Fuel costs have impacted AirAsia quarterly profits and the carrier reported its first drop in profit in five quarters. Net income fell 39% to 104.8 million ringgit ($35 million) in the three months ended March 31, while revenue climbed 11% to 1.30 billion ringgit.
Fuel costs rose 18% in the quarter to 523 million ringgit, while aircraft lease expense climbed 11% to 44.7 million ringgit. AirAsia also booked foreign exchange loss of 37.7 million ringgit, compared with a gain of 88 million ringgit a year earlier.
AirAsia carried more passengers during the period however. Passenger numbers rose by 7% to 5.2 million in the period, with average fares increasing by 2%.
Group Chief Executive Officer Tony Fernandes said the carrier has potential for “double digit” growth this year as AirAsia franchise expands.

The Indian Finance Ministry has questioned the rationale behind Air India’s plan to trim its 27,000-strong workforce by offering a voluntary retirement scheme (VRS). The scheme will cost Rs 1,200 crore, but the ministry has questioned whether it is necessary since 7,000 employees will retire from service over the next three years anyway, while 12,000 will be transferred to the ground handling and engineering subsidiaries, leaving 8,000 employees left at Air India over the next five years.
There is also the concern that rather than retain talented employees, they will migrate and the “deadwoods” would remain there till superannuation.

The Times of India has reported a rumour that Gulf carriers Qatar Airways and Air Arabia are keen to follow Etihad’s lead and invest in Indian airlines.
The newspaper reports that Qatar Airways is seeking investment in an existing Indian carrier such as SpiceJet and GoAir, while Kingfisher Airlines is attempting to encourage Qatar Airways to invest in the ailing airline. Air Arabia has also been mooted for an Indian investment.
However, Qatar Airways has already dismissed reports it is interested in investing in an Indian airline.

In an update on the progress of ‘Delivery and Future Direction’, the package of measures implemented by Flybe UK to return to growth, the airline states that the action it has taken so far will deliver £30m of cost savings in 2013/14 against the £25m target.
Flybe has also announced further initiatives under the turnaround plan. The first is an agreement to transfer its 25 pairs of arrival and departure slots at London Gatwick Airport to easyJet for a total consideration of £20m. The realisation of the value of these slots will help Flybe finance its return to profitability, says the airline. Completion is subject to Class 1 shareholder approval, expected in July 2013.
The second initiative comprises an agreement with Embraer for the deferral of 16 new E175 aircraft due for delivery during 2014 and 2015. The aircraft will now not be delivered until 2017 to 2019 and will lead to a reduction in pre-delivery payment commitments in winter 2013/14 of £20m.
Details of Phase 2 of Flybe’s turnaround plan is currently being implemented, targeting a further £12m of savings in 2013/14, and an annual run rate saving of £23m from 2014/15 onwards.
Head count at the airline has already reduced by 22% from 2,730 to 2,140, while Flybe has reached an agreement in principle with the British Airlines Pilots Association (BALPA), for up to a 5% reduction in salary in return for extra time off.
The turnaround plan is being financed without recourse to shareholders through:

New start up Thai airline, a subsidiary of Lion Air, is moving closer to launch as Thai Lion Air has begun recruiting pilots, cabin staff and ground staff
Thai Lion Air intends to start its operation strongly with the deployment of up to six single-aisle twin-jet Boeing 737-800s and by using Bangkok’s Don Mueang airport as its base.

San Francisco has approved a $4.1 billion capital improvement plan for San Francisco International Airport (SFO), which will fund terminal improvements, facility enhancements, and the creation of an on-site luxury hotel, pending environmental approval.
Capital improvement projects funded by the plan include renovations to concourse and security checkpoint areas in Terminal 3, a full renovation of Terminal 1, Boarding Area B, and the creation of a 400-room luxury hotel within the airport grounds, pending environmental approval.

United Airlines has ordered 40 E175 aircraft, with another 60 firm re-confirmable orders that are subject to regional subsidiary SkyWest being awarded capacity purchase agreements with major US airline partners.
Additionally, the agreement includes options for another 100 E175s, taking the total order potential up to 200 aircraft. This sale is in addition to the contract signed by United for 30 firm and 40 options for E175 jets earlier this year.
SkyWest plans to configure the E175s in a dual-class 76-seat layout, with the delivery of the first aircraft scheduled for the second quarter of 2014.

fastjet will launch a double daily, seven days per week service on South Africa’s busiest route between Johannesburg and Cape Town, using a 144-seat Boeing 737-300 from July. Other routes will be added once this service has been established. The start date has been pushed back from May 31,2013 to allow time to improve its ticket distribution systems.

fastjet has entered into a complex partnership with South African investment company Blockbuster to gain access to the South African market where it plans to launch services in July 2013.
fastjet has reportedly given up 75% ownership to Blockbuster, which has been renamed Fastjet Holdings.

Oman Air, the national carrier of the Sultanate of Oman, has placed an order for three A330-300s, growing its A330 Family fleet to a total of ten Airbus aircraft. The aircraft will be operated on long haul routes and can comfortably seat close to 300 passengers.

“The efficiency, reliability and passenger appeal of our in-service A330’s already make The Pillar of Oman Air’s long haul operations,” said Wayne Pearce, CEO of Oman Air. “This additional order will allow us to continue our strategy of growth with an aircraft we know to be both reliable and profitable, and in addition offering the highest levels of passenger comfort.”

“We are proud to continuously grow and develop our partnership with Oman Air through our popular A330-300 aircraft,” said John Leahy, Airbus Chief Operating Officer, Customers “The winning combination of efficiency, reliability and comfort provided by the A330 continues to delight customers and passengers worldwide and will do so for many years to come, with our consistent investment in the aircraft family.”

Airbus aircraft share a unique cockpit and operational commonality, allowing airlines to use the same pool of pilots, cabin crews and maintenance engineers, bringing operational flexibility and resulting in significant cost savings. Airbus is the leading aircraft manufacturer with the most modern and comprehensive family of airliners on the market, ranging in capacity from 100 to more than 500 seats.