COVID-19 LIVE BLOG: March 27
As the number of confirmed cases of Covid-19 in the US tops 85,500, the largest total worldwide, Corporate Jet Investor’s live Covid-19 blog continues to bring you news and views from business aviation.
Please send any news or comments to [email protected]
- All UK business aviation flights ‘on the verge of grounding’: BBGA
- Munich Airport boss: ‘No end in sight to global transport crisis’
- Gatwick Airport to close North Terminal and limit flight hours
- FAA updates Part 135 training procedure
- New business aviation group aims to mitigate Covid-19 risks
- Recovery process for business aviation could be long term
- CARES boosts Boeing and Textron share prices
- Malta Business Aviation Association requests resumption of business flights.
Luxaviation launches solidarity initiative for business aviation industry
Luxaviation Group has launched the European Business Aviation Solidarity Initiative (EBASI) in response to the coronavirus crisis. EBASI is a solidarity endeavour which puts Luxaviation’s administrative, financial and procurement resources at the service of smaller and operators.
Over the next three months, starting today, Luxaviation pledged to support the European aviation industry by sharing some of its expertise in procurement, purchasing power and finance resources to operators for free.
Patrick Hansen, CEO of Luxaviation Group said: “As a major group we have to take our responsibility towards our clients, partners and the industry in general. We build our business on resources that smaller operators are lacking during lockdown. This initiative allows them to focus their limited resources on keeping their clients and assets safe, which is paramount to keep the industry as healthy as possible.”
The EBASI initiative allows operators to enjoy where possible the same pricing that Luxaviation gets from suppliers as well as to take advantage of the Luxaviation’s payment terms. It also provides operators with the possibility to get access to all documents required to be sent to authorities and other agencies alike to reduce costs.
“We also invite EBAA to join the EBASI initiative”, said Hansen, “With the financial support of EBAA a ‘guarantee fund’ could be set up and CAA, Eurocontrol and various European Institutions could make sure that the rescue funds are flowing. In case EBAA was ready and on-board the initiative, we would be very much inclined to put EBASI under their supervision or coordination.”
The Group’s initiative focuses currently on Europe but might be extended to other parts of the world.
Operators interested in the initiative can get in touch with Luxaviation’s chief operations officer, Joao Casimiro or group rresident of wholesale, Christophe Lapierre at [email protected].
All UK business aviation flights ‘on the verge of grounding’: BBGA
All business aviation flights could be halted by the end of next month due to the Coronavirus pandemic, according BBGA CEO Marc Bailey.
Bailey told AIN that UK business aviation flights could slow to the point of ceasing given the heavy impact of Covid-19 on the aviation market.
“I would suggest that in a couple of weeks we will be in full grounded mode across the sector and I don’t see that changing,” Bailey said.
When asked about how serious the potential impact the pandemic will be for business aviation, Bailey said: “It is highly likely that we will see a significant number of business casualties that will be defeated by cash-flow problems. The magnitude of this depends on how quickly the market opens in a global sense. Clearly it is not just how your home country is performing against the virus, it is how your normal client network is affected. If this spreads out over some three months, then there could be significant losses.”
Given the severe impact to operations and cash flow a full-grounding would have, Bailey called for additional access to government funding for business aviation companies.
“Our sector is now heading to the same position as scheduled airlines where we will struggle to service our debt and cash flow will be the killer. Therefore, all the measures in terms of tax relief, business rates, and access to national funds need to be available to our sector,” Bailey said.
Longer term, Bailey predicts that the impact of Covid-19 will lead to further consolidation in the market, giving strong businesses opportunities for growth.
Munich Airport boss: ‘No end in sight to global transport crisis’
Munich Airport is “in crisis mode” and there is no short-term prospect of an end to the current worldwide transport disruption, warns Jost Lammers, the airport’s President and CEO.
“We are experiencing a crisis in global air transportation on an unprecedented scale, with no end in sight,” said Lammers. “Protecting the health of the passengers and employees at Munich Airport remains our top priority. Another vital concern is to limit the enormous economic damage for Munich Airport and the people working here by taking all necessary measures to preserve our financial stability.”
Flight restrictions arising from the global Covid-19 pandemic had resulted in “drastic reductions” in flights. The number of take-offs and landings fell steadily in March and this week (Week 17) plunged to less than 10% of the total achieved in the same period last year. Passenger traffic had fallen to 5% of last year’s level.
‘Far exceed the impact of the terrorist attacks’
“The effects of the coronavirus crisis far exceed the impact of the terrorist attacks of September 11, 2001, or the global financial crisis in 2008,” said Lammers. “Consequently, it may take significantly longer this time before demand returns to the previous level. Nor can we rule out structural changes in air traffic. But I have no doubt that the global need for mobility will increase in the medium term and that air travel will, therefore, return to growth once more”, said Lammers.
Munich Airport will continue to operate in order to help people returning home and to speed the shipment of cargoes, pledged Lammers. Airlines now have over 100 out-of-service aircraft parked at Munich Airport. Unneeded infrastructure in areas of Terminal 1 and the Terminal 2 have been temporarily shut down.
Shipment of cargoes
The airport’s owner Flughafen München GmbH (FMG) and its subsidiaries began a programme of cost cutting measures several weeks ago. These included limiting personnel and material costs. Planned investment projects, such as a new parking facility and new corporate headquarters, have been postponed.
Meanwhile, in annual results posted today (March 27th), the company revealed record earnings after taxes (EAT) of €175m last year. Consolidated revenues rose to €1.6bn.
The number of take-offs and landings rose by 1% percent to nearly 417,000. About 8.4m passengers benefited from 59 intercontinental connections offered at Munich Airport, according to the company. “We want to continue that trend when the current global crisis in aviation is over,” said Lammers. “Despite the expected massive decreases in traffic this year, our airport retains its enormous potential for continued dynamic growth.”
Below: “We are experiencing a crisis in global air transportation … with no end in sight …”: Jost Lammers, airport President and CEO.
Gatwick Airport to close North Terminal and limit flight hours from April 1st
London’s second biggest commercial airport, Gatwick, will be consolidating all of its operations to its South Terminal on 1 April in response to the ‘unparalleled impact’ of the Coronavirus on commercial flights.
The North Terminal will be closed for a minimum of one month and the situation kept under regular review. During the month, all scheduled flights will take place at the South Terminal between 1400 and 2200 hours.
The ‘dramatic fall in airline traffic’ was cited as the reason for the closure. The terminal will reopen when traffic at the airport increases and public health advice, including social distancing guidelines, is relaxed.
Stewart Wingate, CEO, Gatwick Airport, said: “Gatwick is a resilient but also responsible business and during these extraordinary times we need to take unprecedented measures to protect the health and wellbeing of our staff and passengers, while also shielding the business from the impact of Coronavirus.
Duncan Aviation to host free sanitising webinar next week
Duncan Aviation is hosting a free online webinar on cabin disinfection on April 3rd next week.
In the midst of a global pandemic, Duncan Aviation Critical Resource Mast Specialists will be explaining two different ways operators and MRO’s can disinfect aircraft to prevent the spread of viruses.
The webinar will cover a sanitizing method devised by Duncan Aviation for aircraft arriving and departing its MRO facilities which it hopes to implement and make available to customers in the next few weeks.
It will also cover how to use an Aviation Clean Air Ionization System – a long term approach to prevent virus contamination onboard aircraft by cycling fresh air and sanitizing surfaces during flight.
The free webinar will take place at 2pm CST and will be hosted by join Duncan Aviation Critical Resource Master Specialists Rob Weyant and John Simms, and Aircraft Clean Air Sales Consultant Vince Restivo.
Business aviation may be better prepared
Business aviation may be better prepared for the downturn caused by the Covid-19 pandemic than it was for the 2008 financial crisis, says analyst, Brian Foley.
He noted in a report, dated 25th March, that in a matter of days the industry has moved from optimism over a promising start to 2020 “to a state of bewilderment, uncertainty and anxiety”.
While it is difficult to predict how business jet sales and activity will fare, “based on the recent avalanche of negative financial news”, Foley said “the industry is arguably in better shape to weather this downturn than it was going into the pummelling 2007-2008 financial crisis”.
Foley attributes this to the relative strength of the US market, which he describes as “the epicentre of business aviation”, with 63% of the worldwide fleet based in the country – equivalent to around 14,200 “active jets”.
Before the Covid-19 pandemic, US stock markets had been at ”all-time highs that were 67% above 2007 levels, with quarterly corporate profits around a third higher”, he notes.
Manufacturing was improving, job growth strong, consumer strength was “meaningful” and business investment healthy. “The most important economy to the industry was clearly in better shape before this downturn than it was in the last crisis.”
Added to this, reforms to the financial system following the 2008 recession have required banks to hold greater reserves and adopt tighter lending standards, providing added liquidity and reduced credit risk. “For those who need to finance or lease a jet, rates are significantly lower than they were back then,” he added.
FAA updates Part 135 training procedure
The Federal Aviation Administartion (FAA) has made four temporary exemptions to Part 135 training in order to ensure charter operators can still fly during the Coronavirus pandemic in response to calls from the National Business Aviation Association.
You can read the full list of exemptions below:
On March 25, the agency issued the following four exemptions in effect through May 31, 2020, and applicable to most Part 135 operators:
- FAA-2020-0291, exempting Part 135 operators from the requirement that crewmembers don protective breathing equipment or oxygen masks during recurrent and upgrade training, testing and checking.
- FAA-2020-0292, allowing Part 135 ground personnel and crewmembers to complete recurrent training and qualification activities up to three calendar months after the month that the activity was due to have been completed, for requirements that were due to be completed through May 31, 2020.
- FAA-2020-0307, exempting Part 119 certificate holders, including some Part 135 operations, from the requirement that crewmembers don protective breathing equipment or oxygen masks during recurrent and upgrade training, checking and evaluation.
- FAA-2020-0308, allowing Part 119 certificate holders, including some Part 135 operations, allowing ground personnel, crewmembers and dispatchers to complete recurrent training and qualification activities up to three calendar months after the month that the activity was due to have been completed, for requirements that were due to be completed through May 31, 2020.
You can read the full story on the NBAA website here.
New business aviation group ‘will help mitigate Covid-19 risks’
A new community group for business aviation, dedicated to delivering data, knowledge and solutions, will help firms mitigate the impact of the Covid-19 global pandemic, claims risk management, insurance brokerage and advisory company Willis Towers Watson.
Commenting on the group, known as A Class, the firm’s CEO Global Aerospace, John Rooley, told Corporate Jet Investor: “Understanding risk is even more important at times of uncertainty and issues can be better tackled when sectors work as a community. The core purpose of A Class is to provide a platform for business aviation operators. Evolving risks and unprecedented crises, such as Covid-19, require collective action.”
A Class focuses on data analytics and risk strategy and is designed to equip business aviation operators with data and expertise to help them analyse and mitigate risks.
Equip business aviation operators
The closed group has three main features which deliver benefits to clients: Data, Knowledge and Solutions, said Rooley. “The group’s accessible data platform provides analytical insight, which enables you to analyse your data and ultimately building your own risk management function,” he said.
Knowledge is delivered by the evaluation of risk and the business aviation sector landscape through industry insights, events and market updates. The benefits are said to be supporting a pro-active response to sector developments and risk trends.
Solutions for assets and people
Finally, customised innovative solutions are claimed to support the assessment of risks relating to people and assets. The benefits are providing solutions for assets and people risks and ensuring a holistic approach to risk management.
Rooley told Corporate Jet Investor: “A Class was developed after years of collaboration with clients in the business aviation sector. Client conversations confirmed there were benefits from creating a forum connecting the sector, so the General Aviation team at Willis Towers Watson was able to leverage their global resources to create such a community.”
Rooley said the community was restricted in access. “We’re inviting certain business aviation operators to become part of this community. We believe this select grouping will enhance the opportunity to collaborate and make a difference,” he said.
Meanwhile, read more information about the group here.
The new community group for business aviation, known as A Class, will
help firms mitigate the impact of Covid-19 , claims Willis Towers Watson.
Recovery process for business aviation could be long term
Worst case scenario for the business aviation industry could mean a long recovery process for the sector, according to Mike Chase. He added that we can only hope that the impact of Covid-19 is short lived.
To give some indication, Chase constructed the following chart showing Business Jet Transactions Market Trends for the past five years (2016 to 2020) in Europe for new and used sales transactions.
Comparing 2016 through to 2020 for the two months of January and February, the first two months of 2020 is trending down in new and used business jet transactions as reported by JETNET. It is also down compared to the five year average (3.8 New and 36.4 Used). The peak of used business jet transactions (48) is seen in 2018 and new peaked (7) in 2019.
Chase said: “A worst-case scenario would be no sales transactions for the remainder of 2020 for either new or used. However, that is not likely as new aircraft have already been ordered and are in process of being built and completed.
“Used business jet transactions would also be impacted but this is different than ordering a new business jet. The timing for used could be much shorter. Sellers would simply keep their business jet because the buyer pool is gone.”
Chase concluded: “Most companies will actively take steps to build up its liquidity, and to reduce CapEx (capital expenditure) and operating costs. They will get into discussion with the OEM’s, Banks and Financial Institutions to delay, postpone and cancel new and used business jet orders if they can.”
CARES boosts Boeing and Textron share prices
Boeing and Textron share prices saw substantial gains this week following the passing of the US Government’s Coronavirus Aid, Relief, and Economic Security (CARES) bill.
The bill, which will see $2tn injected into the US economy, was passed by the White House and Senate on Wednesday. This includes $500bn worth of business loans and guarantees set aside for industries like aviation that have hit hard by the pandemic.
On Monday this week, Boeing shares were trading at around $105 and has since shot up to $180 following the passing of CARES. Textron shares were trading at around $21 on Monday and climbed throughout the week, closing yesterday at $29.24.
Boeing’s statement on the CARES act
Boeing has released a statement thanking the US administration for passing the US Government’s Coronavirus Aid, Relief, and Economic Security (CARES) bill.
The bill looks to inject $2tn into the American economy to help keep businesses and individuals afloat during the Coronavirus pandemic.
You can read the full statement below.
We thank the Administration, especially the President and Secretary Mnuchin, as well as the Senate for working together to take swift bipartisan action to support the American economy, including the 2.5 million jobs and 17,000 suppliers that Boeing, the aerospace industry and the U.S. rely on to maintain our world leadership in commercial, defense and services. The bill’s access to public and private liquidity, including loans and loan guarantees, is critical for airlines, airports, suppliers, and manufacturers to bridge to recovery.
Boeing’s top priority is to protect our workforce and support our extensive supply chain, and the CARES Act will help provide adequate measures to help address the pandemic. We have also taken a number of measures for affordability and liquidity as we navigate the challenges our industry currently faces, including forgoing pay for our CEO and board chairman, suspending our dividend until further notice, and extending our existing pause of any share repurchasing until further notice.
We appreciate the House taking swift action to support the American people.
Malta Business Aviation Association statement
The Malta Business Aviation Association has issued a press release staying that it has written to the Maltese government asking it to allow business aviation flights again, provided those on board can prove that they have tested negative for coronavirus.
You can read the full statement below.
“The MBAA is at the forefront of making the voice of the Maltese business aviation sector heard with the local and European authorities. In this specific moment in time we will try to assist and guide the business aviation operators in order to keep alive their activities and being ready to start business again once this pandemic will be over.
In view of this, apart from issuing a succinct overview of general precautions and pertinent sources of information to its members, a letter to: Hon. Silvio Schembri, PM Maltese Minister for Economy, Investment and Small Business and to Hon. Ian Borg, PM Maltese Minister for Transport, Infrastructure and Capital Projects Project House was sent requesting inter alia: the removal of the ban for business aviation flights, having onboard passengers with COVID19 negative swab, postponing or elimination of tariffs due to TMCAD, an extension of 6 months for the validity of the radio license, and ask to defer the collection of the Eurocontrol Charges.
Kindly, feel free to contact MBAA for every question at the following email address: [email protected]”
Here you find also the website link of the association http://mbaa.org.mt/
AviationManuals on updating policies and manuals during coronavirus outbreak
AviationManuals prepared two white papers during the coronavirus outbreak. The first looks at how to update travel health concerns in manuals, the second looks into FBO policies.
Updating Your Manuals for Travel Health Concerns – Whitepaper
The recent Coronavirus (COVID-19) pandemic has led a lot of operators to re-examine their travel health-related policies and procedures. Subjects such as health resources, flight planning, how to handle health-related emergencies, and even considerations for SMS are hot topics right now. Are you looking for some ideas or not sure where to begin? We have prepared a whitepaper that can help you review and revise your procedures for not only COVID-19, but any travel health emergency you may encounter, both in the air and on the ground.
Updating Your FBO Policies for COVID-19 – Whitepaper
FBOs handle many different aircraft, passengers, and crews in any given day, so it makes sense that COVID-19 is concerning. It is critical to have policies and procedures in place to protect your customers and employees. Topics such as where to get reputable advice on health-related issues, evaluating the situation with your SMS, and handling medical emergencies should be covered in your procedures. Are you looking for some ideas or not sure where to begin? We have prepared a whitepaper that can help you create procedures for not only COVID-19, but any health emergency you may encounter.
You can contact any of our journalists by clicking the initials at the end of each story. Alternatively, please use any of the links below:
AB – Alex Baldwin – [email protected]
AD – Alud Davies – [email protected]
AW – Alasdair Whyte – [email protected]
MS – Mike Stones – [email protected]
YK – Yuvan Kumar – [email protected]
YM – Yves Le Marquand – [email protected]