CHICAGO, Sept 14 (Reuters) – Delta Air Lines said on Monday it is seeking to raise $6.5 billion through new bonds and loans backed by its SkyMiles loyalty program, further bolstering liquidity to weather a drastic downturn in travel demand due to the COVID-19 pandemic.
The airline said it would use the loyalty program as collateral to secure the new loans and issuance, as it continues to burn through about $27 million in cash each day.
U.S. airlines have cut costs and raised debt to survive what they call an unprecedented industry crisis. The situation is not expected to improve until there is a meaningful recovery in demand.
With its latest financing deal, Delta will not pursue a $4.6 billion federal loan available under the Coronavirus Aid, Relief, and Economic Security (CARES) Act, officials said, even as it continues to lobby for a second round of federal payroll grants.
Atlanta-based Delta is among U.S. airlines to have tapped funds under a $25 billion made available primarily in grants under the CARES Act to cover employees’ payroll through September, but not a separate $25 billion package in secured loans.
The loan program has attractive financing terms but restricts executive compensation and share buybacks.
The airline has said it could furlough nearly 2,000 pilots in October without more federal aid, but believes it can avoid any flight attendant furloughs through the winter thanks to strong demand for voluntary departures or leaves.
Delta had $15.7 billion in liquidity at the end of June, which it said equaled about 19 months of financial runway at a daily burn rate of $27 million.
It still has unencumbered assets worth $6 billion to $7 billion, primarily in the form of spare aircraft parts and engines, if needed, officials said.
Delta did not disclose the value of the loyalty program or the terms of the new financing, which mirrors a debt deal by United Airlines in June backed by its $20 billion MileagePlus program.
Delta’s shares, which have lost about 46% this year, closed at $31.70 on Friday.
(Reporting by Tracy Rucinski; Editing by Ana Nicolaci da Costa)
Rolls-Royce’s business unit Power Systems and Shanghai Cooltech Power Co. Ltd. have agreed to form MTU Cooltech Power Systems: The 50/50 joint venture will produce backup generator sets powered by MTU engines in China. In the picture: Generator set with a 20V 4000 MTU engine.
Der Geschäftsbereich Power Systems von Rolls-Royce und Shanghai Cooltech Power Co. Ltd. haben gemeinsam MTU Cooltech Power Systems gegründet. Das 50/50-Joint Venture wird Notstromaggregate mit MTU-Motoren in China produzieren. Im Bild: Aggregat auf Basis eines 20V-4000-MTU-Motors.
Rolls-Royce’s business unit Power Systems and Shanghai Cooltech Power Co. Ltd., a leading Chinese manufacturer of power generation systems, have made a significant step forward together to strengthen their market position by forming a 50/50 joint venture. MTU Cooltech Power Systems will produce backup generator sets powered by MTU Series 1600, 2000 and 4000 engines for applications including but not limited to hospitals, airports, mining, semiconductors, telecoms and the rapidly growing data centre market, which has recently received a significant boost from the Chinese government’s newly announced New Infrastructure development plan, a programme launched by the central government to accelerate the digital transformation of the economy.
– New 50/50 joint venture established in Shanghai to serve the growing Chinese market
– Purpose is to establish a stronger position in the backup power supply market, with a focus on data centers
– Production of generator sets equipped with MTU engines to start at end of 2020
Tobias Ostermaier, President MTU Greater China, Rolls-Royce Power Systems, said: “This is an important step to further accelerate our fast-growing business in China. We pursue our growth strategy for diesel systems in China and move further towards becoming a provider of integrated power solutions in this strategically important market. We look forward to being in a position to supply our customers with world class MTU system solutions at China speed. The Chinese market presents tremendous opportunities for Power Systems’ business growth in a challenging global environment. We have an important role to play in ensuring power for China’s New Infrastructure such as telecommunications networks, servers, and data centres through our best-in-class safety-critical MTU power solutions.”
Xu Nai Qiang, President of Shanghai Cooltech Power, said: “We are proud to form the new joint venture with Rolls-Royce, which enables us to manufacture products of the highest quality for the Chinese market, and to continue and enhance the success story of our long-standing collaboration.”
Rolls-Royce and Shanghai Cooltech Power have enjoyed a close partnership since 2013. Shanghai Cooltech Power is one of the biggest customers of the Power Systems business unit in China and has already installed nearly 1,000 MTU engines in backup generator sets. A key focus has been the telecommunications market, which will also be a major target now for the new joint venture.
MTU Cooltech Power Systems is to have a workforce of around 50 employees when it is launched this year. The joint venture will produce a range of generator sets based on MTU engines, which are to be supplied from Germany and China. Rolls-Royce and Shanghai Cooltech Power will then market and deliver these generator sets to their Chinese customers.
Having production in China will shorten delivery times significantly. Combined with direct access to the high quality and competitively priced supply chain in China, MTU system solutions will establish a highly competitive position in the China market. “As a result, we will be in a better position to adapt our product range to market requirements and to provide our customers with local support. Irrespective of the new joint venture, we will maintain our long-standing strategic partnerships and well-established collaboration with our community of Chinese partners in the field of decentralised power supply systems, and will systematically continue and strengthen these partnerships,” said Tobias Ostermaier.
Increasing market share in China, in addition to setting up and developing partnerships, are key elements of the PS 2030 strategy with which the Rolls-Royce business unit Power Systems is currently transforming itself from an engine manufacturer to a provider of integrated solutions.
Rolls-Royce has been producing MTU engines in China since 2006 and formed joint ventures with Chinese manufacturers to continue localizing its footprint over the years. The founding of MTU Cooltech Power Systems will help accelerate its localization in China to seize business opportunities and better serve the market.
Rolls-Royce’s business unit Power Systems and Shanghai Cooltech Power Co. Ltd. have agreed to form MTU Cooltech Power Systems: The 50/50 joint venture will produce backup generator sets powered by MTU engines in China. In the picture: Generator set with a 20V 4000 MTU engine.
Der Geschäftsbereich Power Systems von Rolls-Royce und Shanghai Cooltech Power Co. Ltd. haben gemeinsam MTU Cooltech Power Systems gegründet. Das 50/50-Joint Venture wird Notstromaggregate mit MTU-Motoren in China produzieren. Im Bild: Aggregat auf Basis eines 20V-4000-MTU-Motors.
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
Rolls-Royce is to supply complete MTU propulsion systems for five new Type 31 general-purpose frigates for the Royal Navy. In total, the order comprises of 40 engines and generator sets to be used for main propulsion and on-board power generation, the MTU Callosum propulsion control and monitoring system, and Integrated Logistics Support (ILS).
Rolls-Royce liefert komplette MTU-Antriebssysteme für fünf neue Type-31-Mehrzweckfregatten der britischen Royal Navy. Der Auftrag umfasst insgesamt 40 MTU-Hauptantriebsmotoren und Bordstromaggregate, das Antriebssteuerungs- und Überwachungssystem MTU Callosum und die dazugehörige integrierte logistische Unterstützung (ILS).
Delivery scope: 20 main propulsion engines and 20 on-board generator sets, Callosum marine automation and integrated logistic support
MTU propulsion solutions from Rolls-Royce now feature in almost all current and future Royal Navy vessels
Each new Type 31 frigate of the Royal Navy will be powered by four MTU 20V 8000 M71 engines, each delivering over 8,000 kW.
Die neuen Type-31-Fregatten der britischen Royal Navy werden von je vier MTU-Motoren des Typs 20V 8000 M71 mit einer Leistung von über 8000 Kilowatt angetrieben.
Rolls-Royce is to supply complete MTU propulsion systems for five new Type 31 general-purpose frigates for the Royal Navy. In total, the order comprises of 40 engines and generator sets to be used for main propulsion and on-board power generation, the MTU Callosum propulsion control and monitoring system, and Integrated Logistics Support (ILS). Each new frigate will be powered by four MTU 20V 8000 M71 engines, each delivering over 8,000 kW. On-board power will be provided on each vessel by four MTU generator sets based on 16V 2000 M41B units, each delivering in excess of 900 kW. In September 2021, Rolls-Royce will deliver the first shipset comprising four main propulsion engines and four generator sets to prime contractor Babcock International Group. Integrated Logistics Support for propulsion and onboard power systems will ensure efficient and cost-effective maintenance throughout their entire service life. It is expected that the MTU Callosum propulsion control and monitoring system will be officially added to the supply contract very shortly.
Sean Donaldson, Managing Director for Energy & Marine at Babcock International, said: “We’re delighted to welcome Rolls-Royce with its MTU solutions as a supplier to our Type 31 Programme. Its engines and on-board generator sets are already proving their mettle in numerous comparable vessels worldwide.”
Knut Müller, Vice President Marine & Defense at Rolls-Royce business unit Power Systems, said: “We’re very proud of the fact that Babcock International Group has opted for MTU propulsion and on-board power solutions on this highly significant project. MTU products now feature in almost all current and future projects of the Royal Navy. That is impressive proof of the trust our British partners place in us and of the reliability and flexibility of our products.”
The Royal Navy relies on Rolls-Royce propulsion solutions across its surface and submarine fleets. MTU Series 2000, 4000 and 8000 units will feature in future in most Royal Navy warships – in destroyers (Type 45), all frigate classes (Type 23, 26, 31) and submarines (Astute class).
Rolls-Royce is to supply complete MTU propulsion systems for five new Type 31 general-purpose frigates for the Royal Navy. In total, the order comprises of 40 engines and generator sets to be used for main propulsion and on-board power generation, the MTU Callosum propulsion control and monitoring system, and Integrated Logistics Support (ILS).
Rolls-Royce liefert komplette MTU-Antriebssysteme für fünf neue Type-31-Mehrzweckfregatten der britischen Royal Navy. Der Auftrag umfasst insgesamt 40 MTU-Hauptantriebsmotoren und Bordstromaggregate, das Antriebssteuerungs- und Überwachungssystem MTU Callosum und die dazugehörige integrierte logistische Unterstützung (ILS).
Outbreak of the coronavirus disease (COVID-19) in Renton, Washington
PARIS (Reuters) – Safran <SAF.PA> shares rose on Thursday after Boeing <BA.N> said it would restart production of its 737 MAX jet and announced further cost-cutting measures.
Shares in the French aerospace firm, which co-produces the 737 MAX’s engines with General Electric <GE.N>, were up 2.2%, while Airbus <AIR.PA> shares were 0.7% higher.
Boeing said on Wednesday it was eliminating more than 12,000 U.S. jobs, including 6,770 involuntary layoffs, as the largest American planemaker restructures in the face of the coronavirus pandemic. The move nevertheless lifted Boeing’s shares.
The U.S. rival to Airbus said it had restarted 737 MAX production at a “low rate” at its Renton, Washington factory. Reuters reported in April that regulatory approval for the MAX was not expected until at least August.
(Reporting by Sudip Kar-Gupta; Editing by David Goodman and Alexander Smith)
The Safran company logo is pictured at the company’s logistic area in Colomiers near Toulouse
Textron Aviation Inc., a Textron Inc. (NYSE:TXT) company, today announced the successful first flight of its new twin utility turboprop, the Cessna SkyCourier. The milestone flight is a significant step toward entry into service for the clean-sheet aircraft, and it kicks off the important flight test program that validates the performance of the Cessna SkyCourier.
“Today was an exciting day for our employees, our suppliers and our customers. The Cessna SkyCourier performed exactly as we expected, which is a testament to the entire team of men and women who worked together to prepare for this day,” said Ron Draper, president and CEO, Textron Aviation. “I’m proud of the way the team has persevered through disruptions caused by the COVID-19 global pandemic and remained focused on getting us to this point. The Cessna SkyCourier will be an excellent product in its segment due to its combination of cabin flexibility, payload capability, superior performance and low operating costs. Our customers will be very pleased with what they experience from this aircraft.”
The Cessna SkyCourier took off from the company’s east campus Beech Field Airport, piloted by Corey Eckhart, senior test pilot, and Aaron Tobias, chief test pilot. During the 2-hour and 15-minute flight, the team tested the aircraft’s performance, stability and control, as well as its propulsion, environmental, flight controls and avionics systems.
“We were very pleased with how the Cessna SkyCourier performed throughout its first flight,” Eckhart said. “It was particularly impressive to see how stable the aircraft handled on takeoff and landing. The Cessna SkyCourier already displays a high level of maturity in its flight characteristics, especially for a first flight. We were able to accomplish everything we wanted on this flight, and that’s an excellent start to the flight test program.”
The prototype aircraft, along with five additional flight and ground test articles, will continue to expand on performance goals, focusing on testing flight controls and aerodynamics.
Relentless capability
The Cessna SkyCourier, featuring Pratt & Whitney Canada PT6A-65SC engines, will be offered in various configurations including a 6,000-pound payload capable freighter, a 19-seat passenger version or a mixed passenger/freight combination, all based on the common platform.
The Cessna SkyCourier is designed for high utilization and will deliver a combination of robust performance and lower operating costs. Cessna SkyCourier will feature the popular Garmin G1000 NXi avionics suite and offer highlights such as a maximum cruise speed of up to 200 ktas and a maximum range of 900 nm. Both freighter and passenger variants of the Cessna SkyCourier will includer single-point pressure refueling as standard to enable faster turnarounds.
AKARTA (Reuters) – An Indonesian court on Friday jailed Emirsyah Satar, a former chief executive of Garuda Indonesia, for bribery and money laundering related to procurement of planes and engines from Airbus and Rolls-Royce, his laywer said.
Satar’s lawyer Luhut Pangaribuan said his client had been given an eight-year sentence and fined S$2 million ($1.4 million) by the country’s corruption court.
Indonesia’s Corruption Eradication Commission (KPK) had indicted Satar, CEO of Garuda from 2005 to 2014, over payments from a businessman via a third party for the procurement by Garuda Indonesia of Roll-Royce Trent 700 engines and Airbus A320 and A330 planes.
The indictment also related to the procurement of Airbus planes for PT Citilink Indonesia, a unit of Garuda.
In 2017 Rolls-Royce agreed to pay authorities more than $800 million to settle charges after an investigation by the U.S. Justice Department and Britain’s Serious Fraud Office into alleged bribery of officials in six countries in schemes that lasted more than a decade.
Airbus in February this year agreed to pay a record $4 billion in fines after reaching a plea bargain with prosecutors in Britain, France and United States over alleged bribery and corruption stretching back at least 15 years.
Satar, who had previously denied wrongdoing, will decide next week whether to appeal against his sentence, said Pangaribuan.
($1 = 1.4139 Singapore dollars)
(Reporting by Agustinus Beo Da Costa; Writing by Ed Davies; Editing by David Goodman)
Aeroflot, the Russian flag carrier and member of the SkyTeam alliance, has taken delivery of its first A350-900, becoming the launch operator of the latest-generation widebody aircraft in Eastern Europe and CIS. Aeroflot’s A350-900 features a distinctive new livery embracing its almost 100-year heritage. Aeroflot has a total of 22 A350-900 aircraft on order and operates an Airbus fleet of 126 aircraft (107 A320 Family and 19 A330 Family aircraft).
Aeroflot’s A350-900 features a brand new elegant cabin design, offering unrivalled passenger comfort. The aircraft has a spacious three-class cabin layout with 316 seats: 28 private Business Class suites with full-flat seats, 24 Comfort Class with extra legroom and 264 Economy Class. In addition, the latest-generation Panasonic eX3 in-flight entertainment system, HD screens and Wi-Fi connectivity will ensure enhanced experience for all passengers on long-haul flights. Aeroflot will operate its A350-900 from Moscow to a number of destinations including London, Dubai, New York, Miami, Osaka and Beijing.
The A350 XWB offers by design unrivalled operational flexibility and efficiency for all market segments – up to ultra-long haul (9,700 nm). Its Airspace by Airbus cabin is the quietest of any twin-aisle aircraft and offers passengers and crews the most modern in-flight flying experience. The aircraft features the latest aerodynamic design, a carbon fibre fuselage and wings, plus new fuel-efficient Rolls-Royce Trent XWB engines. Together, these latest technologies result in 25% lower operating costs, as well as 25% reduction in fuel burn and CO2 emissions compared with previous-generation competing aircraft – demonstrating Airbus’ commitment to minimise its environmental footprint while remaining at the cutting edge of air travel.
Japan’s five-star carrier plans to acquire 11 787-10 airplanes, four 787-9s jet and five options
Deal marks ANA’s sixth Dreamliner purchase; order book to eclipse 100 airplanes once options are exercised
ANA plans to use the largest, most efficient Dreamliner to replace certain domestic 777 models
Boeing [NYSE:BA] and ANA HOLDINGS INC. announced the Japanese airline group today decided to acquire up to 20 more 787 Dreamliner airplanes. The agreement with Boeing includes 11 787-10s, one 787-9 and options for five 787-9s valued at more than $5 billion at list prices. The airline also plans to acquire three new 787-9 airplanes from Atlantis Aviation Corporation.
Once the agreements are finalized, it will be ANA’s sixth order for the ultra-efficient and passenger-pleasing Dreamliner and bring their overall 787 order book to more than 100 airplanes.
“Boeing’s 787s have served ANA with distinction, and we are proud to expand our fleet by adding more of these technologically-advanced aircraft,” said Yutaka Ito, Executive Vice President of ANA and ANA HD. “These planes represent a significant step forward for ANA as we work to make our entire fleet even more eco-friendly and further reduce noise output.”
With this order, the airline will add 11 of the largest and most fuel-efficient Dreamliner models, the 787-10 to its world-class fleet. Powered by a suite of new technologies and a revolutionary design, the 787-10 set a new benchmark for fuel efficiency and operating economics when it entered service in 2018. The airplane allows operators to achieve 25 percent better fuel efficiency per seat compared to older airplanes in its class.
ANA sees the 787-10 as the perfect airplane to replace previous domestic 777 models that are slated for retirement.
“Introducing the 787-10 on our domestic routes will help ANA Group maintain its leadership role and improve our ability to operate as a responsible corporate citizen,” Yutaka Ito said.
ANA became the global launch customer of the 787 Dreamliner when it placed its initial order in 2004. Since then, like half of all Dreamliner operators, the Japanese carrier has placed follow-on orders. However, ANA is in a class by itself as the world’s biggest 787 operator with 71 airplanes in its fleet and 12 more to be delivered prior to the latest agreement. The new deal will bring the 11 additional 787-10 airplanes, one 787-9 and options for five more 787-9 jets.
ANA is also in the launch customer group for Boeing’s new 777X.
“ANA has grown into one of the leading airline groups in Asia by continually raising the bar for customer satisfaction and investing in the most technologically-advanced and capable fleet. We are truly honored that ANA HD is coming back to order more 787 planes with plans to boost their Dreamliner fleet to more than 100 jets,” said Ihssane Mounir, senior vice president of Commercial Sales and Marketing, The Boeing Company. “We are confident that the unique capabilities of the 787-10 will continue to safely serve its passengers with best-in-class comfort and reliability.”
The 787 Dreamliner is playing an important role in reducing carbon emissions around the world. Since the first 787 entered commercial service in 2011, the Dreamliner family has saved more than 48 billion pounds of fuel. In addition, the 787 fleet’s noise footprint is 60 percent smaller than those of the airplanes it replaces.
ANA HD’s new 787 jets will be powered by GE’s GEnx-1B engines. The new engines will contribute to the 25 percent improved fuel efficiency per seat of the 787-10.
An Air Canada Boeing 767 aircraft made a safe emergency landing at Madrid’s Adolfo Suarez-Barajas International Airport after part of the jets landing gear reportedly fell off and entered its engines.
The Toronto-bound flight touched down shortly after 7.10pm Monday evening with fire engines lining the runway.
A passenger tweeted out video of the safe emergency landing. Click the link below to view!
