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Boeing scraps 2019 financial forecast, halts share buybacks in wake of 737 MAX disaster

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World’s biggest aerospace corporation was forced to pull its full financial forecast for the current year due to unresolved issues surrounding Boeing’s once best-selling 737 MAX aircraft.

Boeing also announced plans to pause share buybacks, citing “a challenging time for our customers, stakeholders and the company.”

“Across the company, we are focused on safety, returning the 737 MAX to service, and earning and re-earning the trust and confidence of customers, regulators and the flying public,” Boeing Chairman and CEO Dennis Muilenburg said in a statement.

The manufacturer had previously posted a report on the first-quarter earnings that managed to fall in line with analysts’ expectations, while its revenue was slightly less than projected. Boeing’s earning per share totaled the expected $3.16 from January through March, while the revenue amounted to $22.92 billion against $22.98 billion forecasted by London-based provider of financial markets data Refinitiv.

Boeing stressed that the previous guidance didn’t reflect the impact of two crashes of the company’s flagship planes, leading to the grounding of all 737 MAX 8 jets by global regulators, lawsuits from some air carriers and a decline in market value.

According to the producer, more than 135 test and production flights of updated software for the 737 MAX have been carried out so far.

Boeing’s bestseller crashed on March 10 not far from the Ethiopian capital of Addis Ababa six minutes after takeoff on the way to Nairobi, Kenya. The tragedy, which killed 157 people, marked the second crash involving the same jet model in less than six months. In October, the same type of aircraft, operated by Indonesia’s Lion Air, crashed in the Java Sea shortly after takeoff, claiming the lives of 189 people.

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India’s Jet Airways halts all international and domestic operations

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One of India’s major airlines, Jet Airways, has announced it is temporarily halting flight operations on Wednesday after the carrier failed to secure the “critical interim funding” necessary for the company to remain afloat.

Jet Airways will operate the last flight on Wednesday as it cancels all its international and domestic flights, the airline said in a statement. It explained that it cannot afford to pay for fuel or other critical services to keep the operations going, as all its months-long attempts to seek both interim and long-term funding were in vain.

“Unfortunately, despite its very best efforts, the airline has been left with no other choice today but to go ahead with a temporary suspension of flight operations,” the statement reads.

Earlier this month, the airline’s fleet was significantly reduced to just five aircraft and it was forced to suspend international operations. On Wednesday, the Jet Airways website listed only 37 domestic flights and had an additional nine-page list of canceled flights, saying that the schedule was impacted by “operational reasons.”

The troubled company failed to receive a stop-gap loan of about $217 million from its lenders as part of a rescue deal agreed in late March, Reuters earlier reported.

“Bankers did not want to go for a piecemeal approach which would keep the carrier flying for a few days and then again risk having Jet come back for more interim funding,” an unnamed bank source in the negotiations on the debt resolution process told the agency.

The uncertainty over the crucial funding crashed Jet Airways stock on Tuesday, with shares plunging around 20 percent.

Employees have been hit hardest by the crisis in the company and have reportedly not been paid in months. The pilots even called on the State Bank of India (SBI) to release the necessary funds and appealed to India’s Prime Minister Narendra Modi to save 20,000 jobs which may be lost in the shutdown.

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US airlines wrongfully reject over 25% of their passengers’ compensation claims

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Consumer rights advocacy group released the results of a new study showing that United States airlines wrongfully reject more than 25% of compensation claims, indicating that more than one in five travelers are being denied up to $700 they are owed by Delta Air Lines, United Airlines, and American Airlines following flight disruptions.

Each year, more and more travelers flying out of the U.S. are eligible to claim compensation under European law EC 261 which covers travelers on European flights. AirHelp found more than 25% of valid claims filed against U.S. airlines for disrupted flights in 2016, 2017 and 2018 were turned away on wrongful grounds by airlines trying to avoid their obligation to travelers.

The travel experience is continuously getting worse due to overtourism. In the U.S., 407,000 travelers are eligible to claim compensation under EC 261 following flight delays and cancellations experienced last year, up from 370,000 the previous year. During the first three months of 2019, more than 75,000 passengers experienced disruptions due to the fault of the airlines that have made them eligible for compensation.

This trend is a small part of the larger issue of airlines mistreating passengers. A survey of travelers found 75% of U.S. travelers feel uninformed about their air passenger rights, and less than 25% of travelers who were on a disrupted flight actually file a claim, despite airlines being required by law to inform passengers of their rights.

How the U.S. Airlines Stack Up

Of the U.S. airlines, Delta Air Lines wrongfully rejects the most claims at a rate of one in three. United Airlines wrongfully rejects nearly one in four claims, and American Airlines rejects one in every five. According to an annual ranking of global airlines and airports, U.S. airlines’ unsurprisingly perform poorly, with each major carrier earning less than seven out of 10 for quality of service.

The most popular U.S. airlines ranked on wrongfully rejected claims rate

United States ranking Global ranking for wrongfully rejected claims rate

Airline Wrongfully rejected claim rate

1 32 Delta Air Lines 32%
2 42 United Airlines 23%
3 44 American Airlines 22%

Data from January 1, 2016 to December 31, 2018

“The bleak picture in the U.S. is just the tip of the iceberg. The volume of legitimate passenger claims being wrongfully rejected by airlines is appalling. Flight delays and cancellations are increasingly heaping chaos on passengers, and travelers are forced to fight airlines for compensation they’re rightfully owed,” says Henrik Zillmer, CEO of AirHelp. “It’s all very well for airlines to say they will compensate passengers who make their claim directly. The reality is that thousands of passengers are continuing to face an impossible struggle to claim the money they’re entitled to. If they are embroiled in a legal battle with an airline, passengers may face costs to hire a lawyer to push through their claim, which can make fighting for compensation virtually impossible.”

U.S. Passenger Rights

U.S. passengers are protected under EC 261 for flights to the EU on an EU airline, and any flight departing from the EU. Cancelled flights, delays of more than three hours, and incidents of denied boarding are covered under EC 261, as long as the disruption was not caused by extraordinary circumstances such as weather, sabotage or political unrest. Eligible passengers may be entitled to financial compensation of up to $700 per person, and can file claims up to three years after the incident occurs.

Travelers have fewer protections on domestic U.S. flights, but can claim up to $1,350 in compensation for denied boarding due to overbooking, depending on the value of the ticket fare and ultimate delay in arrival to their final destination

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UK Foreign Office urged to update UAE travel warnings

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British legal group Detained in Dubai has urged the UK Foreign and Commonwealth Office (FCO) to update its UAE travel warnings to UK tourists in an open letter penned by the organization’s head, Radha Stirling.

“We have frequently called upon the FCO to provide more accurate information to Britons about the many risks they face in the UAE which the current advisory does not cover,” Stirling said. “It is simply not enough to warn people to obey the laws and customs, when very often the legal system itself poses a threat even to law-abiding tourists who may be subjected to false arrests, fabricated cases, forced confessions, torture, and lack of representation.”

Stirling’s letter specifically highlights the dangers inherent in the UAE’s Cybercrime laws, under which Laleh Shahravesh was prosecuted. In the letter to Permanent Under Secretary of State Sir Simon McDonald, head of the FCO, Stirling said:

“This warning is insufficient in light of the Shahravesh case, insofar as it does not explain that a British citizen can, in fact, be prosecuted if they ever visit the UAE, for posting material online in the UK which anyone inside the UAE may deem offensive.

It is vital for British citizens to be aware before traveling to the UAE that their entire social media history must adhere to UAE standards of acceptable content before they risk entering the country.”

The Cybercrime laws, she says, are irresponsibly vague and can easily be misapplied, as in Laleh’s case, in matters that have nothing to do with public endangerment, hate speech, or incitement to violence. “UAE Cybercrime laws subordinate the police, prosecutors, and courts to the tyranny of individual egos,” Stirling explained.

“If anyone in the UAE is offended by someone’s online content, even if they do not know that person, and even if that person posted the content in a different country; a criminal case can be made and an arrest warrant issued. It is an enormous threat to free speech well beyond the borders of the UAE.”

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ADI statement on circus lion attack in Ukraine

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Animal Defenders International (ADI) has urged Ukraine and other countries without bans on the use of animals in circuses to stop circus suffering after a lion attacked a trainer during a circus performance in the city of Lugansk.

 

ADI President Jan Creamer said: “Exploited for entertainment, animals in circuses endure a lifetime of suffering and abuse. It’s time for countries without bans in place to step up and stop animals and people being put in harm’s way.”

 

The attack is one of a growing catalogue of incidents involving circus animals around the world, highlighting the inherent animal welfare and human safety issues.

 

Studies of the use of wild animals in traveling circuses show that circuses cannot meet their physical or behavioral needs. Animals are confined in small spaces, deprived of physical and social needs, spending excessive amounts of time shut in transporters. These animals are often seen behaving abnormally; rocking, swaying, and pacing, all indicating that they are in distress and not coping with their environment. ADI’s video evidence has shown how these animals are forced to perform tricks through physical violence, fear, and intimidation.

 

The animal protection organization is currently in Guatemala helping enforce a ban on the use of animals in circuses, as it has done in both Bolivia and Peru, and now has 21 lions and tigers at its temporary rescue center. Eighteen of the big cats will be going to the new ADI Wildlife Sanctuary in South Africa. To support the rescue mission, donate here: https://donate.adiusa.org/guatemala/

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Reunion Island breaks tourist arrivals record

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Despite a difficult end to the year, 2018 was profitable and even historic for Reunion tourism as more than 574,000 outside visitors were welcomed . This is 4.1% more than in fiscal 2017, which had already had an unprecedented inflow of visitors.

In 2018, 35 ships and 39,433 cruise passengers landed on the island, which was satisfactory, although slightly lower as several companies were forced to review their routes in November and December.

Nevertheless, with revenues still increasing and amounting to more than 432 million euros, also a new record for the destination, the tourism sector confirms its preponderant place in the economy of Reunion.

Reunion’s neighbors in the Indian Ocean remain fond of the destination. Arrivals from the Indian Ocean area remains above 60,000 tourists in 2018, after a spectacular increase of 46% recorded in 2017. Within this Indian Ocean zone, Mauritius remains the main source market since it represents more than 30,000 tourists, or 5.8% of total arrivals to Reunion.

The communication and promotion actions carried out on the main European markets, other than France, have also been fruitful, as this visitor source market now accounts for 7.4% of total arrivals, compared to 6% in 2017. In total, 39,664 visitors came from the rest of Europe in 2018 which is 4.2% more than last year!

Unsurprisingly, the leisure clientele represents an overwhelming majority of arriving visitors with 90.8% of the overall volume of arrivals on the island, supplemented by 8.5% of business tourism.

The average length of stay of these foreign tourists is 17 days and remains unchanged compared to 2017, a figure particularly important for a long-haul destination such as Reunion.

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Boeing 737 Max forced to make emergency landing

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The Federal Aviation Administration reported that a Southwest Airlines Boeing 737 Max jet was forced to make an emergency landing today, Tuesday, March 26, 2018, in Orlando, Florida, after experiencing an engine problem.

The 737 Max was grounded on March 13 in the US after 2 catastrophic fatal crashes. The FAA is investigating but stated that it appears the emergency was not related to anti-stall software suspected in the two previous crashes.

There were no passengers on board as the aircraft was being ferried to Victorville, California, where Southwest stores airplanes.

The crew took off from Orlando International Airport and then declared an emergency, landing the plane safely.

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