17 Jul 2017

USA Aviation Industry Newsletter 17 July

AA to End Codeshare Relationships with Qatar and Etihad American Airlines has announced that it is discontinuing its codeshare relationships with oneworld partner, Qatar Airways, as well as with Etihad Airways, citing the ongoing dispute over the Open Skies agreements and allegations that the three Middle Eastern carriers receive illegal subsidies. The codeshare relationships between American and both Etihad and Qatar will end after the close of business on March 24, 2018. Amerijet International is the first all-cargo U.S. airline to receive a IATA CEIV-Pharma certification Amerijet International has become the first all-cargo U.S. airline to receive an IATA CEIV-Pharma certification, further signalling that South Florida has become a hub for pharmaceutical transport. The certification is a global standard for pharmaceutical transport awarded by the International Air Transport Association. Consultant Study Highlights Emirates’ $21.3 Billion Contribution to U.S. Economy On the 25^th anniversary of the first Open Skies agreement signed by the U.S. State Department, Emirates released a public statement showing that it has helped support more than 104,000 American jobs as well as contributed $21.3 billion to the U.S. economy in 2015. The study was completed by Campbell-Hill Aviation Group, a consulting firm based in the U.S. The airline has regularly argued that its biggest economic impactor in the U.S. has been its continued massive purchases of Boeing 777 aircraft. Emirates went on to say that it has 171 aircraft still on order from Boeing. Delta posts $1.2 billion 2Q net profit; takes first A350-900 Delta Air Lines posted a $1.2 billion net profit for the second quarter of 2017, down 21% from $1.5 billion in net income for 2Q 2016. The Atlanta-based airline reported $10.9 billion in operating revenue for the quarter, up 3.3%. Delta took delivery of its first Airbus A350-900 July 13, which will be placed in service Oct. 30 on the Detroit-Tokyo Narita route. This is the first of five of the type Delta will take this year. How Warren Buffett's Airline Investment Reflects a Turning Point in Industry History The U.S. airline industry reached an important milestone in 2016 -- it became cumulatively profitable for its entire history. The landmark was enabled by a record profit of $25.6 billion in 2015 followed by a $13.5 billion gain in 2016, erasing a cumulative deficit and establishing a cumulative profit of $7.6 billion, according to figures provided by industry trade group Airlines for America. Increased Hiring, Wages Pressure U.S. MRO Costs Maintenance cost per flight hour edged up in 2016 for most U. S. airlines. As a group, the three network airlines, American, Delta and United, paid $1,032 per flight hour for their mixed fleets, up 1.7% from 2015. American and United paid the most, $1,175 and $1,000 per flight hour, respectively. Delta paid the least, $905 per flight hour, and actually nicked 0.8% off its prior-year rate. United to suspend Shannon-Newark flights for winter United confirmed that it would stop flying from the mid-west airport to Newark, New Jersey, which serves New York, between November 26th next and March 9th 2018. The airline blamed a “seasonal reduction in market demand” for its decision. It will begin flying from Shannon again from March 10^th. US, EU aviation insiders fret about future of open skies US and European aviation players warn that protectionism could cloud the future of open-skies deals, as they celebrate the 25th anniversary of the first US open-skies agreement. "There are challenges on the horizon," says Henrik Hololei, the European Commission's director-general for mobility and transport. "It's important to not hide behind the protectionism, and to enable the entry of new players in the market.” Acumen Aviation © 17 July All Rights Reserved.