Skift Breaking News Blog

Short stories and posts about the daily news happenings around the travel industry.

Airlines

Amsterdam Airport Extends Passenger Restrictions as Staffing Issues Persist

1 week ago

The summer may have passed but the staffing issues at Amsterdam’s Schiphol airport have not. The airport is implementing new passenger caps that will restrict the number of travelers passing through the European hub until at least the end of October.

Following a shortfall in security staff, Schiphol is cutting the number of locally departing passengers by 18 percent a day — or to 54,500 people daily in September, and 57,000 in October — through October 31, Schiphol said Friday. And, the operator of Schiphol warned, additional capacity restrictions could be in place through the end of the year.

In 2019, Schiphol handled an average of 196,458 total arriving and departing passengers a day — including both local and transit travelers — according to airport data.

(Caribb/Flickr)

“This decision first and foremost is bad news for passengers and for airlines,” Royal Schiphol Group Chief Operating Officer Hanne Buis said. “Nevertheless, the decision taken is necessary with the safety of passengers and employees in mind.”

Schiphol is not alone in extending capacity restrictions beyond the summer. London’s Heathrow airport is also keeping summer caps in place through the end of October. However, London’s Gatwick airport, after facing its own issues over the peak holiday period, lifted its restrictions at the end of August.

KLM, the largest airline at Schiphol, said Friday that the news on short notice was “disappointing,” and that the new cap would have “far-reaching consequences for our passengers, colleagues and the national and international reputation of Schiphol and therefore KLM.”

Business Travel

Uber’s $30 Billion Quarter Shows the Travel Recovery Is Well Underway

2 months ago

Taxi tech company Uber has just recorded its busiest quarter, with gross bookings reaching an all-time high of $29.1 billion in the three months to June 30, 2022. That number’s up 33 percent on the same period last year.

However, losses prevail. Uber posted a net loss of $2.6 billion, with a $1.7 billion net headwind relating to its equity investments, mostly tied to the revaluation of its Aurora, Grab and Zomato stakes. The net loss also includes $470 million in stock-based compensation expense.

For its first quarter it reported a net loss of $5.9 billion, so the momentum is there, particularly from its business travel division.

Overall, trips during the quarter grew 24 percent year-on-year to 1.87 billion, or 21 million trips per day. Revenue grew 105 percent to $8.1 billion, compared to the 2021 first quarter. There was a slower pace of growth for its food delivery unit though, where gross bookings grew 7 percent year-on-year to $13.9 billion.

That may be because fewer employees are ordering takeaways, and instead jumping in an Uber to get to the office. Uber for Business revenue almost doubled in the quarter, growing 105 percent year-on-year to $8.1 billion.

Managed Uber for Business, its “actively managed” portion of the business through Uber’s account managers and sales team, represented 29 percent of Uber for Business’s gross bookings, compared to 25 percent in the second quarter of 2021.

“We’re really selling to significant enterprise customers out there, both in the tech space and the non-tech space,” said CEO Dara Khosrowshahi during an earnings call on Tuesday.

“A lot of these enterprises, some of them are going back to returning to office, some of them are not … the champion use case that we’re seeing with U4B is essentially the business traveler getting out on the road again. And obviously, a sales call over Zoom is one thing, but if the salesperson comes in to see you in person, it gives a different impression and we’re seeing our U4B clients invest in getting their teams on the road.”

Airport traffic was also recovering, growing 139 percent year-on-year, and 49 percent on the first quarter.

The results came out just a day before it launched Uber Travel in the UK, which includes a tie-up with Omio.

In June, Uber for Business said it was taking steps to make it easier for travel managers to nudge their organizations into more sustainable modes of transport, including price-matching Uber Green trips against UberX.

Airlines

Saudi Arabia to Slash Airport Fees to Compete With Rival Hubs

2 months ago

After offering financial incentives to carriers to fly “unprofitable” routes, Saudi Arabia is now luring airlines by cutting airport charges by as much as 35 percent in its bid to compete with the world’s biggest airline hubs, most of which happen to be in the Middle East region.

Airport charges at three major airports — Riyadh, Jeddah and Dammam — would be reduced by anywhere between 10 percent and 35 percent, Saudi Arabia’s General Authority of Civil Aviation said. The decreased airport charges would be coming into force later this year.

To maximize growth, airports in the kingdom would be further allowed to reduce charges below the announced caps, the civil aviation authority announced at the Farnborough Air Show. 

In its pivot from oil to diversify into other sectors, Saudi Arabia is looking at tourism in a big way to bolster the country’s economy and then there’s the ambitious goal to attract 100 million tourists by 2030.

This development comes days after Saudi’s civil aviation authority also announced the decision to open the nation’s airspace to all commercial carriers that meet the country’s civil aviation authority’s overflying requirements.

Under the decision, Saudi airspace is now open to flights operated through Israel and by Israeli carriers, a decision which complements Saudi’s efforts to consolidate its position as a global hub. 

US President Joe Biden called the decision “the first tangible step in the path of what I hope will eventually be a broader normalization of relations.” 

Mergers and Acquisitions

It’s Official, A New $6 Billion Travel Retail Giant is Born: Dufry Buys Autogrill

3 months ago

This deal has been rumored and in the works for many months now: Switzerland headquartered travel duty free and retail firm Dufry has agreed to buy Autogrill from Italian billionaire Benetton family, creating a new $6 billion player in the travel retail market, reports Bloomberg. The combined group will have 5,500 outlets at around 1,200 airports and other locations.

From the release announcing the deal: Upon completion of the transaction, the combined group will adopt a new name with a new identity. Edizione, which currently owns a 50.3% stake in Autogrill, will become the largest shareholder of the new group, of which it will hold a stake of approximately between about 25% and 20% at the end of the transaction, depending on the level of subscription to the mandatory tender exchange offer.Juan Carlos Torres and Xavier Rossinyol will be respectively Executive Chairman and CEO of the new group.

Airlines

Aviation Tech Provider SITA Raises $400 Million In ‘Green Financing’

3 months ago

SITA, a global technology provider for the aviation industry, has raised $400 million in so-called green financing.

As Skift described in its 2022 Megatrends report, green financing is an emerging trend where investments are made in companies that support or provide planet-friendly practices or products.

Four new banks have now signed up to support SITA with a sustainability-linked revolving credit facility, which has a minimum three-year term, the company said on Thursday.

The new funds will be directly linked to pre-agreed environmental key performance indicators and yearly targets, with a bonus (or penalty charge) on the interest margin depending on SITA’s performance. Performance against the targets will be externally audited.

The cash will go towards supporting the company’s general business needs, “such as developing new solutions and strategies to alleviate the air transport industry’s challenges of today and in the future,” it said in the statement.

SITA said it had ramped up its emission reduction efforts in recent years, achieving carbon neutral status under The CarbonNeutral Protocol in 2021. More recently it announced its commitment to setting science-based targets via the Science Based Targets initiative (SBTi) to join other leading companies to combat climate change aligned to net-zero and the 1.5C scenario of the Paris Agreement.

SITA’s five existing banking partners also participated in the raise.

“Sustainability is high on our agenda and we are deeply committed to ensuring a sustainable future for all, including for our employees, customers, and partners,” said Nicolas Husson, SITA’s chief financial officer. “We are delighted to secure financing that is directly linked to the performance of our sustainability ambitions.”

Speaking at Skift’s Sustainable Tourism Summit at the end of June, Intrepid’s chairman revealed that the tour operator recently received a large investment from a family-owned private equity firm because of its sustainability stance.

Saudi Arabia is also aiming to prop up its Red Sea tourism project with an up to $2.7 billion loan in green financing.

During the pandemic, SITA’s CEO said the tech provider had weathered the storm. but the private company will undoubtedly have been impacted by poor performances from its airports and airline customers as the pandemic continued to hammer travel.

“We contained our fall in revenue to -27% for the year, at $1.34 billion, compared to the previous year’s $1.8 billion,” said Barbara Dalibard in her 2020 report. “In reacting quickly to the crisis, we decreased our cost base in 2020 by 18 percent versus prior year, while reducing external support by 50 percent.”

It also achieved $300 million in cost reductions.

SITA was formerly known as Société Internationale de Télécommunications Aéronautiques, and was founded by 11 airlines more than a decade ago. The company’s board includes executives from several airlines.

Airlines

UK Speeds Up Security Checks for New Airport Workers Amid Staffing Shortages

3 months ago

The UK government is accelerating national security checks for new airport employees to tackle staffing shortages that have contributed to a chaotic summer for travelers in the country and throughout Europe.

The country has sped up the vetting process all new aviation recruits must undergo, with accreditation checks being completed on average within five days and counter-terrorist checks taking less than 10 days — half of the average in March, according to the Department of Transport.

A common scene at airports this summer (Courtesy: Mark Hodson Photos/Flickr)

Staffing shortages have driven London’s Gatwick and Heathrow Airports to limit the flights the number during the summer travel season to avoid overcrowding. In addition, UK Transport Secretary Grant Shapps has told airlines to stop selling tickets for flights they cannot staff.

Airlines

Lonely Planet on Summer Travel: Cope, Don’t Cancel

3 months ago

You’ve seen and heard the horror stories of travel plans gone awry in May and June, and now Lonely Planet is stepping up with advice for travelers that skittish travel businesses would welcome: “DO NOT let the threat of a cancellation keep you home. It’s been a long pandemic. It’s time to get out there again.”

Madrid Airport
File photo of Madrid Airport. Unsplash.

In an email, Lonely Planet said that is the counsel from its editor-at-large, Sebastian Modak.

Among Modak’s tips:

  • Research a specific flight’s past performance to see if it is prone toward delays and cancellations.
  • Be on the lookout for news about endless security lanes and baggage gone missing.
  • Think about doing domestic trips instead of traveling abroad.
  • Try not to avoid holiday or even weekend travel.
  • Consider alternative airports that may not be as popular.
  • In the U.S., consider Amtrak, which has increased its schedules, instead of flying.

Meanwhile, with all of the angst out there because of disrupted travel plans, online travel company Hopper reported that purchases of its flight protection products, which provide certain safeguards to thwart delays, cancelled flights or missed connections, jumped 28 percent over the last month.

On the other hand, in China, where Covid lockdowns have been intense, staycations in local hotels have become a trend. That might not be a bad idea for the less-adventurous among us.

Airlines

UK Doesn’t Plan to Dispatch the Military to Airports to Ease Long Security Lanes

4 months ago

A few days after Ryanair boss Michael O’Leary called on the UK government to temporarily send the army to staff excessively long airport security lanes, UK Transport Minister Grant Shapps told the BBC Sunday he doesn’t envision the need to make such a move.

A file photo of passengers queuing at Heathrow Airport. Reuters

Shapps said steps have been taken to ease the administration of security lanes. But while taking a conciliatory tone at one point, saying the government will “work with the industry very hard … to make sure we don’t see a repeat of those scenes,” Shapps also said the airline industry’s staff cuts were too deep and it needs to take responsibility for resolving the situation, Reuters reported.

“The industry itself needs to solve it,” he said. “The government doesn’t run airports, it doesn’t run the airlines. The industry needs to do that.”

On Wednesday, leading up to the Platinum Jubilee, Shapps told airlines they should cease selling tickets for flights they can’t adquately support after seeing massive lines and delays at security lanes.

The issue isn’t limited to the UK, of course. On Saturday, KLM ceased boarding passengers heading to Amsterdam because of the chaos at Schipol airport.

New York Airports Won’t Be Able to Overcharge Crazy Prices for Food and Drinks Anymore

4 months ago

The Port Authority of New York & New Jersey, the body that overlooks the three New York Area airports of LGA/JFK/EWR has come down hard high prices at its airports. The new policy, it says, “caps all concession prices at local, off-airport “street prices” plus a maximum surcharge of 10 percent and requires concessionaries to offer lower-priced food and beverage options to provide a wider range of value for customers.”

It has singled out concessionaire operator OTG, which first came to notice via a July 2021 traveler complaint on social media about the listed price of a seasonal beer, which exceeded $27, the audit said.

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