Irish aviation firm warns airline passengers will face higher fares due to US tariffs

Irish Examiner

21-04-2025

Irish aviation services firm Avia Solutions Group is pencilling in higher maintenance expenses from potential tariffs that would affect its aircraft charter business, with those costs eventually being passed on to airline passengers.
The firm specialises in short-term leasing of aircraft and crew to airlines, which typically use Avia to boost capacity during busy seasons.
It is carrying out a 'stress test' by calculating 12% higher costs on maintenance services across its fleet, chairman Gediminas Ziemelis said in an interview.
Avia is exploring ways to access more spare parts from Europe if tariffs drive up the cost of imported products like engine components, he said.
His comments shed more light on how the aviation industry — which has mostly been shielded from tariffs in the past — is contending with uncertainty caused by US president Donald Trump's bid to rewrite the rules of global trade.
'It's a mess,' Ziemelis said. 'If you don't know the size of the disaster or problem then it's very difficult to forecast.'
Trump has placed tariffs of 10% on goods coming into America from dozens of countries including the EU, and hit other nations with higher rates.
The fee is set to rise to 20% on EU manufacturers sending products the US if a 90-day pause expires without a deal — raising the prospect of retaliatory EU tariffs on US-made goods.
Others in the industry are nervous about uncertainty around the aviation supply chain, Ziemelis said. Airlines cannot swallow additional costs if they do not increase their ticket prices, so ultimately any added fees will be borne by passengers, he said.
'If prices go above what the consumer is willing to pay, of course it can slow down traffic and number of the passengers overall,' he said.
Others are also preparing for disruption. Delta Air Lines has said it will not pay tariffs on planes from French manufacturer Airbus SE, while Ireland's Ryanair Holdings has said it may delay aircraft deliveries from Boeing should the EU retaliate.
So far, the tariff war has hit airlines hardest in China, where reciprocal levies have more than doubled the price of Boeing products, and any parts coming into the US from the Asian nation also cost more than twice as much.
Bloomberg News reported Beijing told Chinese carriers not to accept delivery of any more Boeing aircraft and asked them not to buy US-made aircraft parts.
There is also evidence the tariff talk has rattled travellers and slowed demand across the lucrative transatlantic route.
Dublin-based Avia placed an order late last year for 80 Boeing 737 Max jets to add into its fleet of 220 aircraft. The company plans to grow the fleet to 700 planes by the end of the decade.
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