ASIA: Association Of Asia Pacific Airlines Cries Out To Government For Financial Bailout

The Association of Asia Pacific Airlines calls on governments to provide financial support for airlines to weather the Covid-19 storm.

APPA says air travel in the Asia Pacific is virtually grinding to a halt due to the travel bans, border closures, lockdowns, quarantine and isolation orders imposed by governments.

Representing the interests of hundreds of airlines in the Asia-Pacific, APPA calls on governments to rapidly implement emergency relief measures.

Association of Asia Pacific Airlines Advice

Suspend payroll taxes, defer or reduce income taxes, the extension of payment terms, waiver of ticket taxes & other government levies, taxes, dues and charges for 2020.

Direct financial support for reduced revenues and liquidity support due to travel restrictions

Extend interest-free loans or loan guarantees, and support for corporate bond markets either directly or to commercial banks to extend credit for affected companies.

Direct financial support needed for individuals facing the loss of livelihood.

AAPA urges all Governments to take immediate action to address the societal impact of the world’s worst public health crisis in a century.

Asian airlines are facing revenue shortfalls of upwards of USD60 billion this year as a result of sharp falls in demand which have already forced the grounding of over half of the fleet.

Many of the 1 million workers employed in the Asia Pacific airline industry are unable to work because of the drastic reductions in operations. Many are facing the threat of a loss of their livelihoods.

The sharp reductions in passenger services have also drastically reduced available air cargo capacity affecting critical supply chains, including getting food and medical supplies to affected communities worldwide.

Asian airlines are continuing to operate dedicated freighter services but need help in streamlining operations, scheduling, and crew clearances to keep critical goods moving as a lifeline.

APPA claims the World Health Organisation (WHO) is providing strong leadership in coordinating the global public health response and notes that this is the first pandemic we can control if all countries and sectors come together.

ASIA: Asia Pacific Airlines Carried 29.8 Million Int. Passengers in April 2018

Preliminary traffic figures from the Association of Asia Pacific Airlines (AAPA) for the month of April 2018 show growth in international air passenger and air cargo demand progressed at an encouraging pace, driven by further expansions in global service and manufacturing sectors.

A combined total of 29.8 million international passengers were carried by the region's airlines in April, representing a robust 9.3% increase compared to the same month last year.

Business activity strengthened across major advanced and emerging market economies during the month, with positive confidence levels boosting growth in business travel demand.

At the same time, continued availability of affordable airfares driven by promotional campaigns supported growth in leisure travel markets.

Overall, demand as measured in revenue passenger kilometres (RPK) increased by 8.3% year-on-year, ahead of the 7.2% expansion in available seat capacity.

As a result, the average international passenger load factor edged 0.8 percentage points higher to 81.5% for the month.

Whilst there are signs that international trade flows may be easing, international air cargo demand for the region's carriers, in freight tonne kilometres (FTK) terms, saw an encouraging 5.8% year-on-year increase in April.

Improvement in client demand within the region, on the back of stronger domestic conditions, aided growth in air cargo markets.

After accounting for a 6.6% expansion in offered freight capacity, the average international freight load factor was 0.5 percentage points lower at 64.1% for the month.

Commenting on the results, Mr. Andrew Herdman, AAPA Director General said, Overall, during the first four months of the year, Asia Pacific airlines carried an aggregate total of 118 million international passengers, a solid 7.3% increase compared to the same period last year.

Correspondingly, air cargo demand registered an encouraging 5.7% growth during the same period, on top of the strong 9.6% annual increase recorded in 2017."

SSustained growth in the region and the wider global economic expansion lends credence to a positive market outlook for the remainder of the year.

However, operating conditions remain challenging, with airlines still facing intense competition and the pressure of sharply higher fuel costs, up more than 30% compared to last year.

The region's carriers continue to explore avenues for further growth, whilst implementing pro-active measures to control costs and achieve further operational efficiencies.


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Demand For 5000 New Airplanes in Asia-Pacific

Boeing presented its Current Market Outlook for the Southeast Asia and Oceania regions during the Association of Asia Pacific Airlines’ 60th annual Assembly of Presidents meeting in Manila.

Over the next 20 years, the company forecasts a demand for 3,860 new airplanes, valued at $565 billion, in Southeast Asia; while an investment of $160 billion for 1,020 new airplanes is expected in the Oceania region.

“Southeast Asia and Oceania remain important markets for Boeing as airlines continue to add capacity, modernize their fleets and shift their business models to adapt to this competitive market,” said Dinesh Keskar, senior vice president of Asia Pacific and India Sales, Boeing Commercial Airplanes.

“While we see the majority of the demand being for single-aisle airplanes such as the 737 MAX, fuel-efficient twin-aisle airplanes such as the 787 Dreamliner and the 777X will also be needed, enabling airlines to profitably open new routes, never before possible.”

The annual report projects that more than 75 percent of the airplanes needed in both regions will be for single-aisle airplanes, as they continue to see a rise in the number of low cost carriers as well as strong annual traffic, with growth rates of 6.4 percent and 4.7 percent, for Southeast Asia and Oceania, respectively.

Worldwide, Boeing projects a demand for 39,620 new airplanes, over the next two decades. Boeing’s Current Market Outlook is the longest running jet forecast and regarded as the most comprehensive analysis of the aviation industry.

Malaysia Airlines CEO Pleads For Uniform Air Charges

Malaysia Airlines Bhd (MAS) Chief Executive Officer Peter Bellew has reiterated his call for airport passenger service charges to be the same at the Kuala Lumpur International Airport and KLIA2, saying the current charges are totally anti-competitive.

He said the move was crucial for MAS to become profitable again as it needed a "competitive set of charges at our home base" that would protect workers' jobs and enable new jobs to be created in the future.

"Charges for international passengers at KLIA are at RM33 (US$8.25) more per person than they are at KLIA2," he said when addressing MAS employees here on Friday. His remarks were made available to Bernama.

"This is totally unfair and completely anti-competitive," said Bellew, who took over as CEO and Managing Director of MAS last month.

The differential in the rates between KLIA and KLIA2 reportedly costs well over RM100 million annually for MAS.

Some 51 other carriers now operating out of the two terminals at Sepang are also looking forward to the same charges.

MAS is not the only airline or association urging the Malaysia Aviation Commission (MAVCOM) for uniformity when rates are revised, probably, by year-end.

The Geneva-based International Air Transport Association (IATA) and the Association of Asia Pacific Airlines (AAPA) -- both trade bodies -- have also written to MAVCOM and Malaysia Airports Holdings Bhd (MAHB) to protest about the ridiculous difference.

AAPA, which is headquartered in Kuala Lumpur with international representation in Brussels and Washington, has 16 Asia Pacific airlines as its members.

"We will continue to demand fair treatment for Malaysia Airlines. It is nuts that one airline gets a discount of RM5,940 (US$1,500) for every international flight from KLIA2," Bellew said, obviously referring to AirAsia.

IATA had urged the Malaysian government for a solution that would be "revenue neutral to the airport operator" and that there should be no discrimination between users at KLIA and KLIA2.

In urging airport passenger service charges to be the same at all terminals in Kuala Lumpur, he said that if the charges were not changed by next April, MAS would be forced to operate some flights from KLIA2 at a discount of RM33 per passenger.

The first routes would be new operations to North Asia and China where there would be few connecting passengers.

Against such a scenario, he said, "I hope the authorities change their mind and give fair competition for all airlines. I dont want to operate from KLIA2 and I just want a fair charge.

"For Malaysia Airlines to grow and become profitable again we need a fair and competitive set of charges at our home base. This will protect all our jobs and allow us to create new employment in the future.

"KLIA2 is a super facility and I spent 12 hours there at the end of July.

"The few building problems have been exaggerated as it was normal to have some teething problems.

"The operator and the government have spent millions of dollars promoting KLIA2 and one airline wants to change the name to something confusing that means nothing in the ASEAN region.

"I think that is really silly and of course the name should stay as KLIA2," he said.

Bellew also told his staff that MAS has a tough job ahead in turning around financially, but gave his personal commitment that he would do everything possible "to fight for equal treatment for this airline from all authorities and suppliers over the next few years."