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Transport

Dubai vows to inject funds into Emirates amid Covid-19 losses

Full details of the government’s plans will be announced at a later stage

Dubai Crown Prince Sheikh Hamdan bin Mohammed bin Rashid Al Maktoum has vowed that Dubai will inject funding into Emirates amid the ongoing coronavirus pandemic, it was announced on Tuesday.

According to the UAE’s state-run WAM news agency, the move to inject liquidity to the company is a reflection of “its strategic importance to the Dubai and UAE economy, and the airline’s key role in positioning the emirate as a major international aviation hub”.

On Twitter, Sheikh Hamdan said that “the government of Dubai is committed to fully supporting Emirates at this crucial time and will inject liquidity into the company”.

“Emirates, our national carrier, positioned Dubai as a global travel hub and has great strategic value as one of the main pillars of Dubai’s economy, as well as the wider economy of the UAE,” he added.

Travel restrictions imposed as a result of the coronavirus pandemic, forced Emirates to suspend passenger operations earlier in March, as well as cut staff wages.

Further details of the government plan to inject funds into the airline will be announced “at a later stage”, WAM reported.

Around the world, a number of countries have announced plans to support airlines amid the losses caused by the coronavirus pandemic.

The United States, for example, has announced $58bn in assistance.

In a recent episode of the Arabian Business podcast, Saj Ahjmad, the chief analyst at London-based StrategicAero Research said that government assistance may not be enough to save many airlines around the globe.

“Assistance by various governments will help to a certain degree, but the reality is that it may not be enough,” he said. “Whatever IATA is talking about in terms of hundreds of billions of dollars, to be honest it may run into tens of trillions, because you’ve got to factor in the supply chains of hotels, leisure centres and associated supply chains with those that rely on aviation as a catalyst for their own industries.”

“It’s going to run into trillions, and I really don’t see that we’ve reached the bottom of this yet,” he added.

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Transport

TUI UK completes customer repatriation as final flights lands

The arrival of 265 passengers at Birmingham Airport from Cancun has marked the end of a mammoth repatriation programme mounted from TUI UK in response to the Coronavirus pandemic. 

The long-haul flight was the final part of a finely orchestrated operation bringing 45,000 holidaymakers home.

The complex process was planned as government and local authority advice changed and countries closed their borders. 

Hundreds more holidaymakers, unable to get home with the airlines they had travelled with, were also repatriated by TUI from destinations including Goa, Jamaica, Turkey, Spain and Marrakech.

The flights could not have been operated without the efforts of 964 TUI cabin crew and 362 flight crew team members, who put in over 11,000 flying hours to get customers home.

The repatriation effort was supported on the ground by over 2,500 TUI destination reps overseas who were on hand to help customers as they waited in their hotels and resorts before.

In the last ten days 192 TUI airways flights have taken off from 30 overseas airports in destinations across the world from Spain, Turkey and Greece to Mexico, Costa Rica and Thailand, bringing customers and 320 overseas destination reps back to 16 UK airports.

Andrew Flintham, managing director of TUI UK & I, commented: “I don’t think anyone could have imagined just a few months ago that we would be where we are today.

“We have dealt with the largest repatriation operation our business has ever seen, bringing 45,000 of our own customers, and hundreds of other holidaymakers, back from overseas, and now our operation, and the entire, travel industry is temporarily ‘on pause’.

“I would like to say a huge thank you to everyone who played their part in getting our customers home as safely and as quickly as possible.”

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Transport

Government pledges £75m to repatriate stranded Brits

The British government has pledged to bring home thousands of travellers stuck abroad following a new agreement with airlines.

The global travel situation caused by the coronavirus pandemic has seen many holidaymakers stranded overseas – leading to criticism of the authorities.

In response, Virgin Atlantic, easyJet, Jet2 and Titan Airways have signed a memorandum of understanding negotiated by the foreign and transport secretaries.

British Airways have also made clear it will work with the government in the national interest to get people home.

Foreign secretary, Dominic Raab, said: “This is a worrying time for many British citizens travelling abroad.

“We’ve already worked with airlines and governments to enable hundreds of thousands to return home on commercial flights, and we will keep as many of those options open as possible.

“Where commercial flights are not possible, we will build on the earlier charter flights we organised back from China, Japan, Cuba, Ghana and Peru.

“The arrangements agreed today will provide a clearer basis to organise special charter flights where Britons find themselves stranded.”

UPDATE: The UK Government and the airline industry to fly home stranded British travellers.

➡️ Read our guidance: https://t.co/fX28Rj5pNk

➡️ Follow @FCOTravel for country updates#coronavirus | #COVID19 pic.twitter.com/W5k28aqSkz

— Foreign Office

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Transport

Singapore Airlines secures rescue funding to overcome Covid-19 downturn

Singapore Airlines will offer all shareholders S$5.3 billion in new equity and up to a further S$9.7 billion through a ten-year mandatory convertible bonds.

Both will be offered on a pro-rata basis via a rights issue, and both issuances will be treated as equity in the company’s balance sheet.

Singapore Airlines’ majority shareholder, state-fund Temasek Holdings, said it would underwrite the sale of shares and convertible bonds for up to S$15 billion.

The carrier said it would use the cash to weather the Covid-19 storm and to expand once it has passed.

Singapore Airlines has also arranged a S$4 billion bridge loan facility with DBS Bank.

This money would be used to support the company’s near-term liquidity requirements, the airline added, until the share offering could be completed.

Singapore Airlines chairman, Peter Seah, said: “This is an exceptional time for the SIA Group.

“Since the onset of the Covid-19 outbreak, passenger demand has fallen precipitously amid an unprecedented closure of borders worldwide.

“We moved quickly to cut capacity and implement cost-cutting measures.”

He added: “We have also worked closely with the Singapore government to bring Singaporeans home safely during this time.

“At the same time, we are also working with various parties to enable our staff on no-pay leave to have other income opportunities.

“We are especially grateful for Temasek’s strong vote of confidence.

“The board is confident that this package of new funding will ensure that SIA is equipped with the resources to overcome the current challenges, and be in a position of strength to grow and reinforce our leadership in the aviation sector.”

The aviation sector is a key pillar of Singapore’s economy, supporting more than 12 per cent of the country’s GDP and 375,000 jobs.

The group is at the heart of the aviation ecosystem, with SIA, SilkAir and Scoot accounting for more than half of the passengers flying in and out of Changi Airport.

Coronavirus

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Transport

EU carriers request relief from paying refunds

IATA is calling for European Union regulators to temporarily
suspend the requirement that European airlines offer refunds when flights are
canceled. 

The request comes as airlines in Europe and elsewhere have
canceled an unprecedented number of flights due to the Covid-19 crisis. Some
carriers have unilaterally decided to suspend refunds or make them more
difficult to process. 

“Permitting the use of vouchers instead of refunds, as has
been allowed for some tour operators, would give airlines breathing space to
repair cash flows,” IATA said. 

According to the CAPA Centre for Aviation, scheduled
European flight capacity is down 59% this week from a year earlier. The real
reduction is likely higher, CAPA added, since the data did not appear to
reflect the true extent of announced flight cuts. 

Among European carriers, Swiss already states on its website
that it is not currently processing any refunds on any sales channels so that
it can focus on cancellations and rebookings. 

EU carriers Air France, KLM, Aegean, Olympic Air and Plus
Ultra Lineas Aereas have informed ARC that they will manage all refunds
directly and not allow them to be processed via GDSs or ARC’s Interactive Agent
Reporting (IAR) system.

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Transport

Airlines Eliminate Middle Seats, Reduce Food and Beverage Service

Major U.S. air carriers are making sweeping policy changes to their services and policies in light of the COVID-19 outbreak, implementing measures to minimize flight attendant-to-customer interaction, maximize the distance between passengers and discourage customers congregating by shutting down airport lounge areas.

According to CNN Business, the implementation of several of these strategies is made easier because many of those flights that are still in operation are flying with only 20- to 30-percent of passenger seating filled.

American Airlines, Delta and Southwest have all issued announcements that they’re scaling back food-and-beverage service in an effort to cut costs and reduce the number of items being handled by cabin crew.

American Airlines

American Airlines’ temporary changes come with an assurance that full service will resume once the coronavirus situation has stabilized, and that the company expects to soon make snacks and bottled water available at the gate.

From March 27 through April 30, on flights under 2,200 miles (typically about 4.5 hours):

—No meals will be served in First Class

—No snacks or food will be available for purchase

—No alcohol will be served in the Main Cabin, although it will be available in First Class

—Beverage choices (upon request) will be limited to water, canned beverages or juice

On Flights over 2,200 miles, including transcontinental and Hawaii flights:

—Alcohol will be available in First Class, but not in the Main Cabin (except on long-haul international flights);

—Standard beverage service will continue as usual

—Meals in all cabins will be served on a single tray

—No food or snacks will be available for purchase

In accordance with the Centers for Disease Control and Prevention’s (CDC) social-distancing guidelines, American is also relaxing its seating policies, blocking off 50 percent of middle seats, instructing gate agents to reassign seats as needed to maximize space between passengers, in some instances, allowing fliers to switch seats within their ticketed cabin.

Effective March 26, all of American’s Admiral’s Club lounge services—including food and beverage offerings, restrooms and shower facilities—will be temporarily suspended and most locations closed entirely. Checked pet service is also being suspended, though carry-on pets and service/support animals are still permitted.

Your safety is important. We’ve made changes to our seat assignments and service offerings to allow for social distancing and less interaction while in flight. pic.twitter.com/NV5iikZDsI

Delta Air Lines

Effective immediately, on all U.S. domestic and short-haul international flights, Delta’s in-flight service has been streamlined to “decrease physical touch points on board”.

—Snack selections have been reduced to two

—Across all cabins, bottled water is the only beverage available

—Plastic cups and ice have been removed

—First Class and Delta One meal service is being replaced with individually pre-packaged Flight Fuel boxes

Across all U.S. domestic and international flights, Delta has already removed glassware and hotel-towel service from First Class and Delta One. Delta’s statement on the subject said that it’s also currently evaluating adjustments to be made to its long-haul international flying protocols. Separately, Delta Sky Club lounges have cut back food-and-beverage options, discontinued shower service and completely closed in many locations.

Southwest Airlines

While Southwest doesn’t operate lounges or first-class cabins, the airline is also making some changes to protect the health of its crew and customers, informed by health officials’ recommendations for limiting close public interactions. It’s temporarily suspending all in-flight snack and beverage services, with the exception of canned water, available upon request.

United Airlines

United hasn’t announced any alterations to its onboard service, as yet. The airline commented to CNN Business that it has no immediate plans to make the types of changes instituted by its competitors, but has adjusted protocols so that its flight attendants wear gloves, beverage cups are no longer being refilled and snacks are being served from a tray, rather than allowing guests to pick their own.

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Transport

IATA Now Says Coronavirus Could Cost Airlines $250 Billion

Less than three weeks after saying the airlines could lose $113 billion in revenue due to the coronavirus pandemic, the International Air Transport Association (IATA) has revised its estimates.

And it’s not good.

The industry advocate now says global passenger revenues could fall by $252 billion this year – 44 percent down from 2019’s figures.

“The airline industry faces its gravest crisis,” warned IATA’s Director General and CEO, Alexandre de Juniac. “Within a matter of a few weeks, our previous worst-case scenario is looking better than our latest estimates. But without immediate government relief measures, there will not be an industry left standing. Airlines need $200 billion in liquidity support simply to make it through. Some governments have already stepped forward, but many more need to follow suit.”

de Juniac’s words came before the U.S. Senate came to an agreement to bail out American carriers with $58 billion in loans as part of a new stimulus package.

IATA said its $113 billion figure from earlier this month was an estimate “before countries around the world introduced sweeping travel restrictions that largely eliminated the international air travel market.” It said that the new $250 billion figure was based on “severe travel restrictions” lasting for up to three months, followed by a gradual economic recovery later this year.

While several governments have jumped in to help, United Kingdom Chancellor Rishi Sunak said that the government would only step in to help airlines as “a last resort.”

“Despite the significant economic interventions we have put in place, we will not be able to protect every single job or save every single business,” Sunak said.

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Transport

Regional carrier implements social distancing on the plane

West Coast short-haul airline JSX has capped flights at 20
passengers in order to practice social distancing on the plane during the Covid-19 pandemic.
The change took effect on March 23, said spokeswoman Meghan Patke.

JSX operates scheduled flights from private air terminals
and flies a fleet of 30-seat Embraer ERJ135 and ERJ145 aircraft. That business
model already made JSX a potentially safer option for those who must fly right
now than traditional carriers flying larger aircraft from commercial airports. 

The airplanes are configured with one seat on the left side
and two on the right. Under the 20-person limit, people traveling together can
still sit abreast on the right side, Patke said. 

“Otherwise, they will be spaced as far apart as possible to
adhere to the 6-foot-apart requirement for social distancing,” she said. 

JSX is currently flying eight combined routes involving
Phoenix, Las Vegas, Orange County, Burbank, Oakland and the East Bay community
of Concord.

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Transport

Wizz Air cuts services, reassures passengers on long-term survival

Wizz Air has grounded around 85 per cent of its fleet and mooted the possibility of a complete suspension of services in its latest operational update.

While capacity at the low-cost carrier fell by only 30 per cent year-on-year in March, much larger cuts are expected next month.

The company continues to operate 15 per cent of its capacity and remains operational in Romania, Hungary and Bulgaria.

However, even this limited service could be cut as potential additional travel restrictions and social distancing policies issued by authorities may make international flying for commercial purposes either untenable or impossible.

For the avoidance of doubt, Wizz Air emphasised it would resume all flights as soon as reduced travel restrictions and governmental policies allow commercial operations.

József Váradi, Wizz Air chief executive, added: “Our ever-disciplined attitude to cost and cash enables Wizz Air to take decisions that are right for crew, passengers and communities even in the context of demand and travel restrictions due to the Covid-19 pandemic in Europe.

“Wizz Air’s ultra-low-cost business model and our strong balance sheet provide a solid foundation and a significant competitive advantage in the current challenging environment for airlines, while also making us a long-term structural winner in the aviation sector.”

To secure its financial position during the reduction in capacity, however, the company has implemented additional cost-reduction measures in third-party spending, overhead spending, discretionary spending and non-essential capital expenditure.

Wizz has also rolled out a series of voluntary working hour reduction and leave options to employees.

“While difficult to predict the duration of the pandemic, given the significant balance sheet strength and liquidity, as well as the company’s business model, Wizz Air is confident in its ability to survive even a potential prolonged grounding substantially beyond the current estimates for the impact of Covid-19 in Europe,” Váradi concluded.

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Transport

India suspends passenger train services until March 31

India to spend $1.3bn to boost pharmaceutical production

The railways ministry said passenger rail will stop with immediate effect though freight services will continue, according to a statement on Sunday.

India suspended passenger train services across the country until March 31 as the government tries to curb the spread of the coronavirus outbreak.

The railways ministry said passenger rail will stop with immediate effect though freight services will continue, according to a statement on Sunday.

Pharmaceutical boost

Meanwhile, India will also set up a nearly 100-billion-rupee ($1.3 billion) fund to encourage companies to manufacture pharmaceutical ingredients domestically after supply chain disruptions due to the coronavirus pandemic exposed the country’s dependence on China and raised the spectre of drug shortages.

The programme includes spending on infrastructure for drug manufacturing centres, and financial incentives of up to 20% of incremental sales value over the next eight years, according to a government statement.

India imports almost 70% of its active pharmaceutical ingredients — the chemicals that make a finished drug work — from China. A number of those chemicals are sourced from Hubei province, the epicentre of the coronavirus outbreak. As the world’s single largest exporter of generic drugs, India is responsible for about 20% of the world’s supply.

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