Market Intelligence: -Airline Aircraft Orders

Boeing to Establish Middle East Headquarters in Saudi Arabia

Boeing has officially declared its intention to establish its Middle East headquarters in Riyadh, Saudi Arabia, responding to the kingdom’s deadline for global firms to set up regional bases. Boeing Saudi Arabia’s president, Asaad Aljomoai, confirmed the decision during the World Defense Show in Riyadh, stating that the license application has been submitted, and discussions are ongoing with the Saudi Ministry of Investment for official approval.

Source: Boeing
Photo Credit: Boeing (shown as meta image)

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IATA: Air Travel Reaches 99% of 2019 Levels as Recovery Continues in November 2023

The International Air Transport Association (IATA) released data for November 2023 air travel performance indicating that air travel demand topped 99% of 2019 levels.

Total traffic in November 2023 (measured in revenue passenger kilometers or RPKs) rose 29.7% compared to November 2022. Globally, traffic is now at 99.1% of November 2019 levels.

International traffic rose 26.4% versus November 2022. The Asia-Pacific region continued to report the strongest year-over-year results (+63.8%) with all regions showing improvement compared to the prior year. November 2023 international RPKs reached 94.5% of November 2019 levels.

Domestic traffic for November 2023 was up 34.8% compared to November 2022. Total November 2023 domestic traffic was 6.7% above the November 2019 level. Growth was particularly strong in China (+272%) as it recovered from the COVID travel restrictions that were still in place a year ago. US domestic travel, benefitting from strong Thanksgiving holidays demand, reached a new high, expanding +9.1% over November 2019.

“We are moving ever closer to surpassing the 2019 peak year for air travel. Economic headwinds are not deterring people from taking to the skies. International travel remains 5.5% below pre-pandemic levels but that gap is rapidly closing. And domestic markets have been above their pre-pandemic levels continuously since April,” said Willie Walsh, IATA’s Director General.

International Passenger Markets

Asia-Pacific airlines had a 63.8% rise in November traffic compared to November 2022, which was the strongest year-over-year rate among the regions. Capacity rose 58.0% and the load factor was up 2.9 percentage points to 82.6%.

European carriers’ November traffic climbed 14.8% versus November 2022. Capacity increased 15.2%, and load factor declined 0.3 percentage points to 83.3%.

Middle Eastern airlines saw an 18.6% traffic rise in November compared to November 2022. November capacity increased 19.0% versus the year-ago period, and load factor fell 0.2 percentage points to 77.4%.

North American carriers experienced a 14.3% traffic rise in November versus the 2022 period. Capacity increased 16.3%, and load factor fell 1.4 percentage points to 80.0%.

Latin American airlines’ November traffic rose 20.0% compared to the same month in 2022. November capacity climbed 17.7% and load factor increased 1.7 percentage points to 84.9%, the highest of any region.

African airlines had a 22.1% rise in November RPKs versus a year ago. November 2023 capacity was up 29.6% and load factor fell 4.3 percentage points to 69.7%, the lowest among regions.

The Bottom Line

“Aviation’s rapid recovery from COVID demonstrates just how important flying is to people and to businesses. In parallel to aviation’s recovery, governments recognized the urgency of transitioning from jet fuel to Sustainable Aviation Fuel (SAF) for aviation’s decarbonization. The Third Conference on Aviation Alternative Fuels (CAAF/3) in November saw governments agree that we should see 5% carbon savings by 2030 from SAF. This was followed up at COP28 in December where governments agreed that we need a broad transition from fossil fuels to avoid the worst effects of climate change.  Airlines don’t need convincing. They agreed to achieve net zero carbon emissions by 2050 and every drop of SAF ever made in that effort has been bought and used. There simply is not enough SAF being produced. So we look to 2024 to be the year when governments follow-up on their own declarations and finally deliver comprehensive policy measures to incentivize the rapid scaling-up of SAF production,” said Walsh.

Source: IATA
Photo Credit: IATA

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Avia Solutions Group’s Avion Express Has Started AOC Establishment Process for Avion Express Brasil

Avion Express, globally leading narrow-body ACMI (Aircraft, Crew, Maintenance, and Insurance) and charter airline, has officially started the process to obtain an Air Operator Certificate (AOC) in Brazil.

Darius Kajokas, Avion Express CEO, emphasizes the company’s strategic intent to expand its global presence in markets which are counter-cyclical to Europe. He states, “While Avion Express, as a professional and reliable ACMI airline, has firmly established itself in Europe, our strategic focus now extends to other markets: Latin America, Southeast Asia, and beyond. ACMI would be a rather novel concept for the Brazilian market, which approximately has 100 million passengers per annum. Our services will create additional tools for local Brazilian airlines and tour operators to reach higher operational efficiencies throughout the year with a substantial positive impact on their Financial Structure and cashflow, replicating successful similar structures in place in Europe and other regions, taking into account the long trajectory, experience, and reliability of our Company. Our footprint in the region has been recently expanding in different markets, making Brazil the next natural step in the region with a new and different approach to the market. This strategic decision by Avion Express is also aligned to the initiatives launched by the Brazilian Government through ANAC to enter the Brazilian market under the “Voo Simple” and “Fly2Brazil” initiatives, which facilitate and speed up the certification processes, based on our current AOCs in Europe and global experience.”

For the start-up airline in Brazil, Avion Express will utilize part of the aircraft currently kept on its European AOCs, benefiting from the reverse seasonality of the markets. Looking ahead, the CEO of Avion Express reveals, “We aim to start operating in Brazil by Q4 2024. The operations will start with 5-10 aircraft, and we have an ambition to scale up Avion Express Brasil to 25 aircraft by 2027/2028.”

Avion Express Brasil attracted to its team two local seasonal airline executives – Paulo Tarter, who is taking the position of Chief Operations Officer, and Ruy Carlos Nogueira Lotz, who is taking the position of Chief Technical Officer. The company is expanding its team further with local talents in-line with certification, and later – operational, stages.

The expansion of Avion Express is backed by its parent company, Avia Solutions Group, the world’s largest ACMI provider with a 199-aircraft fleet operating on all continents of the world. The group holds nine AOCs in Europe and recently established new airlines, BBN Airlines Thailand and BBN Airlines Indonesia, expanding its worldwide presence.

Source: Avia Solutions Group
Photo Credit: Avia Solutions Group

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