Delta & LAX Accelerate Terminal Transformation
Thanks to highly-depressed traffic numbers, Delta Air Lines and LAX have made great progress in the revamping of Delta’s Terminal 2 and 3 at the airport, now expecting completion 18 months earlier than previously-predicted.
The $1.86 billion modernization project was originally supposed to be finished sometime in late 2024, but the airline and airport now expect to finish work on the project by mid-2023. Work started slow when Delta attempted to pay the $1.86 billion bill for the terminal with 242 billion sky miles plus a bevy of drink coupons for use in-flight, but once the airline agreed to pay cash for the project, work moved along at a steady pace.
As seen across the world, one of the lone benefits of the downturn in air travel due to the pandemic is that it has allowed airports to complete projects and move up completion timelines thanks to the lack of traffic at the airport. Delta now expects its new central headhouse (everything before security) to be completed by Q1 in 2022, a year before the final project is complete, and about 3 years before the airline announces a new LAX modernization project for completion by 2040.
Korean Air in Discussions to Buy Asiana
Rumors out of South Korea say that Korean Air is exploring purchasing its rival Asiana Airlines in a shake-up that would be felt beyond the borders of Korea.
Asiana has been struggling for years and, as of June 2020, carried debt in excess of $11 billion dollars. The airline was on the market to be sold prior to the pandemic, and a consortium was in discussion to purchase it for $2.25 billion. The deal was first discussed last December but fell apart once the pandemic hit in February despite an offer to throw in the Kumho Art Museum and four Kumho tires for every exec.
If the deal were to go through — still a big if at this point — it would potentially be a blow to United and Star Alliance, losing a key member in East Asia to Korean, Delta, and Skyteam.
Interjet Loses Key Investor at a Really Bad Time
Just one week after canceling its entire schedule for two days because it couldn’t pay for fuel, Mexican carrier Interjet is again in trouble with the departure of a key investor. Carlos Cabal Peniche has withdrawn his interest in the airline, and that includes a $150 million investment he had pledged to Interjet earlier this summer.
The airline says that the departure of Peniche and his pesos will not affect the company and its restructuring… which we suppose is true, when one considers they didn’t have any money from Peniche’s investments. With him gone, they…still don’t.
In addition to losing a key investor, the Mexican tax authority announced Interjet has been holding debts for the purpose of withholding VAT and income tax since 2013.
But other than that, things at Interjet are going very well.
Aer Lingus Applies for Manchester to U.S. Flights
Irish carrier Aer Lingus has applied for slots to operate to the United States from Manchester (MAN) airport in the U.K. The airline would base four aircraft in Manchester for service to the U.S., its filing reported. The aircraft would consist of three A321neos, one A330 widebody, and one Delorean.
Whether the application is because the airline really wants to fly from Manchester to the U.S. or is bluffing to get more support from the Irish government is unclear at this point — as Aer Lingus is on record looking for more support for its U.S. routes from Shannon (SNN).
Just under 2 million passengers flew to the United States from Manchester in 2019, and a large slice of that business is up for grabs with the demise of Thomas Cook and Virgin Atlantic’s struggle in bankruptcy. VS commanded 53% of the market in 2019, before factoring in its JV with Delta.
Aeroflot Station Manager Accused of Treason
Here’s a new one. Russian authorities have arrested the London station manager for Aeroflot, the nation’s flag carrier, for committing alleged acts of high treason while working for the airline.
The Russians are accusing Dmitry Fedotkin, the station chief at Heathrow since 2015, of committing treason by passing information on to British intelligence services. This obviously raises several questions, the first of which is: what secrets does an Aeroflot employee at Heathrow airport know that could get him arrested for treason? Was he sharing the fact that Aeroflot rigs its scales by 5 pounds, to charge more for overweight baggage? Or that the airline pads its on-time performance in and out of Heathrow?
A spokesperson for the Russian government said “Fedotkin is suspected of having betrayed secret information about the socio-political situation in the Russian Federation to the British intelligence service,” whatever that means. Did he reveal that Aeroflot actually serves the same meal to passengers in economy and business class, just the business class meal is presented more elegantly?
He stands accused of High Treason under Article 275 of the Russian Criminal Code and if found guilty could face between 12 and 20 years behind bars, as well as a 500,000 ruble ($6,445) fine. Aeroflot has wisely refused to comment on the arrest of their most senior person in London.
Airline Potpourri
- Air Arabia posted a $12 million loss in Q3.
- Copa Airlines has been given permission to once again fly to Venezuela.
- Qantas will restart operations between Melbourne and Tasmania with 84 weekly roundtrips beginning November 27. When asked for comment, Taz said, “bleh, snort, blargh, sniff, bleh.”
- Singapore Airlines raised $630 million through a convertible bond issue.
- Ukraine International Airlines will begin 3x-weekly flights to London/Heathrow from its Kiev hub on December 17.
Andrew’s Moment of Levity
“That bird sure is rude,” I thought. “Well,” my friend said, “it is a mockingbird.”