Travel Demand Continues Strong in April; Domestic Traffic Fully Recovered

01 June 2023

Geneva – The International Air Transport Association (IATA) announced continued strong passenger traffic demand in April.

•             Total traffic in April 2023 (measured in revenue passenger kilometers or RPKs) rose 45.8% compared to April 2022. Globally, traffic is now at 90.5% of pre-Covid levels. At 81.3%, industry load factor was only 1.8 percentage points below pre-pandemic level.

•             Domestic traffic for April rose 42.6% compared to the year-ago period and has now fully recovered, posting a 2.9% increase over the April 2019 results.

•             International traffic climbed 48.0% versus April 2022 with all markets recording healthy growth, with carriers in the Asia-Pacific region continuing to lead the recovery. International RPKs reached 83.6% of April 2019 levels.

“April continued the strong traffic trend we saw in the 2023 first quarter. The easing of inflation and rising consumer confidence in most OECD countries combined with declining jet fuel prices, suggests sustained strong air travel demand and moderating cost pressures,” said Willie Walsh, IATA’s Director General.

April 2023 (% year-on-year)         World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  45.8%    39.7%    3.4%      81.3%

Africa    2.1%      47.1%    41.7%    2.6%      70.8%

Asia Pacific          22.1%    170.8%  135.1%  10.3%    78.4%

Europe 30.8%    22.2%    15.6%    4.5%      83.8%

Latin America     6.4%      15.3%    15.8%    -0.4%     81.4%

Middle East        9.8%      36.8%    26.4%    5.8%      76.0%

North America  28.8%    13.9%    13.8%    0.1%      85.6%

1% of industry RPKs in 2022   2year-on-year change in load factor   3Load Factor Level

 International Passenger Markets

•             Asia-Pacific airlines saw a 192.7% increase in April 2023 traffic compared to April 2022. Capacity climbed 145.3% and the load factor increased by 13.2 percentage points to 81.6%.

 •            European carriers had a 22.6% traffic rise versus April 2022. Capacity rose 16.0%, and load factor climbed 4.5 percentage points to 83.3%, which was the second highest among the regions.

 •            Middle Eastern airlines posted a 38.0% traffic increase compared to April a year ago. Capacity climbed 27.8% and load factor rose 5.6 percentage points to 76.2%.

 •            North American carriers’ traffic climbed 34.8% in April 2023 versus the 2022 period. Capacity increased 26.5%, and load factor rose 5.2 percentage points to 83.8%, which was the highest among the regions. North American international traffic is now fully recovered, with RPKs 0.4% above April 2019 levels.

 •            Latin American airlines saw a 25.8% traffic increase compared to the same month in 2022. April capacity climbed 26.4% and load factor slipped 0.4 percentage points to 83.1%.

 •            African airlines’ traffic rose 53.5% in April 2023 versus a year ago, the second highest among the regions. April capacity was up 50.0% and load factor climbed 1.6 percentage points to 69.8%, lowest among the regions.

Domestic Passenger Markets

April 2023 (% year-on-year)         World share1  

RPK        ASK        PLF (%-pt)2         PLF (Level)3

Domestic             42.0%    42.6%    42.1%    0.3%      81.1%

Australia              1.0%      -4.5%     1.1%      -4.4%     76.0%

Brazil     1.5%      5.7%      6.7%      -0.7%     77.4%

China P.R.            6.4%      536.2%  377.5%  18.6%    74.4%

India      2.0%      18.3%    7.8%      7.8%      88.2%

Japan    1.2%      42.6%    11.8%    15.2%    70.4%

US          19.2%    5.5%      8.1%      -2.1%     86.1%

1% of industry RPKs in 2022   2year-on-year change in load factor 3Load Factor Level

•             China’s domestic traffic rose 536.2% in April compared to a year ago and surpassing the April 2019 levels by 6.0%.

•             US airlines’ domestic demand climbed 5.5% in April and was 3.3% above the April 2019 levels.

 April 2023 (% year-on-year vs 2019)        World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  45.8%    39.7%    3.4%      81.3%

International      58.0%    48.0%    38.1%    5.5%      81.4%

Domestic             42.0%    42.6%    42.1%    0.3%      81.1%

The Bottom Line

“Heading into the Northern Hemisphere peak travel season, aircraft and airports are full of people eager to make use of their travel freedoms. Airlines are working hard to accommodate them with a smooth travel experience despite continuing supply chain shortages and other operational challenges. Sadly, some governments appear more keen on punitive regulation than on doing their part to enable hassle-free travel. The Dutch Government’s high-handed effort to slash capacity at Schiphol airport is a prime example. And then we have a focus on EU-style passenger rights regulation that is spreading like a contagion. Proponents of this approach miss a key fact. EU 261 has not led to a reduction in delays. That’s because penalizing airlines raises airline costs but does not address delays caused by factors over which airlines have no control, such as inefficient air traffic management or staffing shortages at air navigation service providers. The single best thing that Europe could do to improve the travel experience is deliver the Single European Sky. As for other governments contemplating passenger rights regulations, avoiding a repeat of Europe’s mistake would be a helpful starting point.

“In just a few days, leaders of the global aviation community will gather in Istanbul at the 79th IATA Annual General Meeting (AGM) and World Air Transport Summit. Regulation and other key issues, including the critical topic of sustainability, will be on the agenda,” said Walsh.


Lufthansa’s Airbus A380 back in service after three-year hiatus





Lufthansa is back serving customers with the Airbus A380 after a three-year pause

Dirk Daniel Mann /

Lufthansa’s first commercial flight with the Airbus A380 in three years has taken off on June 1, 2023.

The aircraft, registered as D-AIMK, is currently in the air, flying between Munich Airport (MUC) and Boston Logan International Airport (BOS) on flight LH424. 

The Airbus A380 returned to the German airline’s fleet after more than three years, when a large majority of bigger, quad-engine aircraft were grounded during the COVID-19 pandemic due to a lack of demand for air travel and the aircraft’s exuberant operating costs.

Avion In Article Banner May 2023

According to data, the aircraft departed MUC at 4:01 PM local time (UTC +2) and is estimated to arrive at BOS at 5:54 PM local time (UTC -5). Throughout the past few weeks, the Airbus A380 and its crews were operating many training and familiarization flights, visiting many European cities as pilots were getting to grips with the aircraft once again.

Lufthansa, like many airlines that previously operated the Airbus A380, has ungrounded the type in response to the rise in travel demand post-pandemic. While the German airline group has reiterated that the aircraft has no long-term future at the airline, a total of at least six A380s will potentially rejoin the carrier’s fleet by 2024.

Aerviva In Article Banner May 2023

Currently, the airline is still mulling whether to reactivate two aircraft of the type, while the remaining four will be based at MUC for the upcoming months.

Lufthansa indicates the Airbus A380 has no long-term future at the airline





The Frankfurt Airport (FRA)-based airline has scheduled several flights from MUC using the A380, including to destinations such as Los Angeles International Airport (LAX), Bangkok’s Suvarnabhumi International Airport (BKK), BOS, and New York John F. Kennedy International Airport (JFK).

Previously, Lufthansa operated as many as 14 Airbus A380 aircraft.

A Lufthansa A380 aircraft is being catered and cleaned as passengers disembark while cargo is unloaded after arriving at Hong Kong International Airport

Lufthansa Airlines: its routes, services and fleet


What’s NeX for e-commerce logistics?

May 30, 2023 by Payload Asia

Neutral Air Partner has introduced a new global platform that aims to contribute to the growth of the e-commerce industry around the world.

The network group, made up of air cargo architects and aviation logistics specialists, has partnered with the ATEM Group to launch the NeX e-commerce supply chain logistics network.

NeX is an international group of experts focused on advancing the interests of the eCommerce supply chain logistics industry. The network is comprised of highly specialized supply chain logistics experts, including express couriers, postal brokers/operators, linehaul consolidators, first and last mile operators, gateway customs brokers, return/reverse logisticians, resellers/wholesalers, e-fulfillment providers, e-commerce marketplaces, 3PLs and distribution providers, tech and solution providers, consultants, carriers, e-tailers, and shippers.

“NeX members benefit from the global reach of e-commerce experts, building trust in a complex sector, express mail and freight buying power, advanced e-logistics community tools, omnichannel network operations, global contracts with carriers and postal operators, volume incentive schemes, and industry recognition of excellence,” said Christos Spyrou, CEO of Neutral Air Partner.

Rudee Bertie, CEO of the ATEM Group said the mission is to provide a global platform to engage with eCommerce logistics professionals and suppliers to the trade.

Amongst the solutions that the new group will provide are end-to-end e-logistics services, order fulfillment, first and last-mile delivery, reverse/return logistics, 3PL and distribution, B2C custom clearance, gateway cross-border services, linehaul consolidation, airfreight, mail, and express.

Other Topics: Air Cargo Network, Air Express, Air Freight Services, Air Logistics, Asia Pacific Air Cargo, Asia Pacific Air Freight, Asia Pacific Air Logistics, Asia Pacific Shipments, Cargo Flights, E-Commerce Logistics, Express Delivery, Express Logistics, International Air Shipments, International Express Delivery, Neutral Air Partner, Transpacific Air Cargo, Transpacific Air Freight


ISAGO -15 Years of Advancing Aviation Safety

Abu Dhabi – The International Air Transport Association’s (IATA) Safety Audit for Ground Operations (ISAGO) has been advancing aviation safety for the last 15 years. ISAGO is an industry program for the global oversight of ground handling service providers (GHSPs). It is based on the IATA’s Ground Operations Manual (IGOM) standards. Since its launch in May 2008, over 3,000 audits have been conducted worldwide, making it the industry global standard for ground handling service providers (GHSPs).

“Over the past 15 years, ISAGO has matured and evolved to become a center of excellence for safety auditing in ground handling. With 195 organizations onboard it is now the driving force in improving ramp safety, reducing ground damage and enabling standardized and sustainable operations. It also plays a role in mitigating the billions of dollars of damage to aircraft and equipment that happens each year and helps airlines to allocate resources efficiently. More and more governments and airports now recognize ISAGO as part of their safety oversight programs,” said Monika Mejstrikova, IATA’s Director of Ground Operations.

ISAGO Registry 

Hong Kong Air Cargo Terminals Limited (Hactl) and dnata Dubai were the world’s first ISAGO-accredited ground handling service providers and have maintained their ISAGO registration for 15 years. Both companies acknowledge the positive impact of ISAGO in their operations.

“ISAGO plays a vital role in enhancing aviation safety levels – in particular, by standardizing many different safety standards and recommended practices and minimizing the potential risks in ground handling around the world. It is an invaluable resource and significant safety driver for all parties,” said Wilson Kwong, Hactl’s Chief Executive.

The ISAGO Registry now includes 195 GHSPs that provide services at 324 accredited stations in 206 airports around the world. Over 100 ISAGO airline members have instant access to the ISAGO Registry, where they can access nearly 500 different ISAGO audit reports and drive more efficient oversight of outsourced ground handling services including risk, cost and audit reduction.

“ISAGO has been an integral part of our journey towards continuous improvement, and we are proud to have achieved this significant milestone. The positive impact that ISAGO has brought to our operations cannot be overstated, and we remain fully committed to upholding its rigorous standards,” said Jaffar Dawood, dnata Senior Vice President Airport Operations UAE, Middle East, and Africa.

Future Proofing ISAGO

ISAGO is constantly evolving to reduce duplicate audits and drive greater standardization of ground handling processes worldwide. And to drive further simplification of audit processes and to ensure GHSPs’ readiness for the ISAGO audit, IATA launched the free Operational Portal to help GHSPs and airlines to perform a gap analysis between their ground operational procedures and IGOM. The tool helps to identify operational variations with the intention to reduce them and standardize procedures according to IGOM. In addition, a new checklist is being developed that mirrors IGOM and Airport Handling manual requirements, allowing for remote documentation validation through the Operational Portal. “We remain committed to evolving ISAGO,” said Mejstrikova.


Japan Airlines to introduce dedicated freighters

May 15, 2023 by Payload Asia

For the first time in 13 years JAL will operate its own freighter.

Japan Airlines wants to further grow its cargo and mail business and has announced that it will introduce three Boeing 767-300ER freighters for dedicated cargo operations by the end of this year.

JAL has been securing revenues reliably and efficiently in the air cargo business by using cargo space on passenger flights and chartering other companies’ freighters in response to demand.

With the introduction of the freighter, the airline will operate under a new business model that will capture stable demand, improve aircraft utilization ratio and ensure profitability.

“To capture domestic and international e-commerce, parcel delivery, and other high growth cargo, we will build alliances with logistics partners and operate routes that ensure stable demand,” the airline said.

“We will ensure that domestic air transportation plays a growing role in response to the ‘2024 issue’ and limit business risks caused by fluctuations in demand and market conditions.

The ‘2024 issue’ refers to the foreseen shortage of truck drivers in Japan as new restrictions regarding overtime come into effect in Japan next year.

JAL said it will begin operating international flights mainly to East Asia from the end of this year. It will also operate domestic flights in the future to improve aircraft utilization and maximize cargo loading ratio, whilst flexibly offering charter and non-scheduled flights.

Other Topics: Air Cargo Network, Air Express, Air Freight Services, Air Logistics, Asia Pacific Air Cargo, Asia Pacific Air Freight, Asia Pacific Air Logistics, Asia Pacific Shipments, Cargo Flights, E-Commerce Logistics, Express Delivery, Express Logistics, International Air Shipments, International Express Delivery, Transpacific Air Cargo, Transpacific Air Freight


Focus Africa Conference to Strengthen Aviation’s Contribution to African Development

Geneva –  The International Air Transport Association (IATA) announced that the Focus Africa Conference will delve into six priorities under IATA’s Focus Africa initiative to strengthen aviation’s contribution to the continent’s economic and social development and improve connectivity, safety and reliability for passengers and shippers. Focus Africa is taking place in Addis Ababa, Ethiopia, on 20-21 June 2023, with Ethiopian Airlines as the host airline.

“Over the next 15 years, Africa’s passenger traffic is expected to double. The continent stands out as the region with the greatest potential and opportunity for aviation. But this potential is limited by infrastructure constraints, high costs, lack of connectivity, regulatory impediments, slow adoption of global standards and skills shortages, among other factors. The Focus Africa Conference will bring together the continent’s key stakeholders to address these challenges,” said Willie Walsh, IATA’s Director General.

Mesfin Tasew, Group CEO of Ethiopian Airlines, will deliver an Opening Keynote Address. “We are delighted to host IATA’s Focus Africa Conference and welcome the aviation industry to our home, Addis Ababa. Advancing the air transport industry is critical for Africa’s economic growth. The conference will allow industry leaders to join forces and drive the Focus Africa initiative,” said Tasew.

Speakers & Sessions

Walsh, Tasew, and Kamil Alawadhi, IATA’s Regional Vice-President for Africa and Middle East will be speaking at the event along with:

 •            Yvonne Makolo, CEO RwandAir and Chair of the IATA Board of Governors (2023-2024)

•             Adefunke Adeyemi, Secretary General, African Civil Aviation Commission (AFCAC)

•             Abdulrahman Berthe, Secretary General, African Airlines Association (AFRAA)

•             Aaron Munetsi, CEO, Airlines Association of Southern Africa (AASA)

•             Rodger Foster, CEO Airlink

•             Poppy Khoza, Director General Civil Aviation, South African Civil. Aviation Authority (SACAA)

•             Bradley Mims, Deputy Administrator, Federal Aviation Administration (FAA)

Session tracks will address:

 •            Safety

•             Aeronautical information management

•             Intra-African connectivity

•             Airport infrastructure

•             Biometrics and security

•             Modern airline retailing

•             Sustainability

•             Skilled workforce


The top 10 largest airlines in the United States by capacity in Q1 2023




Ceri Breeze /

When looking at the Q1 2023 financial results posted by some of the largest airlines in the United States, one phrase comes to mind in terms of revenue: record-breaking. And yet, many of these carriers have been unable to post a profit during this period due to an industry-wide trend where costs have outweighed revenue, primarily caused by surging fuel prices.

While fuel prices have since come down and airlines are preparing for what is expected to be a great peak travel season, Q1 2023 results have been less positive than expected. 

AeroTime reviews the figures to find out how well the US airline industry has performed  – and which carrier is the biggest in terms of capacity.

Bordeaux Airport In Article Banner Wine

1. United Airlines’ rise to the top

While American Airlines can still boast that its fleet number is the biggest in the world, United Airlines has managed to offer slightly more capacity in Q1 2023. This made it the largest carrier in the US in terms of offered capacity in Q1 2023. 

United noted that its Available Seat Miles (ASM) was 65.7 billion, with the airline carrying 36.8 million passengers during the first three months of the year and earning a total revenue of $11.42 billion. However, revenues were outweighed by operating costs, which were $11.47 billion, resulting in an operating loss of $43 million and a net loss, following non-operating expenses of $213 million, of $194 million.

However, in the company’s financial release CEO Scott Kirby said that he was “extremely proud of the United team’s performance”, which contributed to “an all-time high operating cash flow” of $3.1 billion. Free Cash Flow (FCF) was $1.29 billion during Q1 2023, and, in total, United Airlines had $8 billion in cash at the end of Q1 2023.

KlasJet Roadshow Article Second May 2023

At the end of the period, that airline had a total of 677 commitments to purchase aircraft, including an order for 100 Boeing 787 and 737 MAX aircraft finalized in December 2022. Most of these aircraft are scheduled to be delivered after 2024, including 92 787s and 210 737 MAXs, with the airline expecting to receive 114 Boeing 737 MAX and 12 Airbus A321neo aircraft in 2023, and eight 787s, 88 737 MAXs, and 31 A321neos in 2024.

In Q1 2023, United Airlines operated 891 mainline and 446 regional aircraft, totaling 1,337 jets in its fleet.

However, Airbus told United Airlines that eight A321neo aircraft will be delivered instead in 2024, and a further 10 will be delivered in 2025 instead of 2024. 

Meanwhile, Boeing also notified the carrier about 737 MAX delivery delays. The manufacturer now expects to hand over 37 aircraft of the type to the carrier in 2024 rather than 2023 as was originally forecasted.

The airline estimates that a further 11 aircraft deliveries will be delayed by a year until 2024, and delivery of an additional 30 737 MAX aircraft will now take place in 2025 rather than 2024.

While revenues surged compared to Q1 2022, United Airlines still ended Q1 2023 with a net loss

United Airlines posts $194 million loss in Q1 2023 due to cost overruns





2. American Airlines’ small profit

Out of the Big Four airlines in the United States – American Airlines, Delta Air Lines, Southwest Airlines, and United Airlines – only a single company was profitable in Q1 2023.

American Airlines managed to eke out a small net profit of $10 million on the back of record-breaking revenues of $12.1 billion and FCF of $3 billion. Throughout the quarter, the airline, based at Dallas/Fort Worth International Airport (DFW), recorded 48.2 million passenger enplanements on a total of 1,464 aircraft in its mainline and regional fleet.

American Airlines operating costs were $11.7 billion, with the two largest expenses being fuel ($3.1 billion) and salaries, wages, and benefits ($3.281 billion). Another key issue for the airline is its debt, which peaked at $54 billion in Q2 2021. The company expects to reduce its liabilities to between $43 billion and $44 billion by the end of the year, improving its net debt to adjusted earnings before interest, tax, depreciation, amortization, and restructuring or rent (EBIDTAR) ratio from 6.7 at the end of 2022, to 4.5 in Q1 2023, and less than 4.5 by the end of 2023.

The 4.5 net debt/adjusted EBITDAR ratio is the lowest since 2019.

In total, capacity, measured in ASM was 65.0 billion, while Revenue Passenger Miles (RPM), measuring demand, was 52 billion with an average yield of 21.35 cents.

Comparatively, United Airlines RPM was 52.5 billion, with an average yield of 19.56 cents.

Robert Isom, the CEO of American Airlines, summarized that the airline “ran a great operation” and had delivered on its “financial guidance for the quarter, resulting in a first-quarter profit for the first time in four years”. 

Looking ahead, American Airlines expects ASM to grow by between 3.5% and 5.5% in Q2 2023, and between 5% and 8% in 2023. Adjusted earnings per diluted share are estimated to be between $1.20 and $1.40 in the next quarter and $2.50 and $3.50 for the full year.

In Q1 2023, the adjusted earnings per diluted share was $0.02.

American Airlines became the only big four airline in the US to achieve a profit in Q1 2023

Was American Airlines the only profitable US airline in Q1 2023?





3. Delta Air Lines building momentum

Despite record-breaking revenue Delta Air Lines ended the first quarter of the year with a net loss. However, the airline’s expectations for the next few months remain positive.

Glen Hauenstein, the President of Delta Air Lines said: “We delivered record March quarter revenue with total unit revenue that was 16 percent higher than the same period in 2019.  These results reflect the strength in the underlying demand environment and continued momentum in premium products and loyalty revenue.” 

Operating revenues, based on an average passenger yield per flown mile of 20.95 cents, were $12.7 billion, with operating costs of $13 billion overshadowing a momentous quarter for the carrier. Included in the final lines of Delta Air Lines’ Q1 2023 financial report were an operating loss of $277 million and a net loss of $363 million.

Its ASM was 61.3 billion, with RPM standing at 49.6 billion at the end of the first quarter of 2023.

322 aircraft are scheduled to join the airline’s fleet in the coming years, most of which will be manufactured by Airbus because Delta Air Lines has outstanding orders for 59 A220-300s, 130 A321neos, 17 A330-900neos, and 16 A350-900s. Boeing is scheduled to deliver 100 737 MAX-10 aircraft to the airline. 

While the carrier has not provided an estimate of how many aircraft will be delivered in the next few years, it did indicate that its aircraft purchase commitments until 2027 and thereafter total $18.7 billion. As of March 31, 2023, Delta Air Lines said that it will spend $2.3 billion on new aircraft in the remaining nine months of 2023, growing to $4.4 billion in 2024 and $4.2 billion in 2025. In 2026 that sum will go down to $3.8 billion, and will drop to $2.5 billion in 2027, with the remaining $1.2 billion spent in the years following.

“With record advance bookings for the summer, we expect June quarter revenue to be 15 to 17 percent higher on capacity growth of 17 percent year over year,” Hauenstein added. 

While it remains optimistic about its future prospects, Delta Air Lines began the quarter with a net loss of $363 million

Delta Air Lines begins 2023 with $363 million net loss





4. Southwest Airlines reeling from the operational meltdown in 2022

At the end of 2022, Southwest Airlines became the focus of much discussion when it experienced a complete operational meltdown during the Holiday period in December 2022. As a result, mor than 16,700 flights were canceled, with the negative effects carrying over to Q1 2023.

According to Southwest Airlines CEO Bob Jordan, that had been expected and the net loss was a result of the “negative financial impact of approximately $380 million pre-tax, or $294 million after-tax, related to the December 2022 operational disruption”. Jordan also added that the operational meltdown had a negative revenue impact of around $325 million due to “cancellations of holiday return travel and a deceleration in bookings for January and February 2023 travel”.

However, with the airline carrying 30.2 million passengers, offering 38 billion ASM, 29.5 billion RPM, and average yields per RPM of 17.28 cents, Jordan noted that “travel demand and revenue trends in March 2023 were strong and resulted in solid profitability for the month and record first quarter revenues”. 

The carrier ended Q1 2023 with operational revenues of $5.7 billion and operating costs of $5.9 billion, resulting in an operating loss of $284 million. Including other expenses, as well as benefits from income taxes, the airline’s net loss for the period was $159 million.

Southwest Airlines also highlighted that while it ended Q1 2023 with 793 aircraft, delivery delays at Boeing will result in the airline receiving 70 737 MAX-8 aircraft, 20 fewer than expected.

As a result, the airline noted that due to “the revision in aircraft deliveries and retirements” it now expects to “to end the year with 814 aircraft, compared with its previous guidance of 833 aircraft”.

Southwest Airlines is expecting to spend $2.3 billion on aircraft-related purchases in 2023

Southwest Airlines plans to spend $2.3 billion on new 737 MAX aircraft in 2023





In mid-April 2023, Spirit AeroSystems notified Boeing about an irregular manufacturing procedure on certain 737 aircraft, except for the 737 MAX-9. The manufacturer later clarified that the related delivery delays would remove around 9,000 seats from airline schedules in the 2023 summer season, yet it reiterated its aim to deliver between 400 and 450 737 MAX aircraft in 2023.

While American Airlines only mentioned that it does not have any financial commitments in place for 10 737 MAX aircraft, United Airlines stated that the manufacturing defect could result in additional delays of six aircraft, with the possibility that the planemaker may inform customers of further delays down the line. Delta Air Lines’ 737 MAX-10 order should not be impacted, as the largest 737 MAX has still not been certified by the Federal Aviation Administration (FAA).

Boeing still expects to deliver between 400 and 450 737 MAX aircraft in Q1 2023

Boeing expects to deliver 400-450 B737 MAX in 2023 despite production problems





5. JetBlue exploring new European horizons

JetBlue began the year by beating its own expectations, with the airline continuing to explore and announce new destinations in Europe, utilizing the increased range of the Airbus A321neoLR.

The airline earned $2.3 billion in revenue but with operating costs at $2.5 billion, and other expenses totaling $24 million, its net loss after income tax benefits was $192 million. Still, according to Robin Hayes, JetBlue’s CEO, the airline’s Q1 2023 results were better than expected and the airline is “forecasting strong sequential pre-tax margin improvement into the second quarter”.

“We remain well on track in executing our comprehensive plan to enhance our long-term profitability and restore our historical earnings power,” Hayes said, adding that in Q2 2023 the airline should see “strong revenue growth to continue as demand remains robust and as we see continued momentum from our commercial initiatives”. 

During the first quarter of the year, the carrier announced flights to Paris Charles De Gaulle Airport (CDG) and added flights to Amsterdam Schiphol Airport (AMS) in April 2023 from its two East Coast hubs, New York John F. Kennedy International Airport (JFK) and Boston Logan International Airport (BOS). Both flights are set to begin during the summer of 2023.

The average yield per passenger mile at JetBlue was 16.31 cents. Capacity, namely ASM and demand in the form of RPM, were 16.7 billion and 13.3 billion, respectively. The airline carried 10.1 million passengers, operating 290 aircraft by the end of Q1 2023. JetBlue was contracted to receive 11 Airbus A321neo and 17 A220 aircraft throughout the year. However, the carrier noted that Airbus delays had forced it to assume delivery of 11 A220, four A321neo, and four A321neoLR aircraft in 2023.

“We made no flight equipment deposits for the three months ended March 31, 2023, as we work with Airbus to realign such payments to anticipated delivery delays,” JetBlue noted. 

JetBlue provided an update on the timeline of its merger with Spirit Airlines

JetBlue anticipates merging with Spirit by H1 2024





6. Alaska Airlines buying back its own stock

Alaska Airlines was another airline which, like many of its industry counterparts, registered revenue growth and had expected much from the future. However, it ended the first quarter of the year with a net loss. 

The Seattle Tacoma International Airport (SEA)-based carrier also managed to buy back its own shares during the quarter, spending $18 million on share repurchases. The carrier expects to spend as much as $100 million on common stock buybacks by the end of 2023. 

Alaska Airlines’ net loss was $142 million in Q1 2023. The company earned $2.1 billion in revenue but spent $2.3 billion on running its operations throughout the three months. While most of the expenses were non-fuel related, these items have only grown by 13% compared to Q1 2022. 

Furthermore, the company had $537 million in cash at the end of the quarter compared, for example, to JetBlue’s $1.4 billion. This is despite Alaska Airlines having similar operational statistics, including 15.7 billion ASM and 12.5 billion RPM. Per mile yields were 15.80 cents for the 9.8 million passengers it carried during the period.

Its fleet at the end of the quarter included a mix of Boeing 737 aircraft, including the NextGeneration (NG), MAX and freighters as well as Embraer E175s, and totaled 294 aircraft. The carrier plans to add 40 additional aircraft throughout the year, including one 737-800F, three 737 MAX-8, 28 737 MAX-9, and eight E175s. The airline also noted that the expected delivery estimates already include the delivery delays communicated by Boeing, yet these are unrelated to the production problem that does not affect the 737 MAX-9.

Two Boeing 737-800 NG and 10 Airbus A321neo, the latter of which are the final remnants of a merger with of the merger with Virgin America, will leave Alaska Airlines’ fleet in 2023.

Despite a net loss of $142 million, Alaska Airlines still repurchased $18 million of its own stock

Alaska Airlines buys back stock worth $18 million despite Q1 2023 loss





7. Spirit Airlines updates on merger with JetBlue

Although many airlines are optimistic about their future, Spirit Airlines is more reserved about the next few months. The airline stated that while it should achieve a positive profit margin, it will be in the single digits due to issues related to the Pratt & Whitney PW11000G engine powering the A320neo family of aircraft. 

The issue, which has affected airlines across the globe, including the recent suspension of operations by India’s Go First, has continued to hamper Spirit Airlines. 

According to the carrier’s Chief Financial Officer (CFO) Scott Haralson, in Q2 2023 the operating margin should be between 4.5% to 6.5%, but “in this demand environment, and with a declining fuel price in the second quarter of this year, the business at full utilization should be producing double digit operating margins”. The CFO pointed out that pilot attrition is also negatively affecting the airline’s operations, resulting in less than desirable aircraft utilization. Haralson added that the A320neo aircraft engine problems “will likely remain a drag on utilization for the rest of the year”.

Ending the quarter with a net loss of $103.9 million, Spirit Airlines earned $1.3 billion in revenue and spent $1.46 billion on operating expenses. Its ASM was 13.2 billion, while RPM was 10.6 billion with an average yield of 12.64 cents. On average the airline operated 194.8 aircraft daily. By the end of the quarter, it had 195 aircraft.

In terms of its merger with JetBlue, the low-cost carrier stated that it expects to complete the process by H1 2024, even though the US Department of Justice (DOJ) filed a suit to block the merger between the two airlines in March 2023. At the time Merrick Garland, the US Attorney General argued that the two airlines coming together would “result in higher fares and fewer choices for tens of millions of travelers, with the greatest impact felt by those who rely on what are known as ultra-low-cost carriers in order to fly.” 

Spirit Airlines said that its expected double-digit operating margin is being hampered by A320neo engine issues

Spirit Airlines’ hopes of double-digit margins dashed by A320neo engine issues





8. Frontier Airlines beginning to reshape its network following Spirit merger failure

Frontier Airlines almost made a profit during the quarter, with the low-cost carrier beginning to reshape its network in the face of changing market dynamics and after it was outbid when trying to acquire Spirit Airlines.

The airline posted a narrow $13 million net loss during the first three months of the year, earning revenues of $848 million that were less than the $873 million operating expenses in Q1 2023, which were offset by $4 million in tax benefits. Frontier noted in its Q1 2023 results release that one of those costs was a $1 million charge “related to the terminated merger with Spirit Airlines, Inc. within transaction and merger-related costs”. 

“Post-pandemic demand has increased due, in part, to work from home arrangements and flexible working schedules. We also see a change in passenger behavior with outsized demand on peak days and peak periods,” stated Barry Biffle, the President and CEO of Frontier Airlines. 

Following an analysis of consumers’ new behavior, Frontier Airlines has begun to reshape its network in Q2 2023 to, Biffle added, “exploit this post-pandemic demand dynamic, and expect the changes to be fully deployed in the second half of 2023”. 

And while capacity will be a reduced going forward, Biffle noted that its cost advantage “will widen further throughout the year, allowing Frontier to remain the lowest unit cost operator in the industry in spite of lower utilization on off-peak days and in off-peak periods”. The executive added that this will result in a pre-tax margin of between 7% and 10%, which would be the airline’s highest result post-pandemic.

With a fleet totaling 125 aircraft, Frontier Airlines had 8.7 billion ASM, 7.2 billion RPM, and carried 6.8 million passengers with an average of 121 operated aircraft in Q1 2023.

9. Hawaiian Airlines rising fuel bill blamed on A321neo

Like Spirit Airlines, Hawaiian Airlines is experiencing issues with its Airbus A321neo fleet, with the airline arguing that the A330s that replaced the grounded A321neo resulted in a much higher fuel bill.

The airline declared that its fuel consumption rose by 21.4% compared to Q1 2022 due to “higher capacity and inefficiencies resulting from these challenges”. 

Capacity, measured in ASM, was 4.9 billion in Q1 2023, compared to 4.2 billion in Q1 2022. Meanwhile, demand was 3.8 billion RPM compared to 2.9 billion RPM in Q1 2022. The average yield was 14.27 cents, with Hawaiian Airlines operating 63 aircraft throughout the three-month period: 24 Airbus A330-200, 18 A321neo, 19 Boeing 717, and one each of ATR 42 and ATR 72 aircraft. While the carrier did not indicate how many A321neos were grounded, data shows that three out of the 18 aircraft of the type are currently under maintenance.

“Certain of our suppliers, including our supplier of engines for our A321neo aircraft, Pratt & Whitney, have experienced and continue to experience significant supply chain disruptions,” the airline noted in its Q1 2023 US Securities and Exchange Commission (SEC) filing. 

While Hawaiian Airlines does not yet know the full extent of the impact on its operations, it anticipates “continued delays for Pratt & Whitney engines on our A321neo aircraft during 2023”.

The airline’s net loss for Q1 2023 was $98.2 million. The airline earned $621 million in revenue, while operating expenses were $730 million.

Hawaiian Airlines blames A321neo engine supply issues for its growing fuel bill

Hawaiian Airlines blames A321neo engine supply issues for rising fuel bill





10. Allegiant Airlines ending the quarter profitably and beginning to switch to Boeing

The only other profitable airline, besides American Airlines, is Allegiant Airlines, with the small carrier posting a net profit for Q1 2023.

Allegiant Airlines ended Q1 2023 with a net profit of $56.1 million, with operating revenues of $649.6 million outweighing operating expenses that totaled $554.8 million in addition to other costs that set the company back $20.4 million.

“The team worked tirelessly to ensure operational integrity, and our controllable completion of 99.9 percent for the quarter is a testament to their efforts. Running a safe, reliable operation is a critical component to our success, and I could not be prouder of the team’s performance,” commented John Redmond, the CEO of Allegiant Travel Company, the parent company of Allegiant Airlines.

Capacity was 4.5 billion ASM (4.6 billion including non-scheduled services), while demand was 3.9 billion RPM, as the airline carried 4.1 million scheduled passengers throughout Q1 2023 with an average yield of 8.29 cents. The all-Airbus operator operated 124 aircraft by the end of the quarter, namely the A319ceo and A320ceo.

However, by Q4 2023 it expects to receive its first two Boeing 737 MAX aircraft. Allegiant Airlines ordered the rival product to the A320 family in December 2021, finalizing the order in January 2022. The airline’s then-CEO and current Chairman of the Board Maurice J. Gallagher, Jr. had argued that deliveries of new aircraft, which is a contrast to its all-second hand A320 family fleet, will bring numerous benefits, including “flexibility for capacity growth and aircraft retirements, significant environmental benefits, and modern configuration and cabin features our customers will appreciate.”

Confirmed: Allegiant Air orders up to 100 Boeing 737 MAXs





In summary, these are the top 10 airlines in the United States in terms of capacity, measured in ASM:

United Airlines (65.7 billion)

American Airlines (65 billion)

Delta Air Lines (61.3 billion)

Southwest Airlines (38 billion)

JetBlue (16.7 billion)

Alaska Airlines (15.7 billion)

Spirit Airlines (13.2 billion) 

Frontier Airlines (8.7 billion)

Hawaiian Airlines (4.7 billion) 

Allegiant Airlines (4.5 billion)

Revealed: The top 10 most loved and hated airlines in the world





American Airlines

Delta Air Lines

United Airlines

United States


Air Travel Growth Continues in March

Geneva – The International Air Transport Association (IATA) announced strong demand growth in air travel for March 2023.

 •            Total traffic in March 2023 (measured in revenue passenger kilometers or RPKs) rose 52.4% compared to March 2022. Globally, traffic is now at 88.0% of March 2019 levels.

 •            Domestic traffic for March rose 34.1% compared to the year-ago period. Total March 2023 domestic traffic was at 98.9% of the March 2019 level.

 •            International traffic climbed 68.9% versus March 2022 with all markets recording healthy growth, led once again by carriers in the Asia-Pacific region. International RPKs reached 81.6% of March 2019 levels while the load factor at 81.3% exceeded the March 2019 level by 10.1 percentage points.

“The calendar year first quarter ended on a strong note for air travel demand. Domestic markets have been near their pre-pandemic levels for months. And for international travel two key waypoints were topped. First, demand increased by 3.5 percentage points compared to the previous month’s growth, to reach 81.6% of pre-COVID levels. This was led by a near-tripling of demand for Asia-Pacific carriers as China’s re-opening took hold. And efficiency is improving as international load factors reached 81.3%. Even more importantly, ticket sales for both domestic and international travel give every indication that strong growth will continue into the peak Northern Hemisphere summer travel season,” said Willie Walsh, IATA’s Director General.

March 2023 (% year-on-year)     World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  52.4%    41.2%    5.9%      80.7%

Africa    2.1%      66.1%    51.0%    6.7%      73.9%

Asia Pacific          22.1%    158.9%  109.0%  15.3%    79.2%

Europe 30.7%    37.0%    25.9%    6.5%      80.5%

Latin America     6.4%      19.9%    19.8%    0.1%      81.2%

Middle East        9.8%      40.4%    28.3%    6.9%      79.4%

North America  28.9%    16.9%    15.9%    0.7%      83.7%

1% of industry RPKs in 2022   2year-on-year change in load factor   3Load Factor Level

 International Passenger Markets

•             Asia-Pacific airlines had a 283.1% increase in March 2023 traffic compared to March 2022, continuing the robust momentum since the lifting of travel restrictions in the region. Capacity rose 161.5% and the load factor increased 26.8 percentage points to 84.5%, the second highest among the regions.

 •            European carriers posted a 38.5% traffic rise versus March 2022. Capacity climbed 27.0%, and load factor rose 6.6 percentage points to 79.4%, which was the second lowest among the regions.

 •            Middle Eastern airlines saw a 43.1% traffic increase compared to March a year ago. Capacity climbed 30.5% and load factor pushed up 7.0 percentage points to 79.4%.

 •            North American carriers’ traffic climbed 51.6% in March 2023 versus the 2022 period. Capacity increased 34.0%, and load factor rose 9.8 percentage points to 84.8%, the highest among the regions.

 •            Latin American airlines had a 36.5% traffic increase compared to the same month in 2022. March capacity climbed 33.4% and load factor rose 1.9 percentage points to 82.8%.

 •            African airlines’ traffic rose 71.7% in March 2023 versus a year ago, the second highest among the regions. March capacity was up 56.2% and load factor climbed 6.5 percentage points to 72.2%, lowest among the regions.

Domestic Passenger Markets

March 2023 (% year-on-year)     World share1  

RPK        ASK        PLF (%-pt)2         PLF (Level)3

Domestic             42.1%    34.1%    32.8%    0.8%      79.8%

Australia              1.0%      44.7%    25.9%    10.7%    82.5%

Brazil     1.5%      8.0%      8.7%      -0.6%     78.6%

China P.R.            6.4%      195.2%  153.0%  10.3%    72.3%

India      2.0%      20.3%    15.4%    3.5%      85.6%

Japan    1.2%      61.1%    14.2%    23.0%    79.0%

US          19.3%    4.4%      8.4%      -3.2%     82.9%

1% of industry RPKs in 2022   2year-on-year change in load factor 3Load Factor Level

•             Brazil’s domestic traffic rose 8.0% in March compared to a year ago and is now just fractionally below pre-pandemic levels.

 •            Indian airlines’ domestic demand climbed 20.3% in March and was 10.0% above the March 2019 levels.

March 2023 (% year-on-year vs 2019)     World share1     RPK        ASK        PLF (%-pt)2         PLF (level)3

Total Market      100.0%  -12.0%  -10.5%  -1.4%     80.7%

International      57.9%    -18.4%  -18.8%  0.4%      81.3%

Domestic             42.1%    -1.1%     4.1%      -4.3%     79.8%

The Bottom Line

“As traveler expectations build towards the peak Northern Hemisphere summer travel season, airlines are doing their best to meet the desire and need to fly. Unfortunately, a lack of capacity means that some of those travelers may be disappointed. Part of this capacity shortfall is attributable to the widely reported labor shortages impacting many parts of the aviation value chain, as well as supply chain issues affecting the aircraft manufacturing sector that is resulting in aircraft delivery delays. However, a significant share of recent flight cancellations, primarily in Europe, are owing to job actions by air traffic controllers and others. These irresponsible actions resulted in thousands of unnecessary cancellations in March. This is unacceptable and should not be tolerated by the authorities,” said Walsh.


Air Cargo Declines Moderate in March

Geneva – The International Air Transport Association (IATA) released data for March 2023 global air cargo markets showing a continued decline against previous year’s demand performance. This trend began in March 2022.

•             Global demand, measured in cargo tonne-kilometers (CTKs*), fell 7.7% compared to March 2022 (-8.1% for international operations). This was a slight improvement over the previous February’s performance (-9.4%) and half the rate of annual decline seen in January and December (-16.8% and -15.6% respectively). At this point, it is unclear if this is a potentially modest start of an improvement trend or the upside of market volatility. Irrespective of this, March performance slipped back into negative territory compared to pre-COVID levels (-8.1%).

 •            Capacity (measured in available cargo tonne-kilometers, ACTK) was up 9.9% compared to March 2022. The strong uptick in ACTKs reflects the addition of belly capacity as the passenger side of the business continues to recover.

 •            Several factors in the operating environment should be noted:

o             Even with record low unemployment rates, the global economy continues to decelerate due to a combination of factors such as tightening global financial conditions, high levels of global debt, and supply chain problems including those linked to the war in Ukraine.

o             In line with the weakening global trade, the Purchasing Manager Indices (PMIs) for new export orders at the global level remained below the 50-critical line for a full year as of March. China’s PMI retreated to below the 50-mark in March, following a slight improvement observed in February.

 o            The PMI for supplier delivery times indicates high inventory levels, which tends to have a negative impact on air cargo.

 o            Global goods trade decreased by 2.6% in February; this was a faster rate of decline than the previous month of -1.0%.

“Air cargo had a volatile first quarter. In March, overall demand slipped back below pre-COVID-19 levels and most of the indicators for the fundamental drivers of air cargo demand are weak or weakening. While the trading environment is tough, there is some good news. Airlines are getting help in managing through the volatility with yields that have remained high and fuel prices that have moderated from exceptionally high levels. Looking ahead, with inflation reducing in G7 countries policy makers are expected to ease economic cooling measures and that would stimulate demand,” said Willie Walsh, IATA’s Director General.

March (% year-on-year)               World share1     CTK        ACTK     CLF (%-pt)2         CLF (level)3

Total Market      100.0%  -7.7%     9.9%      -8.8%     46.2%

Africa    2.0%      -6.2%     -4.1%     -1.1%     48.9%

Asia Pacific          32.4%    -7.3%     23.6%    -16.2%  48.5%

Europe 21.8%    -7.8%     8.8%      -10.3%  57.0%

Latin America     2.7%      -5.3%     12.9%    -7.0%     36.6%

Middle East        13.0%    -5.5%     9.7%      -7.3%     45.6%

North America  28.1%    -9.4%     0.4%      -4.2%     39.3%

1 % of industry CTKs in 2022  2 Change in load factor  3 Load factor level

March Regional Performance

•             Asia-Pacific airlines saw their air cargo volumes decrease by 7.3% in March 2023 compared to the same month in 2022. This was a slight decrease in performance compared to February (-5.4%).  The drop in demand suggests that air cargo traffic in the region has not yet stabilized following China’s reopening in January. Available capacity in the region increased by 23.6% compared to March 2022 as more belly capacity came online from the passenger side of the business.

•             North American carriers posted the weakest performance of all regions with a 9.4% decrease in cargo volumes in March 2023 compared to the same month in 2022. This was a decrease in performance compared to February (-10.3%).  The transatlantic route between North America and Europe saw traffic declining at an accelerated pace throughout March. Capacity increased 0.4% compared to March 2022.

•             European carriers saw the most substantial improvement in demand in March over the previous month.  Airlines in the region saw their air cargo volumes decrease by 7.8% in March 2023 compared to the same month in 2022. This was an improvement in performance versus February (-15.9%). Airlines in the region continue to be most affected by the war in Ukraine. Capacity increased 8.8% in March 2023 compared to March 2022.

•             Middle Eastern carriers experienced a 5.5% year-on-year decrease in cargo volumes in March 2023. This was also an improvement to the previous month’s decline (-7.1%). The demand on Middle East-Europe routes has been trending upward in recent months. Capacity increased 9.7% compared to March 2022.

•             Latin American carriers had the strongest performance of all regions in March despite posting a decline in performance over the previous month. Carriers in the region reported a 5.3% decrease in cargo volumes in March 2023 compared to March 2022. This was a drop in performance compared to February which saw a 2.9% decrease. Capacity in March was up 12.9% compared to the same month in 2022. 

•             African airlines saw cargo volumes decrease by 6.2% in March 2023 compared to March 2022. This was an improvement in performance compared to the previous month (-7.4%). Notably, Africa to Asia routes experienced significant cargo demand growth in March. Capacity was 4.1% below March 2022 levels.


IATA Welcomes Telcos’ Agreement to Extend 5G Mitigations but More is Needed

Geneva – The International Air Transport Association (IATA) welcomed the agreement by AT&T Services, T-Mobile, UScellular, and Verizon to extend until 1 January 2028 the voluntary mitigation measures for 5G C-band transmissions at 188 US airports. These mitigation measures, which were put in place in January 2022, concurrent with the rollout of 5G C-band operations at or near US airports, include lowering the power of 5G transmissions and had been set to expire 1 July 2023. However, while the agreement is a welcome stop-gap development, it is by no means a solution. The underlying safety and economic issues around 5G C-band deployments by telecommunications services providers (telcos) have only been kicked down the road.

“Airlines did not create this situation. They are victims of poor government planning and coordination. Industry concerns about 5G, expressed for many years in the appropriate forums, were ignored and over-ridden. Half-measure solutions have been foisted upon airlines to implement at their own expense and with little visibility into their long-term viability. This extension is an opportunity for all stakeholders, including telcos, government regulators, airlines and equipment manufacturers, to work together for a fair and equitable solution,” said Nick Careen, IATA’s Senior Vice President Operations, Safety and Security.

Background to the current situation

The activation of 5G C-band operations in January 2022 threatened enormous disruption to the US air transport system because of the potential risk of interference with aircraft radio altimeters (radalts) that also use C-band spectrum and are critical to aircraft landing and safety systems. This was only addressed at the eleventh hour when AT&T and Verizon agreed to a voluntary power limit for 5G C-band transmissions near airports. Even with this agreement, however, the continuing risk of interference with aircraft radalts was seen as so significant by the Federal Aviation Administration (FAA) that airlines were only permitted to operate at affected airports in low visibility (Category 2 and Category 3) conditions through one of two methods: 

 •            Alternative Means of Compliance (AMOC) under which avionics and aircraft original equipment manufacturers (OEMs) establish that specific aircraft / radalt combinations provide sufficient resilience against interference to continue to utilize low visibility landing procedures at the affected airports. 

 •            Modifying existing radalts or replacing them with newer models at their own expense, to enable unrestricted operations at agreed 5G power levels.

In May 2022, the FAA informed airlines that, as of 1 July 2023 the AMOC process would end. In its place, a blanket requirement defining a minimum performance level for radalts for low visibility landing procedures was to be established. Radalts not meeting the minimum performance level would have to be replaced or upgraded at airline expense. The cost of fleet wide radalt upgrading is estimated at more than $638 million.

Several airlines began the radalt upgrade process shortly after the May 2022 communication from the FAA, even though the FAA did not issue a formal notice of proposed rulemaking until January 2023. Even then, supply chain issues make it unlikely that all aircraft can be upgraded by the 1 July deadline, threatening operational disruptions during the peak northern summer travel season.

Recent developments

The latest agreement by the telcos to defer until January 2028 full power-up of 5G C-band transmissions near airports buys time but does not address underlying issues.

The retrofits required by 1 July 2023 are a temporary fix as they are not sufficiently resilient in the face of full power 5G C-band transmissions. New 5G tolerant radalt standards are being developed but are not expected to be approved before the second half of 2024. Following that, radalt makers will begin the lengthy process to design, certify and build the new devices for installation in thousands of existing aircraft, as well as for all new aircraft delivered between now and 2028. Four-and-a-half years is a very tight timeframe for the scale of this undertaking.

“Many airlines have indicated that despite their best efforts they will not meet the 1 July deadline owing to supply chain issues. But even for those that do, these investments will bring no gains in operating efficiency. Furthermore, this is only a temporary holding action. Under current scenarios, airlines will have to retrofit most of their  aircraft twice in just five years. And with the standards for the second retrofit yet to be developed we could easily be facing the same supply chain issues in 2028 that we are struggling with today. This is patently unfair and wasteful. We need a more rational approach that does not place the entire burden for addressing this unfortunate situation on aviation,” said Careen.