The director-general of the International Air Transport Association (IATA), Willie Walsh, was in Singapore recently where he talked about strategic and significant issues facing the aviation industry. These include the uncertainties surrounding the impending U.S tariffs and the viability of low cost carrier models upon the exit of Qantas’ owned Jetstar. He also heavily criticised the EU’s sustainable aviation fuel (SAF).

U.S. tariffs may cause airlines to refuse delivery of aircraft

Airlines may be reluctant to take delivery of aircraft due to the ongoing uncertainty around U.S. tariffs and their impact on the cost of the planes, Walsh said, as reported by Reuters.

“It’s not just going to be a major Boeing and Airbus issue. It’ll impact all aspects of the aerospace industry and have an impact on most, if not all, airlines as well,” he said.

The 50% tariff that U.S. President Donald Trump plans to impose on Brazilian exports starting in August could hammer the revenue of planemaker Embraer like the COVID-19 pandemic did, its CEO Francisco Gomes Neto, warned last week, flagging risks to U.S. partners.

Neto said the tariffs would amount to a trade embargo on the regional jets it supplies to U.S. airlines and could trigger order cancellations, deferred deliveries and tough consequences for Embraer’s U.S. suppliers.

EU’s green fuel mandate costly, not helping environment

IATA also stepped up criticism of the European Union’s sustainable aviation fuel (SAF) mandate as a costly initiative that is not helping the environment as regional supplies there remain low.

“The idea that you’re buying sustainable fuel and then transporting it to use in Europe isn’t the right way to do it, because you’re clearly increasing the carbon footprint of that fuel as a result of the transportation costs,” Walsh said.

IATA estimated in June that production of SAF, which is considered a low carbon replacement for traditional jet fuel is expected to reach two million tonnes, or 0.7 per cent of airlines’ fuel consumption, in 2025.

“Mandating the use of a product that isn’t available doesn’t lead to any environmental benefit,” Walsh said, adding that fuel companies that have an obligation to produce SAF are also increasing the cost of traditional jet fuel.

By IATA’s assessment, he said “the cost that they’re charging is way in excess of the actual cost of the limited supplies of sustainable fuel”.

“The EU in effect has facilitated monopoly suppliers to increase prices with no environmental benefit,” said Walsh, adding that the region needs to re-evaluate its SAF targets.

Under the ReFuelEU Aviation requirement, airlines need to have a six per cent SAF blend in their jet fuel usage by 2030. The EU is offering some subsidies for SAF purchases by airlines, Reuters reported in June.

On the supply front, at least five SAF projects in Asia, outside of China, have started up or are earmarked to start production in 2025, targeting exports regionally and to Europe. Singapore is among key exporters of the green fuel to the EU.

Walsh also questioned the use of palm oil as a means to produce sustainable fuel.

“I think that you could argue there is sustainable palm oil and there is palm oil that wouldn’t be considered sustainable, and I think in some parts of the world there it’s too black and white,” Walsh said.

We need to have a much more “nuanced approach” to the usage of palm oil as a feedstock and “much more detailed assessment of the sustainability of the feedstock”, he added.

Low-cost carrier model remains viable, but may not work at every airport

The budget airline model is not dead, but it does not always work at every airport, said Walsh. He added that it probably does not make sense for budget carriers to operate at certain airports because of their nature or cost structure.

“Just because you see some low-cost airlines exiting the market, I don’t think you can read across that the business model is not relevant for the future,” he said. “I firmly believe it is and will continue to be. But it doesn’t always work at every airport. Airlines that are labelled budget or low-cost, that doesn’t necessarily guarantee their financial success.”

The viability of budget airlines at high-cost airports such as Changi Airport was thrust into the spotlight after Jetstar Asia said it was exiting Singapore at the end of July, flagging increased competition and operating costs as some push factors.

“Heathrow Airport is no different. For example, there’s no real low-cost operation at Heathrow, principally because of the cost of the airport and the access to slots.”

The airline industry is a highly competitive one, Walsh added. He pointed out that, although 408 new airlines were started in the past decade to December 2024, there were 420 failures as well, making a net loss of 12. Profitability on a global level is wafer-thin – the net profit margin this year is forecast at 3.7 per cent.

Photo Credit: Ivan Marc / Shutterstock.com

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United Airlines will not receive its first Airbus A321XLR delivery until the summer of 2026, according to the airline’s earnings call on June 17, 2025. United Airlines has 50 A321XLR aircraft on order.

The Chicago-based carrier had previously planned to begin receiving deliveries in January 2026. However, the timeline has once again been pushed back by at least six months, most likely due to supply chain issues. United Airlines did not specify why the delays continue to persist.

Deliveries In The Summer of 2026

During United Airlines’ earnings call on June 17, Executive Vice President and Chief Financial Officer (CFO) Michael (Mike) Leskinen responded to a question about whether any A321XLR deliveries would occur this year, stating simply, “none this year.” Chief Commercial Officer Andrew Nocella added that the aircraft are now expected to arrive “in the summer of 2026,” without specifying the exact month.

United Airlines placed an order for 50 Airbus A321XLR narrowbody aircraft in 2019, aiming to modernize its fleet by replacing aging Boeing 757-200s and to support an expansion of transatlantic service from key US hubs, including Newark/New York and Washington, DC.

Deliveries were originally expected to begin in 2024, with transatlantic operations planned to launch in 2025. However, the A321XLR program faced delays due to regulatory concerns and design modifications required by aviation regulators. The European Union Aviation Safety Agency (EASA) raised fire safety concerns about the rear center tank (RCT), particularly regarding fuel tank crashworthiness and protection from fire in the event of a landing gear failure or fuselage breach.

Other US Orders For The A321XLR

United Airlines is not the only US carrier with Airbus A321XLRs on order, American Airlines and JetBlue Airways have also committed to the aircraft. Like United, American placed an order for 50 A321XLRs back in 2019.

In March 2025, the first Airbus A321XLR destined for American completed its maiden flight at Airbus’ facility in Hamburg-Finkenwerder, Germany. The airline had planned to take delivery of the aircraft, registered as N300NY, in the first half of 2025, according to media reports. However, that delivery has not yet taken place.

Meanwhile, JetBlue ordered 13 Airbus A321XLRs by converting 13 existing A321neo orders in June 2019. According to a December 2024 report by FlightGlobal, the airline expects to receive its first A321XLR in the autumn of 2025. However, the exact delivery date remains uncertain, and the timeline could be pushed back further. Simple Flying has asked JetBlue and American Airlines for comment.

Frontier Airlines Backed Out Of A321XLR Commitment

The Denver-based airline’s interest in the A321XLR came about in June 2019 when it announced that its existing order for 18 A320neos would be converted to 18 A321XLRs. However, in 2024, Frontier Airlines announced that it had canceled its plans to acquire the highly anticipated Airbus A321XLR.

However, cost-saving measures and the A321XLR not quite living up to its expectations have persuaded Frontier to drop the narrowbody jet entirely. It has since doubled down on the Airbus A321neo narrowbodies, converting nearly 20 orders that were originally for the slightly smaller A320neo. At present, Frontier Airlines has a total of 153 A321neos on order, as per ch-aviation data.

It is worth noting that only four operators worldwide have received the A321XLR, including Iberia, Aer Lingus, Wizz Air (the first airline to receive the PW-powered A321XLR), and Qantas.