Archive for category: News

IAG have purchased NIKI from the collapsed Air Berlin airline for a total investment of £32.5m. 

It’s reported that IAG will integrate the operation into Vueling and employ some 740 out of 1,000 NIKI staff.  

IAG’s chief executive Willie Walsh, said: “NIKI was the most financially viable part of Air Berlin and its focus on leisure travel means it’s a great fit with Vueling. This deal will enable Vueling to increase its presence in Austria, Germany and Switzerland and provide the region’s consumers with more choice of low-cost air travel.” 

European press have reported on Monday that Lufthansa’s failure to buy Air Berlin’s Austrian arm NIKI will likely cost the German government €150m (£133m), according to a senior member of Angela Merkel’s ruling alliance.  Collapsed carrier Air Berlin was extended a €150m loan by the German government as it grappled to stay afloat. Hans Michelbach, the deputy leader of the CSU – the Bavarian sister party of Merkel’s Christian Democrats called for a full investigation and claimed the European authorities had provoked Lufthansa’s withdrawal of its takeover offer for NIKI in order to ‘make possible the takeover by a certain investor at a bargain price.’ 

Why has IAG bought NIKI? 

The announcement of IAG’s purchase of NIKI pushed its share price up 2.7 per cent yesterday, this is because it represents a savvy consolidation deal in a market blighted by price wars and overcapacity. Lufthansa’s bid was blocked to allay EU competition concerns, as buying the airline threatened to create a monopoly on dozens of routes in Austria, Germany and Switzerland. This meant that IAG was able to swoop.

The market also likes the IAG-NIKI deal because of the apparently low price. Lufthansa had been seeking to buy Niki, including 800 staff and up to 15 aircraft, plus LGW, including 870 staff and 33 aircraft, for €210m. IAG is paying only €20m, plus a €16.5m liquidity injection, for NIKI and those aircraft. LGW and Niki are different businesses, with different airport slots.

Perhaps the most obvious reason for the market reaction is that IAG’s low-cost arm Vueling, which will operate NIKI flights through a new subsidiary, starts the year with the European expansion it promised at last year’s capital markets day.

It has been reported in the British media that the first day of trading of 2018 saw IAG outperform a weaker London market, with Merrill Lynch upgrading the stock to ‘buy’, largely on long-term trading hopes. Merrill put a target of 750p on the group, which closed at 668.8p.  

Rolls-Royce faced the prospect of more charges as a result of the engines used to power Dreamliner aircraft, after two carriers revealed they had to ground aircraft due to faulty turbines.

A source close to the project to replace turbine blades on affected aircraft explained that a lack of spare turbines meant that aircraft were being grounded for longer than they should, which could result in additional charges.

Rolls-Royce said that the new engine had been re-designed and should not suffer the same issues. It is possible that holidays and flights over the Christmas period could be at threat for airlines with Dreamliner aircraft in their fleet, including British Airways and Virgin Atlantic unless they have sufficient spare aircraft or have the opportunity to quickly arrange wet leases, it is thought Dreamliner aircraft with the affected engines could be grounded long term due to engine production already at maximum capacity. 

Aviation analysts write that airlines are on course to increase profits in 2018.

They say the International Air Transport Association (IATA) forecasts a rise in net profit to $38.4bn (£28.4bn) in 2018, up from an expected $34.5bn for 2017. 

They suggest the heightened expectations are a result of strong demand, efficiency and reduced interest payments. This is despite an expected decline in operating margin to 8.1 per cent, down from 8.3 per cent. “These are good times for the global air transport industry,” said the IATA’s chief executive Alexandre de Juniac. “Safety performance is solid. We have a clear strategy that is delivering results on environmental performance. More people than ever are travelling. The demand for air cargo is at its strongest level in over a decade. Employment is growing. More routes are being opened. Airlines are achieving sustainable levels of profitability. It’s still, however, a tough business, and we are being challenged on the cost front by rising fuel, labour and infrastructure expenses.” 

The Air League are offering a flying scholarship to help students achieve their PPL by funding 12 hours of Powered Flight training towards the award of an NPPL.

The intention of this award is to enable a person to go solo and enjoy the responsibility and achievement of solo flight.

Scholars are encouraged to undertake their training as a residential course over the course of week to ensure consistency in their learning and to allow training as a small group with other scholars so that ideas and a fun, open learning environment can develop.

Annually they award in the order of 50 Flying Scholarships depending on funds available.

Training is undertaken at one of our three training providers:

1. South Warwickshire Flying School
2. Booker Aviation
3. Tayside Aviation

Details here.

Airbus announced at the Dubai Airshow that Indigo Partners has placed the largest-ever order for 430 aircraft, totalling $49.5 billion at list price. Indigo Partners, which owns Frontier Airlines in the US, Wizz Air in Europe, Jetsmart in Chile and Volaris in Mexico, has placed an order for 273 A320neos and 157 A321neos.

Airbus says when added to the firm’s previous A320 orders for 427 planes, the new agreement makes Indigo Partners one of the largest customers by order number in the world for the Airbus single-aisle aircraft.

This is welcome news for Airbus as it was widely expected that Emirates were to order further A380 which would have secured production on the aircraft for a number of years, however it appears the deal has fallen through.