Airbus is striving to restore aircraft delivery rates following a dip in the last couple of months, but believes supply-chain hitches are temporary and its broader ramp-up of aircraft production is under control. The airframer’s monthly delivery figure slipped back to 40 aircraft in August and September, its lowest level since February. Airbus chief Guillaume Faury, speaking during a third-quarter briefing on 28 October, described the situation as “disappointing” and admits September proved to be a “difficult” month – with October likely to be similar. He attributes the “gap” between production and delivery partly to having aircraft ready, but yet to be taken by customers, while other aircraft have had to be sent for “outstanding work” following assembly as a result of external supply-chain issues. “They’ve been through the assembly line but need to be fully finished,” he says. He says the airframer plans to deliver the “vast majority” of backlogged aircraft by the end of the year. Faury says there is no “significant” change regarding the number of suppliers “on watch”, although there has been “some change in the mix of suppliers”. “We all observe tension in the supply chain after 15 months of stable rates,” he says. “We’re now in a ramp-up – we see all the difficulties to go from ‘hibernation’ back to business.” He says the airframer is “managing individual cases of supplier difficulties”, but declines to identify any particular entities. “I don’t want to single out suppliers,” he says. “It wouldn’t be appropriate to finger-point at some suppliers or sectors.” He stresses that the situation affects only a “small number of suppliers” and that the airframer is “on top of it”. Faury believes the problem is “temporary” and the company is maintaining its delivery target of 600 commercial aircraft for 2021. “I think we’re going to manage, moving forward,” he says, adding that the current delays to deliveries will not have an impact on the longer-term ramp-up schedule. While Faury has outlined plans to take A320-family monthly production rates to 65 aircraft within two years, he is coy on the current output level. Airbus had previously indicated that it would raise the A320 rate to 45 by the end of this year. Faury says the airframer felt there was a need to give “very detailed” updates on production rates during the depths of the crisis, because it was “important to be specific and precise” in order to guide suppliers. But he wants to revert to “more generic” figures as the recovery accelerates. Faury insists the ramp-up trajectory remains the same “in substance”, adding that demand “more than supports” the planned hikes in production. “We’ve been very granular on production rates,” he says, and the company is “progressively coming back to previous practices” – meaning it will be “less specific”. Airbus has asked suppliers to “protect capacity” for increasing the A320 monthly rate to 70 aircraft, but Faury says the company has yet to conclude an assessment on a potential further rise to 75. “There are lots of views on this,” he says. “We have our own views that the demand supports this.”

Air New Zealand chairman Therese Walsh says the airline will continue to focus on its domestic network and expects to increase capacity to over 110% of pre-pandemic levels. Walsh says the airline will further “[unlock] that demand” through increasing flight frequency as part of its domestic network strategy, during its 2021 annual shareholders’ meeting on 28 October. The domestic network has been a major contributor to the airline's operating revenues despite the ongoing challenges in the past 12 months, she says, with domestic capacity tracking in excess of 90% of pre-pandemic levels prior to the latest lockdown in August. Walsh states: “Leisure demand was up 130% in May, June and July compared to pre-Covid levels, and we had seen strong performance on our regional routes, with routes such as Tauranga-Christchurch and Hamilton-Christchurch performing well above pre-Covid levels, along with New Plymouth, Kerikeri and Invercargill.” It also expects to increase frequency on its international network from November. "While the trans-Tasman bubble is closed, we are flying an average of 50 flights per week to 16 destinations including Los Angeles, Hong Kong, Shanghai, Australia and key Pacific ports. From November, this will increase to 65 flights per week for the summer period," says Walsh. Air New Zealand has also started new cargo flights to Guangzhou in China. Walsh adds: “The board acknowledges the lack of financial return for our shareholders but assure you that we are using this opportunity to further critique our cost base and roll out an exciting new strategy. “We aim to be a more cost-effective and more innovative airline than even before and we look forward to sharing those rewards with you in the future. We thank you for standing by us through this difficult time.” Chief executive Greg Foran states: “2021 has been uncertain, volatile, and complex and continues to be so. Remarkably, we managed to keep our planes flying every single day, moving customers, and moving freight. “And through this we’ve maintained a strong cost discipline and developed new capabilities which will allow us to build back even better when the borders reopen and domestic restrictions ease.”

The UK plans to slash air passenger duty (APD) on domestic flights from April 2023, while imposing an additional tax on ultra-long-haul services. As part of the country's annual budget statement, chancellor Rishi Sunak said the move would halve APD for 9 million passengers annually, support local airports, and "bring people together across the UK". The measures will introduce a new domestic band for APD set at £6.50 ($8.90), which will apply to all flights between airports in England, Scotland, Wales and Northern Ireland, excluding private jets. Carriers have long complained that APD in effect double taxes their domestic services because it charges a passenger with a return ticket for both legs of their journey, compared with only once for an international trip. The extra duty on ultra-long-haul services will apply a £90 charge to flights of 5,500 miles or more, roughly the distance from London to Sri Lanka or Mexico City. It means the UK's new APD distance bands will be set at 0-2,000 miles, 2,000-5,500 miles and 5,500 miles plus, at rates of £13, £87 and £91 respectively for economy passengers, plus the new domestic tariff. Sunak adds that the additional duty on long-haul flights is being enacted to reflect the environmental impact of such services and will affect fewer than 5% of passengers. Both measures will come into force from April 2023.