British Airways is likely to jettison its 'fire and rehire' labour plans because it has reached agreements in principle with its unions. 'I am pleased that we have reached a point at which it appears we may have a solution that does not require the need to issue new contracts," BA chief executive Alex Cruz has told members of the UK parliament's transport committee which is investigating labour relations at the airline. "We have reached agreements in principle with most unions," adds Cruz. "Some areas we have already balloted and some are in the process of balloting." IAG-owned BA has come under significant pressure from the press and politicians over its plans to force employees onto new contracts at lower pay. Cruz says the carrier will now look instead at amending employees' current contracts. The carrier plans to cut a total of 10,000 jobs because of the coronavirus crisis. Some 7,200 people have already left the business. Cruz says the pandemic has resulted in a "fundamentally different" aviation market that has left BA "fighting for our survival". He warns: "We do not see a short-term coming back of our passengers." Last week, he notes, the carrier flew around 187,000 customers, compared with just under a million a year previously, "so we are running between 25-30% of the normal schedule … Fewer flights means fewer people required to service them." Cruz observes that passengers remain afraid of travelling, and complains that a return to normality is hindered by frequent changes to the travel-corridor safe list. Not only does this disrupt passengers' plans, but it requires the carrier to change crews and aircraft at short notice and high cost, he says. BA is advocating a more regional approach to quarantines that would avoid the need to remove entire countries from the safe list. Echoing statements by the chef executives of EasyJet and Air France-KLM on 15 September, Cruz bemoans the lack of airport testing which could give customers more confidence: "We need some testing regime that will minimise the quarantine process." BA has proposed that a testing trail between New York and London could provide the data and experience for a more widespread testing regime. In response to questions about the carrier's financial position, Cruz says: "It would be inaccurate to say we are in a healthy position... If you had looked at the situation at the end of 2019 we could have asserted that, but that's no longer the case." At the end of June, BA had £2.1 billion ($2.7 billion) of cash, but the airline has been burning through roughly £20 million per day. It has accessed government support and raised around £600 million against its aircraft, while parent group IAG is in the process of raising a further €2.75 billion ($3.26 billion) that will "give us a little bit more room to weather what will be a long, protracted period of time". Cruz points out that all BA managers have taken wage cuts of 5-20%; his personal salary has declined by a third. His total salary plus benefits in 2019 was £805,000 with no bonus, although he did receive equivalent of 164,000 shares relating to 2017. None of the airline's managers received a bonus in 2019, and given the crisis in the industry, Cruz says there will be "no bonus for many years to come, I imagine".

Source: Cirium

Airbus has ousted Boeing as aerospace’s biggest business after a year in which the 737 Max crisis led to the US manufacturer’s revenues plunging by a quarter. FlightGlobal’s latest Top 100, based on 2019/20 financial year figures, before the onset of the coronavirus pandemic, show Boeing’s annual sales at $76 billion, down from $101 billion the previous year. Airbus’s turnover rose from $75.1 billion in 2018 to $78.9 billion, allowing the European company to take top spot in the annual ranking for the first time in over a decade. Boeing also slid deeply into the red, with operating losses of almost $2 billion, compared with profits of around $12 billion in 2018. Airbus’s operating profits also fell from around $6 billion in 2018 to $1.5 billion in the latest financial year. Even though the vast majority of Top 100 companies had a positive bottom line, the squeeze felt by the big two meant profit growth as a whole was in negative territory, down 11.1% compared with a rise of 20.6% the previous year. Average operating margins dropped from 11.3% to 9.4%. With Top 100 revenues up 3.5% against 8.2% in 2018, it suggests that the industry was heading into a slower growth phase even before the pandemic hit. That said, the biggest aerospace companies continued to grow faster than the world economy – global GDP increased by 2.9% in 2019 – as they have for many years. Consolidation has brought other changes to the Top 100 with the merged United Technologies and Rockwell Collins ranked fourth in terms of size. The further coming together of United Technologies’ aerospace businesses and Raytheon, completed earlier this year, should see the combined business overtake third-placed Lockheed Martin in next year’s survey. Meanwhile, the new L3Harris – created from L-3 and Harris – broke into the top 10 at number nine.

Source: Cirium

Italy’s civil aviation authority is meeting with Ryanair on 16 September to discuss allegations of non-compliance with the country’s coronavirus-related health measures. ENAC notes that despite speaking to the airline about similar issues in early August, it is still receiving “reports regarding Ryanair’s incomplete compliance with the provisions planned in Italy to limit the health risk derived from coronavirus on board the aircraft departing and arriving at national airports”. The previous allegations – denied by the Irish carrier – included claims from ENAC that social-distancing requirements were not being met, and came with a threat that Ryanair’s Italian services could be suspended. This time, the authority will also “verify compliance” by Ryanair with the requirement that all passengers complete Covid-19 self-declaration forms, noting that the lack of adherence contributes to the lengthening of the checking process at airports. It cites Milan Bergamo airport – Ryanair’s largest Italian base – where passengers have been waiting for excessive periods inside the facility in recent days, ENAC claims, “as evidenced by videos”. Ryanair parked a number of aircraft at Milan Bergamo during the grounding of services earlier this year Before they travel to Italy, passengers are required to download and complete a self-declaration form supplied by the Ministry of Interior, which is meant to be collected by the airline and may be requested by border police. By signing the form, passengers agree to measures including the wearing of face masks on board aircraft and in airports. Ryanair has been contacted for comment.

Source: Cirium