Aviation

Major US airlines sue Biden administration over junk fee rule

A clash is brewing between US airlines and the Biden administration over a new rule aimed at shedding light on the often opaque world of airline fees.

The rule, announced by the US Transportation Department, requires airlines to be more transparent about charges such as baggage fees and reservation changes. However, major carriers including American, Delta, and United, alongside their industry trade group, are pushing back against the regulation.

They argue that the increased transparency could overwhelm consumers with information and complicate the ticket-buying process.

The Transportation Department, on the other hand, is staunchly defending the rule, emphasizing its role in protecting consumers from what it calls “hidden junk fees.” The department estimates that the rule could save consumers over $500 million annually.

The dispute lies in the requirement for airlines and travel agents to disclose fees upfront, prominently displaying them on the first webpage where flight prices are quoted.

While the Biden administration sees this as a step towards empowering consumers, airlines fear it will confuse travelers and disrupt their business models. Despite the opposition from some airlines, Southwest Airlines expressed support for the principle of transparent pricing.

While the rule may have minimal impact on Southwest due to its existing policies of allowing free checked bags and no extra fees for reservation changes, the airline emphasizes the importance of clear and consistent fee disclosure for informed consumer decision-making.

Aviation

Airbus Alters Production Schedule Due to Engine Supply Difficulties

In a significant development for Airbus, the aerospace giant has announced adjustments to its 2024 delivery targets and production timelines, citing severe disruptions in engine supplies as a primary cause.

Airbus lowered its 2024 delivery target

Originally aiming to deliver approximately 800 airplanes in 2024, Airbus has revised this figure downwards to around 770 aircraft. This reduction follows ongoing challenges in its supply chain, exacerbated by lingering pandemic impacts and heightened parts shortages.

Airbus CEO Guillaume Faury acknowledged the headwinds faced by the company, stressing the necessity to address these issues directly. “We are facing headwinds right now; we have to bite the bullet,” Faury remarked during a briefing with analysts.

The revised projections also include a delay in achieving a production rate of 75 narrow-body A320-family jets per month, now pushed back to 2027 from the initially planned 2026. The root of these setbacks lies partly in critical engine shortages affecting Airbus’s popular A320neo family, a direct competitor to Boeing’s 737 MAX.

Faces increased parts shortages and output delays.

Faury highlighted that engine supplies for wide-bodied jets, particularly the A330neo, have also experienced delays, albeit without impacting the A350 production timeline.

To mitigate these challenges, Airbus is reportedly in discussions with Spirit AeroSystems Holdings Inc. to potentially acquire portions of its aerospace business, aiming to bolster its supply chain resilience. Despite these strategic adjustments, Airbus remains steadfast in fulfilling its long-term order commitments, boasting a sold-out production schedule through the end of the decade.

The industry-wide struggle to stabilize supply chains post-pandemic has further compounded Airbus’s operational hurdles. Issues ranging from labor shortages to financial instability among suppliers continue to strain production capacities across the aviation sector.