as part of its fleet renewal programme to replace older aircraft including six A310s. The A321LRs will be deployed on its longer international flights to Europe and the Caribbean, along with Central and South America.


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Air cargo woes endure amid US-China spat

The tough conditions seen in the air freight market are continuing into the second half of the year, as demand is dented by the China-USA trade spat and a slowing global economy.

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KLM transfers A350 order to Air France

KLM has formally transferred an order for seven Airbus A350-900s to its SkyTeam and corporate partner Air France.

Airbus’s latest official orders data, covering the period to 31 August, shows that the seven A350s have been removed from the Dutch airline’s backlog.

Air France’s orders for the twinjet have correspondingly risen from 21 to 28.

The French flag-carrier had previously indicated that it would simplify its fleet by swapping the A350s for a batch of six Boeing 787s ordered by KLM.

Air France has nine 787-9s in service with one more still on order, according to Cirium fleet data.

It is set to take delivery of its first A350 in the last week of September.

KLM has 14 787s in its fleet – nine -9s and a single -10 – and it has another 14 787-10s on order.


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Brazilian air force receives first Embraer KC-390

The Brazilian air force received its first Embraer KC-390 transport in a ceremony at Anápolis Air Base outside of Brasilia on 4 September.

The service is starting preparations for the transport’s entry into service with its First Troop Transport Group. Embraer says it has already been conducting “theoretical and practical training with the air force teams to start operations”.

“The incorporation of the KC-390 into the Brazilian air force is a milestone in military aviation,” says Brazilian air force commander, Lieutenant-Brigadier Antonio Carlos Moretti Bermudez. “Its modernity will bring an implementation and improvement in the doctrine of use of this multi-mission vector, greatly contributing to the fulfillment of the mission to control, defend and integrate the [2.2 billion ha (5.4 billion acres)] under our responsibility.”

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Embraer KC-390 for the Brazilian air force

Brazilian air force

The Brazilian air force has 27 more aircraft on order. In July, the Portuguese air force became the KC-390’s first export customer with a firm order of five examples.

Embraer has 33 letters of intent for the KC-390, including six from the Argentine air force, six from the Chilean air force, 12 from the Colombian air force, two from the Czech Republic air force, one from the Portuguese air force and six from aviation services firm SkyTech, according to Cirium fleets data.

Development of the KC-390 was started in 2009 as a joint project between the Brazilian air force and Embraer. The first example flew in 2015.

The KC-390 competes directly with the Lockheed Martin C-130J four-engine turboprop transport. Both aircraft are designed for a variety of roles including troop and cargo transport, aerial refueling, humanitarian support, medical evacuation, search and rescue and forest fire fighting missions. Embraer says the KC-390’s two IAE V2500 turbofan engines and swept wing design make it more efficient and give it “the lowest life-cycle cost in the market”.

As part of its purchase agreement with the Brazilian air force, Embraer says it signed a five-year services and support contract. That contract makes it responsible for logistical and engineering support, maintenance control, component repair, support staff for the aircraft’s entry into service and materials supply. The agreement also encompasses structural analysis, maintenance bulletin development, aircraft painting and other services, says the manufacturer.


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Air Canada steps in as Brussels drops Toronto for Montreal

Star Alliance carrier Brussels Airlines is to open a new transatlantic service to the Canadian city of Montreal next year, but will axe its link to Toronto.

The Toronto-Brussels connection, however, will be picked up by Star Alliance partner Air Canada.

Brussels Airlines says it will start operating the Montreal route five times weekly beginning 29 March.

It is to discontinue the Toronto service from 7 January, adding that passengers booked on the connection will be rerouted on alternative flights.

Air Canada says it will commence a Toronto-Brussels service from 1 May 2020, with up to five weekly flights on three-class Boeing 787-8s.

Brussels Airlines’ additional aircraft capacity over the winter season will enable the airline to offer a year-round service to Washington DC – currently a summer route – from 20 February.

The Belgian carrier says Montreal is the “most important market” in Canada from Belgium.

It will operate the new connection with Airbus A330-300s, configured with a three-class cabin including a premium-economy section.

Air Canada already serves the Montreal-Brussels route, as does Air Transat – a carrier being acquired by Air Canada.

Brussels Airlines says the extended Washington service will be offered daily in the summer and four times weekly in winter.


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Vietnam Airlines gets USA air carrier permit

Vietnam Airlines has been awarded a foreign air carrier permit from the US Department of Transportation, a regulatory filing shows.

The airline is authorized to operate flights between Ho Chi Minh City and Hanoi to several US destinations as well as flights via points in Taipei, Taiwan and Osaka and Nagoya in Japan.

The airline will be permitted to fly to Los Angeles, San Francisco, New York, Seattle and Dallas-Fort Worth. It can also continue flights to Canadian cities Vancouver, Montreal and Toronto.

Vietnam Airlines and Delta Air Lines recently upped their codeshare relationship, with Delta carrying its code on the Hanoi-Tokyo route starting in October.

The USA awarded Vietnam Category 1 status in February, which was a key step in opening up flights between the two countries that lack nonstop links. With this status Vietnamese airlines—most notably Vietnam Airlines, VietJet Air and Bamboo Airways—are permitted to apply for the requisite regulatory approvals to serve US cities.

Vietnam Airlines has shown interest in the Ho Chi Minh City-Los Angeles route.


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