In a recent appearance on the “Conversations with Mike Milken” podcast, Delta CEO Ed Bastian shared with the Milken Institute founder how the global airline is providing a safe travel experience for customers and employees, while also moving toward recovery amid the worldwide pandemic.
“In my opinion, consumers can fly with confidence and safety today,” he said. “We are taking the same measures towards the personal safety of our customers on board our planes, just as we do the flight safety of the experience.”
Bastian continued to highlight the many steps being taken to give customers confidence when traveling, including electrostatic spraying, back-to-front boarding, capping load factors at 60 percent and requiring masks for employees and customers.
“The reason I go through all those steps is that security and safety is in our DNA,” Bastian shared. “That’s the core of our franchise.”
The May 21 interview, which aired June 4, is part of Milken’s pandemic podcast series featuring notable industry leaders and medical experts. A replay of the complete interview is available.
SEOUL (Reuters) – South Korea’s largest airline, Korean Air, plans to sell around 1 trillion won ($816.55 million) in new shares in its biggest rights issue in 20 years to raise funds amid mounting strains in the industry due to the pandemic.
Korean Air is the latest carrier to raise funds as travel restrictions imposed by governments around the world have led to airlines grounding their fleets worldwide.
Korean Air separately plans to receive 1.2 trillion won in support from South Korean state-owned banks.
About 79 million newly issued shares, to be listed on July 29, will be first bought by the carrier’s shareholders, including holding company Hanjin Kal which has a 30% stake in the carrier, followed by general public, the company said in a statement.
“Korean Air will continue to carry out self-rescue measures to overcome the dismal business environment due to COVID-19,” the company said.
Korean Air had 70% or more of its employees working in South Korea take a six-month leave of absence in April. Woo Kee-hong, the airline’s president, warned in March that the coronavirus outbreak could threaten its survival if the situation becomes prolonged.
Korean Air also picked last month a preferred bidder to buy its real estate and non-core assets, which some analysts value at about 400-500 billion won.
Korean Air had a debt-to-equity ratio of about 870% as of end-2019. It is expected to announce January-March quarter earnings later this week.
A spokeswoman for Korean Air said it was operating just 10% of its previously planned international schedule, and 60% of its domestic schedule.
The airline said it expects its June international schedule to rise to 20% of its previous plan, as it announced the addition of more international passenger flights to prepare for increased travel demand once COVID-19 restrictions are relaxed.
United Airlines Holdings Inc said earlier this month it plans to raise $2.25 billion through a bond offering, after announcing a public offering to raise more than $1 billion in April.
In March, Singapore Airlines said it would issue S$5.3 billion ($3.70 billion) in new equity and up to S$9.7 billion($6.78 billion) via mandatory convertible bonds in a rights issue backed by state investor Temasek Holdings.
($1 = 1,224.6700 won)
(Reporting by Joyce Lee; Editing by Simon Cameron-Moore and Louise Heavens)
Korean Air’s passenger planes are parked following outbreak of COVID-19, at Incheon International Airport
FILE PHOTO: EasyJet planes parked at Luton airport after the airline grounded its entire fleet
LONDON (Reuters) – EasyJet can survive a nine-month shutdown thanks to its measures to contend with the coronavirus crisis and is planning for a slow recovery, the British airline said on Thursday.
As airlines worldwide battle for survival after lockdowns and travel bans brought the sector to a virtual standstill, EasyJet announced a new fleet plan to manage its emergence from the enforced hibernation.
The UK-based company said it will start to shrink its fleet and the number of planes it operates will not reach pre-crisis levels until 2022, signalling that it does not expect a quick recovery for the industry.
“We’ve been able to adapt ourselves to reduced demand for the next couple of years, then have the flexibility to increase as demand picks up again,” Chief Executive Johan Lundgren told reporters.
The industry is split on how quickly the sector can recover. Lufthansa, plane manufacturers and airline body IATA have warned that it will be a slow process. EasyJet’s bigger low-cost rival Ryanair, meanwhile, has predicted a swift rebound in traffic.
Lundgren said that, while he does not expect the grounding of easyJet’s fleet to last nine months, the company would remain cash-positive even if that were the case and could survive for longer than that by seeking additional funding.
Among the steps it is taking, easyJet is in talks over the sale and leaseback of some planes to leasing companies, with expected proceeds of up to 550 million pounds ($687 million).
“Overall, the company has presented a very credible response to the crisis,” said Goodbody analyst Mark Simpson.
In addition to the deferral of new orders and non-renewal of leases, easyJet said it now plans to sell six aircraft.
The airline, however, has faced calls from its founder and biggest shareholder, Stelios Haji-Ioannou, to terminate its 4.5 billion pound order with Airbus for 107 new jets.
He escalated his row with management on Thursday, issuing a statement saying he planned to call for the removal of Lundgren as well as chairman John Barton at forthcoming meetings. He said Lundgren should not send money to Airbus for planes while running an “aircraft parking lot”.
CASH PILE
Through various funding initiatives, easyJet expects to generate total additional liquidity of about 1.85 billion to 1.95 billion pounds, leading to a notional cash balance of about 3.3 billion pounds.
Given the level of continued market uncertainty, the company said it is not possible to provide guidance for the remainder of the 2020 financial year.
However, it said winter bookings are well ahead of those at the same stage last year, with Lundgren adding that he expects there to be pent-up demand for holidays as people emerge from lockdown.
But travel restrictions are likely to ease slowly and easyJet will have to be flexible, the CEO said. “I don’t think this is going to be a case of let’s just open everything up,” he added.
Measures under consideration include disinfecting aircraft and steps to ensure social distancing on planes.
“We will clearly look to have the middle seat empty as we start,” Lundgren said. “I think that is actually what the customers would like to see.”
EasyJet shares were up 2.2% at 616 pence at 1207 GMT, having lost more than 50% year to date.
($1 = 0.8007 pounds)
(Reporting by Sarah Young; Editing by Kate Holton and David Goodman)
An employee leaves the Volkswagen (VW) plant as the company will temporarily close its factories in Mexico amid growing worries over the spread of the coronavirus disease (COVID-19), in Puebla
MEXICO CITY (Reuters) – German automaker Volkswagen said on Wednesday it would extend until April 30 a suspension of activities at two production plants in central Mexico after the government declared a health emergency because of coronavirus.
Volkswagen <VOW.DE> is among manufacturers worldwide who are responding to a fall in demand, as well as supply chain challenges following measures taken to rein in the pandemic.
In a statement the company said the halt was extended from April 12 to comply with government orders for a suspension of all non-essential activities.
Volkswagen said it would continue to pay employees during the suspension. Mexico reported 37 deaths, up from 29 a day earlier, and 1,378 infections, up from 1,215, because of the virus.
(Reporting by Sharay Angulo; Writing by Stefanie Eschenbacher; Editing by Clarence Fernandez)
Gogo AVANCE L5 provides the fastest and most reliable 4G air-to-ground high-speed internet coverage over North America for business aircraft today
Retrofit available for Learjet 40, Learjet 45, Learjet 70 and Learjet 75 aircraft throughout Bombardier’s growing service network, which has unparalleled OEM expertise to enhance the ownership experience for customers
This high-speed connectivity is already available on new Learjet aircraft, and will be an option on the new Learjet 75 Liberty business jet
Bombardier Aviation is bringing faster connectivity to its in-service Learjet fleet as part of a continuing commitment to this legendary platform. Gogo Business Aviation’s next-generation, 4G air-to-ground (ATG) internet system, Gogo AVANCE L5, has been an available option on new Learjet aircraft since last year.
Bombardier is now offering customers the high-performance 4G in-cabin Wi-Fi system as a retrofit for in-service Learjet 40, Learjet 45, Learjet 70 and Learjet 75 aircraft. Customers can have the system installed at all Bombardier Service Centres and Authorized Service Facilities throughout the United States.
“Learjet aircraft are renowned productivity tools, and this enhancement ensures that our customers have the connectivity they need to maximize their time in the air,” said Michael Anckner, Vice President, Worldwide Sales, Learjet Aircraft and Corporate Fleets, Bombardier Business Aircraft. “With various upgrades available for our large fleet of in-service aircraft and the recent unveiling of our value-added Learjet 75 Liberty aircraft, there’s never been a better time to own a Learjet.”
The new and significantly faster 4G service uses Gogo AVANCE L5, which is lightweight and compact, accesses the Gogo Biz 4G ground network of more than 250 towers and delivers seamless connectivity over the continental U.S. and large parts of Canada and Alaska. Designed specifically for business aircraft, the system offers audio and video streaming as well as faster web surfing for a vastly improved user experience over previous-generation technology.
The iconic Learjet brand is synonymous with excellence in aviation, with more than 2,000 Learjet aircraft in service around the world. This fleet is a testament to the longevity and reliability of this platform, while the upcoming Learjet 75 Liberty signals a strong future for the world’s best light jet.
Bombardier is growing its worldwide support network, including a new service centre at Miami-Opa Locka Executive Airport and the recent addition of two U.S. line maintenance stations in Teterboro and Van Nuys. In addition to providing this 4G connectivity upgrade to the Learjet fleet, Bombardier is also offering the latest update to the popular Garmin G5000 avionics suite aboard Learjet aircraft, which was recently certified by the U.S. Federal Aviation Administration and brings many workload-reducing improvements to the cockpit.
The Learjet 75 Liberty aircraft is on track to enter service in mid-2020. Its spacious cabin features a six-seat configuration that gives light jet passengers unprecedented freedom to stretch out. A standard pocket door delivers a quiet, productive flight coupled with the comfort of Bombardier’s signature smooth ride.
The Learjet 75 Liberty aircraft has a range of 2,080 nautical miles, able to connect Las Vegas to New York, Seattle to Washington, D.C., and Mexico City to San Francisco, nonstop.* This aircraft has the same operating costs as its competitors in the light jet category while offering the most spacious cabin, the fastest speed, the longest range and the smoothest ride. It is also a step up from other light jets in terms of safety standards, certified to the FAA’s more stringent Part 25 regulations, applicable to commercial airliners, unlike other light jets certified to Part 23 regulations.
WASHINGTON – Amtrak announced that it has named William J. Flynn as its next Chief Executive Officer and President. Flynn, a seasoned business leader with four decades of transportation and logistics experience, will begin his role on April 15, 2020. Flynn succeeds Richard Anderson, who joined Amtrak as CEO in July 2017. Anderson, who fulfills his three-year commitment to the company this year, will remain with Amtrak through the end of the year as a senior advisor to Flynn.
Flynn, 66, has been a successful leader across multiple modes of transportation, including rail, maritime and aviation. Most recently, he served 13 years with Atlas Air Worldwide Holdings, Inc., which serves the global air freight, military charter and passenger charter markets, as President and CEO and Board Chairman. He also held senior roles with CSX Transportation, Sea-Land Services, Inc., and GeoLogistics Corp.
“Bill is the right executive to lead us into the future,” said Amtrak Board Chairman Tony Coscia. “We’ve never been stronger as a company than we are today. We are modernizing the customer experience and delivering our service to more people. Bill has a consistent track record of growing and improving complex transportation businesses. We are confident he will build upon the strong foundation of record-setting growth and improvement set by the Board, Richard and the entire Amtrak team.”
In fiscal year 2019, Amtrak set new records in ridership, revenue and earnings. In 2020, Amtrak is on pace to achieve operational breakeven for the first time in the company’s 49-year history. Additionally, Amtrak is investing billions in capital assets and is undertaking the largest fleet renewal in company history, with new high-speed Acela trains entering service on the Northeast Corridor next year.
“Amtrak’s future is incredibly bright and I’m excited to join the team,” said Flynn. “Amtrak service is vital to millions of Americans across the nation and by improving the customer experience, driving safety, and strengthening our partnership with states and other stakeholders, we can do much more for the American people. Tony, Richard and Amtrak’s dedicated employees have done an amazing job modernizing the company for the 21st Century. It’s a privilege to join them in continuing this work and advancing something as important as Amtrak’s mission.”
“I congratulate the Board on selecting Bill to lead Amtrak into its 50th year and beyond,” said Anderson. “Bill brings deep expertise across all aspects of transportation and a true passion for the customer. As the company refleets our equipment, expands our services and advances key infrastructure projects like the Gateway Program, it will require the steady leadership and relentless drive for improvement that I know Bill can provide.”
Major upgrade adds option to load instrument procedures, customized holds and more
Garmin International, Inc., a unit of Garmin Ltd. (NASDAQ: GRMN), today announced the addition of new features within the Garmin Pilot™ app that incorporate professional IFR navigation tools found within Garmin avionics. Pilots can experience a near-seamless transition between Garmin avionics and the Garmin Pilot app when performing common functions, such as loading and activating instrument approach procedures, departures and arrivals within the Americas. Additional features such as a visual procedure selector, custom holding patterns and more, give pilots convenient access to advanced tools all within a mobile app.
Vertical planning within Garmin Pilot (Photo: Business Wire)
“Leveraging technologies found within Garmin avionics and flight decks, we’re excited to bring this game-changing update to Garmin Pilot customers,” said Carl Wolf, vice president of aviation sales and marketing. “This upgrade gives pilots the ability to load complex routes and procedures into the app just as they would within a Garmin integrated flight deck, offering added convenience, time savings and confidence when transitioning between multiple Garmin products in the cockpit.”
Professional IFR navigation tools
Within the latest Garmin Pilot upgrade, pilots have the option to load or activate departures, arrivals and instrument approach procedures. Published holds that are included as part of the missed approach are also added to the flight plan. When pilots activate a procedure with published altitude constraints, those altitudes are automatically incorporated into a flight plan within the app. Pilots can also choose to manually add altitude constraints into a flight plan. Additionally, approach procedures with radius-to-fix (RF) legs can be activated within Garmin Pilot.
Using the vertical planning feature within Garmin Pilot, pilots can more easily input and adhere to crossing restrictions in a flight plan. For example, pilots can manually input a crossing restriction over a specific navigational aid or GPS waypoint. With these new features, pilots can optimize their flight planning and fuel calculations.
Visual procedure selector
Pilots can now more easily visualize departures, arrivals and instrument approach procedures prior to a flight using the visual procedure selector. This new selector allows pilots to simultaneously view departures, approaches or arrivals on a map alongside a flight plan so it’s easier to visualize and select the most appropriate procedure based on a flight plan and intended direction of flight.
Customized holding procedures
Pilots now have the flexibility to easily build customized holding patterns. These holds may be created over an existing fix or over a user-defined waypoint and then inserted into a flight plan. When creating a hold, pilots can easily input an inbound or outbound course, select left or right turns and specify leg length in time or distance. Unpublished holds or those assigned by air traffic control are easily created and displayed within Garmin Pilot to simplify the process of visualizing and flying a holding pattern.
Worldwide route data packages
Route data packages within Garmin Pilot help to ensure pilots have downloaded all of the data required for a flight plan. Once a flight plan is entered, pilots can review the data that is downloaded to their mobile device. If information is missing for a particular flight, Garmin Pilot displays an option to download additional data. Route data packages are also available worldwide to help ensure pilots have all of the data they need prior to every flight. Databases that are included within the worldwide route data packages include navigation data, instrument approach procedures, SafeTaxi®, terrain, obstacles and more.
The newest release of Garmin Pilot on Apple mobile devices is available immediately. For new customers, Garmin Pilot is available in the Apple App Store as a free download for the first 30 days. After the 30-day trial period, customers may purchase an annual subscription of Garmin Pilot starting at $79.99. Garmin Pilot is supported by Garmin’s award-winning aviation support team, which provides 24/7 worldwide technical and warranty support. Visit www.garmin.com/aviation for additional information.
LONDON/FRANKFURT, Feb 5 (Reuters) – China’s HNA Group is resuming efforts to find a buyer for airport luggage handler Swissport despite facing a loss of several hundred million dollars on its initial $2.8 billion investment, four sources familiar with the matter told Reuters.
The Chinese conglomerate has rekindled talks with several heavyweight investment funds as it needs to raise cash to cut its debts, the sources said.
Rothschild is helping HNA identify prospective bidders, who are hoping to buy the Zurich-based business on the cheap after previous attempts to sell it stalled last year, the sources said, speaking on condition of anonymity because the process is not public.
U.S. buyout funds Apollo Global Management Inc and Cerberus as well as Canadian asset manager Brookfield have come forward to revisit a possible acquisition of Swissport, the sources said.
Two other U.S. investors – Bain Capital and Centerbridge Partners – are also looking to take part in a new auction, two of the sources said, adding interest from industry buyers had waned.
HNA is hoping to limit its losses and recoup at least $2.3 billion from the sale, one of the sources said.
But offers are expected to value Swissport at about $2 billion, two of the sources said, with one adding Apollo had previously offered $2.1 billion.
This means HNA may need to swallow a loss of more than $500 million to offload the business, which has annual core earnings of about $270 million, they said.
HNA, Apollo, Cerberus, Brookfield and Bain declined to comment, while Centerbridge was not available.
HNA bought Swissport for 2.7 billion Swiss francs ($2.8 billion) in 2016 in a deal that was meant to complement its sprawling portfolio of investments in aviation, logistics and tourism.
But the Chinese giant had to look into cashing out at the start of 2018 when its liquidity challenges turned it into one of China’s most indebted companies and forced it to quickly sell assets.
The 20-year old company, led by chairman Chen Feng, came under pressure after embarking on an aggressive M&A spree in the United States and Europe with deals worth an overall $50 billion.
It made a push into the travel and tourism industry, buying a 25% stake in Hilton Worldwide Holdings Inc in 2016 and then branched out into financial services, becoming the leading investor in Deutsche Bank.
But its M&A binge resulted in cash flow problems, prompting a review of all its business interests overseas.
HNA initially considered a possible listing of Swissport on the Swiss SIX Exchange in 2018, but then opted for an outright sale.
Apollo and Cerberus, which bought Paris-based Worldwide Flight Services (WFS) in 2018, were both initial contenders for Swissport, but negotiations stalled after the Swiss company secured a refinancing package in August.
($1 = 0.9727 Swiss francs)
(Reporting By Pamela Barbaglia and Clara Denina in London and Arno Schuetze in Frankfurt; Editing by Mark Potter)
KUALA LUMPUR (Reuters) – Shares of Malaysia’s AirAsia Group <5099.KL> fell on Monday, after allegations by Britain’s Serious Fraud Office that Airbus <EADSY> paid a bribe of $50 million to win plane orders from Asia’s largest budget airline group.
AirAsia shares fell as much as 11% to 1.27 ringgit – their lowest since May 2016 – while those of AirAsia X tanked 12% to their all-time low of 11.5 Malaysian sen.
Malaysia’s anti-graft agency is investigating the allegations from Britain. AirAsia has said it never made any purchase decisions that were premised on Airbus sponsorship, and that it would fully cooperate with the Malaysian Anti-Corruption Commission (MACC).
Malaysia’s Securities Commission said on Sunday it would also examine whether AirAsia broke securities laws.
The allegations were revealed on Friday as part of a record $4 billion settlement Airbus agreed with France, Britain and the United States. Prosecutors said the company had bribed public officials and hidden payments as part of a pattern of worldwide corruption.
Airbus said at the weekend it would not comment on the Malaysian investigations.
Analysts said the accusation against AirAsia comes at a particularly bad time as airlines grapple with a slowdown in business because of the fast-spreading coronavirus epidemic that has killed more than 300 people in China and disrupted air travel.
“Besides being embroiled in this corruption scandal, we expect a tough operating environment to persist over the medium term with maintenance cost remaining high … and concerns over the Wuhan virus outbreak which could derail propensity for air travel in the region,” Malaysia’s Kenanga Investment Bank wrote in a research note.
TA Securities downgraded AirAsia Group stock to “sell” from “buy”.
“We choose the ‘sell first, ask questions later’ approach to avoid the uncertainty in association with the corruption investigation by MACC, where the impact on AirAsia could be significant in terms of corporate governance,” it said in a note.
(Reporting by Krishna N. Das; Editing by Himani Sarkar and Christopher Cushing)
FILE PHOTO: Thai AirAsia Airbus A320 plane prepares for take off at Don Mueang International Airport in Bangkok
FILE PHOTO: FILE PHOTO: The Airbus logo is pictured at Airbus headquarters in Blagnac near Toulouse
PARIS/LONDON/WASHINGTON (Reuters) – Airbus <EADSY> bribed public officials and hid the payments as part of a pattern of worldwide corruption, prosecutors said on Friday as the European planemaker agreed a record $4 billion settlement with France, Britain and the United States.
The disclosures, made public after a nearly four-year investigation spanning sales to more than a dozen overseas markets, came as courts on both sides of the Atlantic formally approved settlements that lift a legal cloud that has hung over Europe’s largest aerospace group for years.
“It was a pervasive and pernicious bribery scheme in various divisions of Airbus SE that went on for a number of years,” U.S. District Judge Thomas Hogan said.
The deal, effectively a corporate plea bargain, means Airbus has avoided criminal prosecution that would have risked it being barred from public contracts in the United States and European Union – a massive blow for a major defence and space supplier.
Prosecutors said individuals could still face criminal charges, however.
Airbus, whose shares closed down 1%, has been investigated by French and British authorities for alleged corruption over jet sales dating back more than a decade. It has also faced U.S. inquiries over suspected violations of U.S. export controls.
“In reaching this agreement today, we are helping Airbus to turn the page definitively” on corrupt past practices, French prosecutor Jean-Francois Bohnert said.
France’s financial prosecutor said the company had also agreed to three years “light compliance monitoring” by the country’s anti-corruption agency.
The U.S. Department of Justice said the deal was the largest ever foreign bribery settlement.
CODE NAME ‘VAN GOGH’
In a packed hearing at London’s Royal Courts of Justice, an Airbus lawyer said the settlements “draw a clear line under the investigation and under the grave historic practices”.
Outlining detailed findings, the UK’s Serious Fraud Office (SFO) said Airbus had hired the wife of a Sri Lankan Airlines executive as its intermediary and misled Britain’s UKEF export credit agency over her name and gender, while paying $2 million to her company. The airline could not be reached for comment.
