While most airlines reported reassuring figures at the end of 2018, there are a number that are in varying degrees of difficulty.
Nothing new you might say. Well, yes. The “companies in distress” column is increasingly filled with low-cost airlines which, until recently, were predicted to have a bright future. But there are also some majors. Small overview in alphabetical order.
Alitalia: on life support
It is for industrial reasons (skyteam, joint venture with Air France-KLM) an airline that we closely watch. And it gets tiring. Irreformable, dropped by Etihad, it has been looking for a buyer since 2017 without having returned to profitability. EasyJet has thrown in the toweland Delta is not in a hurry.
Etihad: convalescent
The other blockbuster of the moment. Etihad is losing money despite significant cost reductions, but still imagines it will go it alone. A marriage with Emirates, the most logical solution, is disdainfully brushed aside.
Jet Airways: on probation
Jet Airways is starting to feel the heat. The Indian airline was forced to ground its planes twice last week because it could not pay its lenders and there are fears of a strike by pilots who have not been paid for months. To date the debt is one billion dollars
Today the “industrial” partner Etihad, which holds 24% of the capital (there is regularity in the success of Etihad’s investments) has announced that it does not want to inject any more money, and is even ready to withdraw.
The debt was just converted into equity this week anda consortium led by the State Bank of India just became the majority shareholder. Jet Airways has found a way to survive, but the basic problems remain: the only thing worse for an airline than having grounded planes is that they lose money every time they fly.
One last detail: Jet Airways is a major partner of Air France-KLM on services to India. A partnership strategic enough for the Franco-Dutch airline to be concerned about its survival?
It looks like a funeral ceremony on the banks of the Ganges.
Malaysia : for sale or to let
Never really recovered from the loss of flights MH17 and MH370, the airline has reformed itself, still offers an excellent service but struggles to become profitable again, notably weighed down by long-haul flights. The Malaysian government is considering the future of the company and does not rule out a sale or a shutdown. The rumor of a takeover by Qatar Airways has recently appeared, but in my opinion it is more an exploration of the field of possibilities than an option really studied on the Gulf side.
Norwegian: not everything is settled
The attractive, promising (and beloved, which is rare in this niche) Norwegian low-cost airline has closed bases, considered selling aircraft, closed unprofitable routes, closed bases. The future is not totally black for Norwegian, but it’s not all rosy either: it will have to deal with the high level of debt that has allowed it to grow at a rapid pace. While waiting for IAG to come back to better intentions?
South African Airways: bankrupt without knowing it
2 billion dollars of debt, refusal to present its 2017/2018 accounts...the South African airline is dead and is the only one that did not realize it. On life support as long as the state funds, which is not for much longer.
We will also watch those that without being frankly ill have nevertheless shown signs of weakness for whom operating results are a valid thermometer: Aeromexico, Air Asia X, and even Ryanair, which, unusually, lost money in Q3 2018 and is concerned about the health of the sector in Europe
And let’s not forget those who recently left us.
Air Berlin: bankruptcy
Almost no profit in 8 years of existence and a debt of 1.2 billion at the time of its bankruptcy earlier this year. For the record, its shareholder at the time, Etihad (yes again…) which held 29.2% of the capital was ordered to pay 2 billion euros to the administrator of the airline for broken promises.
Flybmi: bankruptcy
It is a self-proclaimed “first victim of the Brexit” because of the impact on business of fears related to the UK’s exit from the European Union. The increase in kerosene prices was also cited. The airline operated 17 aircraft and served 25 cities in Europe.
It stopped all its operations overnight, leaving 400 employees out of work.
Germania: bankruptcy
It was the price of kerosene that killed the German low-cost airline that carried 4 million passengers per year.
Inselair : bankruptcy
You probably don’t know it but the small airline from Curacao (Kingdom of the Netherlands) has been declared bankrupt at the end of February.
Primera Air: bankruptcy
It was in October that the Danish long-haul low-cost airline filed for bankruptcy, paving the way for a series of bad news about low-cost airlines, especially long-haul. Reasons given: cost of anti-corrosion treatments for the aircraft (!) and delivery delays on the part of Airbus.
Wow Air: bankruptcy
Wow Air sold planes to stay afloat but it wasn’t enough. Talks with investment funds have failed. Icelandair, which considered buying them, has just thrown in the towel. Wow Air announced the end of its operations a few minutes after the original publication of this post.
We can clearly say that the vital prognosis is engaged.
It remains to be seen what it tells us as a story…but that will be for a future article.
[Billet Edité le 28 mars à 15h09 après l’annonce de Wow Air]
Photo : Wow Air by Vytautas Kielaitis via Shutterstock
