Catch up on CAPA’s exclusive Market Analysis pieces

    Each week, CAPA – Centre for Aviation, produces informative, thought provoking and detailed market analysis of the aviation industry. With supporting data included in every analysis, CAPA provides unrivalled and unparalleled intelligence.


    Delta Air Lines: A220 delivers on performance and customer experience

    It is early days for Delta Air Lines’ operation of its fleet of Airbus A220 narrowbodies, but so far the aircraft is meeting the airline’s expectations and the route network for the jet continues to expand beyond the initial deployment from New York JFK and LaGuardia.

    Delta continues to believe that the aircraft offers a superior customer experience in the US domestic market while delivering much better economics than smaller regional jets the aircraft is replacing.

    Until JetBlue takes delivery of its first aircraft in 2020, Delta has the distinction of being the only A220 operator in the US, which means that Delta’s strategy for the aircraft will continue to be closely scrutinised.

    To read on, visit Delta Air Lines: A220 delivers on performance and customer experience


    European airlines: IAG profit cut another sign of cyclical downswing

    On 26-Sep-2019 IAG issued a profit warning lowering its 2019 operating result guidance by EUR215 million, or 6%.

    IAG blamed the downgrade on three main factors. Two of these were one-offs and broadly known to the world at large, even if not previously fully quantified – namely, the Sep-2019 pilot strike at British Airways and threatened Heathrow strikes.

    The third, however, was less expected and highlighted some changes to underlying demand patterns. Since IAG last reiterated its previous 2019 outlook in early Aug-2019, forward booking trends at Vueling and LEVEL have deteriorated to the extent that they are hitting its profit guidance.

    IAG had previously maintained its 2019 operating profit guidance – that it would match last year’s result – since the beginning of the year, apparently defying the gravity that has weighed on its peers. In Jun-2019 Lufthansa Group lowered its profit target. Although Air France-KLM has not published any profit guidance, its Aug-2019 traffic report revealed a decline in load factor and weaker bookings.

    IAG is still forecast to report the highest operating margin among Europe’s five leading airline groups in 2019. Nevertheless, its profit warning is further evidence of a downswing in the European airline profit cycle.

    To read on, visit European airlines: IAG profit cut another sign of cyclical downswing


    Airlines’ gender diversity: Air Canada and WestJet efforts

    IATA took a significant step when it unveiled a new ’25by2025′ policy that urges its airline members to increase the level of female representation in their senior ranks and under-represented positions during the next six years, but the commitment needs to be underpinned by real initiatives designed to break the barriers that prohibit women from rising through the ranks.

    Gender parity is becoming widespread in aviation discourse as airlines work to understand ways in which they can work to enlarge the number of women in their work forces.

    Canada’s largest airlines – Air Canada and WestJet – are keenly aware of the importance of increasing female representation in their executive ranks, but believe that invoking quotas is not beneficial in pushing for more gender equality within their organisations.

    To read on, visit Airlines’ gender diversity: Air Canada and WestJet efforts


    ‘Flight Shame’ and the Jet Fuel Tax Threat

    “There is only one way to finance costs created by climate change – through taxes”. Swedish Finance Minister Magdalena Andersson’s 20-Jun-2019 comments to a Netherlands-hosted conference on carbon pricing and aviation taxes, represent a growing view among Europe’s politicians and electorates. The conference proposed a jet fuel tax.

    The Swedish word flygskam, ‘flight shame’ in English, underpins an anti flying movement that has spread from Scandinavia to other European countries. It reflects a growing sentiment, particularly in the developed world, that flying is a source of guilt and shame because of its climate change impact. Sweden introduced a per trip aviation tax in 2018, but Ms Andersson would like to introduce a tax on jet fuel. Meanwhile, the 2018 tax and public sentiment towards aviation’s climate change impact are depressing demand for air travel in Sweden.

    Only a small proportion of the world’s population flies, but for those that do, it can account for a very significant proportion of the CO2 emissions attributable to them individually.

    As a result of ‘flight shame’, this is causing a small but growing number of people to reduce or even eliminate discretionary air travel. Global aviation should watch Sweden with care.

    To read on, visit ‘Flight Shame’ and the Jet Fuel Tax Threat