TOMORROWS TRANSPORTATION NEWS TODAY!
Barron’s says it’s going to be another good day for airlines, as a number of analysts had good things to say about stocks across the sector.
Where we were: Airlines have struggled this year, but Spirit Airlines (SAVE) upbeat fourth-quarter forecast sent shares soaring Tuesday.
DUBAI (Reuters) – Saudi Arabian airline SaudiGulf owner Al-Qahtani Aviation has signed an agreement to buy 10 Airbus (AIR.PA) A320neo family jets, Airbus said in a statement on Thursday.
The value of deal was not announced. It would be worth around $1.1 billion at list prices, though discounts are common.
The “commitment” was announced at the Bahrain International Airshow, which is taking place this week, Airbus said.
The parties did not immediately respond to questions about whether the deal was new or part of earlier Airbus announcements in which the buyer was not identified.
Reuters reported in July, citing sources, that SaudiGulf was behind an order for 10 A320neos that Airbus said during England’s Farnborough was for an undisclosed customer.
SaudiGulf President Samer Majali said the order would help the airline’s regional and international expansion.
SaudiGulf, based in the eastern Saudi Arabian city of Dammam, launched it 2016. It currently operates a fleet of six A320 jets.
(Reporting by Alexander Cornwell; editing by Jason Neely)
(Reuters) – Icelandair (ICEAIR.IC) has agreed to buy rival Icelandic airline WOW air from its founder for about $18 million in an all-share deal aimed at creating a stronger international competitor.
Airlines are looking to consolidate in many markets as a result of rising running costs, largely to higher oil prices, and increased competition from low-cost, budget carriers.
WOW has focussed on low-cost travel across the Atlantic, using smaller single-aisle planes to fly between Iceland and destinations in the United States and Europe.
While there has been some consolidation in Europe over the last year, with Lufthansa and easyJet acquiring parts of failed airline Air Berlin in 2017, the chief executives of the continent’s biggest airline groups say more is to come.
Struggling Italian carrier Alitalia is seeking new investors and British Airways-owner IAG (ICAG.L) bought a stake in Norwegian Air (NWC.OL) with a view to a takeover.
A jump in the oil price could spur more consolidation, as weaker players are likely to suffer over the winter period as costs rise during a period when fewer people tend to fly.
Both Icelandic airlines, which Icelandair said would continue to operate under separate brands, use Keflavik Airport as their main hub between Europe and North America.
Together they have a combined 3.8 percent share of the transatlantic market, Icelandair, which warned on profit in July due to an increase in capacity on some routes across the Atlantic, added in a statement.
Icelandair shares jumped by nearly 50 percent after it announced the WOW takeover, the biggest one day percentage gain in its stock price since September 2009. The headline value of its offer for WOW was based on Friday’s closing share price.
“WOW air has been Icelandair’s main competitor and the acquisition is likely to lead to increase in average fares and better capacity control on the market to and from Iceland.” Arion Banki analyst Elvar Ingi Moller said.
WOW’s founder and sole owner Skuli Mogensen, who will receive 272 million shares in Icelandair, said that the deal will strengthen its international competitiveness.
Moller said WOW, which has 14 Airbus A320 family aircraft and three widebody A330 planes, has come under pressure due to higher oil prices and lower air fares in recent months.
Icelandair said its shareholders are due to meet to vote on the deal in the near future.
(Reporting by Tommy Lund; Additional reporting by Saray Young; Editing by Jon Boyle/Louise Heavens/Alexander Smith)
Image from www.boeing.com
DUBAI (Reuters) – IranAir is looking to buy planes from any company not requiring U.S. sales permits and may consider Russia’s Sukhoi Superjet 100, the flag carrier’s head was quoted as saying, as Iran tries to renew its ageing fleet despite facing U.S. sanctions.
The U.S. Treasury’s Office of Foreign Assets Control (OFAC)revoked licences for Boeing Co and Airbus to sell passenger jets to Iran after President Donald Trump pulled the United States out of the 2015 Iran nuclear agreement in May and reimposed sanctions.
“We welcome any (company) which is able to provide the planes needed by IranAir. We even have gone after planes such as Sukhoi 100 or planes made by non-European countries,” said IranAir Chief Executive Farzaneh Sharafbafi, quoted by Iran’s Roads Ministry website.
Most modern commercial planes have more than 10 percent in U.S. parts, the threshold for needing U.S. Treasury approval. But Russian officials have been reported as saying Sukhoi is working on reducing the number of U.S. parts in the hopes of winning an Iranian order for up to 100 aircraft.
“We will consider plane purchases if these companies can sell planes to Iran without an OFAC licence, and are willing to negotiate,” Sharafbafi added. She gave no further details.
IranAir had ordered 200 passenger aircraft – 100 from Airbus, 80 from Boeing and 20 from Franco-Italian turboprop maker ATR. All the deals were dependent on U.S. licences because of the heavy use of American parts in commercial planes.
(Reporting by Dubai newsroom, Additional reporting by Tim Hepher in Paris; Editing by Edmund Blair)
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