IAG is striving to close the acquisition of Air Europa by the end of this year, undeterred by the impact of the air transport crisis, although it is reviewing the structure of the €1 billion ($1.2 billion) deal in response to the downturn.

While outgoing IAG chief Willie Walsh has previously stated that the “best form of consolidation is when the weak disappear” – underlining his belief that inefficient airlines should not be saved by investors – he stressed during the company’s half-year briefing that Air Europa, even under the pressure of the current crisis, was not among these weak operators, and that IAG believes its pursuit is justified.

“We firmly believe Air Europa will not fail,” he insists. “That has been a fundamental factor in our decision.”

Recovery in the Latin American market will lag that in North America which, in turn, will lag the rest of the network, IAG expects. Air Europa has resumed a number of transatlantic services to Latin American destinations, having also restored several European routes.

IAG chief-elect Luis Gallego says the regulatory clearance for the Air Europa acquisition will depend on formally closing the deal.

The two sides are in “active discussions” over a “potential restructuring” of the agreement, to take into account the crisis, says IAG. It has not disclosed the nature of any possible changes, and whether they include the overall acquisition price.

“We consider that we can have [regulatory] approval if we close the deal before the end of the year,” says Gallego, adding that the strategic rationale remains strong.

“The good thing about this deal is that we are in a solid position,” he says.

“We can think in the medium term and the future and we consider that this [arrangement] is the future of group, the future of Iberia, the future of the Madrid hub.”

The Federal Aviation Administration (FAA) has suggested four key design changes to the beleaguered Boeing 737 Max in order to address safety issues that led to its almost 17-month grounding following two fatal crashes that killed 346 people.
The regulatory body said on 3 August that it is proposing a new Airworthiness Directive (AD) that will allow the aircraft to once again return to service. The AD includes proposals that will enhance the safety of the aircraft as well as the ability of the cockpit crew to deal with potential issues. Though the FAA completed three days of flight tests on 1 July, there is still no indication of when the jet will be released to fly again in revenue service. The aircraft’s re-certification flights were an important milestone in the process to bring the troubled aircraft back, but numerous steps are still required. “This proposed AD would require installing new flight control computer software, revising the existing Airplane Flight Manual to incorporate new and revised flight crew procedures, installing new Max display system software and changing the horizontal stabilizer trim wire routing installations,” the FAA writes. The new flight control software is intended to prevent erroneous activation of the aircraft’s manoeuvring characteristics augmentation system (MCAS), which was determined to be a primary cause of the two crashes, in October 2018 and March 2019. In addition, revisions to the flight manuals and alerts to the pilots are conceived to ensure that crew can correctly recognise and respond to a potential angle of attack sensor failure – a key piece of equipment for the MCAS system. The final design point, changing the trim wire routing, “is intended to restore compliance with the FAA’s latest wire separation safety standards”, the FAA says. The agency has now opened a 45-day period during which it invites comment on the proposed AD. In addition to these four changes, the FAA’s proposed AD includes a requirement that operators conduct an angle-of-attack sensor system test and perform an operational readiness flight prior to returning each airplane to service. The FAA estimates that this AD will affect 73 US-registered aircraft costing the operators a total of about $1 million altogether (excluding the cost of the operational readiness flight). The most expensive repair is projected to be the stabilizer wiring, the FAA says. Boeing must make the changes on the aircraft that it had not yet delivered prior to the grounding. According to Cirium fleets data, the biggest US operators of the 737 Max are American Airlines, United Airlines and Southwest Airlines. The notice of proposed rulemaking does not include proposed requirements for pilot training, which it will publish later the FAA says. ”Pilot training will be evaluated by the Joint Operations Evaluation Board (JOEB) and the FAA’s Flight Standardization Board (FSB),” the agency says. ”The FAA intends to assure the global community that when the work is completed, the 737 Max will be safe to operate and meet FAA certification standards,” the FAA writes in its preliminary review of the Boeing 737 Max’s return to service, also published on 31 July. ”Through a thorough, transparent, and inclusive process, the FAA has preliminarily determined that Boeing’s proposed changes to the 737 Max design, flightcrew procedures and maintenance procedures effectively mitigate the airplane-related safety issues that contributed to the… accidents.” In early July, a US government watchdog issued a scathing report that blasted Boeing for misleading regulators and purposefully holding back information about MCAS during the aircraft’s certification process. The FAA was kept in the dark about potential dangers of the flawed system, and therefore it was not able to adequately test or otherwise address it before the aircraft was originally certificated. Last week, Boeing told investors that it intends to deliver a majority of its 450-strong 737 Max stockpile within one year of resuming deliveries of the still-grounded jet. Boeing accumulated those aircraft because it continued manufacturing the Max through most of 2019 despite being unable to deliver the jets due to the worldwide grounding.

Source: Cirium

United Airlines is bringing back to its schedule this fall nearly 30 international routes. Among the regions, countries and destinations to which the Chicago-based carrier will be resuming or adding flights in September are Asia, India, Australia, Israel, Latin America, the Caribbean and Mexico. United plans to operate in September 30% of the international schedule it operated in September 2019, a five-point increase compared with August 2020, the airline states. Chief executive Scott Kirby had said during United's 22 July second-quarter earnings call that United has been taking steps to ease European Union travel restrictions in order to restore international routes. Earlier this month, Kirby and chief executives at International Airlines Group, Lufthansa and American Airlines drafted and sent a letter to EU and US officials asking them to adopt a joint Covid-19 testing program. International bans on US travelers are particularly damaging to United, which had the most international capacity in January 2020 among major US carriers. United had 10.1 billion international ASM's in January compared to 7.9 billion ASM's for Delta Air Lines and 7.5 billion ASM's for American Airlines. United is also adding in September 40 daily flights to 48 domestic routes and is resuming service between the US mainland and Hilo and Kauai in Hawaii. "We continue to be realistic in our approach to building back our international and domestic schedules by closely monitoring customer demand and flying where people want to go," Patrick Quayle, United's vice president of international network and alliances, states.

Source: Cirium