A trusted source of Asia-Pacific commercial aviation news and analysis


MAY 2020

Week 21

Daily Update

Orient Aviation's COVID-19 briefs: Hainan Airlines Holdings cancels US$635 million aircraft sale to Hong Kong’s HNA Aviation

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May 27th 2020

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  • Hainan Airlines Holdings said in a regulatory filing to the Shanghai Stock Exchange today it had cancelled a 4.5 billion yuan (US$635 million) sale of five 737-800s, two 787-8s and two A350-900s to Hong Kong-based HNA Aviation. The statement said the sale cancellation was due to a change in the buyer's operating strategy in response to the coronavirus pandemic. Read More »

     
  • New Zealand prime minister, Jacinda Ardern, told reporters in Wellington today her country and Australia were working to bring in a trans-Tasman safe travel zone "as quickly as we can", and added it "won’t be too long before we are ready”. A panel representing government agencies, airports, airlines and health experts is working on the trans-Tasman safe travel zone, or bubble. It has said it could be in a position to present a plan to the Australia and New Zealand governments in early June, with the aim of having the scheme in place in September.

     
  • Delta Air Lines has adjusted a planned restart of nonstop daily passenger flights from Detroit and Seattle to Shanghai Pudong that were due to take off in June. The SkyTeam alliance member said on its website on Monday (U.S. time) it would serve Shanghai from Detroit and Seattle one-stop via Seoul Incheon in June. Delta already flies cargo-only services from Atlanta and Los Angeles to Shanghai.

     
  • The International Air Transport Association (IATA) said overnight airlines were expected to have added US$120 billion of net debt compared with US$30 billion in new equity in calendar 2020. The latest figures would lift the airline industry's global debt by 28%, to US$500 billion, from US$430 billion at the end of calendar 2019, IATA said.

    While noting government aid, including loans, loan guarantees and deferred tax payments, were in many cases "life-saving measures" for airlines, IATA director general and CEO, Alexandre de Juniac, said policy makers should be fully aware the increased debt burden would have consequences, such as making "the recovery longer and more difficult".

    Other IATA figures published overnight showed governments in the Asia-Pacific had pledged US$26 billion in financial support for airlines battling the coronavirus pandemic. The financial support represented 10% of the US$257 billion in revenues generated by those airlines in calendar 2019.  IATA said Singapore has provided the most aid as a percentage of 2019 ticket revenues, at 84.2%, followed by Japan (22.1%) and South Korea (11.6%).

     
  • Aircraft leasing company, AerCap Holdings, said yesterday it had pushed out the delivery dates of 37 aircraft from 2021 and 2022 to "2023 and later years". This latest change in its acceptance schedule brought to more than 100 the number of AerCap aircraft to have their original delivery dates in 2020, 2021 and 2022 rescheduled, allowing the Dublin-headquartered company to reduce its cash capital expenditure in 2020 and 2021 by about US$4.7 billion.

     
  • China's Ministry of Finance has introduced a scheme to help airlines cover up to 80% of the costs of modifying passenger aircraft to carry cargo on international services, as well as for airlines operating international cargo flights. The scheme also offered financial support for airlines operating international cargo flights, which varies according to flight distance and maximum take-off weight, the Ministry of Finance said in a statement on its website.

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