ARC NEWS
Consumer watchdog takes Qantas to court over cancelled flights
August 01, 2023
The Australian Competition and Consumer Commission has launched a lawsuit against Qantas alleging that it misled customers by continuing to sell tickets for flights that had been proactively cancelled between May and July 2022. In a statement, the ACCC says that the airline kept selling tickets on its website for more than two weeks after cancelling 8,000 flights that were scheduled to depart over the three month period. It also alleges that Qantas failed to notify ticketholders for more than 10,000 flights scheduled to depart that they had been cancelled for an average of 18 days. The Commission has filed the lawsuit in Australia's Federal Court on the basis that the airline engaged in "false, misleading or deceptive conduct", in contravention of the country's consumer law. Maximum penalties available for breaches include a fine of up to A$10 million ($6.5 million), three times the total benefits obtained, or up to 10% of the company's annual turnover if the value cannot be obtained. In response, Qantas says that it takes the allegations seriously and will respond to them fully in court. "We have a longstanding approach to managing cancellations for flights, with a focus on providing customers with rebooking options or refunds. It’s a process that is consistent with common practice at many other airlines," it states. Qantas adds that during the time period mentioned by the ACCC that the airline industry was experiencing major challenges. "All airlines were experiencing well-publicised issues from a very challenging restart, with ongoing border uncertainty, industry wide staff shortages and fleet availability causing a lot of disruption." In May 2022 Qantas announced that it was cutting back planned capacity in the domestic market between July and August from 107% of pre-Covid capacity to 103% in response to high fuel prices, although at the time it noted that the adjustments "are not expected to materially impact customers due to the large number of flights on most routes". The court action comes as Qantas defends its role in apparently lobbying the Australian government to deny a request from Qatar to increase the number of flights available under its bilateral air services agreement.


Southwest converts Max 7 orders to Max 8s
July 31, 2023
US carrier Southwest Airlines in the second quarter exercised 30 Boeing 737 Max 7 options for delivery in 2024 and converted Max 7 orders delivering in 2024 to Max 8s, a 28 July filing to the US Securities and Exchange Commission shows. Last year, the airline entered into supplemental agreements with Boeing to replace the majority of its 2023 Max 7 firm orders with Max 8 firm orders, among other adjustments to its near-term orderbook, the filing adds. Boeing said in an SEC filing on 26 July that it now expected first delivery of the Max 7 to be in 2024, following certification this year. "We continue to expect the 737-10 to begin FAA certification flight testing in 2023, with first delivery in 2024," it added. Bob Jordan, chief executive at Southwest, said on the carrier's second-quarter earnings call on 27 July: "We currently are planning to be flying the Max 7 at some point next year, but if not, we'll take Max 8 instead just as we are doing now."


El Al secures financing for 787-8
July 31, 2023
El Al has signed an agreement to cover the financing of its 16th Boeing 787-8. The Israeli flag carrier says in a 27 July stock-market disclosure that it has entered into a memorandum of understanding with a "foreign investment bank". The loan will be provided by two special-purpose vehicles incorporated in Japan and is guaranteed by UK Export Finance. The airline notes that the aircraft, scheduled for delivery in July, is powered by Rolls-Royce engines. Under the terms of the agreement, El Al is not able to repay the loan early, expect under specific circumstances. Fleets data shows the carrier has three 787-8s in operation and one on order.


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