IAG Cuts Weekly Operating Costs To $211 Million Per Week

Today, IAG revealed its first-quarter operating results for 2021. As national travel bans have heavily impacted its airlines,…

IAG Cuts Weekly Operating Costs To $211 Million Per Week

Today, IAG revealed its first-quarter operating results for 2021. As national travel bans have heavily impacted its airlines, the numbers weren’t great. The airline group has been able to drop its weekly operating costs to €175 million ($211 million) per week.

COVID-19 restrictions heavily impacted IAG’s Q1 results. Photo: Getty Images

While the United States and China have seen a decent amount of recovery this year, the same cannot be said about Europe. The continent was essentially faced with slow COVID-19 vaccine rollouts, tied with second and third COVID-19 waves around the start of the year. As we move forward into the summer, things are starting to look slightly more optimistic.

The numbers

For the first quarter of the year, the International Airlines Group reported an operating loss of €1.068 billion ($1.29 billion). Of course, with far fewer flights operating and far fewer passengers on those flights, the company’s revenue dropped significantly. In the first three months of Q1, the airline group took in €459 million ($554 million), compared to €3.95 billion ($4.77 billion) last year.

Despite the drop in revenue and the significant loss, The airline seems to be in a reasonably good place in terms of its liquidity. According to today’s report, the group is currently sitting on €10.5 billion ($12.7 billion), up from €10.3 billion ($12.4 billion) at the end of 2020.

IAG, Cargo, Travel Restrictions
Cargo has played a vital role in the business over the past year. Photo: British Airways via Twitter

Cargo remains a big part of the business

In the absence of passengers, cargo remains a big part of the business. According to IAG, it operated 1,306 cargo-only flights during the first quarter of the year. By comparison, this is up from 969 in the fourth quarter of 2020.

IAG’s cargo-only flights are interesting compared to its biggest rivals such as Air France-KLM and the Lufthansa Group. Both of which have dedicated freighter aircraft. IAG Cargo has none of its own aircraft, relying instead on belly space in its sister airline’s bellies. This has seen airlines operating some odd routes, such as Aer Lingus flights from Germany to the US.

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A better summer coming?

Across IAG member airlines, there is hope that the summer will be better for the airlines. Indeed, commenting on the situation in Ireland, IAG CEO Luis Gallego said,

“About Ireland, the situation, as Steve explained before, I will say, It cannot be worse!”

British Airways, India, Humanitarian Aid
British Airways will be keen to see travel corridors announced tonight. Photo: Vincenzo Pace – Simple Flying

The UK government, which is home to British Airways, has currently banned non-essential overseas travel. This means that people traveling for a holiday currently face fines of up to £5,000. Additionally, the mandatory quarantine and testing requirements make travel unattractive for many others.

This is set to change from May 17th, when the non-essential travel ban will lapse. On the same day, additional countries should be labeled as green, meaning it is much easier to travel from them. Later today, the government is expected to reveal which countries have made the green list. Expect to see a surge in travel for these destinations. This will be a boon for IAG and British Airways in particular.

What do you make of IAG’s first quarter? Let us know what you think and why in the comments!

Source : Simple Flying More   

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The Airline Startups Finding Opportunity In A Crisis

You wouldn’t think in the midst of a pandemic, launching a new airline would be a good idea.…

The Airline Startups Finding Opportunity In A Crisis

You wouldn’t think in the midst of a pandemic, launching a new airline would be a good idea. But there are a few brave souls out there who believe it’s exactly the right time. Let’s take a look at some of the airline startups we’ve seen in recent months who believe they have what it takes to build success out of a crisis.

For some airline startups, the pandemic was an opportunity wrapped up in a crisis. Photo: Avelo

Breeze

In the making long before COVID was a thing, Breeze was officially announced last year. The low-cost airline is another startup from serial airline entrepreneur David Neeleman, and is targeting secondary cities with point to point routes. Dubbed the ‘nicest’ airline you’ll ever fly, Neeleman is hoping to capture traffic on underserved direct routes.

Breeze
Breeze has billed itself as operating new nonstop routes as a “nice” carrier. Photo: Breeze Airways

It will launch later this year with Embraer 190s and 195s, but will soon begin adding A220s to its fleet as well.

Avelo

Avelo took the market by surprise. It had barely been noticed until it broke onto the scene, launching its first flight in late April from Hollywood Burbank in California. Much like Breeze, it’s targeting point to point services on underserved routes, and is headed up by ex-United Airlines executive Andrew Levy.

Avelo Aircraft Interior & Exterior 737
Avelo began flights in the US last month. Photo: Avelo

It currently has just three Boeing 737 NGs in service, but has big plans for expansion. Just this week, it was announced to be eyeing an East Coast base in Connecticut, so its keenly snapping up market share and taking the opportunities where it can.

EGO Airways

Moving away from the US, EGO Airways is planning to fill the gaps in Italy’s domestic market. Flying 11 routes initially, it will connect various Italian cities with its two 100-seat E190s, operating some interesting W rotations to accommodate six sectors a day.

EGO Airways
EGO Airways will be an Italian domestic workhorse. Photo: EGO Airways

EGO undertook its maiden flight in early April, and has more routes launching over the coming weeks. From June, it will base a third aircraft at Milan Bergamo, operating routes to Rome and other destinations as we move into peak summer.

PLAY

With a gap in the Icelandic low-cost market still yet to be filled since WOW ceased operations in 2019, PLAY is tipped to be the one to fill it. The airline has been building its finances, personnel and operational infrastructure for a couple of years now, and looks to be finally ready to take off.

PLAY icelandic airline
PLAY is set to receive its first A321neo later this month. Photo: PLAY

PLAY will serve European destinations first, including Paris, London, Copenhagen, Tenerife and Alicante. It is set to receive its first A321neo later this month, with two more joining the fleet in July. Launch is slated for June 24th. There is still plenty of ambition at PLAY to go transatlantic too, with a rough plan to begin flying to the US from December this year.

FlyPOP

It’s been almost two years since Simple Flying caught up with Nino Judge, CEO of UK startup flyPOP. Now, the airline is eyeing a launch of services between the UK and India, using leased A330s that it signed up for last month. With aircraft on the books, the airline can now apply from its Air Operator Certificate, ahead of beginning flights.

flypop
flyPOP is leasing A330s for low-cost India services from the UK. Photo: flyPOP

Targeting VFR traffic, flyPOP describes itself as the ‘UK’s only long-haul, low-cost airline’. It intends to target underserved and overpriced direct connections to India, including to Amritsar and Ahmedabad.

AVA Airways

Based in the Dominican Republic, AVA Airways wants to service the demand between its home at Santo Domingo and various Caribbean, Latin American and North American destinations. It has floated Europe and Africa too, and plans to launch service in the second or third quarter of this year.

Ava Airways
Based out of the Dominican Republic, AVA wants to connect to multiple continents. Photo: AVA Airways

Headed up by Olivier Arrindell, the airline has some ambitious growth plans. It plans to start service with Airbus A320s, and received its license from the Dominican CAA in March this year. Within its long term plan are subsidiary airlines in Curacao and Sint Maarten, both of which have been incorporated under the brand but not yet launched.

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And there’s more

That’s not all. There are a bunch more airline startups risking it all in spite of COVID. Lattitude Hub in the Canaries, bus company founded ITA Transportes Aereos, PRAGUSA.ONE, Super Air Jet, Ecuatoriana… the list goes on.

Although air traffic might be stifled due to the pandemic, these startups are actually launching from a very strong position. Leasing rates for aircraft are super low, there’s plenty of secondhand vehicles around to choose from, and jet fuel is still cheaper than it has been for many years. Add to that the fact that, unlike most existing carriers, these airlines are entering the industry unburdened by debt, you can see the attraction.

Watching startups form, evolve and launch is always interesting, as is getting into the minds of those who are founding these challengers. The forthcoming FTE APEX Virtual Expo offers an opportunity to do just that, with a session specifically for these new and emerging carriers. The ‘New Airlines C-Suite Summit’ will take place on Tuesday May 25th at 13:30 London time. Featured speakers will be:

  • Olivier Arrindell – CEO of Ava Airways
  • Matteo Bonecchi – CEO of EGO Airways
  • Arnar Magnusson – COO of PLAY
  • (Nino) Navdip Singh Judge – CEO and founder of flyPOP

The session will be moderated by familiar BBC World Service face Aaron Heselhurst, a news presenter and anchor for the service. It should be a super interesting session and a chance to hear from these executives what the visions and ambitions of their airlines are.

In addition to the New Airlines C-Suite Summit, FTE APEX Virtual Expo features:

  • 100+ speakers, including the CEOs of United Airlines, Etihad, AirAsia, WestJet, oneworld, Saudia Airlines, Scoot, Dallas-Fort Worth Airport, Gatwick Airport, Los Angeles World Airports, Pittsburgh Airport, and Western Sydney Airport.
  • 150+ airlines and airports have already registered for a free access-all-areas pass including the virtual exhibition hall, conference sessions, and networking areas.

Early bird registration ends today – May 7th – so reserve your place today.

Source : Simple Flying More   

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