Singapore and Indonesia have agreed to realign the boundary between their respective flight information regions (FIR), which returns parts of its airspace over Indonesian territories to its control. Singaporean prime minister Lee Hsien Loong and his Indonesian counterpart Joko Widodo signed the landmark bilateral agreement at the Singapore-Indonesia Leaders’ Retreat on 25 January in Bintan. The new agreement will enlarge the scope of the Jakarta FIR to cover "all of Indonesia's territorial airspace, particularly in the waters around Riau and Natuna islands", Widodo says at a same-day televised press conference. Widodo states: "Going forward, we hope that the cooperation in law enforcement and aviation safety as well as defence and security of the two countries can continue to be strengthened based on the principles of mutual benefit." Lee says the implementation of the agreement "will meet the civil aviation needs of both countries and uphold the safety and efficiency of air traffic in a manner consistent with ICAO rules". The two countries will need to jointly submit the FIR agreement to ICAO for final approval. Singapore's current FIR covers parts of Indonesia, including the islands of Batam, Bintan and parts of Sumatra and Natuna, according to CAAS' aeronautical information publication dated 2 December. The agreement will see Indonesia and Singapore cooperating to provide aviation services in areas bordering their respective FIRs, according to a statement by Indonesia's coordinating ministry for maritime and investment affairs. "Indonesia will provide a delegation of flight services in certain areas at an altitude of 0-37,000 feet to the Singapore aviation authority. In certain areas, altitudes of 37,000 feet and above remain under Indonesian control," the ministry says. The countries have also put in place arrangements for civil and military cooperation for air traffic management, including stationing Indonesian civilian and military personnel at the Singapore Air Traffic Control Center.

Boeing's commercial unit reported an operating loss of $4.4 billion in the fourth quarter of 2021, improving year-on-year from a loss of $7.6 billion as 787 aircraft deliveries remain paused during inspections with regulators that are taking longer than expected. Boeing Commercial Airplanes during the fourth quarter took a $3.5 billion pre-tax charge related to the 787 programme as the company works with the US Federal Aviation Administration to restart deliveries of the long-haul jet. Boeing halted 787 deliveries for most of 2021 due to quality issues with some parts of the aircraft. For the full year 2021, the Chicago-based airframer reported a $6.4 billion operating loss, halving that loss compared with $13.8 billion for 2020. The costs of the 787 programme were partially offset by growing demand for 737 Max jets, as 737 type aircraft accounted for 750 orders out of the 900 gross commercial airplane orders during 2021. Airline demand recovered amid the availability of Covid-19 vaccines and Max jets are now permitted to return to service in more than 185 nations. With these considerations, Boeing chief executive David Calhoun said on 26 January during an earnings call that "2021 was a key rebuilding year for us". Remarking on the 787 costs and ongoing delivery delays, Calhoun adds "the work we’re putting in now will build stability and predictability going forward" as the airframer prepares for a recovery of widebody demand. An additional $2 billion in costs are expected related to the 787 programme by the end of 2023. The overall Boeing Company for the full year 2021 reported a $4.3 billion loss, nearly a third of the $11.9 billion loss it reported in 2020. Even before the start of the pandemic, the airframer also reported a $636 million loss in 2019 amid the grounding of Max aircraft following two fatal crashes. In a bright spot for the company, Boeing reported $716 million positive operating cash flow during the fourth quarter, despite having burned $3.4 billion in cash during the full year 2021. Annual cash burn decreased from $18.4 billion during the full year 2020. The company had previously not reported positive operating cash flow since the first quarter of 2019, just before the FAA and other regulators grounded Max aircraft in March 2019. Looking ahead, Boeing chief financial officer Brian West during the call forecast a "meaningful acceleration of cash flow in 2023" once the airframer is able to resume 787 deliveries and increase shipments of 737s and other aircraft. There are 335 Max jets in inventory with the aim of delivering most of those by the end of 2023, West says, adding the abnormal costs of Max jets are "largely behind us". Boeing delivered 340 commercial aircraft in 2021, rising from 157 in 2020. Delivering jets is a priority for Calhoun, who said he wants 787 deliveries to outpace the production rate increase of that type. Commercial unit revenue during the fourth quarter of 2021 was $4.7 billion, nearly flat year-on-year. Full year 2021 commercial revenue stood at $19.4 billion, rising 21% from $16 billion for 2020.

The global recovery in international air passenger demand was knocked back by around two weeks by the spread of the Omicron variant in December, but activity still grew in the month and is set to accelerate in 2022, according to IATA. In its first media presentation of the year, the airline association presented data showing that total revenue passenger-kilometres grew from a pandemic-era low of 90%-plus below 2019 levels in April 2020 to a gap of around 45% in December 2021. Across the whole of 2021, RPKs were down 58% against 2019, benefiting from a fairly consistent improvement throughout the year, including during the spread of Omicron. In 2020, full-year RPKs were down 66% versus 2019. IATA notes that for most of 2021 international passenger demand recovered at a pace of roughly four percentage points per month compared with 2019.
Without Omicron, it would therefore have expected international demand for December to improve to around 56.5% below 2019 levels. Instead, volumes rose marginally to 58.4% below 2019 from -60.5% in November. "Overall travel demand strengthened in 2021. That trend continued into December despite travel restrictions in the face of Omicron. That says a lot about the strength of passenger confidence and the desire to travel," says IATA director general Willie Walsh. "The challenge for 2022 is to reinforce that confidence by normalizing travel. While international travel remains far from normal in many parts of the world, there is momentum in the right direction." The global data masks large differences between regions. While overall RPKs in North America fell by just 39%, helped by the large domestic US market, in the Middle East they were down nearly 70% and in Asia-Pacific by over two-thirds. IATA also sought to highlight the strong performance of air cargo in the year: demand rose 6.9% in 2021 compared with 2019, and 19% compared with 2020, helped by a strong performance in December. This represents the second largest year-on-year performance since IATA began collecting data in 1990. Briefing reporters, Walsh cited some encouraging trends. As well as the strength in domestic travel, with several market surpassing their 2019 levels, he highlighted that premium RPKs were recovering at the same pace as in economy, contrary to many expectations. Separate data shows that airlines are increasingly confident about growing passenger numbers over the next 12 months as pent-up demand is released onto the market and travel restrictions are pulled back. "More and move government are reviewing restrictions, and we are pleased to see some... are beginning to be removed," says Walsh. This is a "positive indication with what is likely to happen with bookings", he adds. Walsh also gave his brief opinion about the increasingly acrimonious dispute between Airbus and Qatar Airways concerning the A350. "Myself and a lot of airline CEOs will want to understand what has caused that issue," he says, before sounding a warning about market duopoly and a lack of competition between suppliers. "I would hate to think one market player is taking advantage of their current strength to exploit their position... That's something we are watching very closely."