Asia’s storm season threatens parked aircraft

Extreme weather is a growing concern for airports across Asia with larger numbers of aircraft grounded because of the coronavirus pandemic. (Shutterstock)
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Updated 04 June 2020

Asia’s storm season threatens parked aircraft

  • Hong Kong International Airport, home to Cathay Pacific Airway and Hong Kong Airlines, said it had 150 planes parked

SYDNEY: Airlines, airports and insurers across Asia are bracing for the prospect of unusually high damage as the region’s tropical storm season begins, as hundreds of aircraft grounded by the coronavirus pandemic can’t be moved easily.

Major airports in storm-vulnerable regions such as Hong Kong, Taiwan, Japan, the Philippines, Thailand and India have been effectively turned into giant parking lots as COVID-19 travel restrictions choke demand.

“If you have got those aircraft on the ground, you can imagine to get them back up and running in a short space of time is no easy thing,” said Gary Moran, head of Asia aviation at insurance broker Aon. “The challenge is you can have a typhoon or hurricane coming and there are going to be a lot of aircraft that aren’t going to be able to be moved in time.”

Airline insurers, already on the hook to refund large portions of crash risk premiums because of the groundings, now face the larger-than-usual risk posed by having lots of airplanes grouped together at airports, industry experts said.

“One event could create damage which costs millions to repair, maybe even closer to hundreds of millions depending on the aircraft that are involved,” said James Jordan, a senior associate at law firm HFW’s Asia aerospace and insurance practices.

In guidance to be issued to airport operators this week, seen by Reuters, the trade group Airports Council International (ACI) warns that flying the planes out of danger, the practice in normal times, may not be possible. It says extra precautions such as more tie-downs could be needed.

“Extreme weather events such as hurricanes, typhoons and cyclones are a seasonal hazard in many areas of the world, and in the pandemic context provide an additional layer of hazard with many airports accommodating larger numbers of parked aircraft,” ACI Director General Angela Gittens said.

Mumbai’s airport said on Wednesday that small private planes vulnerable to strong winds had top priority to be flown out or parked in a hangar as the city braced for a rare cyclone.

Manila’s Ninoy Aquino International Airport has so many aircraft on the ground that is using a runway for parking, according to a spokesman for the Civil Aviation Authority of the Philippines.

Taiwan’s aviation regulator said it had asked airports to hold typhoon preparation meetings 36 hours in advance this year, rather than the usual 24 hours, to give airlines enough time to make parking requests. It will open up taxiways if needed at Taipei’s main international airport, Taoyuan, to allow for 160 parked planes.

EVA Airways Corp. said its plans included securing aircraft, parking them in hangars and sending some to other airports in Taiwan and abroad. Taiwan’s largest carrier, China Airlines Ltd, said it had typhoon plans, but declined to provide details.

Hong Kong International Airport, home to Cathay Pacific Airway and Hong Kong Airlines, said it had 150 planes parked and precautionary measures had already been carried out as part of typhoon season preparations.

The measures include fueling up the planes to make them heavier, tying weights to nose gear and putting double chocks on aircraft wheels.

Osaka’s Kansai International Airport, whose runway flooded when Typhoon Jebi breached a seawall in 2018, said it had raised the wall and waterproofed facilities.


American Airlines threatens to cancel some Boeing 737 MAX orders

Updated 11 July 2020

American Airlines threatens to cancel some Boeing 737 MAX orders

  • American’s stand comes as airlines are finding financing increasingly difficult and expensive
  • Airlines have canceled orders for more than 400 MAX planes so far this year

DALLAS: American Airlines is warning Boeing that it could cancel some overdue orders for the grounded 737 MAX unless the plane maker helps line up new financing for the jets, according to people familiar with the discussions.
American’s stand comes as airlines are finding financing increasingly difficult and expensive as the coronavirus pandemic has crippled their operations.
American had 24 MAX jets before they were grounded in March 2019. It has orders for 76 more but wants Boeing to help arrange financing for 17 planes for which previous financing has or will soon expire, according to three people who spoke Friday on condition of anonymity to discuss private talks between the companies.
If the companies can’t reach an agreement, American could use MAX financing that is about to expire to pay for jets from Boeing’s archrival Airbus, one of the people said.
Chicago-based Boeing said in a statement that it is working with customers during “an unprecedented time for our industry as airlines confront a steep drop in traffic,” but did not comment on the talks with American. The Fort Worth, Texas-based airline declined to comment.
News of American’s threat to cancel some orders was first reported by The Wall Street Journal.
The situation underscores the strain facing airlines during the coronavirus pandemic. It has grown more difficult and expensive for them to finance planes. American’s negotiating stance doesn’t reflect a loss of confidence in the plane’s safety, the sources said.
The MAX was Boeing’s best-selling plane before crashes in Indonesia and Ethiopia killed 346 people and led regulators around the world to ground all MAX jets.
The coronavirus pandemic has compounded Boeing’s problems by causing a sharp drop in air travel and a loss of interest in new planes. Nearly 40 percent of the world’s passenger jets are idled, according to aviation data supplier Cirium, as most airlines have more planes than they need until travel recovers.
That has made it more difficult to finance planes. United Airlines and Southwest Airlines found foreign lenders who agreed in April and May to buy MAX jets and lease them to the airlines, but those carriers are in stronger financial situations than American.
The 17 planes in dispute were supposed to have been delivered to American at least a year ago. That has given the airline the option of canceling the order without penalty and recovering its down payments now, according to one of the people familiar with the matter. The deliveries have been delayed while Boeing works to fix a flight-control system suspected of playing a role in the crashes.
Airlines have canceled orders for more than 400 MAX planes so far this year, and 320 are no longer certain enough to count in Boeing’s backlog. Some were dropped because the airline buyer ran into financial problems, while others were swapped for different Boeing planes. The company had taken 4,619 orders through May.
Air travel in the US fell about 95 percent from the beginning of March until mid-April. Traffic has recovered slightly since then, but remains down more than 70 percent from a year ago. With little revenue coming in, airlines are slashing spending and preparing to furlough thousands of workers this fall.
American has accepted $5.8 billion in federal aid to pay workers through Sept. 30, reached tentative agreement on a $4.75 billion federal loan, and lined up billions more in available cash from private lenders to survive the travel downturn.