Airbus is in discussions with all A350 operators about the surface deterioration issue that has led to legal action by Qatar Airways and the airframer’s cancelling of orders from the Gulf carrier. Referring to the issue as the “so-called surface degradation”, Airbus chief executive Guillaume Faury said during a 17 February results briefing: “We have been super-transparent and explained the situation to all operators. “I am happy to say that no other airline other than Qatar Airways sees it as an airworthiness issue. We consider it not an airworthiness issue, and this is also the assessment of EASA.” The European Union Aviation Safety Agency led the A350’s certification campaign. Other international regulators accepted the EU agency’s approval. Qatar Airways previously said it had been instructed by the nation’s civil aviation authority to ground some of its A350s because of the surface deterioration issue. Data shows that 21 of the carrier’s 53 A350s – comprising both -900s and -1000s – are listed as being in storage. Qatar has stopped taking deliveries of further A350s until the dispute has been resolved and, in December 2021, took legal action against Airbus in the UK. Airbus, in turn, disclosed in January that it had cancelled a Qatar Airways order for 50 A321neos. Earlier this month, the airframer revealed its cancellation of two A350-1000 delivery positions after the carrier had not picked up two completed aircraft. Another 21 A350-1000s remain an order for Qatar Airways. Faury denies an accusation that the act of cancelling the A321neo order may have been taken in self-interest as the narrowbody is among the airframer’s most popular product lines – with limited early delivery slots – while A350 orders have been affected by the slump in long-haul traffic amid the pandemic. “It’s not self-service, not at all,” Faury says. “It comes from the contractual situation with Qatar Airways. We are now in a legal dispute, and we have to take steps that are really linked to that very specific situation.” Faury describes the clash with Qatar Airways as “something we don't feel good about. We don't like to be in that situation. “It’s quite a unique situation. It’s a very public dispute and this has been made very public by our customer,” he says. “We have to take steps to protect ourselves and protect the company and that’s basically what we are doing.” Faury adds: “Obviously we continue to try to resolve the situation in a more amicable way, if possible.”

American Airlines has once again scaled back its summer schedule, citing Boeing's "continued inability to deliver" its 787-8 aircraft as the reason for the diminishment of its international flights. Previous delays in 787-8 deliveries had prompted earlier cuts in American's international schedule in 2022. American's finance chief Derek Kerr noted during an earnings call on 20 January that 13 787-8s were to arrive in 2022, but warned that manufacturing issues continue to affect production rates. "[We expect to] put four [787-8s] in the schedule this summer," Kerr said on 20 January. "As of today Boeing is on track." The US major now expects to receive from Boeing just 10 787-8s in 2022. The remaining three aircraft are now scheduled for delivery in 2023, American states in an 18 February US Securities and Exchange Commission filing. "We are taking a proactive approach to reduce the negative impact Boeing’s delays could have on our business and our customers," American says of its newly revised summer schedule. "Our 787-8 aircraft are an essential part of our fleet. And despite the ongoing delay, we still have tremendous confidence in the aircraft and will continue to work with Boeing on their delivery." The further delay in 787-8 deliveries has prompted American to push back the launch of its Dallas/Ft Worth-Tel Aviv route. The carrier will also temporarily suspend service on routes including Seattle-London Heathrow; Dallas/Ft Worth-Santiago, Chile; and Los Angeles-Sydney, Australia. Finally, American will reduce its Miami-Sao Paulo, Brazil route to a single daily service. "Further reducing our international flying this summer is a difficult decision, but ultimately, it’s the right one for our team members and customers," American says. "While we are disappointed in the continued delay of our 787-8 deliveries, we remain focused on running a reliable operation on our path to profitability by delivering for our customers the best global network." American has 46 787 jets in its current fleet and 43 on order. Boeing halted deliveries of 787s for most of 2021. The US Federal Aviation Administration has said it continues to work with the airframer both on quality inspections and re-work necessary to resolve manufacturing issues. No update has been provided when deliveries could resume.

SAS risks edging closer to bankruptcy unless it can restructure its elevated debt pile, according to a research note produced by Norway’s DNB Bank. DNB analyst Ole Martin Westgaard estimates in a research note published on 16 February that the Scandinavian carrier has available liquidity reserves of SKr5.6 billion ($600 million) consisting of SKr2.6 billion of cash and undrawn government guarantees of SKr3 billion. This compares with total debt of SKr40.5 billion at the end of the fourth quarter, which includes hybrid loans booked as equity. “The high debt seems unsustainable, and with SKr3.8 billion (excludes SKr2.8 billion of lease payments) of maturities due in the next 12 months, restructuring will surely be needed. In our view, this would need to address the too-high debt and uncompetitive cost position versus peers,” he states. The bank forecasts that SAS will report a SKr1.9 billion first-quarter loss on 22 February as a result of “low demand due to Covid, limited ability to adapt capacity, rising fuel prices and high financing costs due to elevated debt”. The bank reiterates its “sell” advice to investors and has cut its target price to reflect “reduced estimates and increased financial risk”. DNB says that while there is likely to be “significant pent-up demand” for travel as restrictions ease, it believes SAS’s “weak competitive position” makes it a target for low-cost carriers such as Ryanair. At the same time, the bank notes that fuel prices are up appreciably and SAS has no hedges in place. In a separate 16 February note, Sydbank analyst Jacob Pedersen says the Omicron variant has “derailed” traffic recovery and, together with stiff exchange-rate headwinds of some SKr800 million against the US dollar in the first quarter, will create a “massive” SAS deficit that reinforces the need for more strategic initiatives and an overhaul of the airline’s capital structure. He says SAS has unveiled some initiatives for its survival, including the establishment of new low-cost units. Pedersen adds that he looks forward to more concrete objectives for cost-saving initiatives. He warns that the Stockholm-based carrier’s book equity now consisting only of hybrid bonds, but says the company is not pressured for liquidity “here and now”. Pedersen suggests that new SAS chief executive Anko Van der Werff could be contemplating a rescue plan that may be accompanied by a capital increase. SAS’s share price has fallen more than 20% since the publication of the research notes.