Abta Aviation Forum: Government policy and the drive Continued from page 48 Increasing evidence of a
collapse in the Canadian travel market to the US – the country’s biggest source of visitors – could bring down hotel rates. Indeed, The Washington Post reported last week: “Travel to the US from almost everywhere is falling.” However, none of these
factors could wholly counter the impact of an economic downturn. Business sentiment generally
runs in advance of consumer confidence so a Guild of Business Travel Association (GBTA) poll, conducted between March 31 and April 8, is worth noting. It suggested a sea change in corporate travel sentiment. The proportion of GBTA
members optimistic about the outlook had more than halved since November, from 67% to 31%, and up to 20% of respondents reported cancelling or considering cancelling attendance at meetings or events in the US. Airline chiefs are already
warning tariffs could affect aircraft deliveries, exacerbating delivery delays and capacity constraints. Ryanair chief executive
Michael O’Leary warned last week of “every likelihood we may delay the delivery” of 25 Boeing aircraft due from August. Delta Air Lines chief Ed Bastian similarly warned “we will not be paying any tariffs” on Airbus aircraft due this year. Deliveries can’t be delayed
indefinitely, of course. They must be fulfilled or cancelled, with costs attached either way which will ultimately fall on passengers. It should be a relief then
that this summer’s bookings are so far advanced and that most of the uncertainty relates to the seasons ahead.
Aircraft charter and lease costs ‘unlikely to drop’
Ian Taylor
The current high costs of aircraft charter and leasing are unlikely to fall, with the US imposition of tariffs set to exacerbate the existing capacity shortfall. That is according to Richard
Mumford, partner at aviation law firm Clyde & Co and a specialist in aircraft leasing. He described the aircraft, crew, maintenance and insurance market as “difficult” and the leasing market for short-haul aircraft as “overheated because airlines can’t get more aircraft”. This has kept “fares higher and
airlines profitable”, Mumford told the forum, meaning “older aircraft are not being taken out of service and stripped for parts”, leading to “a squeeze on the parts market”. He noted: “Boeing and Airbus
have different reasons why they can’t keep up with orders. Boeing has had a shocking sequence of failures. It’s difficult to get proper information about why there are the delays, but there are a lot of supply chain issues.”
DfT official hails Labour’s support for aviation sector
Relations between the government and aviation industry are in “a materially different place” than a year ago, according to a senior Department for Transport (DfT) official. Michael Stark, deputy
director for aviation, insisted: “The government has been very
46 24 APRIL 2025
An Airbus A320neo
However, he said: “They
couldn’t keep up with orders prior to Covid. The reality is there are too many [aircraft] orders and the manufacturers can’t fulfil them.” Mumford added that “the push
for greener engines” has added to the problems as the latest engines require substantially more maintenance. He said engines are “taking too
long to fix and aircraft are spending more time on the ground”. A move by engine manufacturers
to take on more of the maintenance has caused further “massive problems”, he suggested, saying: “It means aircraft can be on the ground for a year.”
clear about the importance of aviation to the UK economy.” He noted: “The chancellor has
given firm backing to Heathrow, and the transport secretary has made clear there is no contradiction between pushing on growth and decarbonisation. That means pushing on sustainable aviation fuel [SAF]. It also means accelerating airspace modernisation.” Stark suggested “times have
changed” since a year ago, saying: “We’re in a materially different place.” Richard Mumford, a partner at specialist aviation law firm Clyde
He warned: “The likelihood is this
problem will be around for a few years. We see problems all over the world.” Iata director general Willie Walsh
hit out over aircraft delivery delays, the number of aircraft grounded for engine maintenance and high leasing costs at the turn of the year, saying: “The situation is unacceptable” (Travel Weekly, January 2). “Aircraft are spending far too long
on the ground. Airlines are using aircraft they don’t want to operate and paying too much to lease them,” said Walsh. “The durability of newer engines is nowhere near what we’re used to. We see more and more problems.”
Richard Mumford
& Co, agreed, saying: “There is a lot more talk about the economic benefits of aviation.” He described the “general tone” of discussion around government policy and aviation a year ago as “defensive”.
travelweekly.co.uk
PICTURE: Airbus
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