Air Baltic has posted its strongest ever second-quarter net result but observes that its performance was held back by maintenance problems associated with the Pratt and Whitney PW1000G engines which grounded much of its Airbus A220 fleet. The carrier made a net profit of €26 million ($29 million) in the three months to end-June, with revenues rising to €186 million, a 42% increase on last year and up 30% on 2019. But the Latvian airline warned that high fuel prices exacerbated by “significant disruption” to its operations related to engine shortages and the need to wet-lease in capacity raised costs by €30 million. Throughout the period an average of 11 A220 aircraft were grounded due to engine shortages, related to the need for enhanced maintenance checks on the PW1000G units, plus a lack of spare equipment available as replacements. This represents more than a quarter of the airline’s 42-strong fleet. Air Baltic was therefore required to bring in 11 wet-leased A320s as replacements through the quarter, resulting in increased fuel burn, lower load factors, increased airport and ground handling fees and deteriorating on-time performance. “The Q2 punctuality was one of the lowest in Air Baltic's history,” it states, with just over 60% of services being on time compared to nearly 90% in 2019. Furthermore, it warns of ongoing “significant uncertainty” surrounding the delivery and maintenance of engines, which may have a negative impact on the airline's “operational performance and cash generating ability beyond management's current expectations.” While the company remains in talks with P&W for compensation, it warns of uncertainty surrounding the extent of the support that will be provided, adding that: “The airline's liquidity would be negatively impacted if the support proves to be inadequate.” Air Baltic did receive €20.4 million to mitigate its costs regarding the engine issues in early July, which therefore did not contribute to its second-quarter result. The issue with P&W’s engines has been a particular concern for Air Baltic as the A220, exclusively powered by the PW1000G, makes up the entirety of the carrier’s permanent fleet. Chief executive Martin Gauss said that in June the carrier was taking significantly longer than expected for engines to be overhauled by P&W, making it impossible for the carrier to plan its forward capacity. More recently, Wizz Air said that issues with the same engines that power its A320-family units would constrain capacity growth this year. The issues come despite strong demand for Air Baltic’s product through the period, as the industry continues to see strong leisure sales post-pandemic. Overall booked revenue rose by 30% on last year and 12% on 2019. ACMI earnings also rose to nearly a fifth of its revenues as Air Baltic placed wet lease capacity with several airlines across Europe – agreed before the impact of the P&W engines issues was understood. However, Air Baltic did warn that the probability of hitting its target of €700 million in revenues for the full year had “somewhat decreased” due to softening in demand in July, with its updated guidance being €670-700 million. The carrier was also negatively impacted by a lack of fuel hedging for the first half of 2023, although over the “medium term” it plans to ramp up hedges to cover 30-50% of its requirements up to 18-months out. Air Baltic has sought to move away from a focus purely on a hub-model based around Riga towards more point-to-point flying in response to the war in Ukraine, which shut down Russian airspace hurting transfer passenger numbers. This will see it increase leisure flying during the winter season from Riga, Tallinn, Vilnius and Tampere with new leisure routes, plus extending its season length to popular holiday destinations such as Malta, Catania, and Valencia. In total, it operated 108 connections through the first half against 102 last year and 87 in 2019, with seat capacity rising by 23% on last year, although it remains 9% below 2019.

The US Federal Aviation Administration has issued an airworthiness directive to address a major safety risk arising from the operation of the Boeing 737 Max's engine anti-ice (EAI) system under certain conditions. The regulator says in the directive that use of the system "in dry air for more than five minutes during certain environmental and operational conditions can cause overheating of the engine inlet inner barrel beyond the material design limit, resulting in failure of the engine inlet inner barrel and severe engine inlet cowl damage". The directive requires the addition of a paragraph to the aircraft's flight manual to prohibit the use of EAI "in-flight when not in actual or anticipated icing conditions". Following the revision to the manual, operators will also be required to revise their master minimum equipment list to prohibit dispatch under a certain item. Boeing 737 Max jets are equipped with CFM International Leap-1B engines, while the inlet is manufactured by Boeing. The directive was prompted by a June 2023 report that indicated that flight testing and analysis revealed the EAI could be prone to excessive heat buildup when operated for more than five minutes in dry air " during certain combinations of altitude, total air temperature, and N1 settings", leading to the failure of the inlet barrel. "The departure of the inlet may cause fuselage and/or window damage, potentially resulting in decompression and hazard to window-seated passengers aft of the wing and/or impact damage to the wing, flight control surface, and/or empennage, which could result in loss of control of the airplane," it says. "Inlet loss also causes significantly increased aerodynamic drag and asymmetric lift due to wing blanking, which risks fuel exhaustion on certain flights, resulting in a forced off-airport landing and injury to passengers." The airworthiness directive is an "interim action" that will become effective from 25 August, and operators have 15 days to comply. The issue affects approximately 402 aircraft registered in the USA and 1,187 aircraft worldwide, the FAA estimates. The cost of compliance for US operators is about $34,000 to comply with the airworthiness directive. The FAA adds that the manufacturer is currently "developing a modification that will address the unsafe condition identified" and may consider additional rulemaking. Boeing says it "supports the rule issued by the FAA addressing a potential overheat issue for specific parts on the engine inlets on 737 Max airplanes". It adds: " Boeing has identified measures to mitigate the potential issue and are working with our customers to deploy those measures while a permanent fix is developed. We will continue coordinating closely with the FAA." The manufacturer adds that airlines will receive updated airplane flight manual operational guidance to address the issue in the near term.

Oman Air is to undergo a “radical and sustainable” transformation plan over the coming three to four years after racking up a series of losses. Although the company’s financial situation has not been revealed, the restructuring aims to address “ongoing losses and the accumulation of debt,” the carrier says. This could see reductions to the Middle Eastern carrier's network plus the acceleration of its integration with low-cost carrier Salam Air. Oman Air chairman Saeed Al Mawali, who is also the country’s minister for transport, communications and information technology, says the transformation plan aims to address the company’s financial sustainability, corporate governance, commercial aspects, and human capital. It has been based on recommendations from consultancy Oliver Wyman, who assessed the airline’s performance and developed a plan towards sustainable operations. This will include changes to the company’s board and management over the coming months to bring in industry experts, “whether local or international,” it states. “Meanwhile, the airline’s network is being re-evaluated by international experts, and decisions will be taken on whether to continue certain destinations,” Oman Air says. “Integration with Salam Air is also high on the programme’s agenda.” Oman air said last year that it would strengthen its cooperation with Salam Air to align their networks for passenger growth on flights to and from the country. Both companies are ultimately state-owned enterprises. They have played a role in the development of Oman’s Vision 2040 Strategy, which aims to increase inbound tourism to the country through enhanced capacity levels. Oman Air previously launched a transformation plan designed to deliver sustainable profits in September 2019 following losses of RO160 million ($416 million) in 2017. Its recent financial performance, and levels of debt, have not been published. Its 40-strong in-service fleet is made up of 35 Boeing 737 NG and Max aircraft, plus nine 787s and six Airbus A330s. It also has nine 787-9s and two 737 Maxes on order, plus three 737-800s in storage. Of its total fleet of 55 units, including those on order and in storage, eight of its 787-9s are leased, plus 13 Max 8s, nine 737-800s, and five 737-900ERs – amounting to 64% of the total. The entire remainder of its fleet are owned, except for two A330-200s and two 787-8s. The most exposed lessor is Air Lease Corporation, which has 11 737, 737 Max and 787 units with the Omani carrier, followed by CDB Aviation with seven units, Avolon (four) and SMBC Aviation Capital (three) and DAE Capital with two.
GOAL manages five 737s that are owned by Sun Country Airlines, the data shows.