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Airbus and the Government of Québec become sole owners of the A220 Programme as Bombardier completes its strategic exit from Commercial Aviation

Airbus and the Government of Québec become sole owners of the A220 Programme as Bombardier completes its strategic exit from Commercial Aviation
  • Bombardier transfers its remaining interest in Airbus Canada Limited Partnership (Airbus Canada) to Airbus SE and the Government of Québec
  • Airbus now holds 75 percent of Airbus Canada with the Government of Québec increasing its holding to 25 percent for no cash consideration
  • Bombardier work packages for the A220 and A330 will be transferred to Airbus, through its subsidiary Stelia Aerospace, securing 360 jobs in Québec
  • Bombardier will receive US$591M, net of adjustments, of which US$531M was received at closing, and is released of its future funding capital requirement to Airbus Canada
  • Over 3,300 Airbus jobs secured in Québec

Amsterdam / Montreal – Airbus SE (EPA: AIR), the Government of Québec and  Bombardier Inc. (TSX: BBD.B) have agreed upon a new ownership structure for the A220 programme, whereby Bombardier transferred its remaining shares in Airbus Canada Limited Partnership (Airbus Canada) to Airbus and the Government of Québec. The transaction is effective immediately.

This agreement brings the shareholdings in Airbus Canada, responsible for the A220, to 75 percent for Airbus and 25 percent for the Government of Québec respectively. The Government’s stake is redeemable by Airbus in 2026 – three years later than before. As part of this transaction, Airbus, via its wholly owned subsidiary Stelia Aerospace, has also acquired the A220 and A330 work package production capabilities from Bombardier in Saint-Laurent, Québec.

This new agreement underlines the commitment of Airbus and the Government of Québec to the A220 programme during this phase of continuous ramp-up and increasing customer demand. Since Airbus took majority ownership of the A220 programme on July 1, 2018, total cumulative net orders for the aircraft have increased by 64 percent to 658 units at the end of January 2020.

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The single aisle market is a key growth driver, representing 70 percent of the expected global future demand for aircraft. Ranging from 100 to 150 seats, the A220 is highly complementary to Airbus’ existing single aisle aircraft portfolio, which focuses on the higher end of the single-aisle business (150-240 seats).

As part of the agreement, Airbus has acquired the Airbus A220 and A330 work package production capability from Bombardier in Saint-Laurent, Québec. These production activities will be operated in the Saint Laurent site by Stelia Aéronautique Saint Laurent Inc., a newly created subsidiary of Stelia Aerospace, which is a 100 percent Airbus subsidiary.

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Stelia Aéronautique Saint-Laurent will continue the production of the A220 cockpit and aft fuselage production, as well as A330 workpackages, for a transition period of approximately three years at the Saint-Laurent facility. A220 workpackages will then be transferred to the Stelia Aerospace site in Mirabel to optimize the logistical flow to the A220 Final Assembly Line also located in Mirabel. Airbus plans to offer all current Bombardier employees working on the A220 and A330 work packages at Saint-Laurent opportunities around the A220 programme’s ramp-up, ensuring know-how retention as well as business continuity and growth in Québec.

At the end of January 2020, 107 A220 aircraft were flying with seven customers on four continents. In 2019 alone, Airbus delivered 48 A220s, with the further ramp-up to be continued.

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He is an aviation journalist and the founder of Jetline Marvel. Dawal gained a comprehensive understanding of the commercial aviation industry.  He has worked in a range of roles for more than 9 years in the aviation and aerospace industry. He has written more than 1700 articles in the aerospace industry. When he was 19 years old, he received a national award for his general innovations and holds the patent. He completed two postgraduate degrees simultaneously, one in Aerospace and the other in Management. Additionally, he authored nearly six textbooks on aviation and aerospace tailored for students in various educational institutions. jetlinem4(at)gmail.com

Aviation

American Airlines Flight Attendant Orders First-Class Traveler to use Economy Restroom

American Airlines Flight Attendant Orders First-Class Traveler to use Economy Restroom

On a recent American Airlines flight from Chicago O’Hare to Phoenix, Pamela Hill-Veal, a retired circuit court judge, found herself at the center of a disturbing incident.

Despite traveling in First Class, she was directed by a flight attendant to use the Economy Class restroom, sparking allegations of racial discrimination. According to Hill-Veal, the ordeal began when she used the dedicated First Class lavatory during the flight. A flight attendant approached her, accusing her of slamming the door and issued a warning.

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Despite remaining calm, Hill-Veal faced further confrontation when she attempted to use the First Class restroom again later in the flight. The situation escalated as the flight attendant persisted in berating Hill-Veal, who felt targeted due to her race. She highlighted the disparate treatment, noting that white passengers were not subjected to similar directives.

In a distressing turn, the flight attendant followed Hill-Veal to her seat and allegedly touched her while threatening arrest upon landing. This alarming encounter left Hill-Veal feeling humiliated and traumatized, impacting her ability to rest even after the flight.

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American Airlines has responded, expressing a commitment to investigating the matter and addressing discrimination claims seriously. However, the incident underscores ongoing concerns about racial bias in air travel and the need for accountability in ensuring all passengers are treated with dignity and respect.

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Aviation

Southwest CEO Signals Major Shift: Farewell to Open Seating

Southwest CEO Signals Major Shift: Farewell to Open Seating

Southwest Airlines is contemplating a significant shift away from its traditional open seating policy, a move that could signal a departure from its long-standing business model.

The potential change, which would introduce assigned seating and premium seat options, is being considered to appeal to a younger demographic of travelers. This adjustment would mark one of the most substantial alterations for the carrier since its inception in 1971.

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Unlike its competitors who have embraced premium seating offerings, Southwest has stuck to its open seating approach, albeit providing the option for early boarding at a fee. However, with rivals like United Airlines witnessing revenue growth from premium seating, Southwest is reevaluating its strategy. According to Forbes, the airline industry has seen a shift in customer preferences over time, prompting Southwest to reconsider its seating model designed during an era of lower load factors.

While Southwest CEO, Jordan,told to CNBC that he has neither confirmed nor denied the possibility of premium seating, he acknowledges that the company is exploring various options. He emphasized that while it’s still early in the decision-making process, the initial results are promising, hinting at potential changes in the future.

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Southwest currently operates with a single economy class cabin across its all-Boeing 737 fleet, with no assigned seating. However, the airline does offer the option for early boarding for passengers to secure their preferred seats for an additional fee. Over the years, Southwest has maintained a focus on simplicity and user-friendliness in its offerings, striving to minimize costs and complexity.

In contrast, competitors like Delta and United have capitalized on revenue growth from premium seating options such as business class, demonstrating strong upsell rates. Analysts have repeatedly questioned Southwest about the potential for introducing premium seating or additional fees, although the airline has traditionally refrained from charging for the first two checked bags.

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For now, the only way Southwest passengers can secure their preferred seats is by paying for an earlier boarding position, as the airline continues to operate without assigned seating, allowing passengers to choose their seats upon boarding in a predetermined order.

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Airlines

US DOT says Airlines must now pay automatic refunds for cancelled flights

US DOT says Airlines must now pay automatic refunds for cancelled flights

The U.S. Department of Transportation (DOT) has released a final regulation requiring airlines to quickly reimburse passengers with automatic cash refunds when owed, according to a statement made by the Biden-Harris Administration.

Under the new regulation, passengers will find it easier to get refunds when airlines dramatically alter or cancel flights, cause severe delays for checked baggage, or don’t supply the additional services they paid for.

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According to a statement from the Biden-Harris Administration, the U.S. Department of Transportation (DOT) has published a final rule mandating airlines to promptly compensate customers with automatic cash refunds when they are eligible. The new rule would make it simpler for customers to receive refunds from airlines in cases when they drastically change or cancel flights, cause significant delays for checked luggage, or fail to provide the extra services they charged for.

Under the latest rule from the USDOT, passengers are guaranteed refunds in several scenarios:

  1. Canceled or Significantly Changed Flights: Passengers are entitled to refunds if their flight is canceled or significantly altered, including changes in departure or arrival times exceeding 3 hours domestically or 6 hours internationally, departures or arrivals from different airports, increased connections, downgrades in service class, or changes less accommodating to passengers with disabilities.
  2. Delayed Baggage Return: Passengers filing mishandled baggage reports can claim a refund for checked bag fees if their luggage is not returned within specific timeframes after flight arrival.
  3. Unprovided Extra Services: If airlines fail to deliver paid extra services like Wi-Fi, seat selection, or inflight entertainment, passengers can request refunds for those fees.

The final rule streamlines the refund process, ensuring it is:

  • Automatic: Refunds are issued automatically without requiring passengers to request them.
  • Prompt: Airlines must refund credit card purchases within seven business days and other payment methods within 20 calendar days.
  • In Original Form of Payment: Refunds are provided in the original payment method used for purchase.
  • Full Amount: Passengers receive full refunds minus the value of any portion of transportation already used, including government and airline fees.

Suggest banning family seating junk fees and ensuring that parents can travel with their kids at no additional cost. No airline promised to ensure fee-free family seating prior to efforts from President Biden and Secretary Buttigieg last year. Family seating is now guaranteed free of charge on four airlines, and the Department is working on a plan to eliminate family seating junk fees.

Propose to make passenger compensation and amenities mandatory so that travelers are taken care of when airlines cause flight delays or cancellations. 

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