Tag: Reuters (Page 2 of 49)

Delta, American Drop Domestic Change Fees, Matching United

August 31, 2020 / WIL BALDWIN

Delta Airlines planes sit at ATL airport in Atlanta

CHICAGO (Reuters) – Delta Air Lines <DAL.N> and American Airlines <AAL.O> said on Monday they are permanently dropping domestic change fees, mirroring an announcement by rival United Airlines <UAL.O> on Sunday in a push to woo back travelers.

U.S. airlines are burning through millions of dollars daily as the coronavirus pandemic hits passenger air travel, which is hovering around 30% of what it was a year ago, forcing more customer-friendly policies to encourage people to start traveling again.

Atlanta-based Delta said the elimination of change fees is effective immediately and includes tickets purchased for travel within the United States, Puerto Rico and U.S. Virgin Islands. American’s change also covers flights to Canada, Mexico and the Caribbean.

The new policies do not cover any of the three airlines’ basic economy tickets.

Low-cost rival Southwest Airlines <LUV.N> has never charged a change fee for its tickets.

Delta, United and American were already waiving change fees through the end of the year to give travelers more flexibility in an uncertain environment.

The fees represented around 2% to 3% of their total revenues in 2019, though analysts said the overall financial impact going forward will be limited as focus remains on generating bookings.

Delta collected $830 million in ticket cancellation and change fees last year, American $819 million and United $625 million, according to the U.S. Department of Transportation.

(Reporting by Tracy Rucinski; Editing by Chris Reese and Cynthia Osterman)

U.S. Leaves Tariffs on Airbus Aircraft Unchanged at 15%

August 12, 2020 / WIL BALDWIN

WASHINGTON (Reuters) – The U.S. government on Wednesday said it would maintain 15% tariffs on Airbus <AIR.PA> aircraft and 25% tariffs on other European goods, despite moves by the European Union to resolve a 16-year-old dispute over aircraft subsidies.

U.S. Trade Representative Robert Lighthizer (USTR) said the EU had not taken actions necessary to come into compliance with World Trade Organization decisions, and Washington would initiate a new process to try to reach a long-term solution.

USTR said it would modify its list of $7.5 billion of affected European products to remove certain goods from Greece and Britain and add an equivalent amount from Germany and France.

It ignored calls from EU officials and U.S. lawmakers to drop tariffs on EU food, wine and spirits, but did not add tariffs to vodka, gin and beer as it had threatened.

Airbus said it “profoundly regrets” the U.S. decision to keep tariffs in place on its aircraft.

Washington’s decision to refrain from increasing the tariff rates would help prevent a further escalation, an EU official said, calling for intensified efforts to resolve trade conflicts between the powerful economic blocs.

EU trade commissioner Phil Hogan would continue his active engagement with Lighthizer to reach a negotiated settlement, the official said, noting that the current economic slowdown underscored the urgency of ending the conflict.

Last month, Airbus said it would increase loan repayments to France and Spain in a “final” bid to reverse U.S. tariffs and jog the United States into settling the long-running fight over billions of dollars of aircraft subsidies.

The United States declared itself in full compliance with WTO findings in May after Washington state abolished aerospace industry tax breaks that largely benefited Boeing.

Trade groups are bracing for an escalation of the row in the autumn when the EU is expected to win WTO approval to hit back with its own tariffs over subsidies for Boeing <BA>.

Airbus said in a statement it “trusts that Europe will respond appropriately to defend its interests and the interests of all the European companies and sectors, including Airbus, targeted by these tariffs.”

Boeing urged the EU and Airbus to launch prompt and “meaningful negotiations with the U.S. to address the full scope of their noncompliance and finally bring this case to an end.”

USTR in October 2019 imposed 25% tariffs on an array of EU food, wine and spirits, including Italian cheese and single-malt Scotch whisky in retaliation for EU subsidies on large aircraft.

It initially imposed 10% tariffs on Airbus aircraft but hiked that to 15% in March.

(Reporting by Andrea Shalal, David Lawder, David Shepardson and Eric M. Johnson; Editing by Chris Reese, Richard Pullin and Tom Brown)

Cathay Pacific Posts Record $1.27 Billion First Half Loss

August 12, 2020 / WIL BALDWIN

Cathay Pacific aircraft are seen parked on the tarmac at the airport, following the outbreak of the new coronavirus, in Hong Kong

SYDNEY (Reuters) – Hong Kong’s Cathay Pacific Airways Ltd reported a record HK$9.87 billion ($1.27 billion) first-half loss and said it did not expect a meaningful recovery in passenger demand for some time due to the coronavirus pandemic.

The figure was in line with the HK$9.9 billion forecast it had flagged last month and included HK$2.47 billion of impairment charges.

Revenue plunged 48.3% to HK$27.7 billion in the six months ended June 30 as it slashed passenger flying to a barebones schedule due to lower demand and border restrictions, though it added more cargo-only flights as freight yields rose 44.1%.

The airline, which received a $5 billion rescue package led by the Hong Kong government, has so far refrained from large-scale job cuts but has warned it is reviewing all aspects of its business model with an update expected by the fourth quarter.

“Inevitably this will involve rationalisation of future planned capacity compared to pre-crisis plans, taking into account the market outlook and cost structure at that time,” Chairman Patrick Healy said in a statement on Wednesday.

It has rearranged its aircraft order book with Airbus SE to delay deliveries, is in advanced talks with Boeing Co to do the same and has begun sending one-third of its fleet outside Hong Kong for storage in less humid conditions.

The airline said last month that it had reduced its monthly cash burn to about HK$1.5 billion from between HK$2.5 billion and HK$3 billion while maintaining a minimal flying schedule.

Cathay is expected to report a full-year loss of around HK$13.6 billion, according to the average of 13 analysts polled by Refinitiv before it released its half-year results.

The airline’s shares had surged 9.3% on Wednesday ahead of the earnings announcement, which was made while trading was suspended for the market’s lunch break.

“It is laggard buying on some traditional economy stocks,” Steven Leung, a sales director at UOB Kay Hian, said of the rise.

($1 = 7.7506 Hong Kong dollars)

(Reporting by Jamie Freed; additional reporting by Donny Kwok in Hong Kong; Editing by Himani Sarkar)

LATAM Airlines to Fire ‘at Least’ 2,700 Workers in Brazil

August 2, 2020 / WIL BALDWIN

BRASILIA (Reuters) – LATAM Airlines will fire “at least” 2,700 workers in Brazil, including pilots, its Brazilian arm said on Saturday, as the bankrupt carrier struggles to cut costs and cope with an industry collapse due to the COVID-19 pandemic.

In a statement, LATAM Brasil said it opened a voluntary redundancy process on Friday which will run through Aug. 4, after which a further minimum 2,700 jobs will be cut.

The announcement followed the breakdown in talks with the SNA union over workers’ pay, the statement said. O Globo and O Estado de S. Paulo newspapers had reported the redundancies earlier on Saturday. LATAM said it pays its pilots and crew more than its rivals in Brazil, and the pandemic has forced it to “match industry practices.”

The layoffs are the latest in efforts to downsize Latin America’s largest airline. Before the novel coronavirus outbreak, the airline had 43,000 workers worldwide, with most of them in Brazil and Chile.

LATAM is seeking to restructure $18 billion in debt. When it filed for U.S. bankruptcy protection in May, it was the world’s largest airline to date to seek an emergency reorganization due to the pandemic.

(Reporting by Jamie McGeever and Marcelo Rochabrun; Editing by Paul Simao)

British Airways Plans to Sell Shares and Avoid Bailout

July 26, 2020 / WIL BALDWIN

British Airways is scrapping all its Boeing 747 jumbo jets.

It’s cutting capacity to prepare for years of weak demand for air travel.

Now Reuters sources say owner IAG has a plan to get its finances in good order too.

They say the company will probably sell shares at the end of the summer, in a bid to raise almost 2.9 billion dollars.

Though other options for raising the money are being considered.

The cash would be used to keep group airlines in business, and avoid a government bailout.

That’s in contrast with European rivals.

Air France has secured a 7 billion euro package from the French government.

Germany’s Lufthansa agreed a 9 billion euro rescue deal.

IAG has avoided any such agreement, hoping to limit state involvement in how it’s run.

It has though taken state-backed loans in the UK and Spain, where it owns Iberia.

The sources say the airline is working with banks including Goldman Sachs and Morgan Stanley on the new plan.

It’s thought an announcement could coincide with financial results due at the end of the month.

Neither the airline nor the banks would comment on the reports.

IAG shares have lost about 66% of their value this year.

On Friday (July 24) afternoon they were in the red again, down over 5%.

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Airbus Offers Subsidy Concession to End U.S. Tariffs

July 26, 2020 / WIL BALDWIN

PARIS (Reuters) – Europe’s Airbus <AIR.PA> said on Friday it would increase loan repayments to France and Spain in a “final” bid to reverse U.S. tariffs and jog the United States into settling a 16-year-old dispute over billions of dollars of aircraft subsidies.

The European Union, France and Spain said the move to raise interest rates paid by Airbus on A350 aircraft development loans should settle the row at the World Trade Organization and urged Washington to withdraw tariffs on EU goods.

“In the absence of a settlement, the EU will be ready to fully avail itself of its own sanction rights,” EU Trade Commissioner Phil Hogan said.

The loans are part of a system targeted by the United States in the world’s largest corporate trade dispute, which has also aired condemnation of U.S. support for Boeing <BA>.

The United States last year won WTO authorization to impose tariffs on up to $7.5 billion of EU goods from wine to whisky.

Trade groups are bracing for an escalation of the row in the autumn when the EU is expected to win WTO approval to hit back with its own tariffs over subsidies for Boeing.

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Airbus First-Half Deliveries Hit 16-Year Low Despite June Bounce

July 8, 2020 / WIL BALDWIN

Airbus logo at the entrance of the Airbus facility in Bouguenais

PARIS (Reuters) – Airbus <AIR.PA> deliveries rose 50% in June compared with May and reached their highest level since the coronavirus crisis spread to Europe in March, but the accelerating recovery failed to prevent first-half deliveries from sliding to a 16-year low.

Figures released by the European planemaker late on Wednesday underscored a collapse in aerospace industry fortunes since early this year, hours after Airbus workers facing job cuts staged their first strike in 12 years.

Deliveries rose to 36 aircraft in June from 24 in May and a low of 14 in April. For the first half, deliveries fell by 49% to 196 planes compared with 389 in the same period last year.

Airbus has said it faces an average 40% drop in business over the next two years, forcing it to cut 15,000 jobs, or 11%, of its workforce. Unions oppose compulsory cuts.

Facing a slump in demand, planemakers have been urging airlines to take planes that have already been built in return for agreement to defer others due at later dates.

Some aircraft, however, are going straight into storage because travel demand is recovering slowly, experts say.

June’s figures suggested negotiations were partially paying off as Airbus handed over three wide-body A350-900 aircraft for European airlines despite a glut of large jets.

But deliveries of many other wide-body aircraft at Airbus and U.S. rival Boeing <BA> remain hampered by weak demand for long-haul travel as a result of the crisis.

Sources said last month that Airbus had sent out dozens of default notices to airlines in a bid to keep deliveries moving.

With airlines focusing on survival, Airbus posted no orders for a second month.

Gross orders so far this year remained at 365 jets, but net orders adjusted for cancellations slipped by one unit to 298, after lessor Avolon cancelled one of 10 A330neos it has ordered.

(Reporting by Tim Hepher and Benoit Van Overstraeten; Editing by Chizu Nomiyama and Leslie Adler)

DHL to Cut 2,200 UK Workers at Jaguar Land Rover Factories

July 7, 2020 / WIL BALDWIN

(Reuters) – German logistics company DHL plans to cut as many as 2,200 jobs of U.K-based workers at Jaguar Land Rover factories, the Unite trade union said on Tuesday.

The job cuts comprise just under 40% of the entire DHL workforce on the contract, the union said.

DHL indicated that the half of the job cuts are due to a decline in car production and half are the result of anticipated “efficeincy savings”, the union added.

“DHL must not attempt to make permanent full-time staff redundant while continuing to outsource work to sub-contractors,” Matt Draper, Unite national officer for logistics, said.

Last month India’s Tata Motors Ltd said it expected to shed about 1,100 temporary jobs at Jaguar Land Rover after it raised the cost-cutting target at its luxury unit by 1 billion pounds ($1.3 billion) to ride out the disruptions caused by the coronavirus outbreak.

DHL and Jagaur Land Rover were not immediately available for comment.

(Reporting by Sabahatjahan Contractor in Bengaluru; Editing by Stephen Coates)

Presentation of a new DHL/Deutsche Post parcel center in Bochum

Norwegian Air Cancels Boeing Orders, Seeks Compensation

June 30, 2020 / WIL BALDWIN

OSLO (Reuters) – Norwegian Air <NAS.OL> has cancelled orders for 97 Boeing <BA.N> aircraft and will claim compensation from the U.S. plane maker for the grounding of the 737 MAX and for 787 engine troubles that hit its bottom line, the Oslo-based carrier said on Monday.

The airline cancelled 92 of the 737 MAX jets, five 787 Dreamliners and so-called GoldCare service agreements related to both aircraft, just as Boeing on Monday began a crucial set of flight tests of the 737 MAX in an effort to gain regulatory approval for it to return to the skies.

“Norwegian has in addition filed a legal claim seeking the return of pre-delivery payments related to the aircraft and compensation for the company’s losses related to the grounding of the 737 MAX and engine issues on the 787,” the airline said.

Norwegian did not specify the amount it would seek to claim from Boeing, which it had been in talks with about compensation, and was not immediately available for comment.

Boeing said it was working with Norwegian on a path forward in a challenging time as it was with other operators but it would not comment on commercial discussions.

The problematic Trent 1000 engines, used on the Dreamliners, were made by Rolls-Royce <RR.L>, which Norwegian has been in a dialogue with about compensation. Monday’s statement did not say whether Norwegian would file a legal claim against Rolls-Royce.

The European budget carrier, which revolutionised transatlantic travel by offering cheap fares, was struggling before the COVID-19 pandemic brought the airline industry to its knees.

One reason was the grounding of the 737 MAX in March 2019 following the second of two fatal crashes that together killed 346 people. Norwegian had 18 MAX passenger jets in its 163-aircraft fleet at the time.

Originally a small regional airline in Scandinavia, Norwegian made its breakthrough on the global stage with a multi-year order in 2012 for up to 372 aircraft, of which 222 were from Boeing and 150 from Airbus <AIR.PA>.

(Reporting by Gwladys Fouche and Terje Solsvik; Additional reporting by Eric M. Johnson in Seattle; Editing by Leslie Adler and Christopher Cushing)

FILE PHOTO: Norwegian Air Sweden Boeing 737-800 plane SE-RRY lands in Riga International Airport in Riga

Tesla Negotiating for Possible Texas Vehicle Assembly Plant

June 15, 2020 / WIL BALDWIN

(Reuters) – Electric carmaker Tesla Inc is negotiating possible incentives with a Texas county that could bring a new auto assembly plant to the area near Austin, the state capital, the Austin American-Statesman reported on Monday.

Travis County Commissioners Court is scheduled to discuss terms of the deal on Tuesday, the paper reported, citing people with knowledge of the situation. A vote is expected in the coming weeks.

The paper said it was unclear whether negotiations with Travis County show that Tesla has picked the Austin region as the site for the plant, which would build the company’s electric pickup truck and Model Y SUV and employ thousands of people, or if the company is also negotiating with officials in Tulsa, Oklahoma.

Tesla officials could not immediately be reached to comment. The company’s chief executive, Elon Musk, has tweeted previously about the possibility of bringing a plant to Texas. Oklahoma also has been mentioned as a possible site.

Travis County officials declined to comment, and a spokesman for the Texas governor’s office did not immediately comment.

Last month, Texas Governor Greg Abbott said he had spoken with Musk about a potential plant.

Abbott’s comments came three days after Musk had threatened to move Tesla’s headquarters and future operations to Texas or Nevada after officials in California’s Alameda County, where Tesla’s only U.S. vehicle assembly plant is located, said the plant could not yet reopen because of coronavirus lockdown measures. The plant has since reopened.

Officials with the United Auto Workers union, which represents hourly workers at General Motors Co’s assembly plant in Arlington, Texas, said they believe a Tuesday county meeting will include talks about the possible deal. The union, which has unsuccessfully tried organizing Tesla’s Fremont, California, plant, called on Texas officials to obtain assurances from Tesla about any potential jobs.

(Reporting by Ben Klayman in Detroit and Brad Brooks in Austin, Texas; Editing by Leslie Adler and Jonathan Oatis)

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