787 Groundings, Airbus In The USA & Etihad Big News

Welcome back to the channel. Updates on Airbus in the United States. Etihad recording a mega profit and 787 groundings. Why not begin there? With many Boeing 787 aircraft at Air New Zealand, among other planes, expected to be grounded throughout 2025. Air New Zealand has faced challenge after challenge in the recent years, spurred on by not just a pandemic and increased competition, but aircraft reliability woes. The carrier has now provided updates on the continued management of its fleet and the outlook for the remainder of 2025. Therefore, Air New Zealand forecasts an increase in the number of planes on the ground in the second half of this year, with the units parked ranging at 10 to 11 units. This figure represents an increase in the 7 to 8 aircraft grounded across the first half and even more than the 5 to 6 in the second half of 2024. As a result, Air New Zealand believes these groundings will worsen in the coming months before things get better, with all these complications certainly driven by engine manufacturer supply chain woes. The Airbus single-aisle family is also impacted. Therefore, for Air New Zealand, it's not isolated to one aircraft type or one type of specific, say, mission across its network. Next-generation planes in the A320neo family are being pulled from service, spurred on by woes with Pratt & Whitney. Meanwhile, the Rolls-Royce engines on the 787 continue to present problems. It's a reoccurring theme that even dates back to the mid to late 2010s, when engine woes and more led to groundings and wet-lease arrangements being signed. According to Air New Zealand's forecasts, the grounding will include up to five of your single-aisle jets and six of your wide-body aircraft from the 787 family. Air New Zealand, however, says it is undertaking actions to try and mitigate some of the losses that will be caused from this. They have swiftly negotiated the lease of aircraft and engines to combat this, which are incredibly frustrating on all accounts, but at the very least, it has the opportunity to do this. Two additional leased engines are expected to arrive in the second half of this year to try and provide, where possible, some coverage for the company. Meanwhile, two previously disclosed A321 jets from Airbus will arrive in 2025 as well to help compensate for the lost single-aisle capacity on your next generation models. Air New Zealand has also been forced to make changes to its global route network, and I'm really going to focus on your international markets here that would usually rely on an aircraft such as the 787, but have not been able to continue given the restricted capacity that we see. Thanks to this, the airline has made adjustments, including pausing service to Chicago and Seoul. While these are tough decisions, they are made to ensure that the remainder of the business's network remains reliable, but also attainable and realistic. These groundings are obviously frustrating for Air New Zealand, which is really meant to be in the midst of a fleet renewal effort, and the efforts have involved streamlining jets operated, among other things. But the flag carrier knows its schedule needs to remain reliable. If it continued flying towards Chicago and Seoul, you would see negative ramifications on the broader fleet, which is something it wants to avoid. In terms of that fleet, we already know that we have had an announcement that they will axe the Boeing 777 moving forward, and in the future, it'll be a single-fleet type long-haul operation, strictly focusing on the 787. That has been pushed back, however, given the complexities with the engines on the aircraft. Over to some more positive news, Etihad Airways has announced a record-breaking profit and yearly performance as they continue to rebuild, but now actually grow. Reporting an AED $1.7 billion or USD $476 million profit last year marks the third consecutive year of profitability and a profit after tax that is three times that of 2023. Etihad's performance is deemed considerable when you account for the turnaround efforts that this company has been going through to really recover from the billions of dollars that were lost throughout the latter stages of the 2010s, when some even believed that maybe there was no recovery in sight for the company. For the full year, Etihad says it carried 18.5 million passengers, this an increase of 32% from the prior year and allowed for USD $5.7 billion in passenger revenue. Available seat kilometers or ASKs also increased 28% supporting your overall increases in passenger numbers. Load factors grew by just the one percentage point to an average of 87% during the 12 months, which is actually a positive result given that they launched many new services and made adjustments to the network to see this number actually increase. It's a good thing, shows they're making the right decisions in terms of where they're deploying their aircraft and capacity. Total revenue also grew by 25% to USD $6.9 billion. Etihad really saying that those revenues were possible, not just thanks to record performance in its passenger division, but it also has to be mentioned that the cargo division did enjoy a very much successful year with over 1,700 weekly flights and frequency increases across 25 routes in the past 24 months. The airline has really been focusing on expanding its day-to-day flying, ensuring that more locations are being featured on the route map as the years progress, all aligning with those Journey 2030 ambitions, which aim to expand the route network, fleet, and overall employee group to make Etihad Airways a continued powerhouse in not just the Middle East, but on a global scene. While much focus is placed on the finances and metrics, there were also investments into improving how the airline operates on the day-to-day side, looking to really improve your customer experiences. Etihad says that it has invested heavily and it's been able to increase its operational improvements alongside satisfaction for its service. Endeavors such as these and your retrofit program among more are all aiming at making customers enjoy flying Etihad Airways more than ever. And as for 2025, all it represents another year of improvement and growth, certainly more aircraft and new routes will launch and they'll continue to be one to watch. Over to some more controversial news, I know people will have some very strong opinions on this no doubt just because I'll be mentioning a couple of names and words, but you may recall when Airbus purchased the C-Series, one of their key focus markets was that of North America, which was the perfect location they felt for their newly rebranded A220. However, the intensity of selling its aircraft to the United States and also the deliveries may be forced to change as part of prospective new tariffs. The plane makers CEO said that if tariffs were to go on to disrupt its real operation across the United States, it may be forced to place its priorities elsewhere moving forward. Speaking with CNBC, the CEO said that customers worldwide are eager to acquire their planes sooner rather than later where possible. And if the situation in the United States was to worsen, Airbus would make the changes it push ahead deliveries to customers who make the process easier than those in the United States, giving them priority. However, what this means for customers in the United States remains to be seen first given that these moves from the plane maker are unconfirmed. In recent times, airlines in the United States have also increased their reliance on Airbus produced aircraft. This can be for many reasons. Analysts say that a better production line, better stability and better quality are all some of the many reasons. Decisions like those concerning delivery shuffles have been seen across our industry before with geopolitical tensions leading to maybe the suspension or delayed aircraft deliveries to specific locations. Much of Airbus's stance follows the persistent talk of tariffs following President Trump's inauguration. These tariffs or their general discussion have prompted Airbus to remain on its toes about how it will tackle any challenges that may present themselves. Despite this, if anything, the plane maker's strength in the United States has actually recently increased as it established production lines, has sold a number of aircraft to customers and is certainly trying to solidify its presence here. The European plane maker, however, hopes it will not be affected by the implementation of tariffs. They went as far as saying that while this would affect them, they firmly believe that it also would negatively impact the United States. Many of your companies in the United States are heavily relying on deliveries of Airbus produced aircraft to fuel not just their growth but renewal plans.