Climate now ‘top of the agenda’ for investors as airlines try to lower carbon emissions

Escalating pressure from investors is pushing airlines to address environmental concerns, according to the International Air Transport Association (Iata), which acknowledged that the trend toward “flight-shaming” could weigh on the industry’s future growth.

Speaking at a conference in London where airlines vied to demonstrate plans to decarbonise, Iata said the climate was now “top of the agenda” for investors.

Citing HSBC research, Iata’s chief economist, Brian Pearce, said climate issues came up an average of seven times on each call between European airlines and investors in 2019, compared with an average of less than once per earnings call between 2013 and 2017.

Pearce said: “Climate change is not just an issue for protesters or scientists. You can see the spike this year. This is on the top of the agenda for mainstream investors now. We’re getting pressure from all quarters.”

He said flygskam, or flight-shaming – the trend towards making air travel socially unacceptable due to its carbon cost – “could be a factor slowing growth in the future”.

Although airlines have signed up to the Corsia offsetting scheme set up by the UN aviation agency, ICAO, many believe taxes and a consumer backlash could grow. Shai Weiss, Virgin Atlantic’s chief executive, said: “If there is one name everyone in the airline industry knows todaythat it perhaps didn’t know a year ago, it’s Greta Thunberg.”

However, Pearce said that even if Europeans flew less, the predicted growth of air travel in China alone would mean an additional 1.5-2bn passengers travelling each year by 2040. “Solving the climate issue really depends on China, India and Asia,” he said.

Álex Cruz, the chief executive of British Airways, which last week promised to offset all domestic flight emissions, said the airline would make it easier for customers to voluntarily offset international flights. He said there were “huge areas of opportunity” to cut emissions via better air traffic management, while changes such as lighter food trolleys on BA’s fleet had cut 30,000 tonnes a year of CO2 emissions.

Virgin’s new feeder airline, Virgin Connect (formerly Flybe), could axe some routes over environmental concerns, its boss suggested. Mark Anderson, the chief executive of the parent company Connect Airways, said it might decide certain journeys made more sense by train or car.

He told PA news agency: “We need to be responsible. Maybe there are some routes in the future that we will potentially not fly.”

The pledge appeared to be one for the long term, as Weiss told the Airlines 2050 conference that his ambition was for Virgin Connect to operate 12 domestic routes to Heathrow. Virgin Atlantic wants to use the airline’s fleet of 70 aircraft to ensure enough connections to prop up a long-haul network to rival BA’s.

Our Source: https://www.theguardian.com/business/2019/oct/17/flight-shaming-could-slow-growth-of-airline-industry-says-iata

Ethiopian Airlines will fly daily nonstop between Brussels and Addis Ababa from October 28.

The flag carrier currently makes stopovers in Vienna three days per week, increasing the journey time from seven hours to nine hours.

The daily service will depart Brussels at 2130 and land in the Ethiopian capital at 0630, while the return departs at 0045 and lands at 0615.

It will be operated by a mix of Boeing 787s and 777s, Luchtvaart Nieuws reports.

Ethiopian is the only carrier with nonstop flights between the capitals.

The Star Alliance member provides connections to more than 50 destinations around Africa, as well as seven domestic airports.

It also encourages passengers to visit Addis Ababa by allowing passengers to extend their layover at no extra cost.

The airline is now the largest in Africa, and one of the continent’s most profitable.

It launched its first flights from the UK’s Manchester Airport late last year. While the four weekly Manchester flights to Addis Ababa stop in Brussels, the airline said these won’t change with the Brussels increase.

It also added that its Vienna flights will continue to operate, along with Geneva and Marseille.

A $363m second terminal recently opened at Addis Ababa Bole International, more than doubling the airport’s capacity to 22 million annual passengers, though when Business Traveller visited earlier this year it still had several areas waiting to be completed.

Our Source: https://www.businesstraveller.com/business-travel/2019/10/15/ethiopian-airlines-to-fly-brussels-addis-ababa-nonstop-daily/

Swiss says it has resumed all flight operations after it grounded its entire fleet of A220 aircraft on Tuesday.

“As of today [Thursday], Swiss flight operations are resumed on a regular basis, meaning all 29 A220 aircraft have been inspected (with no findings) and released,” a spokesperson told Business Traveller.

Around 100 flights were cancelled this week, affecting 10,000 passengers, after Swiss took the decision to ground the A220s following what it called “technical irregularities” on various short-haul flights.

Swiss said there have been three “incidents” since July 25 involving the aircraft, but added that it could not make further statements about the cause as it was coordinating with engine manufacturers Pratt and Whitney as well as Airbus Canada.

It also said: “The safety of our customers and crews is our top priority.

“We very much regret the inconveniences for our passengers. Swiss will actively inform affected passengers if contact details were provided at the time of booking. They will be rebooked to the best possible alternative at Swiss’s expense.

“In addition, tickets of passengers who were/are booked on a cancelled flight can be rebooked or refunded free of charge.”

The Lufthansa group airline has 20 of the A220-300 variant and nine of the A220-100.

The A220 is a single-aisle plane that was formerly known as the Bombardier C Series before Airbus took a majority stake in the project.

“Together with the engine maker we are supporting our customer in its daily operations,” an Airbus spokesman told Bloomberg by email.

Our source: https://www.businesstraveller.com/business-travel/2019/10/15/swiss-cancels-flights-as-a220s-grounded-for-technical-inspections/

Passengers using fast trains operating between Nairobi and Mombasa are set to lose the freedom to bring food and drinks from outside, the Kenya Railways has said.

Under the new changes set to take effect “soon”, passengers travelling on the standard gauge railway (SGR) will no longer be allowed to carry packed food and drinks as they have done since the Madaraka Express train was launched in June 2017.

Just like the promotional prices, which lapsed several months back, travellers will have to buy food and drinks on offer inside the coaches by NAS Airport Services. NAS is a local subsidiary of Servair, the third-largest airline catering and logistics business globally.

“Kenya Railways wishes to remind our passengers and customers that alcoholic and non-alcoholic beverages and cooked food are strictly prohibited into the termini and stations.

“Those items will be confiscated at security checkpoints at the termini and train stations. Please note that items once confiscated will not be repossessed,” said the firm in a public notice yesterday.

Source: https://www.businessdailyafrica.com/economy/SGR-no-carrying-own-food-and-drinks/3946234-5297696-9dj4jgz/index.html

Budget airline East African Safari Air Express (formerly Fly-SAX) will resume flights between Nairobi and Isiolo after a nearly 15-month hiatus from the route on Friday next week.

The company, which rebranded to East African from Fly-SAX, a sister airline to Fly540 Kenya, said the new flights would originate from Wilson airport twice a week.

The route will be served by a Beechcraft-1900 aircraft that carries 16 passengers.

“We have done it before from September 2017 and withdrew operations in June 2018. We are now resuming operations starting October 11, 2019, after getting regulatory approvals from the Kenya Civil Aviation Authority,” said airline’s director George Kivindyo.

The airline halted its services from the route citing poor performance.

“We will fly twice a week moving into daily flights subjected to support from the relevant stakeholders,” he said.

Source: https://www.businessdailyafrica.com/corporate/companies/Fly-SAX-resumes-Isiolo-flights-after-15-months/4003102-5296302-f0px7az/index.html

Kenya Airways (KQ) and Oman Air have expanded their existing codeshare to increase the number of destinations where the two carriers can connect passengers.

The codeshare expansion effected Wednesday will allow seamless connectivity to Oman Air guests travelling beyond Nairobi to Entebbe and Johannesburg.

“Similarly, Kenya Airways guests can now extend their travel beyond Muscat (Oman) to Karachi (Pakistan) and Lahore (Pakistan),” said KQ in a statement.

The previous codeshare, which commenced in August 2017 between the two airlines, has been covering services between Muscat and Nairobi.

KQ says it would use the partnership to extend its services to tourists as well as to travellers visiting friends and families in Oman through the cultural links that Oman shares with the coastal parts of Kenya and Tanzania.

“This cooperation also expands our footprint in the Middle East through the Muscat gateway and is consistent with KQ’s strategy to improve its network efficiency, grow through partners while focusing on the high yield corporate and leisure segments,” said KQ Chief commercial officer Ursula Silling

Other destinations to be added through codeshare are Dar es Salaam (Tanzania), Bangalore (India), Chennai (India), New Delhi (India), Hyderabad (India) and Jeddah (Saudi Arabia).

“We are very happy with the extension of this codeshare which offers our guests an opportunity to travel beyond Nairobi and Muscat,” said Abdulaziz Al Raisi, Oman Air CEO.

Source: https://www.businessdailyafrica.com/corporate/companies/KQ–Oman-Air-add-more-routes-in-codeshare-deal/4003102-5294950-9cpcj8/index.html

The Kenyan aviation industry supports up to 620,000 direct and indirect jobs including employment in the tourism sector, a study by the International Air Transport Association (IATA) has concluded.

The aviation industry contributed nearly Sh330 billion ($3.2 billion) to Kenya’s economy, or 5.1 per cent of the country’s Gross Domestic Product (GDP), according to the IATA report.

The findings are among highlights of the Importance of Air Transport to Kenya study which was conducted by Oxford Economics on behalf of IATA.

“The study confirms the vital role that air transport plays in facilitating more than $10 billion in exports, some $4.4 billion in foreign direct investment and around $800,000 in inbound leisure and business tourism for Kenya,” said Muhammad Albakri, IATA’s regional vice president for the Middle East and Africa.

“However, by adopting policies that ensure a competitive operating environment for the airlines, Kenya could reap even greater dividends from aviation,” he added.

According to executives surveyed by the World Economic Forum, Kenya’s transport infrastructure quality score places the country sixth out of 37 African countries surveyed and 78th globally.

Kenya was ranked 31st out of the 37 African countries for cost competitiveness in the air transport industry, based on air ticket taxes, airport charges and Value Added Tax.

On visa openness, Kenya was ranked 10th out of the 37 African countries which were in the survey.

Around 130,000 aircraft land and take off from one of Kenya’s five main airports every year.

The Jomo Kenyatta International Airport is the key gateway and handled more than 5.8 million passengers in 2014.

“While Kenya’s air transport infrastructure ranks highly among African states, it is important that heavy fees, taxes and charges do not hold aviation back,” Mr Albakri said.
“We are very encouraged by the news that the Kenya Airports Authority (KAA) has embarked on a study to review Airport charges downwards.”
Mr Albakri who is soon making his first visit to Africa in his new capacity, also expected to visit Kenya.

During his visit to Nairobi, the IATA official will be meeting with key industry stakeholders including officials from the government, the Kenya Civil Aviation Authority, KAA and the African Airlines Association.

Source: https://www.businessdailyafrica.com/corporate/companies/Kenya-aviation-industry-supports-620-000-jobs/4003102-3980024-ylro5yz/index.html

Kenya Airways has pulled out from two West African countries, Gabon and Benin effective October 14, 2019.

Reasons for the withdrawal is the routes are no longer profitable to the firm which is already saddled with huge losses.

Travelers to the two destinations, beyond this date, will be rerouted or re-booked through KQ partner airlines.

“We have made the necessary arrangements to continue serving our customers who had made forward bookings through our existing cooperation with partner airlines to ensure no disruption to their travel,” said Kenya Airways Chief Commercial Officer, Ursula Silling.

The decision to suspend flights to two cities of Libreville and Cotonou is in line with the airline’s strategy to align its network worldwide. Kenya Airways will continue to optimise its network in order to serve its customers better while adapting to the constantly changing market demand.

Kenya Airways, which is being renationalised to save it from mounting debts, saw its first-half pretax loss more than double from a year earlier to Sh8.56 billion.

Parliament voted in July to renationalise the loss-making airline, which is labouring under a mountain of debt and has had three changes of chief executive in the past five years as it struggles to compete with regional rivals.

The government plans to buy out minority shareholders including Air France-KLM’s 7.8 per cent stake.

The carrier said its first-half revenue rose 12.2 per cent from a year earlier to 58.55 billion shillings, which Chief Financial Officer Hellen Mathuka attributed to the launch of new routes and more frequent flights.

Source: https://www.standardmedia.co.ke/business/article/2001342566/kenya-airways-stops-flying-to-gabon-benin

Low-cost carrier Jambojet has received approvals from the Rwandese Civil Aviation Authority to start flying to Kigali, the first of several routes the airline has lined up in its regional expansion plan.

Speaking while unveiling a newly acquired De Havilland Dash 8 – Q400 aircraft, Jambojet chairman Vincent Rague said the carrier was looking eager to operate on the route.

“Kigali is one of the routes we have been pursuing in our expansion plan. Once we have everything in place, we will begin operations,” Mr Rague said.

Mr Rague said the African aviation sector had an opportunity to grow adding that more players were coming on board “as there is enough space for everyone.”

The new aircraft brings to six the airplanes operated by Jambojet. It is also the first of four aircraft that were expected this year to boost the airline’s capacity as it looks to soar into more African destinations.

Jambojet chief executive Allan Kilavuka said plans were afoot to fly to more African destinations saying, “and that is why we are expanding our fleet.”

“The addition of this aircraft to our fleet brings the average age to 3.7 years, making us the airline with the youngest fleet in Africa and possibly across the world,” he said.

Jambojet currently flies to five local destinations namely; Malindi, Ukunda, Mombasa, Kisumu, Eldoret and one regional destination -Entebbe, Uganda -from its hub in Nairobi.

It also flies to Bujumbura, Burundi on behalf of the national carrier.

The International Air Transport Association’s data shows that low-cost carriers account for about a quarter of all flights internationally, but less than 10 percent in Africa.

Source: https://www.businessdailyafrica.com/economy/Jambojet-gets-nod-to-fly-into-Kigali-/3946234-5279982-2mcepdz/index.html