FILE PHOTO: Travelers check-in at a JetBlue Airways kiosk at John F. Kennedy Airport in the Queens borough of New York, U.S., January 24, 2017. REUTERS/Shannon Stapleton
(Reuters)
– JetBlue Airways Corp hopes to break into the low-fare, transatlantic
travel market beginning in 2021 with multiple daily flights from New
York and Boston to London, its first European destination, the carrier
said on Wednesday.
To
service the routes, the sixth largest U.S. carrier will convert 13
Airbus A321LR aircraft from its existing order book with a fresh version
of its Mint business product.
The
idea is to offer customers a fresh choice on routes where JetBlue
President Joanna Geraghty said current competitor fares “are enough to
make you blush.”
New
York-based JetBlue, which unveiled the long-awaited launch at an
employee event at John F. Kennedy International Airport, said it is
still evaluating which London airports it will serve.
The
company, which has built a reputation in the United States for more
coach legroom than competitors and free broadband internet, has argued
for regulators to force slot divestitures at high-traffic airports like
London’s Heathrow to create a level playing field for new entrants.
A
handful of Europe-based budget carriers have tried to penetrate the
transatlantic market in recent years, but only cash-strapped Norwegian
Air is still standing.
Iceland’s
WOW, PrimeraAir Nordic, Britain’s Flybmi and Monarch Airlines and
Cypriot carrier Cobalt have all ceased operations in a sector grappling
with over-capacity and high fuel costs.
JetBlue said it will raise the bar on what travellers can expect from a low-cost carrier, particularly in Europe.
The
carrier has argued in the past that its version of business class,
Mint, has driven a 50 percent decline in premium fares on some competing
U.S. routes, a reduction it believes it can also deliver for premium
travel between the United States and Europe.
“JetBlue’s
Mint product suits the Atlantic market as they will likely come in with
stimulative fares to drive customer awareness and loyalty,” Cowen
analyst Helane Becker said in a recent note to clients.
The
main issue will be whether JetBlue is able to gain access at major
international airports, she said, like London Heathrow and Amsterdam
Schiphol.
(Reporting by Tracy Rucinski, editing by G Crosse)
(Reuters)
– Alphabet Inc’s Google on Wednesday raised the monthly membership
price of its YouTube TV online service by 25 percent to $49.99, while
adding channels such as Discovery, Animal Planet and TLC.
The
second price rise in nearly 14 months comes as YouTube expands its
offering to better compete with a growing number of services, including
Dish Network Corp’s Sling TV, AT&T’s DirecTV Now and Hulu, which are
vying to attract viewers cancelling cable subscriptions, or cord
cutting.
Google had raised the price of YouTube TV from $35 to $40 in February last year.
The
cost for competing services such as Hulu’s offering with more than 60
channels is $44.99 per month, while its library of shows and movies
costs an additional $5.99.
YouTube
TV will be adding eight new channels, including the Travel Channel,
HGTV and Food Network, to take the total number of networks to more than
70.
The
new price takes effect from April 10 for new members, while the revised
fee for existing subscribers will come into force after May 13, it said
in a blog post.
The price for members billed through Apple will be $54.99 per month, it added.
(Reporting by Arjun Panchadar in Bengaluru; Editing by James Emmanuel)
(Reuters)
– Virgin Atlantic on Wednesday reported an annual pretax loss for the
second consecutive year, hit by a shaky economy, the higher costs of
fuel generated by a weaker British pound and problems with Rolls Royce’s
Trent engines.
The
airline, the 1980s brainchild of British billionaire Richard Branson,
fell back into the red in 2017 after three years of profits, as
competition intensified and the weakening of the pound added to already
rising fuel costs.
Best
known in Europe for the trans-Atlantic planes it flies with Air
France-KLM and Delta, Virgin said its loss before tax and exceptional
items was 26.1 million pounds ($34.12 million) for the year ended Dec.
31, compared to a loss of 49 million pounds in 2017.
Total
revenue rose 5.8 percent to 2.78 billion pounds, as passenger numbers
grew just under 5 percent to 5.4 million and revenue per customer rose
1.7 percent.
The
company said performance had suffered from economic uncertainty and the
weaker pound – which increases costs because fuel is priced in dollars –
as well as the well-documented problems of the Trent 1000 engines used
on its Boeing 787 jets.
“While
a loss is disappointing, our performance has improved in 2018 despite
challenging economic conditions and put us on a trajectory for growth
and return to profitability,” Chief Executive Officer Shai Weiss said in
a statement.
Rolls-Royce
on Wednesday agreed to an early inspection of some Trent 1000 TEN
engines by regulatory authorities, a week after Singapore Airlines
grounded two Boeing 787-10 jets fitted with the units.
British
Airways owner IAG in February chose Boeing 777-9s, rather than a
competing package from Airbus in part powered by Rolls, underlining the
risks to airlines from the engine issues.
Since
then the industry has been thrown into chaos by the grounding of
Boeing’s new 737 MAX planes after a second fatal crash within six
months.
The
pound fell 5.6 percent against the U.S. dollar, in 2018 as Britain
contended with the political and economic uncertainty generated by its
negotiations on leaving the European Union.
Finance
chief Tom Mackay said that while economic factors would continue to
challenge the carrier in the year ahead, Virgin Atlantic was in a strong
cash position.
The
results are the company’s first since its acquisition of troubled
regional airline Flybe for $2.8 million earlier this year, in a joint
bid with Stobart Group and Cyrus Capital.
($1 = 0.7649 pounds)
(Reporting by Noor Zainab Hussain and Pushkala Aripaka in Bengaluru; Editing by Anil D’Silva)
FILE PHOTO – The logo of Australian casino giant Crown Resorts Ltd adorns the hotel and casino complex in Melbourne, Australia, June 13, 2017. REUTERS/Jason Reed/File Picture
(Reuters)
– Wynn Resorts Ltd, the world’s No. 2 casino operator, said on Tuesday
it scrapped preliminary talks to acquire Crown Resorts Ltd for A$10
billion ($7.1 billion), after the Australian Financial Review broke news
of the negotiations.
Wynn’s
backtracking illustrates how media leaks of deal talks can test the
resolve of potential acquirers. Crown shares jumped as much as 22
percent on the news to A$14.37, close to the $A14.75 per share level
that Crown said Wynn’s latest cash-and-stock offer valued the company.
This
can make deal negotiations more difficult by emboldening acquisition
targets to drive a hard bargain, analysts said. In this case, Wynn’s
inexperience with pursuing big deals also likely played a factor, some
analysts added.
“(Wynn)
management’s experience with acquisitions is limited, so when you
target synergies it’ll be nice to have more of a track record for such a
large transaction,” said Roth Capital Partners analyst David Bain,
calling the termination of the deal talks a positive development for
Wynn.
After
the Australian Financial Review revealed Wynn’s takeover approach,
Crown not only confirmed the confidential talks on Tuesday, but also
disclosed the price that Wynn was offering. It added that Crown’s board
had not yet considered Wynn’s latest offer.
Wynn then issued two statements, first confirming the talks, and, a few hours later, stating that they had ended.
“Following
the premature disclosure of preliminary discussions, Wynn Resorts has
terminated all discussions with Crown Resorts concerning any
transaction,” the company said in a statement.
Wynn’s shares were down 3.2 percent at $140.21 in New York at mid-afternoon.
Examples
of companies confirming acquisition talks only to back out hours later
are few and far between, because they reflect a lack of conviction on
the part of the aspiring acquirers.
Last
year, drug maker Allergan Plc confirmed it was in the early stages of
making an offer for peer Shire Plc, after Reuters broke news of the
deliberations, only to issue a second statement a few hours later
stating it would not make an offer.
Insurer
Aon Plc said last month it would not pursue a merger with rival
insurance brokerage Willis Towers Watson Plc, a day after it confirmed
it was in early stages of considering an all-stock offer for the Irish
company following a Bloomberg News report revealing the deliberations.
HEDGE AGAINST MACAU
Wynn
was founded in 2002 by Steve Wynn, who started his casino business in
Las Vegas in the 1960s and created some of the city’s most iconic
landmarks – the Mirage, Bellagio and Treasure Island – before selling
them. Beset by sexual misconduct allegations, Wynn left the company and
sold his entire 11.8 percent stake in Wynn Resorts for $2.1 billion last
month.
Wynn
operates large resort-and-casino complexes in Las Vegas and Chinese
gambling hub Macau, with another under construction in Massachusetts.
The deal would have offered a hedge against Macau, where its licences
are up for renewal, by giving it two lavishly revamped Australian
casinos and a third being built on the prized Sydney harbour front.
Buying
Crown would also fit in with Wynn’s strategy to diversify
geographically to protect its growth prospects if its Macau licences are
not renewed.
The
company’s efforts so far have included ramping up promotion of a resort
in Japan, a market seen as the next potential goldmine to Macau and a
former expansion target for Crown.
“Wynn
has typically grown through building their own facilities, not through
acquisition,” said Bain, the Roth Capital Partners analyst.
For
Crown’s 47 percent owner James Packer, who re-badged his father’s media
empire as a gambling concern in 2007 only to withdraw from business
engagements last year due to mental illness, the deal would have ended
his career as a casino mogul with a A$4.7 billion payout.
He
would have ended up as Wynn’s biggest shareholder with 9.8 percent of
its shares, based on its current number of shares on issue.
“We
think Wynn’s strategy was mostly defensive, but if they have a strong
strategic rationale for wanting to acquire Crown, they would likely come
back to the table when things settle down,” said John DeCree, Union
Gaming Securities’ director of North America research.
(Reporting by Byron Kaye, Tom Westbrook and Paulina Duran in SYDNEY, Devika Syamnath and Nivedita Balu in BENGALURU, and Greg Roumeliotis in NEW YORK; Editing by Sriraj Kalluvila, Shounak Dasgupta and Richard Chang)
(Nattee Chalermtiragool/Shutterstock)
stock-Wynn-Macau-01-shutter
Macao, China – March 12, 2016: View of Macao city at night in Macao, China
FRANKFURT, April 9 (Reuters) – A German court on Tuesday approved an application for insolvency from wind turbine manufacturer Senvion, although the company said it was also continuing to look at new funding options and various potential investors had shown interest.
The Hamburg-based company, which has more than a billion euros of debt, said it had applied for preliminary self-administration proceedings because refinancing discussions with lenders had not yet been successful.
Shares in Senvion were down 40.5 percent at 1519 GMT, having fallen as much as 55 percent earlier in the day.
Senvion has faced delays and penalties related to big projects, while the wind industry as a whole has seen falling prices and increased competition as it moves away from governments guaranteeing generous fixed subsidised tariffs for power towards an auction-based system that favours the lowest bidders.
Market leaders Siemens Gamesa and Vestas have more pricing power, putting smaller suppliers under pressure.
Financial sources had told Reuters Senvion needed at least 100 million euros ($112 million) in the short term to keep operating.
“Lenders and major bond holders are currently continuing intensive discussions around a financing offer to secure the continuation of operations which may allow the company to successfully exit this process,” Senvion said in a statement.
Two financial sources said hedge funds Anchorage and Davidson Kempner were prepared to put up the 100 million euros in loans that CEO Yves Rannou – who took the helm in January – needs to continue restructuring and clear the backlog of orders that has recently cost the company revenues and profit.
The sources said majority shareholder Centerbridge was prepared to accept that but the banks – notably Deutsche Bank and BayernLB – would still need to agree. The banks have lent Senvion a total of 950 million euros.
BayernLB and Deutsche Bank declined to comment.
Senvion also has 400 million euros in bonds bought by hedge funds including Anchorage and Davidson Kempner.
Senvion said its management board would remain in office under the initiated procedure and business operations would carry on, with both existing service and maintenance contracts continuing.
The company said the preliminary self-administration proceedings affected Senvion GmbH and a subsidiary called Senvion Deutschland GmbH. It said Senvion S.A., Senvion Topco GmbH and Senvion Holding GmbH were expected to file for insolvency later this week.
Senvion’s website says it has around 4,000 employees globally.
(By Alexander Hübner and Michelle Martin, Additional reporting by Hans Seidenstuecker; Editing by Tom Sims and Mark Potter)
FILE PHOTO: A Tesla logo is seen at a groundbreaking ceremony of Tesla Shanghai Gigafactory in Shanghai, China January 7, 2019. REUTERS/Aly Song/File Photo
(Reuters) – Tesla Inc shares fell more than 8 percent on Thursday after a bigger-than-expected drop in first-quarter deliveries, led by waning demand for its luxury Model S and X vehicles, added to worries about the electric carmaker’s finances.
At least four Wall Street brokerages cut their price targets on the company’s stock, citing concerns about profitability and revenue after deliveries of the higher-priced luxury cars more than halved compared to the fourth quarter.
RBC analysts called Model S/X deliveries “very disappointing” and estimated the numbers would translate to a more than $1 billion shortfall in revenue compared to previous estimates.
The company had already flagged in February that it expected to post a first-quarter loss as it launched its cheaper $35,000 version of the Model 3 sedan.
In the quarter, Tesla delivered 50,900 Model 3s, the linchpin of its growth strategy, falling short of analysts’ estimates of 58,900, according to IBES data from Refinitiv.
Tesla also pinned the blame for the first-quarter delivery drop to longer transit times, which analysts said could impact cash flow, even though the company claimed it had sufficient cash on hand.
The company said it had delivered only half of the quarter’s numbers by March 21, with 10,600 vehicles still in transit at the end of the quarter. By comparison, only 1,900 vehicles were in transit at the end of the fourth quarter.
Cowen and Co analysts said that the delivery and transit details suggested “cash was likely dangerously low” after Tesla paid off a $920 million convertible bond obligation in cash in the beginning of March.
Still, there were no new downgrades by brokerages on Tesla shares. The company is currently rated “buy” or higher by 12 of the 30 brokerages covering the company, 7 “hold” and 11 “sell” or lower.
The carmaker reaffirmed its forecast to deliver between 360,000 and 400,000 vehicles this year, and said U.S. orders for the new Model 3 outpaced what the company was able to fulfill in the quarter.
Nord LB analyst Frank Schwope called the numbers “more shocking than disappointing” and said there remain doubts whether Tesla could deliver 400,000 cars this year.
Lawyers for Tesla chief Elon Musk will argue on Thursday that he did not violate a fraud settlement with the U.S. Securities and Exchange Commission and should not be held in contempt, the latest twist in a high-profile battle between the billionaire and the government.
Musk’s fight with the SEC, to play out in a Manhattan federal court hearing, has raised investor worries that it could lead to restrictions on his activities or even his removal from Tesla, while distracting him at a pivotal point in the company’s expansion.
(Reporting by Vibhuti Sharma in Bengaluru; Editing by Shounak Dasgupta)
April 2 (Reuters) – The U.S. Air Force said on Tuesday that it again stopped accepting deliveries of Boeing Co’s KC-46 tanker aircraft after finding foreign object debris in the planes.
Back in February, deliveries of the aircraft were halted by the U.S. Air Force because of the same issue in one of the aircraft. Deliveries resumed in March after Boeing ramped up the inspection process.
“Our inspectors identified additional foreign object debris and areas where Boeing did not meet quality standards,” U.S. Air Force spokesperson Captain Hope Cronin said.
The decision to halt acceptance of the planes was made on March 23, the Air Force said, adding that the problem was not with the aircraft itself but with the process in place for building it.
“We are currently conducting additional company and customer inspections of the jets and have implemented preventative action plans,” Boeing said in a statement.
“We have also incorporated additional training, more rigorous clean-as-you-go practices and FOD awareness days across the company to stress the importance and urgency of this issue.”
(Reporting by Ankit Ajmera in Bengaluru; Editing by Maju Samuel)
(Reuters) – Air Canada said on Tuesday it would delay the launch of certain seasonal flights this spring, as the carrier wrestles with the challenge of servicing routes previously flown by its grounded Boeing 737 MAX aircraft.
Canada’s largest carrier said it would put off the launch of at least five seasonal routes, including delaying its Vancouver to Boston service to June 16 from June 1.
Montreal-based Air Canada said a previously-announced halting of flights from two Eastern Canadian cities to London’s Heathrow airport would now remain suspended until May 31.
Air Canada, which previously suspended its 2019 financial forecasts, has removed 24 MAX jets from its flight schedule until July 1, following grounding of the Boeing jets after two recent crashes involving the model.
The global grounding, following the crash of an Ethiopian Airlines flight in March, has left U.S. and Canadian airlines with the logistical challenge of replacing the popular roughly 175-seat MAX on certain routes, at a time of rising passenger demand.
The Canadian carrier has been flying alternative planes or consolidating flights into larger jets that were previous flown more frequently on smaller aircraft.
Air Canada has also said it is speeding up the integration of four Airbus A321 aircraft it acquired in late December from Iceland’s cash-strapped WOW air.
Air Canada is “accommodating as best as they can,” said AltaCorp analyst Chris Murray. “At the same time, there is still some uncertainty about when the MAX grounding notice is going to be lifted.”
On Monday, Boeing said it planned to submit a proposed software enhancement package for the grounded 737 MAX in “the coming weeks” after the company had previously said it planned to deliver the fix for government approval by last week.
Anglo-German tour operator TUI said last week that its profit would fall by at least 200 million euros ($223.96 million) this year due to the cost of substituting for the MAX planes, along with loss of business and lower fuel efficiency from the replacement aircraft.
(Reporting by Sanjana Shivdas in Bengaluru; Editing by Shinjini Ganguli and Bill Berkrot)
FILE PHOTO: An aircraft of Gol Linhas Aereas Inteligentes SA departs from Congonhas airport in Sao Paulo, Brazil September 11, 2017. REUTERS/Paulo Whitaker
SAO PAULO (Reuters) – Brazil’s largest airline, Gol Linhas Aereas Inteligentes, will not cancel its orders of Boeing Co’s 737 MAX plane, the model which was involved in two fatal crashes, newspaper Valor Economico reported Gol’s chief executive as saying on Tuesday.
“We will not cancel our orders,” CEO Paulo Kakinoff said. “The 737 MAX is probably the best airplane ever made.”
Gol is going through a significant fleet transformation and has bet heavily on the Boeing 737 MAX, with over 100 planes scheduled to be delivered in the next few years.
The airline has so far received seven aircraft, which it grounded after an Ethiopian Airlines plane crashed in March, the second accident involving that plane model in a span of five months.
Kakinoff added that he thinks it is possible that the 737 MAX planes will fly again by July. That decision is in the hands of regulators around the world.
Gol has flown Boeing planes exclusively since its founding and is the U.S. planemaker’s largest client in Latin America.
(Reporting by Marcelo Rochabrun; Editing by Lisa Shumaker and Susan Thomas)
Exclusive: China’s huge Airbus order padded by old or incomplete deals – source
PARIS
(Reuters) – A landmark order from China for 300 Airbus jets signed
during a state visit last week was bolstered by repeat announcements of
dozens of existing deals and advance approval for deals that have yet to
be struck, two people familiar with the matter said.
Echoing
an umbrella order for 300 Boeing jets awarded during a visit to Beijing
by U.S. President Donald Trump in 2017, the headline figure for the new
“framework order” for European jets was partly driven by political
considerations, the people said.
The
Airbus deal would have been worth some $35 billion at list prices but
the amount of new business is lower, they added. Duplicate announcements
included a deal for 10 A350 aircraft to an unnamed buyer, which
represents a repeat announcement of an order for 10 jets by Sichuan
Airlines at an air show last year.
The
disclosure takes some of the shine off an announcement widely regarded
as the economic highlight of a trip to Europe by Chinese President Xi
Jinping. Nonetheless the deal marked a return to the aircraft market by
China’s state buying agency after a pause of over a year during global
trade tensions.
The
overall figure of 300 was introduced late in the process and after Xi’s
visit was underway, although plane orders typically take months to
negotiate, one of the people said.
Airbus declined to comment on detailed orders but left open the possibility that the large total contained gaps.
The
agreement “creates the approval framework for aircraft ordered by
Chinese airlines, be it existing orders or future orders,” a spokesman
said.
TRADE TIES
Airbus
shares fell 0.7 percent on Tuesday, extending earlier losses after
Reuters reported gaps in the China deal. Airbus’ stock had risen almost
two percent after China’s mega-order, signed in Paris on March 25 in
front of Xi and French President Emmanuel Macron.
Industry
sources say major planemakers play by similar rules when selling to
China, where they face a two-tier system of negotiations with airlines
within a framework of state-backed umbrella deals that may be influenced
by geopolitics.
But
the headline figures for new orders during high-profile diplomatic
visits, which for several years hovered around 150 aircraft for both
Airbus and Boeing, have increased as trade ties between Washington and
China go through highs and lows.
In
November 2017, months before a trade war erupted with the imposition of
tariffs, China announced an order for 300 Boeing jets during a visit to
Beijing by U.S. President Donald Trump.
Analysts
expressed doubts at the time over how much of that was new business,
and said part of the announcement represented renewed government support
for deals already on Boeing’s books.
“The most recent Airbus and Boeing deals followed a similar pattern,” said a China aircraft industry specialist.
Boeing
is now seen as next in line to secure a 200-300-plane order as part of a
possible economic truce being negotiated to end the trade war, but the
recent grounding of one of its jets has cast uncertainty over the timing
of the deal.
Boeing
and Airbus compete fiercely to serve the needs of the world’s
fastest-growing airplane market, while bracing for future competition
from China’s own aerospace industry.
Analysts
say Beijing tends over time to balance U.S. and European purchases,
though recent years have seen the rise of a growing number of
independent Chinese leasing companies and an increase in autonomous
decision-making by several airlines.
(Reporting by Tim Hepher, Additional reporting by Marine Pennetier; Editing by Sudip Kar-Gupta and Richard Lough)
