Aviation News in Brief 19 August 2020

Virgin Australia, Thai Airways bankruptcy, Singapore aviation aid, Hong Kong International Airport, AAR, Diehl Aviation

ACI Asia-Pacific
(PHOTO: Shutterstock)

Use this onevirgin-australia-facing-administrationBondholders fail to convince court of new Virgin Australia plan: Bankrupt Australian carrier Virgin Australia will likely continue with its sale to investment firm Bain Capital after an Australian court threw out a challenge by bondholders for their alternative proposal to be put to creditors at an upcoming meeting. The Federal Court stopped short of blocking any alternative proposal being circulated to creditors ahead of the meeting in September but threw out the specific request by bondholders to force Virgin’s administrators from Deloitte to hold a vote on the two separate proposals. Although the court dismissed the challenge, lawyers for the bondholders said during Monday’s court hearing that they will pursue further legal action to push ahead with their proposal. Bondholders took this step after Deloitte revealed it was planning to only present Bain’s proposal to creditors and then to ask creditors to vote on the plan.

Thai Airways bankruptcy hearings to continue: Thai Airways International’s rehabilitation proceedings started on Monday (17 August) at Thailand’s Central Bankruptcy Court with the cash-strapped national airline represented by acting President Chansin Treenuchagron and two members of the airline’s board appearing as witnesses. The court is trying to determine if the airline can legally enter reorganisation and will also determine if nominated planners or administrators Thai Airways board members and consultancy firm EY Corporate Advisory Services can serve in those positions. The court said Monday it will require two more days of hearings to decide on those issues. It told witnesses that they will likely be called back on 20 August and 25 August. Lawyers representing seven creditors questioned the legitimacy of the rehabilitation process and the qualification of the planners, according to media reports. EY Corporate Advisory Services has no link with London-headquartered multinational accounting and consultancy agency Ernst & Young Global. Thai Airways said several major creditors, including the Ministry of Finance, have submitted a letter expressing their support for its reorganisation. These creditors also did not object to the nominated planners.

covid-19-singapores-changi-to-close-terminal-2Singapore expands aid to aviation: The government of Singapore announced on Monday (17 August) that it would spend an additional S$187 million (US$136.83 million) to help bail out the embattled aviation sector that has been decimated globally by the COVID-19 pandemic. Singapore has been particularly hard-hit because it has no domestic aviation sector and international borders for the most part have remained closed due to quarantine measures implemented by governments to slow the spread of the virus. The latest aid package focuses on airlines, ground handlers, cargo agents and airport tenants and the plan was announced by Deputy Prime Minister Heng Swee Keat. The plan is also being used to support the broader aerospace and tourism industries. “These sectors are important parts of our economy, and they are multipliers for other sectors.” In particular, the Republic’s position as a global business node depends on its connectivity as an air hub, the minister stressed. The Changi air hub and its adjacent industries contribute to more than 5 percent of Singapore’s gross domestic product and employ over 190,000 people. The extended financial relief for airlines, ground handlers, cargo agents and other partners at Changi Airport and Seletar Airport would be provided through landing, parking and rental rebates, the Ministry of Transport (MOT) and the Civil Aviation Authority of Singapore (CAAS) said in a joint statement on Monday. For airlines, these include: a 10 percent landing charge rebate for all scheduled passenger flights landing here; a 50 percent rental rebate for their lounges and offices within Changi Airport and Seletar Airport terminal buildings; and a full rebate on aircraft parking charges at both airports. Ground handlers will get a 50 percent rental rebate for their lounges and offices within the two airports’ terminal buildings. There will also be a 10 percent landing charge rebate for all scheduled freighter flights landing here, as well as a 20 percent rental rebate for cargo agents tenanted at the Changi Airfreight Centre.

AAR’s component repair facility in Amsterdam ranked No. 1: AAR has been named “Outstanding Source of Repair” and ranked No. 1 among all component Source of Repair (SOR) facilities for 2019 by the NATO Support and Procurement Agency (NSPA) and the International Aerospace Management Company (IAMCO). Both organisations manage maintenance work for the North Atlantic Treaty Organisation (NATO). AAR has received this prestigious recognition four times since 2005. AAR Aircraft Component Services in Amsterdam was cited for its superior product quality, timely delivery, quality assurance services and component support on the NATO Airborne Warning and Control System (AWACS) fleet.

Diehl Aviation interiors now available to airline customers directly: Diehl Aviation, a leading solution provider for aircraft cabin interiors and aircraft systems products, has received approval by Boeing to offer Buyer-Furnished-Equipment (BFE) products to airlines for the installation on Boeing airplanes. BFE products are cabin interiors elements that airlines procure directly from the parts manufacturers, such as Diehl Aviation, for the installation on newly-built aircraft at the aircraft manufacturer’ final assembly line. This marks a major milestone for Diehl Aviation in its collaboration with Boeing to offer jointly excellent solutions for airline customers. This achievement follows Diehl Aviation’s close collaboration with the aircraft manufacturer during Boeing’s ecoDemonstrator flight test program in 2019, where one area of testing was Diehl Aviation’s capabilities related to galleys and intelligent galley applications. Galleys usually are BFE products on commercial aircraft. In addition, Diehl Aviation also has other miscellaneous monuments for cabin interiors installation – such as front row monuments and bar units – in its portfolio, all of which are typically considered as BFE products. For decades already, the company has supplied BFE solutions to airlines for installation on aircraft from other manufacturers. The approved listing by Boeing now marks a significant milestone for Diehl Aviation, providing a new market access to airlines that are in the process of adding new Boeing aircraft to their fleet.

Hong Kong Airport Authority extends aid: The Airport Authority of Hong Kong has extended its relief package for the airport community for another two months to end of October 2020 in view of the ongoing impact of the COVID-19 pandemic. The waiver or reduction of various fees for the aviation industry announced in June this year will continue from September to October. The continuing relief measures include full waiver of parking charge for idle passenger aircraft and airbridge fees; reduction of passenger aircraft landing charges; fees reduction related to ramp handling, maintenance and airside vehicles; as well as rental reduction for terminal tenants covering lounges and offices; fees waiver for terminal licensees including ancillary passenger services, commercial services counters and cross-border transport operators; and concessions on franchise fees for aviation support services such as into-plane fuelling. The full waiver on fees in relation to aircraft maintenance charges and fixed charges for inflight catering services will continue until end of October. The rental relief for retail and catering tenants will also continue. Most of the shops and restaurants in the terminal have suspended business and their rental is waived. For those that remain open to provide essential services, the base rent is waived.

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