SA Airlink plummeted to a loss of R365 million in November 2019 – compared to a profit of R84 million in September and R50 million in October – as a result of South African Airways withholding revenue from ticket sales, the Johannesburg High Court heard on Tuesday. The private airline has taken the flag carrier to court over revenue it says SAA owes it for ticket sales generated towards the end of 2019. Initial court papers reportedly indicated that SA Airlink was suing SAA for R700 million, which it wanted the court to order to be paid up within five days. SAA was placed under business rescue in early December 2019. The airline's business rescue practitioners, Les Matuson and Siviwe Dongwana, have previously argued that the monies in dispute are pre-commencement debt, which means they would be classified with other debts SAA incurred shortly before going into business rescue. But according to Airlink's lawyer, Adv Rafik Bhana SC, the funds owed to Airlink were revenue from tickets sold in November and December 2019 through SAA's booking system. SAA earns a commission from such ticket sales. The court heard that SAA did not pay the revenue to Airlink because the funds were deposited in SAA's bank account and got mixed up with its other funds, making it difficult to meet Airlink's demands easily. "It would be unthinkable if SAA took those funds and used them to fund its own operations and then said to Airlink: 'We owe you the money and will pay it in 30 days or 90 days'. It is unthinkable because it is clearly in breach of the agreements... and that is what business rescue practitioners opportunistically want to do here," Bhana argued. SA Airlink now faces the risk of running out of working capital by the end of this month, the court heard, leaving over 1 700 jobs at risk. Airlink operates on 55 routes to 39 destinations in nine African countries. Its CEO, Rodger Foster, previously said the airline was able to cover costs short-term, but could not write off several months of turnover without suffering a major impact. "The airline business is characterised by the sale of high volumes of perishables at low margins. At the same time, there are significant capital and operational costs associated with running an airline, which necessitate continual downward pressure on costs and having enough cash available to cover them," Foster said. Judgment was reserved.

Source: FIN 24

Investigators have disclosed that a new Air Baltic Airbus A220-300 which diverted to Bordeaux on 12 February had suffered an engine failure. While the details of the failure, in the left-hand Pratt & Whitney PW1500G powerplant, have yet to be disclosed, the incident follows a series of engine failures on the type involving Swiss aircraft. The Air Baltic twinjet involved, YL-AAU, had only been delivered to the airline in early December – the aircraft was the 100th of the type to be produced and carried ceremonial markings. French investigation authority BEA says the jet had been operating a service from Riga to Malaga when it diverted. The aircraft had been close to entering Spanish airspace at the time of the incident, and landed at Bordeaux around 10:30. Investigators probing three previous occurrences of low-pressure compressor rotor failure to Swiss A220s had cautioned operators to limit engine power at cruise altitudes. Inspection regimes have also focused on engines which have accumulated relatively few cycles since installation of a particular engine-control software version.

Source: Cirium

Just five days after it extended the cancellation of flights between the United States and Hong Kong, American Airlines was once again forced to revise its schedule in light of coronavirus fears and subsequent customer cancellations. The Forth-Worth-based airline, with service from two US hubs to China and Hong Kong, becomes the second carrier after Delta Air Lines to announce cancellations well into April. “Due to the reduction in demand, American Airlines has extended the suspension of flights to and from mainland China and Hong Kong from our Dallas-Fort Worth and Los Angeles hubs,” the airline says on 11 February. All flights between Dallas and Hong Kong will be cancelled through 23 April, with flights from Dallas and Los Angeles to Hong Kong and mainland China cancelled through 24 April, the airline says. The airline operates service to Shanghai and Beijing on Boeing 787 Dreamliners and uses its 777 aircraft for the flights to Hong Kong. Previously, the airline had cancelled Dallas-Hong Kong service through 21 February, and Los Angeles-Hong Kong as well as mainland China service through 27 March. By Tuesday morning, the death toll from the coronavirus surpassed 1,000, with infections at almost 44,000 in 24 countries as well as numerous cruise ships. The vast majority of these are in mainland China, where the virus originated.This week’s Singapore Air Show has proceeded as planned, even as several large manufacturers cancelled their participation. On Tuesday, several countries extended a travel ban to the southeast Asian city-state, which has reported 45 cases of the disease so far.

Source: Cirium