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Tag: government (Page 13 of 22)

Rolls-Royce Scraps Dividend & Targets Due to Coronavirus

April 6, 2020 /

(Reuters) – British aero-engine maker Rolls-Royce will abandon its targets on profits, cash and deliveries, and suspend its dividend, as airlines around the world ground planes due to the coronavirus outbreak, the Financial Times reported late on Sunday.

Rolls-Royce is also aiming to announce new credit facilities in excess of 1 billion pounds ($1.22 billion) to bolster liquidity, the newspaper said https://on.ft.com/2ULsL7q.

Rolls-Royce, which makes engines for large civil and military planes, has been hit hard by the pandemic as its airline customers park hundreds of planes.

In March, engine flying hours were down by about 40%, the newspaper said, citing a source. The company is paid by airlines based on how many hours its engines fly.

At the end of February, Rolls Royce had forecast 2020 free cash flow of 1 billion pounds, excluding any material impact from COVID-19. The group will ditch that pledge, the FT said.

The dividend payment of 11.7 pence per share, which has been frozen since 2016, will also be suspended, the newspaper added.

Rolls-Royce declined to comment.

In addition, the FT said the company on Monday will reopen its civil aerospace facilities in the UK with a fraction of the normal workforce, after suspending operations in March.

The company could also eventually furlough some 50% of its 7,500 UK shop-floor workers, with wages supported by government subsidy, two sources told the newspaper.

(Reporting by Bhargav Acharya in Bengaluru; Editing by Daniel Wallis and Richard Pullin)

Rolls Royce engine of the first Fiji Airways A350 XWB airliner is seen at the aircraft builder’s headquarters of Airbus in Colomiers near Toulouse

Boeing Extends Suspension of Puget Sound Production Ops

April 6, 2020 /

Boeing is extending the temporary suspension of production operations at all Puget Sound area and Moses Lake sites until further notice. These actions are being taken in light of the company’s continuing focus on the health and safety of employees, current assessment of the spread of COVID-19 in Washington state, the reliability of the supply chain and additional recommendations from government health authorities.

During the suspension, the company will continue to implement additional health and safety measures at its facilities to protect employees. These measures include new visual cues to encourage physical distancing, more frequent and thorough cleaning of work and common areas and staggering shift times to reduce the flow of employees arriving and departing work, among many other improvements.

“The health and safety of our employees, their families and our communities is our shared priority,” said Boeing Commercial Airplanes President and CEO Stan Deal. “We will take this time to continue to listen to our incredible team and assess applicable government direction, the spread of the coronavirus in the community and the reliability of our suppliers to ensure we are ready for a safe and orderly return to operations.”

The volunteers who have been supporting essential site and services work should continue to report to their assigned shifts. Puget Sound area and Moses Lake employees who can work from home should continue to do so.

As the suspension of operations continues, Boeing will monitor government guidance and actions on COVID-19 and associated impact on all company operations. Boeing sites that remain open are being monitored and assessed on a daily basis.

Volaris Announces Temporary Capacity Reduction

April 2, 2020 /

PRNewswire/ — Volaris (NYSE: VLRS), the ultra-low-cost airline serving Mexico, the United States and Central America, announces that pursuant to a decree published in the Official Gazette of the Federation, the Government of the United Mexican States, acting through the General Health Council (Consejo de Salubridad General (“GHC”)) declared a health emergency due to force majeure, as a result of the disease epidemic caused by the virus SARS-CoV-2 (COVID-19), known as Coronavirus, which will be in effect until April 30, 2002 (the “Declaration of Emergency”)

The Declaration of Emergency and the health security measures announced by the GHC, such as the suspension of non-essential activities in the public, private and social sector, as well as the call to the population to comply with stay at home, will impact the demand for passenger air transportation whilst the Declaration of Emergency is in effect.

As a result, from the date hereof, Volaris will make an additional capacity reduction to that which was advised on March 24, 2020.  Capacity measured by available seat miles (ASMs) for the month of April, 2020 will reduce to approximately 80% of total operation versus the schedule originally published.

Volaris will continue to provide relevant market updates should further capacity, governmental travel restrictions or other liquidity preserving measures need to be implemented.

Volkswagen Extends Mexico Coronavirus Production Halt

April 2, 2020 /
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)

Air New Zealand Lays Off 3,500 Employees as Virus Halts Travel

March 31, 2020 /

(Reuters) – Air New Zealand <AIR.NZ> said on Tuesday nearly a third of its employees, about 3,500, will be laid off in the coming months, as it grapples with severe global travel curbs due to the coronavirus that has forced it to cancel nearly all flights.

The national carrier, which employs 12,500 people, said the announced number of layoffs was a “conservative” assumption, and that it could rise if the domestic lockdown and border restrictions were extended.

Large scale layoffs of its global staff will start this week, the company said.

“Unfortunately, COVID-19 has seen us go from having revenue of NZ$5.8 billion to what is shaping up to be less than NZ$500 million annually based on the current booking patterns we are seeing,” Chief Executive Officer Greg Foran said in an email to staff and customers.

“This has the potential to be catastrophic for our business unless we take some decisive action.”

Air New Zealand is an example of the dire situation facing airlines across the world due to curbs on travel to control the spread of the virus.

“We have had to cut more than 95 percent of our flights here in New Zealand and around the world. The only flights remaining are in place to keep supply lines open and transport options for essential services personnel,” Foran added.

Earlier in March, the New Zealand government offered the airline a NZ$900 million ($540.99 million) lifeline to keep it in the air.

The company also noted that “every dollar we use from this loan facility comes with interest (more than double current interest rates for a household mortgage) and must be re-paid.”

“Burdening our airline with massive debt would significantly lessen our ability to compete with airlines emerging from COVID-19,” said Foran.

He also said that in a year’s time he expects staffing levels to be 30% smaller than it is currently.

($1 = 1.6636 New Zealand dollars)

(Reporting by Nikhil Kurian Nainan in Bengaluru; Editing by Shinjini Ganguli)

FILE PHOTO: An Air New Zealand Airbus A320 plane takes off from Kingsford Smith International Airport in Sydney

Norwegian Air Gets Guarantee From Norwegian Government

March 25, 2020 /
  • Norwegian is pleased to announce that two Nordic banks have obtained credit committee approval to provide a guarantee for the required 10 percent for the first tranche of 300 million Norwegian kroner (NOK). Norwegian will secure the necessary headroom to pursue further guarantees from the Norwegian Government.

Government measures
On Thursday 19 March, the Norwegian Government proposed a guarantee of NOK 6 billion for the Norwegian airline industry, of which up to NOK 3 billion is directed to Norwegian. The guarantee will be up to 90 percent from the Norwegian Government provided that financial institutions contribute with the remaining 10 percent. The guarantee scheme will consist of three tranches with a maximum two years maturity.

Since Thursday evening Norwegian has worked with banks and financial institutions and is pleased to announce that two Nordic banks have obtained credit committee approval to contribute with the 10 percent required in guarantee for Tranche I and to provide the NOK 300 million in financing backed by the guarantee from the Norwegian Government. The Company is working with the banks and the Norwegian Export Credit Guarantee Agency (“GIEK”), who will administrate the guarantee scheme, on the documentation in order to obtain the NOK 300 million in liquidity as soon as possible.

The Company is now working with GIEK and the Ministry of Trade, Industry and Fisheries to clarify the criteria and terms related to the remaining tranches under the scheme and to obtain further guarantees from financial institutions in order to back such remaining tranches. Norwegian will update the market with its further plan of action and implications for its stakeholders as soon as the criteria and terms have been finalized. The Government guarantee scheme is crucial for the Company as the current state of the capital markets in combination with the challenging times for the airline industry limit the options available. The first NOK 300 million will create necessary headroom to pursue the remaining tranches of the guarantee scheme.

Operational update
Currently, most of the fleet is grounded and Norwegian has reduced its operations to a minimum. The airline will now primarily operate domestically in Norway and Sweden and between the Nordic capitals, in order to deliver on its corporate responsibility of maintaining critical infrastructure so that people and necessary goods and medical supplies can be transported during this unprecedented crisis. The limited schedule will remain in place until further notice. In addition, Norwegian has conducted repatriation flights together with the authorities in order to get citizens of Norway, Denmark and Sweden back home.

In order to reduce cost, Norwegian has temporarily laid off approximately 90 percent of its workforce and will continue to implement additional cost measures going forward.

Volvo to Temporarily Close Plants in U.S. and Sweden

March 20, 2020 /

FRANKFURT (Reuters) – Swedish carmaker Volvo is suspending production at its factories in Sweden, the United States and Belgium, to curb the spread of the coronavirus, it said on Friday, even as it resumes manufacturing in China where the infection rate has slowed.

Volvo’s Swedish factories in Torslanda, Skovde, Olofstrom, and its U.S. plant in South Carolina will close between March 26 and April 14, the company said. Its plant in Ghent, Belgium has already been temporarily shut down.

“Our primary concerns are the health of our employees and the future of our business,” Chief Executive Hakan Samuelsson said. “I think for the economy, we need to do something drastic, rather then trying half-hearted measures that drag on forever.”

“We are seeing the effect from this coronavirus is increasing every day. We see problems in the logistics supply side,” he told Reuters. “We have to help contributing to social distancing.”

Samuelsson said the financial impact of the shutdown would become clearer when the carmaker published first-half earnings. The company will reduce the working hours of white-collar staff during the factory closures and will take advantage of government incentives, Samuelsson said.

The financial impact on Volvo also depended on how different countries reacted to contain the virus.

“There is a big difference between countries. Some have curfews, with restaurants and schools closed. In other countries there are less drastic measures. I just think we need to synchronise that more.”

(Reporting by Edward Taylor; Editing by Pravin Char)

Nikki Haley Resigns from Boeing Board over Request for Government Financial Assistance

March 20, 2020 /

(Reuters) – Former U.N. ambassador Nikki Haley has resigned from Boeing Co’s board after opposing its bid for government financial assistance due to the crisis caused by the coronavirus outbreak.

“I cannot support a move to lean on the federal government for a stimulus or bailout that prioritizes our company over others and relies on taxpayers to guarantee our financial position,” Haley said in a letter to the company’s management released by Boeing on Thursday.

“I have long held strong convictions that this is not the role of government.”

Haley, a former South Carolina governor, has often been mentioned as a future presidential candidate. “The board and executive team are going in a direction I cannot support,” she wrote.

When asked to respond to Haley’s concerns, Boeing said only the company appreciated her service on the board and wished her well.

Boeing this week said it was seeking on behalf of itself and the aviation manufacturing industry at least $60 billion in government loan guarantees and other assistance. The sector faces huge losses from the coronavirus pandemic as airlines halt flights and some delay orders.

A Senate Republican proposal introduced Thursday would allow aviation manufacturing firms like Boeing to seek collateralized loans and loan guarantees from a $150 billion fund but not provide any cash. The final decision on eligibility would be up to the U.S. Treasury.

“We are not bailing out the airlines or other industries – period,” said Senator Richard Shelby, a Republican who chairs the Appropriations Committee.

To ensure the government is compensated for risks in making loans, the U.S. Treasury could seek equity, warrants stock or other instruments to ensure the government participates in any gains.

Haley’s resignation letter was dated Monday, the same day Boeing confirmed it was in talks to seek short-term assistance from the U.S. government.

Boeing has racked up nearly $19 billion in costs tied to its 737 MAX aircraft, which has been grounded for the past year after two fatal crashes in five months. The company has been working to win approval for the plane to return to service.

(Reporting by Ankit Ajmera in Bengaluru and David Shepardson in Washington and Michelle Nichols in New York; Editing by Arun Koyyur and Tom Brown)

Delta to Suspend Los Angeles to Sydney Service March 18 Through mid-April

March 16, 2020 /

Following self-quarantine restrictions issued by the Australian government, Delta is temporarily suspending service from Los Angeles to Sydney beginning March 18 through April 11.

The last flight from L.A. to Sydney will depart Tuesday, March 17. The last flight from Sydney to L.A. will depart Thursday, March 19.

See here for a list of all current schedule changes.

CHANGING YOUR FLIGHT

Delta has waived change fees for customers traveling to, from or through Australia through May 31. Additional details are available on delta.com.

To help address customers with immediate travel needs, Delta is asking those who do not have travel in the next 72 hours to wait and contact the airline closer to their trip. Customers can also change or cancel a flight anytime before their travel date using My Trips on Delta.com.

To provide even more flexibility, any Delta ticket expiring in March or April is being extended to enable rebooking and travel until Dec. 31, 2020. If you’re not able to adjust your plans in time and don’t make your flight, your ticket number automatically becomes an unused eCredit within 24 hours that can be used to rebook a flight in My Trips or with Delta Reservations.

CAPPED FARES

To ensure customers can travel with financial peace of mind, Delta will cap fares to and from all destinations Delta serves throughout the U.S. and Canada through March 31. These fare caps are in place in all cabins, from Delta One to Main Cabin.

PROVIDING A SAFE AND CLEAN ENVIRONMENT  

Delta’s highest priority is to ensure the health and safety of customers and employees. The airline is regularly disinfecting check-in kiosks, ticket counters, gate areas, jet bridges, and more multiple times a day. More information on our cleaning procedures can be found here. 

American Airlines Announces Additional Schedule Changes in Response to COVID-19

March 15, 2020 /

American Airlines Group Inc. (NASDAQ: AAL) will implement a phased suspension of additional long-haul international flights from the U.S. starting on March 16. This suspension will last through May 6. This change is in response to decreased demand and changes to U.S. government travel restrictions due to coronavirus (COVID-19). The airline will:

  • Reduce international capacity by 75% year over year — from March 16 to May 6
  • Continue to operate one flight daily from Dallas-Fort Worth (DFW) to London (LHR), one flight daily from Miami (MIA) to LHR and three flights per week from DFW to Tokyo (NRT)
  • Continue short-haul international flying, which includes flights to Canada, Mexico, Caribbean, Central America and certain markets in the northern part of South America, as scheduled

In addition to the international changes, the airline anticipates its domestic capacity in April will be reduced by 20% compared to last year and May’s domestic capacity will be reduced by 30% on a year over year basis.

International Route Changes

By region, the new schedule changes include the following: 

Asia, effective March 16 

  • American will suspend all remaining flights to Asia, except for three flights per week from DFW to NRT 

Australia and New Zealand, effective March 16

  • Suspending service from Los Angeles (LAX) to Auckland (AKL) effective March 16, which was slated to end seasonal flying on March 28
  • Suspending service from LAX to Sydney (SYD) effective March 16

Europe, phased suspension 

  • American will continue to operate one flight daily from DFW to LHR and MIA to LHR
  • Suspending flights from New York (JFK), Boston (BOS), Chicago (ORD), and LAX to LHR gradually over the next seven days to reaccommodate passengers and crew
  • LHR, Dublin (DUB) and Manchester (MAN) flights from Charlotte (CLT), Philadelphia (PHL) and Phoenix (PHX) will be suspended faster, as these airports are not approved gateways by the U.S. Department of Homeland Security. Final eastbound flights from CLT, PHL and PHX will be on March 15; final westbound flights returning from LHR, DUB and MAN will depart March 16
  • Continued suspensions in other parts of Europe, as previously announced, including the delayed start of some seasonal routes as well as flights to and from Amsterdam (AMS), Barcelona (BCN), Frankfurt (FRA), Madrid (MAD) and Munich (MUC) Paris (CDG) and Zurich (ZRH) through early May, or later, based on guidance from the U.S. government and customer demand 

South America, effective March 16 

  • Suspending service from JFK and MIA to Rio de Janeiro (GIG) and Georgetown, Guyana (GEO)
  • Suspending service from DFW, JFK and MIA to São Paulo (GRU)
  • Suspending service from DFW and MIA to:
    • Chile: Santiago (SCL)
    • Colombia: Bogota (BOG)
    • Ecuador: Guayaquil (GYE) and Quito (UIO)
    • Peru: Lima (LIM)
  • Suspending service from MIA to:
    • Brazil: Brasilia (BSB) and Manaus (MAO)
    • Colombia: Barranquilla (BAQ), Cartagena (CTG), Cali (CLO), Medellin (MDE) and Pereira (PEI)

These capacity reductions assume no slot waivers are in place other than those previously granted. At airports where demand exceeds airfield and/or terminal capacity, access is governed by slots that grant airlines permission to take off and land at specific times. Given the decrease in demand related to COVID-19, American has requested temporary relief from this usage requirement — otherwise known as requesting a slot waiver — to better align capacity with demand without the risk of losing valuable takeoff and landing slots for the future. American will continue to review its network and make adjustments as needed if waivers are granted.

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