Friday, July 30, 2010

Airline Fined $275,000 for Improper 'Bumping' of Passengers

The U.S. Department of Transportation (DOT) recently assessed a civil penalty against Comair for violating federal rules regarding passengers denied boarding (“bumped”) on oversold flights. Comair and affiliated carriers were ordered to cease and desist from further violations and Comair will pay a civil penalty of $275,000.

“Our bumping rules are designed to protect passengers when airlines overbook a flight,” said U.S. Transportation Secretary Ray LaHood. “We expect carriers to comply with these rules and will take enforcement action when they do not.”

When a flight is oversold, DOT regulations require airlines to seek volunteers willing to give up their seats for compensation. If not enough volunteers can be found and the carrier must bump passengers involuntarily, the carrier is required to give bumped passengers a written statement describing their rights and explaining how it decides who will be bumped from an oversold flight. In most cases, passengers bumped involuntarily also are entitled to cash compensation of up to $800. In June, DOT proposed raising the maximum denied boarding compensation to $1,300 and tying future increases to inflation.

DOT’s Aviation Enforcement Office began an investigation of Comair’s compliance with the bumping rules following a number of complaints filed by consumers. The investigation involved a review of bumping complaints sent to Comair by consumers, as well as an inspection at the carrier’s headquarters of its consumer complaint records and its policies and practices for oversold flights. The investigation revealed numerous cases in which Comair failed to solicit volunteers to leave overbooked flights and provide passengers with the appropriate denied boarding compensation. The Aviation Enforcement Office also found that Comair had filed inaccurate reports with DOT on the number of passengers involuntarily denied boarding.

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Tuesday, July 27, 2010

Massive Mobilization of Aviation Labor Organizations Announced

Unions Agree to Coordinate Aggressive Lobbying Program on Legislative Priorities Including Tightening Aircraft Maintenance Standards, Increased Pilot Training, Protecting Workers During Airline Bankruptcies

Three transportation organizations announced today the creation of a large aviation labor alliance to combine and coordinate lobbying efforts on airline safety and security. The American Aviation Labor Alliance (AALA) is a formal partnership of the International Brotherhood of Teamsters (IBT), the Transport Workers Union (TWU) and the Coalition of Airline Pilots Association (CAPA), which represent more than 140,000 aviation workers.

"We are leading the fight that workers care about in the airline industry," said Teamsters General President Jim Hoffa. "As the American Aviation Labor Alliance, we will speak on the most pressing aviation issues facing our membership and the public with one strong voice."

"The airline industry is under intense financial and competitive pressure and as a result, we believe that security and safety standards are being weakened, said TWU President James C. Little. "Combining our lobbying efforts will allow us to push for legislation that will insure both diligence and vigilance."

"The 28,000 pilots of CAPA want to work with all labor organizations to enhance safety and improve the working conditions of airline employees across our industry," said CAPA President Paul Onorato. "CAPA wants to help provide a flight plan for a successful commercial aviation industry in this country."

The first task for the AALA will be passage of the FAA Reauthorization bill that Congress is expected to finish during the current session. This comprehensive aviation bill deals with a range of issues related to the FAA, including security and safety requirements for overseas repair bases, and rules related to pilot training. In addition to the FAA Reauthorization Bill, bankruptcy reform will be a major focus.

The new alliance is significant because the unions are affiliated with different labor federations or are independent, and they are joining forces to influence labor issues that affect their members and the airline industry as a whole. The AALA will continue to build alliances with other labor organizations in the future.

The Coalition of Airline Pilots Association is a trade association representing over 28,000 professional pilots. CAPA's purpose is to address safety, security, legislative and regulatory issues affecting the professional flight deck crew member on matters of common interest to the individual member unions. CAPA-affiliated unions represent pilots at American Airlines, US Airways, Southwest Airlines UPS, ABX Air, Atlas Air, Polar Air Cargo, Kalitta Air and Southern Air. More information can be found at

The International Brotherhood of Teamsters represents more than 1.4 million hardworking men and women in the United States, Canada and Puerto Rico, including more than 64,000 workers in the airline industry, including Atlas Air pilots, Continental ramp workers, United Airlines mechanics, and more. The Teamsters Union is affiliated with the Change to Win coalition. Visit to learn more.

Transport Workers Union of America represents 200,000 workers and retirees, primarily in commercial aviation, public transportation and passenger railroads, including the majority of ground workers at American Airlines, American Eagle and Southwest Airlines and dispatchers at most major carriers. The union is an affiliate of the AFL-CIO. For more information, visit

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Air France on Facebook

Air France has launched an official facebook page for customers where they can get the latest news, book a flight or share their experience.
This move is the latest one by the French Airline to promote itself as an avant-garde player in the field of new technologies and social networks.

Continental Airlines Tries Self-Boarding

Travelers scan their tickets at an automatic boarding gate in Frankfurt; while common in Europe, Continental is the first U.S. airline to try a similar procedure with a single self-boarding gate in Houston.
Continental Airlines has announced that it is currently testing an automated self-boarding system at one of its gates at Houston Intercontinental Airport. Although self-boarding gates are not a new thing for many of the world’s airlines, the Continental experiment is the first in the US.

The airline has not released a great deal of information about the experiment, but all passengers now have to do when they are barding their plane, is to swipe their boarding pass through and electronic reader. Once this is done a turnstile or set of doors will open and the customer can cross the jet-bridge and take their seat.

Greg Soule, a spokesman for the Transportation Security Administration, which looks after security at the airport, said that there was no security risk posed by the new automated boarding system because all passengers will have gone through a number off security checks before making it to the gate.

Airlines already employing the self-boarding system include Air New Zealand, Air France, Japan Airlines and Korean Air. All Lufthansa’s gates at Munich and Frankfurt are now of an automated design. Martin Riecken, a spokesman for Lufthansa, said that the new gates make getting customers onto aircraft a little faster than normal gates.

However, the main reason for introducing them was so that airline staff would be freed up from the tedious job of scanning endless boarding passes. He added that airline representatives were now free to deal with other customer issues. He went on to say that there were still agents at the gate to scan passes when necessary.

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Sunday, July 25, 2010

Aviation primed for takeoff

For the long-suffering commercial aviation industry, signs of recovery are busting out all over.

Aerospace manufacturers came away from the bi-annual Farnborough International Airshow this past week with more than $30-billion (U.S.) on their order books, not a record by any means but a far cry from the meager $7-billion in orders last year at Farnborough’s sister show, Le Bourget, near Paris.

Airlines – including Air Canada – that not so long ago had been bleeding red ink are reporting stronger quarterly results and presenting upbeat forecasts as passengers take to the skies once again.

A cyclical business notorious for its brutal downturns, the aviation sector is beginning to shake off the effects of a recession that left it struggling with its worst crisis in decades.


After posting losses of $9.4-billion (U.S.) in 2009, the global airline industry will bounce back this year and make $2.5-billion in profits, according to the International Air Transport Association.

Asian, South American and Middle Eastern markets will continue to post strong growth, according to the IATA. But profits in Europe will be darkened this year by the airspace closings that resulted from the explosion of an Icelandic volcano in April.

North American earnings are also likely to remain sluggish because of the weak U.S. economy, according to IATA.

Middle Eastern airlines are attempting to carve out a much bigger role for themselves and that was reflected at Farnborough, where the Dubai-based carrier Emirates ordered 12 new Boeing 777-300ER long-range planes, valued at $3.25-billion.


Aerospace manufacturers are finally getting some relief after struggling with a steep decline in aircraft orders over the past few years, but big airlines remain cautious customers.

While the credit crunch has eased, many carriers are still shying away from committing to major purchases. Some of the major buyers of new planes in this recovery have been aircraft-leasing companies that get discounts for buying in bulk and then lease the planes to carriers.

Montreal-based Bombardier Inc. did not come away from Farnborough with new orders for its new long-range C Series jet. But it could benefit from a sharp rise in demand for small and mid-sized planes by carriers in emerging markets.

Bombardier, as well as its Brazilian rival Embraer SA and new entrants from China, Russia and Japan, are well-positioned to cater to that demand.


Many of the fastest-growing areas for passenger traffic are emerging markets, ranging from Latin America to Asia. Airports in those regions are moving up the lists of the world’s busiest air traffic centres.

Beijing is now the world’s second-ranked airport for total passenger traffic, and dozens of smaller airports in China are being built or expanded to handle the surge in domestic air travel that is expected over the next decade.

In the Middle East, Dubai Airport is fast becoming a major international hub.

It is in a geographical sweet spot between East and West and is trying to market itself as a convenient transit point between any two big cities on earth thanks to long-range airliners.

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US aviation bill stalls, proponents not giving up

Legislation to overhaul aviation programs, including billions for modernizing the aging U.S. air traffic system, has stalled as congressional negotiators struggle to resolve stubborn issues, one of which involves US Airways Group Inc (LCC.N).

Congressional and industry sources said momentum to pass the measure before lawmakers break for August vacation was interrupted this week with key lawmakers unable to reach agreement on provisions affecting long-haul air service and passenger fees that support airport operations.

Disagreements have also surfaced on how to proceed in the Senate, which is scheduled to recess August 6. The agenda is crowded with finance and small business bills and a Supreme Court confirmation vote.

The House of Representatives breaks for a month next Friday.

"We're not that close to getting an agreement on outstanding issues," said one congressional aide not authorized to publicly discuss details while the matter was still being negotiated.

The bill is viewed by proponents as an important step toward improving the efficiency of air traffic operations, which are often blamed for delays that infuriate passengers and cost carriers millions in wasted fuel and lost productivity.

It also includes new consumer protections and safety measures sought by regulators in response to complaints of poor service and accidents.

U.S. airlines flew more than 618 million passengers domestically last year and nearly 200 million through April, the latest available figures show.

Proponents of the bill, especially House and Senate Democrats, are not giving up. But time constraints are now working against expedited consideration.

The Federal Aviation Administration (FAA) has been without a long-term funding blueprint for three years, a scenario that has forced congressional approval of multiple temporary spending measures so the agency can keep its airport towers and other control centers operating.

FAA operations cost more than $14 billion annually.

The bill also includes a downpayment on the multi-year $20 billion effort to transform the air traffic network from one relying on radar to a satellite-based system designed to handle more planes more efficiently.


But major sticking points include new fees that air travelers pay to support airport operations, including construction projects. Proposals would increase the charge from $4.50 to more than $5 per ticket, which some lawmakers view as a tax increase.

Airlines oppose any increase as an "unnecessary tax.".

A second stumbling block involves proposals to increase the number of long-haul flights from Ronald Reagan National Airport -- which is adjacent to Washington and the airport of choice for lawmakers and others doing business in the capital.

Landing rights there are controlled by the Transportation Department and there are government limits on the size of aircraft that can operate there due to noise and other issues.

There are also political, industry and local interests concerned with preserving suburban Dulles airport as a long-haul departure point, industry officials say. United Airlines (UAUA.O) has major operations at Dulles.

Some key lawmakers are resisting a plan that would give a leg up to US Airways, the dominant carrier at Reagan National, for more lucrative longer haul flights, including California service. US Airways is based in Tempe, Arizona.

There is airline opposition to the benefit for US Airways, which would give up some short-haul routes that certain competitors could then fly.

US Airways government affairs chief C.A. Howlett said the bill promotes competition to the largest markets without harming small cities, a priority concern of lawmakers.

The carrier believes rivals United and low cost Alaska Air Group (ALK.N), which operates flights to Los Angeles and Seattle from Reagan National, and local transportation officials are pulling Democratic political strings to thwart new long haul competition from that airport.

Alaska had no immediate comment.

United has consistently opposed changes to restrictions on long haul flying at Reagan National based on its presence at Dulles. The airline said in a statement that it objects to any proposal that "picks winners and losers."

Negotiators also have not finalized how to handle another potential dealbreaker, a House-passed proposal that would make it easier for ground workers at FedEx Corp (FDX.N) to unionize. That provision is not expected to survive, but negotiators have yet to agree on how to dispose of it.

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Wednesday, July 21, 2010

The Flying Prius

The future of aviation that engineers dreamed about 70 years ago didn’t look much like the present. But it did look a lot like the future of aviation they’re still dreaming of today.

Back in 1938, for instance, Popular Mechanics magazine ran a cover story on “The Flying Wing of the Future,” an amazing machine in which the fuselage was almost indistinguishable from the wide V of the wings. In May of this year, NASA presented the latest thinking from Boeing, General Electric, Northrop Grumman, and MIT about the “down to earth” shape of planes to come in the next 20 to 30 years, with companion studies by Boeing and Lockheed Martin about supersonic transport. Sure enough, one of the MIT proposals is for the Hybrid Wing Body H-Series, an enormous flying wing, and NASA actually has been test-flying a model of something similar, the X-48B, since 2006. At first glance they look like they’re straight out of 1938.
But the operative phrase here is “at first glance.” Basic principles of lift and propulsion are immutable, so certain design features keep coming back. What’s really new is just about everything else that’s likely to go into making the next generation—indeed, the next several generations—of planes: the composites for the bodies; the engines that propel them; the computers that steer them; and, most important, the new economic, environmental, and political imperatives of the 21st century. Manufacturers really have little choice but to produce quieter, safer, more fuel-efficient, and greener machines than ever before—if only they can figure out how.

As almost 1,400 exhibitors gather at the Farnborough Air Show in Britain this week, the usual razzle-dazzle of military hardware, the thunderous fly-overs, and the glitzy presentations of airline luxury won’t be able to obscure the enormous challenges that loom on the horizon. The skies already are saturated with planes and passengers, but traffic is expected to double or even triple by 2050. The stunning disruptions caused by a single volcano in Iceland last spring showed just how delicately balanced, and vulnerable, the whole system has become. Meanwhile, the cost of aviation fuel has quadrupled since the mid-1990s and if, as many predict, the global oil supply continues to grow tighter, those prices could go through the stratosphere.
“In the future, environmental concern will be a really huge issue,” says Jaiwon Shin, head of aeronautics research at NASA. “We are seeing that in other industries. I think aviation will not be an exception.” Add the traditionally low profit margins on which the airline industry operates, and “the trend is fairly predictable,” Shin says. “It’s got to be fuel-efficient and environmentally friendly, so any concept that meets these two criteria will win out.” The recent studies commissioned by NASA are for planes that burn 70 percent less fuel than today and fly 71 decibels quieter than a 737. “NASA’s goal,” says spokeswoman Beth Dickey, “is to bring these technologies to a point where they are ready for prime time. Then it is up to the industry to put them on their airplanes.”

What’s new about such projects is not the expression of concern about the environment but the sense of urgency about addressing it. For years, airlines and airplane manufacturers tended to treat climate change as if it were largely a public-relations problem. Their carbon footprint in the sky, after all, was only about 2 to 3 percent of the global total. International air traffic wasn’t even mentioned in the 1997 Kyoto Protocol on the environment. But according to the most recent studies, aviation’s share of greenhouse gases could increase dramatically to about three times current levels by midcentury, with technical improvements being offset by the expected increase in traffic in and among developing countries. In the meantime, the European Union, with some of the most crowded skies in the world already, is trying to force airlines to join its existing carbon-trading scheme. And carbon isn’t the only problem. High-altitude nitrogen-oxide emissions from commercial jets may be destabilizing the ozone layer, while on the ground people are ever less patient with deafening noise around airports. “People will not be as tolerant as we were 30 years ago when 707s were flying like jet fighters overhead,” says Shin.

It’s tempting to think that some truly radical new approach can change all this for the better. “I think we will come to the point in the next 30 to 40 years where we will say, now we have to make a break and go for rather radical designs, which is maybe a completely different design of an aircraft—a completely different type of engine, a completely different type of fuel,” says a European Commission source who asked not to be cited by name because he was not authorized to speak publicly on the issue. “At a certain stage that break will come, don’t ask me when.”

The European Commission sponsored a much-talked-about “Out of the Box” study looking at the future of aviation in 2006, a brainstorm exercise that entertained such whimsical notions as the invisible airplane and a flying boat. This week the commission will call for a raft of new proposals that will actually get funding for further research. That’s the crucial step in any of these efforts to turn designer dreams into soaring realities. Under consideration are nuclear engines, plasma jets, biofuels, and green fuels along with innovative configurations of the fuselage and engines. Some funding targets will have pilots, and some could be computer-controlled from takeoff to landing. But even when the research is well funded, such concepts are mostly geared toward that moment when, or if, the possibilities of somewhat more conventional approaches really have been exhausted. That’s not likely until the middle of the century at the earliest.
The NASA program, meanwhile, is looking toward what it hopes are more-feasible projects for planes that could be in the air two or three decades from now. One that has created a lot of buzz in aviation blogs is being called “the double bubble,” a design proposal that might just as easily be dubbed “the double-wide in the sky”: two tubular fuselages crunched together side by side and held aloft by what seem like impossibly thin wings.

More interesting still is one of the designs that Boeing came up with for NASA: the Subsonic Ultra Green Aircraft Research, or SUGAR Volt. This plane looks a little like a World War II glider with long tapered wings held in place by trusses. But like a Prius or other hybrid cars, you don’t really get an idea how revolutionary it might be until you look under the hood.

The engines that drive modern commercial planes have undergone a quiet revolution—or a massive evolution, if you will—over the last 30 to 40 years. Old jets combined air and kerosene in an explosive mix that blasted out the back to provide rocketlike thrust. They were powerful, loud, and sucked up fuel like nobody’s business. Some jet fighters still do this. But the engines of today’s commercial airliners combine the hot air from a jet at their core with cooler air pushed around it by fans and compressors. The system allows them to be much quieter and more fuel-efficient than earlier engines, and a great deal of R&D these days is focused on making turbines better still by increasing the amount of cold air in the mix—the bypass ratio, as it’s called—to give extra thrust with minimal extra noise and fuel consumption. Common bypass ratios today are about 5 to 1, some are greater than 10, and researchers are shooting for 20 or more. There is also growing interest in what are called “open rotors,” which look like updated versions of propeller engines, but with more blades.

Boeing’s SUGAR Volt proposes to use a hybrid propulsion system that, in broad outlines, really is reminiscent of a Prius: the cool-air fans and compressors would be powered part of the time by electric motors that would be charged by the combustion engine.

Some green aviation projects, meanwhile, are developing independently of aerospace giants and big government programs. One of the most intriguing is the spindly SolarImpulse, funded by Omega watches and other corporate sponsors. It may bear a striking resemblance to those rubber-band airplanes you flew in the backyard as a kid, but with its wings soaking up solar energy it proved in Switzerland earlier this month that it can run both day and night on nothing but the power of the sun. Its builders aim to fly it around the world in 2013.

Many industry experts remain skeptical about the possibilities for truly revolutionary change. Jean-Marc Thomas, a senior vice president of EADS, the European Aeronautic Defence and Space Company, gently mocks the computer-generated pictures firms provide as “dream images” of a distant future. “The more outlandish a plane looks, the more it gives the impression that it’s terribly modern,” says Thomas. “But things don’t really work that way in the aerospace industry.” Aircraft that are going to carry millions of passengers have to be extremely safe and reliable, which militates against their being extreme in most other ways.
As Thomas points out, the enormous-but-conventional-looking Airbus 380 now in service is the only airliner aloft that uses fewer than three liters of kerosene per passenger per 100 kilometers—mainly because it carries up to 800 people at a time. By comparison, in 1985 the average commercial aircraft consumed about 8 liters per passenger per 100 kilometers. Critics have talked about supersize aircraft as if they’re the Hummers of the sky. But the arithmetic for green aviation is different than it is for cars. Thus the International Air Transport Association says many “modern aircraft” already have gotten to the point where they get 3.5 liters per 100 kilometers per passenger, while one person driving alone in an actual 2010 Prius will burn up 3.8 liters to travel the same distance.

Even proposals for a new generation of supersonic airliners are being presented in a greener context these days. The concepts that Lockheed Martin and Boeing submitted to NASA this year would actually be a little slower than the French-British Concorde, which flew from the 1970s until a disastrous crash brought its service to an end in 2000. The new planes would cruise at about 1.6 to 1.8 times the speed of sound, roughly twice as fast as conventional airliners. The Concorde flew at Mach 2. The new ones would carry about three times as many passengers as the Concorde and their design would radically reduce the explosive-sounding boom made crossing the sound barrier from “a crack to a rumble,” says NASA’s Peter Coen, who is overseeing the project. So the planes would be “greener” than the Concorde, but not as friendly to the environment as subsonic aircraft. They’d be high-end time savers, not fuel savers.

“Supersonic airplanes tend to drive a wedge between naysayers and supporters, because we are really talking about opening up whole new markets,” says Shin. “And our perspective is that in order for supersonic markets even to start there is a huge 800-pound gorilla right in the middle of the room, and that is sonic-boom regulation.” Whether a crack or a rumble, the noise is illegal over the continental United States right now. For the moment, neither politics nor economics are favorable to such projects.

So when it comes to outlandish-looking—but practical—planes, the levelheaded seers of the aviation world keep coming back to the subsonic flying-wing designs being developed in both Europe and the United States. These would most likely be enormous craft capable of carrying as many as 1,000 passengers. The lift characteristics of the fuselage would give them savings of about 40 percent on fuel right away, says Shin. Their advanced engines, with bypass ratios two or three times as high as current jets, would be mounted above the fuselage rather than below the wing, lowering dramatically the amount of noise heard on the ground.
According to Fay Collier, who has overseen NASA’s 80 test flights of the X-48B scale model prototype, most of the problems of low-speed control and the structural issues are on their way to being resolved. If manufacturers and airline companies are receptive, commercial aircraft built along these lines could be rolling out of the factory in 15 to 20 years, conceivably even sooner, if the public wants them. Will passengers be comfortable flying inside such a big enclosed space? Could “virtual windows” supplant real ones? Shin thinks customers will get used to such things. Will airports be ready to accommodate the huge change in shape and the multiple points from which passengers would board and disembark? Many terminals already have adapted to the Airbus 380, which had some of the same issues.

Flying wings—truly the jolly green giants of the sky—may not be ready for prime time in NASA terms, but they’re getting close.

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France: Check Your Jacket, Sir?

The French police have arrested an Air France flight attendant accused of stealing tens of thousands of dollars in cash, traveler’s checks and jewelry from dozing business-class passengers on dozens of international flights, judicial officials said Tuesday. Authorities arrested the flight attendant on the tarmac at Charles de Gaulle Airport in Paris early Friday, according to a report in the newspaper Le Figaro. An investigation began in January after five passengers aboard an Air France flight to Paris from Tokyo reported the disappearance of a total of $5,000 in cash.

The police said they identified the suspect, a 47-year-old woman, after cross-checking crew manifests for 142 Air France flights on which passengers had reported thefts this year. They did not disclose her name but said that investigators found stolen checks and credit cards in her home and that she was charged in 26 incidents. Citing “money problems,” she reportedly confessed to stealing from sleeping travelers starting in March 2009. Air France had no comment.

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British Airways, Iberia and American Airlines get US anti-trust immunity for transatlantic business

British Airways (LON:BAY) and its partners Iberia (MCE:IBLA) and American Airlines - a member of the AMR Group (NYSE:AMR) - have received the final regulatory approval required to operate its transatlantic joint venture.

“By working together, the airlines will expand customer choice by supporting routes that would not be economically viable for a single airline”, British Airways stated.

The airlines have now been granted anti-trust immunity from the US Department of Transportation. "This final approval is fantastic news for all three airlines and the oneworld alliance. We've waited 14 years to bring the benefits of the transatlantic joint business to our customers and level the playing field with the other two global alliances”, British Airways Chief Executive Willie Walsh commented.

“We look forward to delivering enhanced competition for customers on transatlantic flights. By working collaboratively, we will enhance our product offerings, strengthen our route networks and better position our airlines to compete in an ever-changing global aviation marketplace," American Airlines chief executive Gerard Arpey said.

The transatlantic partnership received EU regulatory approval last week. Similarly the proposed merger between British Airways and Iberia was also rubber-stamped by the EU commission, and the deal is expected to complete before the end of 2010.

In today’s statement, Iberia executive chairman Antonio Vazquez emphasised the increasing focus on consolidation in the industry. “I am convinced that consolidation is the best and only way to succeed in the airline industry, and the approval we have received today to create a joint business is a very important step towards this consolidation process", Vazquez commented.

Two other oneworld members, Finnair and Royal Jordanian, also received antitrust immunity from the US Department of Transportation.

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British Airways cabin crew reject latest pay deal

Cabin crew at British Airways have rejected the airline’s latest peace offering meaning that further strike action could be on the horizon. Less than half the cabin crew eligible to vote on the pay deal did so, causing BA to put a positive slant on the ballot. The airline said that it was encouraged by the fact that 73 per cent of its cabin crew had not actually voted against the peace deal.

Unite union boss, Tony Woodley, admitted that the turnout for the vote had been lower than usual, and urged BA’s chief executive Willie Walsh to return to the negotiating table. He claimed that the result indicated that 85 per cent of BA’s cabin crew were not satisfied with the airline’s most recent offer.

Although Mr Woodley called for fresh peace talks, he did not rule out the possibility of further industrial action. Strikes since March have resulted in 22 days of walkouts by the airline’s cabin crew and have been estimated to have cost BA more than £150 million.

The new proposals offered cabin crew a pay increase of 2.9 per cent in 2011 with a further pay rise of three per cent in 2012. There was also a clause agreeing not to victimise members of staff who have already taken part in walkouts as well as a promise to partially reinstate travel benefits.

Before the latest ballot Unite said that it would not be advising its members on how to vote so that they would have the opportunity to make up their own minds.

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Airport strike disrupts flights in France

An air traffic control strike disrupted journeys from airports across France on Wednesday with one in five flights cancelled from Paris's main international airport Charles de Gaulle.
Queues formed as half of all flights were also cancelled from Paris's second biggest airport, Orly, which serves domestic and some international destinations, the civil aviation authority DGAC said.
Cancellations began on Tuesday evening at Orly, where Simone Battaglia, 30, was stranded overnight after his Easyjet flight home to Naples was scrapped.
"The company is just offering us a flight for Milan tomorrow," he told AFP. "But Milan is hundreds of kilometres from Naples. That means we'll have to take the train. It's a waste of time and money."
DGAC said disruption was expected at most French airports due to the strike, which comes as many people are leaving for their summer holidays.
Storms forecast later in the day were likely to add to the disruption.
Unions representing air traffic controllers called the strike to protest against plans to merge France's 4,000 controllers and 8,000 other DGAC personnel into a European-wide system.
Air France said 80 percent of its short- and medium-haul flights and all its long-haul ones from Charles de Gaulle would run as normal, and half its short- and medium-haul flights from Orly.
Its long-haul flights were not affected.
Budget airline easyJet cancelled about a third of its departures overall from Charles de Gaulle and Orly to destinations across Europe, according to its website.
At Nice airport, the biggest hub for the holiday hotspots of southern France, nine percent of flights were cancelled on Wednesday, authorities said.
The action was scheduled to run until Thursday morning. It was the third major airport strike in France this year, after similar actions in January and February.
Currently the European Union's air space is a patchwork of 27 air traffic control systems, subdivided into 250 sectors.
As a pilot enters a new sector he must change radio wave frequency and contact the next air traffic control team.
The European Union's 2009 single sky legislation calls for "Functional Airspace Blocks" to be in place by 2012, creating boundary-free airspace to improve efficiency and safety.
France would become part of the Central Europe block, along with Belgium, Germany, Luxembourg, the Netherlands and Switzerland.
In Spain, two-thirds of air traffic controllers in Barcelona called in sick on Tuesday in what was interpreted as an undercover strike. Spanish Transport Minister Jose Blanco said military personnel would cover for them.

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Tuesday, July 20, 2010

Looking for Green in Blue Skies

A month before the Farnborough air show, an assortment of visionaries, inventors and oddballs, together with a sprinkling of aviation heavyweights, gathered at Le Bourget airfield, north of Paris, for the second edition of the Salon de l’Aviation Verte, or Green Air Show.

“There is no such thing as ‘green’ aviation,” said Olivier Jouis, head of environmental affairs at Eurocopter, one of the heavyweights there. “It’s a misnomer. It’s a polluting industry. We can only hope to make it less so.” Progress is being made, he said, to reduce pollution in mainstream commercial flight operations and manufacturing but it is slow and incremental.

Still, alongside the makers of solar-powered planes, flying robots and airships — and the Paris Art Boomerang Club — the 52 participants in the salon included the engine maker Snecma and European Aeronautic Defense & Space proof that the mainstream is getting involved.

Technological innovation is pushing the boundaries of conventional aviation in several different directions, not least toward renewable energy use. “Renewable energy can do impossible things,” Bertrand Piccard, the founder, president and sometimes pilot of Solar Impulse, said after that aircraft completed the world’s first solar-powered, overnight flight this month.

Despite that exciting technical feat, commercial applications are limited, warned Paul Steele, Executive Director of the Air Transport Action Group , a Geneva-based industry lobby. “The Solar Impulse has the wing span of an A-330 but it’s only carrying one person. We would need a similar wing-span to carry 200 people. It’s a weight to wing-span problem,” Mr. Steele said.

Solar power, generated at altitude and stored while an airliner flies its route, can, however, supply auxiliary power for in-cabin systems like lighting and air-conditioning when the plane is on the ground. According to the action group, 85 percent of auxiliary power is used at the airport gate when the main engines are stopped. Using an alternative power source could cut airline power bills by $100,000 a year per gate, it says.

Even more fuel could be saved simply by rethinking inefficient airplane routing, both on the ground and in the air. Mr. Steel said his group is lobbying for quick implementation of the European “Single Sky” coordinated control program and the U.S. Next Generation air traffic management project, both designed, in different ways, to guide airliners more directly to their destinations.

Beside greenhouse gas emissions, noise pollution is another big concern.

Airships, silent and self-supporting, are “an interesting concept” that could find a niche market in transporting non-perishable goods, Mr. Steele said, though for commercial air passengers “spending three days flying across the Atlantic is probably not what they want.”

For the mainstream passenger market a new generation of large airliner engines, reducing noise by 75 percent, will be in production by 2016, he said.

Helicopters, meanwhile, present particular noise problems, Mr. Jouis, of Eurocopter, noted. Their engines are loud and their rotors make a racket all on their own as each blade strikes the sound wake left by the preceding one.

Eurocopter is working on two noise reduction projects. “One is a passive redesign of the blade, which would cut the sound by 50 percent, while the second is an active control system that controls the pulse of the blades,” he said.

But the hot topic in green aviation at Le Bourget this year was biofuel — “probably the most exciting area that is developing quickly,” Mr. Steele said.

“Three years ago it was still a pipe dream that you could use biofuels for aviation,” he said, but in the past three years, technologies have been developed that can produce carbon-neutral, low-sulfur fuels from two plant sources, jatropha and camelina, and from micro algae, that can be burned by jets without modifying the engine or distribution system.

“We’re expecting final certification by the end of this year or by the beginning of 2011 for biofuels,” Mr. Steele said. “If you get the right fuel, you can reduce what’s called the carbon life-cycle footprint by 80 percent.”

One company planning to offer aviation biofuel is Solena, based in Washington, which in February announced a partnership with British Airways to develop Europe's first sustainable jet fuel plant, using waste biomass.

The company says that its technology can turn any type of agricultural, urban or industrial waste into high-quality jet fuel at a competitive price with no effect on the environment.

The process relies on molecular dissociation, using advanced plasma gasification technology and the Fischer-Tropsch catalytic reactions developed in Germany in the 1920s to produce synthetic oil, Solena’s founder and chief executive, Robert Do, said in an interview.
Inorganic slag residues left as a byproduct can be vitrified and used as construction material, he added.

Mr. Do skipped the green aviation salon but said he planned to present a joint project at Farnborough, with BA and the city of London. The project calls for Solena to transform urban waste from London, which would normally go to a landfill, into jet fuel, which he said B.A. had agreed to buy at a price pegged to the market price for jet fuel.

Jet fuel prices of $2.70 to $3.25 per gallon, or 71 cents to 86 cents per liter, would allows Solena’s fuel to be competitive and viable, he said. The average refinery price for jet fuel is now just above $2 a gallon, according to data cited by the International Air Transport Association’s Web site.

Describing the proposed London plant as the “first commercial-sized biotech fuel project in the world,” Mr. Do said that local government officials were assessing several locations in east London that might be suitable sites for the £205 million, or $315 million plant, which he said should process 500,000 tons of waste a year into 16 million gallons of jet fuel, while generating 20 megawatts of electricity as a byproduct. “The planning and permit phase” for the plant should be completed in about a year, with construction scheduled to start in the second half of 2011, he said.

In addition to the environmental benefits, the plant would add more than a thousand jobs to the economy during construction and create a further 200 long-term operating positions, he said.

Once in operation, he said, it would earn carbon credits that could be sold or traded on the European emissions market. These would be shared between Solena and B.A., with the airline earning credits for using a “carbon neutral” fuel and Solena earning them both for producing the fuel and for preventing greenhouse emissions by eliminating landfill.

Mr. Jouis, of Eurocopter, however, questioned the project’s feasibility. Fischer-Tropsch technology had never been applied on a significant scale to urban waste, he said.

In general, biofuels are not yet up to the standards needed for safety — at least not for helicopters — he added. “It’s one thing to put a 50/50 fuel in one engine of a quadri-motor airplane,” he said, referring to a mix of 50 percent standard fuel and 50 percent biofuel: “it’s another to put it in a single- or bi-motor aircraft.”

Mr. Jouis was also skeptical about any industrial process that was purported to be totally environmentally friendly. “There’s always some impact,” he said.

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From Nothing to a Global Hub for Aviation

Attention airline passengers: While some of you were fuming right along with the Eyjafjallajokull volcano in Iceland this past spring, others were finding a new route to international destinations that avoided the ashy Atlantic skies entirely. So, while many regions of the world took a hit in April and May, Middle Eastern carriers carried on, showing a 19 percent increase in passenger volume over last year.

Al Maktoum International Airport in Dubai was designed to handle 120 million passengers a year.
On top of that, the number of their passengers choosing to fly premium class went up 25 percent — “a race to the top,” according to the International Air Transport Association, the lobbying organization and trade group based in Montreal and Geneva.

Global shifts in economic circumstances have created new opportunities, and aviation industry insiders say many of these, both short- and long-term, promise to be in the Middle East.

“The Middle East had the luxury of starting from a blank piece of paper,” said Steven Lott, communications director for IATA in North America. “They were able to design the airline model and the infrastructure models. They opened the biggest airport in the world,” he said, referring to the newly opened Al Maktoum International Airport in Dubai, designed to handle 120 million passengers a year. “Less than 30 years ago they were able to start with a blank piece of paper and move ahead.”

Since the days of pearl diving in the Gulf, the United Arab Emirates have been a crossroads for trade. The airlines, however, Emirates of Dubai, Etihad of Abu Dhabi and the discount airline Air Arabia of Sharjah, are relatively new arrivals on the scene. As economic growth makes air travel more accessible in India, China and other parts of the Asia-Pacific region, the emirates have become a tourist and business center as well as a transit hub.

“The potential is unbelievable,” said Nawal Taneja, the chairman of the aviation department at Ohio State University.

“India, has 1.2 billion people,” Professor Taneja said. “Say that on average only 20 percent have the ability to buy a cheap ticket, that’s 240 million people.”

“Where is the market potential 10 years from now? It is in China. It is in India. The U.A.E. airlines are setting up their expansion growth there.”

The birth of new airlines, like Bahrain Air and Jazeera Airways of Kuwait, bears witness to that policy, as does the building of new airports in Dubai and Doha, Qatar, and an enormous expansion of Abu Dhabi International.

Abu Dhabi’s leaders have decided to update their oil-fueled economy by turning their emirate, with its population of 1.5 million, into a global center for aviation by 2030. Mubadala Development, created by the government, has been buying into or connecting with aerospace companies like Rolls Royce, Sikorsky and Finmeccanica, to start local manufacturing and repair facilities.

“Our growth projections tell us that there is an enormous market potential” Homaid Al Shemmari, the executive director of Mubadala Aerospace, wrote in an e-mail message.

Emerging markets like the Middle East are changing the aviation market, said Randy Tinseth, Boeing’s vice president of marketing. “We’ve seen very dramatic growth in the last decade,” he sad. “They are leveraging their geographic position in the world. They’re leveraging the newest technologies.”

They are also leveraging their clout. With airlines in the United Arab Emirates spending billions on planes, Airbus and Boeing have agreed to assist with Mubadala’s maintenance and repair stations and to help develop Strata, a manufacturing plant in Al Ain, 145 kilometers, or about 90 miles, from Abu Dhabi.

“The Middle East already has the world’s largest fleet of wide-body aircraft, with many more orders in place for newer platforms such as the Boeing 787 and Airbus A350,” Mr. Shemmari said. “This investment was made in anticipation that Strata will be used to produce sections of aircraft for the A330, 340 and 380.”

The recently opened Strata factory is expected to employ 500 people and build products for Airbus by 2014, according to a company brochure.

Mubadala said 10,000 people would be needed to work in Abu Dhabi’s new aviation and aerospace plants and the goal was to fill those jobs with local citizens. This may be challenging.

The aim of progressing from a lucrative, low-employment oil economy into more labor-intensive activities is not just to make money but also to spread the social benefits, creating job opportunities that will enable people to participate in the economic growth of their country.

“Although Abu Dhabi is fortunate to have both the capital and energy needed to sustain the requirements of the aerospace industry, there will be a heavy focus placed on developing the highly skilled workforce that is needed,” Mr. Shemmari said.

The first test will come at the Strata plant. Airbus and Boeing are already on site, and aviation job boards are heavy with Middle Eastern help-wanted advertisements.

“These people are swimming in wealth but they have to be willing to be taught how to repair an engine or repair an aircraft or even sit in an office for eight hours and diligently get paperwork done,” said a contractor who has worked in the region but did not want to be identified. “They do need education. They need people to get technical degrees. They need to have people actually willing to do the work.”

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Wednesday, July 14, 2010

Alaska Airlines ranks first in aviation study

A leading aviation industry magazine, Aviation Week, ranks SeaTac-based Alaska Airlines as the top performing mainline airline in the world in a study released today.

Alaska bumped Singapore Airlines, which has held the top spot in the survey for five consecutive years.

Among low-cost niche airlines, the survey rated Las Vegas' Allegiant Air as the top performer.

Alaska in the last year has improved its on-time performance to the best among the legacy carriers. In the meantime, the airline has turned healthy profits even during the historically weak first quarter.

Alaska has worked assiduously to trim unprofitable flights from its schedule while adding new flights to destinations such as Hawaii, St. Louis, Atlanta and Austin.

The study noted that most American and Asian carriers upped their scores this year while European airlines saw their rankings fall. Among the top 10, smaller carriers not aligned with major alliances performed best as a rule.

Aviation Week said smaller, more nimble carriers such as Alaska use their smaller size to allow them to adjust more quickly to market conditions.

While larger carriers such as Delta and Northwest and United and Continental have been merging operations, industry analyst Ray Neidl told Aviation Week that Alaska's position would not be enhanced by merging with a larger partner.

"They've got a real niche, good management and they can do things a big airline can't do," he said.

Alaska has working agreements for code sharing and frequent flier programs with several major airlines including Delta, American, British, Air France, Icelandair, LAN, Cathay Pacific, Qantas and Korean Airlines.

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Sunday, July 4, 2010

Stowaways That Are Disgusting, Even Deadly

What do mice, mosquitoes, scorpions and maggots have in common? They all breeze past airport security, and they do not seem to mind flying coach.

Passengers on a US Airways flight were disgusted to find maggots falling on them from an overhead bin on Monday. Pilots declared an emergency and returned to the gate in Atlanta at Hartsfield-Jackson International Airport. The plane was emptied and cleaned before proceeding to Charlotte, N.C.

The extensive security process may leave passengers feeling that their bodies and possessions are thoroughly inspected before boarding, but there are no regulations prohibiting them from bringing rotting meat on a plane, which is apparently how the maggots got onto the jetliner, said Morgan Durrant, a spokesman for US Airways.

“We don’t like to take a delay for any reason, but a delay for insect larvae is a new one for us,” Mr. Durrant said.

Vermin have bedeviled airline officials for years. Aviation databases hold dozens of reports of incidents and accidents in which insects and rodents played a role, often by blocking gauges or clogging mechanical parts. Dan Hall, a pilot from Torrington, Conn., crash-landed his Cessna 182 into a river in Rhode Island in 2007 after four mice were sucked into the plane’s carburetor. “The bad news is, you crashed your plane,” Mr. Hall said investigators told him, “but the good news is the mice are dead.”

These problems occur most often on small private airplanes, but in 2002, an Icelandair Boeing 757 en route from Orlando, Fla., to Reykjavik, Iceland, lost altitude and had to make an emergency landing in Baltimore. Insects clogging the tube measuring airspeed were the suspected culprits. There was a similar episode on an American Airlines DC-10 in 1978.

Rodents are especially problematic because they gnaw and jump. In January 2008, eight mice were found on a United Airlines plane in China, and in July 2006, maintenance workers at American Airlines said a plane in Kansas City, Mo., was infested with mice, though the airline said that only 17 were alive.

Insects are more often a health concern than a safety issue. Some scientists believe mosquitoes carrying the West Nile virus were inadvertently transported to the United States on airliners.

“Certainly that’s the biggest, but the same is so for a whole host of insects that can come aboard an airplane with the passengers,” said Philip Tierno, director of clinical microbiology and immunology at New York University Langone Medical Center. “What’s in one country today,” he said of dangerous insects, “can be in another country tonight.”

The Federal Aviation Administration has no regulations for how airlines should combat insects or rodents, said a spokeswoman, Alison Duquette. US Airways opted to fumigate Monday’s flight, No. 1537, when it arrived in Charlotte, a decision made “out of an abundance of safety and cleanliness” said Mr. Durrant, adding that the “gross-out” factor played a role as well.

“There are many reports over the years of insects that are routinely detected on passenger aircraft,” Dr. Tierno said. “It’s one of the reasons why aircraft should be regularly treated with an insecticide, especially when they land in certain areas of the world.”

Douglas Herbstsommer was not traveling anywhere particularly exotic last summer when he had an uncomfortable encounter with a bed of scorpions. A passenger on a Southwest Airlines flight, from Phoenix to Indianapolis, he was stung on his hand. Mr. Herbstsommer told reporters he saw several more in the overhead bin, so he used his flip-flop to kill them.

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Friday, July 2, 2010

The World Airline Report

The world airline industry has been to hell and backin a remarkably short period of time. From record losses of $16 billion in 2008 followed by $9.9 billion in red ink in 2009, carriers are projected to earn $2.5 billion in 2010, according to IATA’s most recent financial forecast presented at last month’s AGM in Berlin (see tables, p. 28). If achieved, this will represent an $18.5 billion profit rebound over two years after a negative swing of $28.9 billion between 2007 and 2008. But recent history hardly inspires confidence in the next six months, let alone the next year, particularly given the known-unknowns of oil prices and terrorism and the unknown-unknowns typified by Europe’s volcanic ash crisis.

Indeed, if anything is to be learned from the past 12-18 months it is that stability and the airline industry will continue to be strangers for the foreseeable future. To understand how thin the margins between tragedy and hope are, it is only necessary to reflect upon what the outlook for the next 12-24 months might be had Umar Farouk Abdulmutallab succeeded in detonating his bomb on Christmas Day.

It is also possible to frame volatility as a positive. In mid-2009, IATA DG and CEO Giovanni Bisignani worried that at least three years of revenue growth had been lost. Yet despite an unprecedented decline in passenger and cargo traffic in 2009, it is apparent that the worst-case scenario did not come to pass. Industry revenues sank from $564 billion in 2008 to an estimated $483 billion in 2009, but IATA now projects that 2010 revenues will bounce back to $545 billion, easily exceeding the $510 billion in 2007 and just 3.4% below 2008.

“We thought that it would take at least three years to recover the $81 billion [14.3%] drop in revenues in 2009. But the $62 billion top-line improvement this year puts us about 75% on the way to pre-crisis levels,” Bisignani said in Berlin.

Likewise, the fear that international premium travel was entering a sustained secular decline turned out to be overblown. The sharp drop in premium travelers bottomed in the summer of 2009 and turned positive in the fourth quarter, reaching an annualized pace of over 20% in the 2010 first quarter. Overall, IATA forecasts a 4.5% improvement in yields this year, driving a 13% rise in revenues. The cargo recovery has, if anything, been more striking: From a stunning 9.8% collapse in demand between 2008 and 2009 it is forecast to rebound 18.5%.

Although the resurgence is being driven by the macroeconomic environment, other factors are coming into play as well, lower oil prices among them. After peaking at more than $135 per barrel in July 2008, the price of a barrel of Brent crude averaged $62 last year, helping reduce industry fuel costs by 40% versus 2008. Unfortunately, the price of oil has risen considerably this year, hitting $86/barrel by late May. IATA expects it to average $79 for the full year.

The industry is doing its part as well. By and large, carriers maintained capacity discipline during the recession with ASKs (Available Seats per Kilometer) down an estimated 3% last year. By the end of 2009, load factors on international flights were at record levels, according to IATA. The 2010 forecast is for a 5.4% rise in capacity, which will be manageable in a high traffic growth environment. Still, as Bisignani noted, 1,340 aircraft will be delivered this year “and only 500 are for replacement.”

On the revenue side, fare “unbundling”—the introduction of things like baggage and preferred seat fees—has created much-needed revenue streams and not just for LCCs. US carriers generated $2 billion in revenue from bag fees and other ancillary charges in just the fourth quarter. Airlines also maintained cost discipline, with nonfuel costs down an estimated 3.4% in 2009. This year’s outlook is less positive, with nonfuel expenses forecast to rise nearly 6%.

Labor unrest at British Airways and Lufthansa signals growing resistance among employees to continuing austerity diets. Most major US passenger airlines are in the process of negotiating open labor contracts, and after years of belt-tightening employees are eager to dine on something a bit richer than the potatoes and gravy they have been served since the restructurings conducted earlier in the decade.

A further challenge comes from revenue-hungry treasuries eager to cover budget deficits with new taxes on aviation. As the AGM was underway, the German government announced plans to impose a new “green” departure tax intended to raise €1 billion ($1.19 billion). “We never had a €1 billion tax gift from a government during an IATA AGM,” Bisignani commented sourly. The government says it will be in place until the Emissions Trading Scheme begins in 2012, but such taxes often have a habit of sticking around long after their ostensible purpose has been fulfilled. Rising air navigation charges are also a concern in Europe, with IATA claiming that rate hikes at 19 ANSPs added $413 million to airline costs.

And what will be the ultimate cost to airlines of Europe’s questionable handling of the volcanic ash crisis that stranded an estimated 10 million passengers and lost airlines an estimated $2.2 billion in the first week alone? Even if one accepts that safety regulators were justified in closing airspace for six days, is it reasonable that the EU passenger rights legislation contains no force majeure clause to absolve carriers of the costs of feeding, housing and in some cases babysitting and entertaining stranded passengers while the airlines were not permitted to fly?

In Review 
A look back at 2009 reveals that, as expected, Europe bore the brunt of the recession. Aggregate airline losses there are estimated at $4.3 billion. Six years of profitability came to an end for Lufthansa Group as it posted a net loss of €112 million ($160.5 million), largely owing to problems in the passenger airline business. Although this was mild compared to the losses at most other European network airlines, it signaled the depth of the crisis that cost Air France KLM €1.56 billion, Alitalia €326 million, British Airways £425 million ($534.3 million), Iberia €273 million and SAS Group SEK2.95 billion ($410.4 million).

Europe’s legacy carriers attributed their troubles to the weak economy and collapse of high-yield long-haul business traffic as well as the residue of upside-down fuel hedges and a stronger dollar. This is certainly accurate, but if additional culprits are needed one could point to rising long-haul competition from Emirates, Etihad and Qatar Airways and perhaps to encroachment in short-haul markets from the likes of Ryanair, easyJet, Air Berlin and Norwegian, although this last factor is disputed by most former flags.

At last month’s ILA Berlin Air Show, Emirates threw down a challenge to Lufthansa (and others) seeking to curb its European ambitions by ordering 32 more A380s. Political leaders in Germany and France now must manage their aviation negotiations with an eye cocked on keeping the EADS factories in Toulouse and Hamburg busy. The continent’s deepening debt crisis, coupled with the fall of the euro and fallout from the volcanic ash crisis, are among the reasons that its airlines are expected to lose money again this year—$2.8 billion, according to IATA.

Return To Form 
Airlines in the Asia/Pacific region that lost some $4.7 billion in 2008 shed a further $2.7 billion in 2009, but most of those losses were incurred in the first half of the year. Singapore Airlines hung onto its 38-year profit streak. Qantas and Air New Zealand, ATW’s Airline of the Year for 2010, also found ways to make money, albeit at a reduced rate. Malaysia Airlines doubled its income year-on-year owing to profitable fuel hedges and some aggressive sales campaigns.

Tough medicine, including parking aircraft and unpaid leave for staff, helped restore Cathay Pacific, although the largest impact came from fuel hedges and asset sales. China’s big three, heavily supported by government cash infusions and a resurgent domestic market, all posted profits after deep deficits the year before. India’s big three are still in the red, but the big two private carriers, Jet Airways and Kingfisher, are feeling better about the future in spite of the inroads made by successful LCCs IndiGo and SpiceJet (ATW, 5/10, p. 28). Air India, reeling from the crash of a 737 in May and an unsustainable cost structure, has pinned its future on a government recap that is tied to an ongoing restructuring program.

The bankruptcy of Japan Airlines, as dramatic in Japan as was the collapse of Swissair in Switzerland, seemingly left the door wide open for rival ANA, but ANA is struggling with cost issues itself. Shorn of its former government/legacy cost structure, JAL could emerge as a leaner, more nimble competitor. In any case Japan, like the US, is a mature air transport market with the added drawback of an excellent high-speed rail network. The opening of Haneda to more international flights including long-haul is a two-edged sword; it will allow both carriers to develop a better hub function than is possible at Narita, but it also devalues their strong slot holdings at NRT. Open skies with the US means antitrust-immunized alliances for both ANA and JAL but does not eliminate the challenges posed by regional rivals happy to scoop up fifth and sixth freedom traffic if liberalization permits.

Continental Divide 
IATA data show that results for North American (US and Canada) airlines improved dramatically over 2008’s $9.6 billion deficit to a loss of just $2.7 billion last year excluding special items. The outlook has brightened considerably for 2010, with carriers expected to earn $1.9 billion. Standout earnings performances last year by AirTran Airways, Alaska Airlines, Allegiant Air, JetBlue and Canada’s WestJet, four of which did not exist 20 years ago, stand in bold contrast to the continuing losses of the big five US legacy carriers plus Air Canada. The merger of United Airlines and Continental Airlines announced in May, if consummated, could help bring stability to the market and keep a lid on capacity—or not (ATW, 6/10, p. 47).

Data from the Air Transport Assn. show that domestic ASMs (Available Seats per Mile) fell 6.9% last year, the deepest contraction since 1942. But why should a network carrier add any new domestic capacity? In 1995 dollars, the average US domestic airfare in the fourth quarter of 2009 was $227 compared to $288 in 1995 and $300 in 2000, according to ATA. Meanwhile, US scheduled passenger airlines employed 4.1% fewer workers in April 2010 than in April 2009, the 22nd consecutive monthly year-over-year decline. The total of 376,200 FTEs was the lowest since at least 1990.

Airlines need to pay much closer attention to the mood in Washington these days. The tarmac delay rule and a slew of new pro-consumer proposals show that the Obama administration intends to back up tough words with tough actions.

The most consistent performers during 2009-10 are the airlines of Latin America, which managed the rare feat of making a bit of money ($500 million) last year and are expected to earn $900 million this year owing to standout performances from carriers such as LAN Airlines, Gol, Copa, and TAM (which joined Star Alliance in May). Airlines in the region’s second-largest market, Mexico, were hard hit by the H1N1 outbreak. Consolidation continues to occur, with the most recent example being the merger of Grupo TACA of El Salvador and Avianca of Colombia via a Bahamas-based holding company structure that is owned 67% by Avianca parent Synergy Aerospace Corp. and 33% by TACA parent Kingsland Holding.

Airlines of the Middle East lost $600 million last year but a breakeven result is expected this year. Except for the fact that it is now larger, Emirates is the Singapore Airlines of the region, consistently profitable and determined to grow beyond the limitations of its home market if only governments in Europe, North America and Asia will permit it. Last month, Qatar Airways’ outspoken CEO, Akbar Al Baker, dismissed the notion that consolidation is required among the more than half-dozen Persian Gulf airlines, saying the majority will “just disappear,” leaving two dominant carriers.

Africa’s industry remains as fragmented as the continent itself, with few sub-Saharan airlines in shape to compete with the influx of lift from Europe and the Middle East. There are exceptions. Those along the Mediterranean and Red Seas like EgyptAir (ATW, 3/10, p. 20), Kenya Airways and Ethiopian Airlines are well-positioned to capture flow traffic, while South African Airways will get a boost from the World Cup that exposed thousands of new visitors to the attractions of the country and its integration into the Star Alliance network. In January, Ethiopian realized a long-sought objective to create a West African hub with the launch of ASKY Airlines, a Lome-based carrier operating a pair of 737s leased from ET, but that was overshadowed by the loss of an ET 737-800 that month, the first of two major accidents involving African carriers operating Western equipment this year. Although Ethiopian has had an excellent safety record, the accident helped to keep the spotlight on safety and training issues in the region.

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Thursday, July 1, 2010

Britain Seeks to Curb Emissions by Abandoning Airport Growth

In a bold if lonely environmental stand, Britain’s coalition government has set out to curb the growth of what has been called “binge flying” by refusing to build new runways around London to accommodate more planes.

Citing the high levels of greenhouse gas emissions from aviation, Prime Minister David Cameron, a Conservative, abruptly canceled longstanding plans to build a third runway at Heathrow Airport in May, just days after his election; he said he would also refuse to approve new runways at Gatwick and Stansted, London’s second-string airports.

The government decided that enabling more flying was simply incompatible with Britain’s oft-stated goal of curbing emissions. Britons have become accustomed to easy, frequent flying — jetting off to weekend homes in Spain and bachelor parties in Prague — as England has become a hub for low-cost airlines. The country’s 2008 Climate Change Act requires it to reduce emissions by at least 34 percent by 2020 from levels reached in 1990.

“The emissions were a significant factor” in the decision to cancel the runway-building plans, Teresa Villiers, Britain’s minister of state for transport, said in an interview. “The 220,000 or so flights that might well come with a third runway would make it difficult to meet the targets we’d set for ourselves.” She said that local environmental concerns like noise and pollution around Heathrow also weighed into the decision.

Britain is bucking a global trend. Across North America, Asia and Europe, cities are building new runways or expanding terminals to handle projected growth in air travel and air freight in the hope of remaining competitive. That growth in traffic has been damped but not halted by hard economic times, and in the current global recession, business concerns have generally prevailed over worries about climate change. In the United States, Chicago-O’Hare, Seattle-Tacoma and Washington-Dulles all opened new runways in 2008.

On Tuesday, John F. Kennedy International Airport in New York reopened its Bay Runway — one of four, and the airport’s longest — after a four-month, $376 million renovation that included the creation of two new taxiways to speed plane movements between runways and terminals.

Airport expansion plans have sometimes been modified or canceled because of concerns about noise or ground-level pollution. But Peder Jensen, a transportation specialist at the European Environment Agency in Copenhagen, said that as far as he knew, Britain “is the only country that had made a conscious decision based on climate considerations.”

Heathrow, one of the world’s busiest airports and a major connection point for destinations in Europe, South Asia, and the Middle East, is already notorious for its flight delays and endless queues. It is the only airport of its size with just two runways; Paris-Charles DeGaulle has four and O’Hare has seven.

So even though the Conservative Party had been expressing growing reservations about the planned expansion since 2008, many businessman were shocked when Mr. Cameron canceled the plan after coming to power in a coalition with Liberal Democrats.

“This is a new government that claimed to be business friendly, but their first move was to eliminate one of the best growth opportunities for London and the U.K. and British companies,” said Steve Lott, a spokesman for the International Air Transport Association. “We’ve run into a short-sighted political decision that will have terrible economic consequences.”

The British government counters that the economic effects of scrapping the third runway are “unclear” while the environmental costs of adding one are unacceptably high. Ms. Villiers said that a high-speed rail network intended to replace short-haul flights would be a better way to address the airport’s congestion than adding a runway.

“We recognized that just putting more flights and more passengers into the skies over southeast England wasn’t worth the environmental costs we’re paying,” she said. “We decided to make Heathrow better rather than bigger.”

Although it is often said that emissions from air travel account for 2 to 3 per cent of global emissions, the proportion is higher in many developed countries: emissions from aviation are growing faster there than those from nearly any other sector.

The British government has calculated that aviation emissions accounted for just 6 percent of the country’s carbon dioxide emissions in 2006. But it concluded in a report that aviation could contribute up to a quarter of those emissions by 2030.

In the United States, the number of general aviation hours is forecast to grow an average of 1.8 percent a year, and to be 60 percent greater by 2025 than they are now, according to the Federal Aviation Administration. While airlines have worked hard to improve airplane efficiency, those efforts are dwarfed by the upward trend in flying.

Citizens’ groups in communities near Heathrow fought hard for nearly a decade against the airport’s runway expansion, complaining about noise and nitrous oxide pollution. As climate change became a more potent political issue in Britain several years ago, environmental groups with broader concerns jumped into the fray, staging camp-outs at Heathrow and occupying runways at smaller airports, shutting them down for hours.

“If you were a politician, how you felt about the Third Runway became a test of your commitment to dealing with climate change,” said Ben Stewart, communications director for Greenpeace U.K.

The temptation to expand airports is great for cities in search of new business and tourism. And airports in Europe are now mostly run by private companies, and for them, the more traffic, the more profit.

Some critics say that the British government’s principled stand is pointless because airlines and travelers will respond not by forgoing air travel but by flying through a different airport. Instead of emissions being reduced, the critics say, they will simply be transferred to places like Barajas Airport in Madrid or Frankfurt International Airport, both of which recently expanded.

“My personal opinion is that the decision concerning Heathrow’s third runway was highly politicized and outpaced the science of what that runway might or might not do in terms of emissions,” said Christopher Oswald, a vice president of Airports Council International, an industry group. He suggested that a third runway might actually reduce emissions above Heathrow, because with less congestion, planes would spend less time idling on runways or circling in holding patterns.

But Dr. Jensen said that building roads or runways generates more traffic in the long term because greater convenience draws people to a route.

Leo Murray, a spokesman for Plane Stupid, an environmental group that has fought new runways, called the British government’s decision “a turning point for aviation” although he added, “It is uncomfortable to have the coup de grace delivered by the Conservative government.”

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No frills, no seats: Ryanair's latest cost-cutting plan

Plans by Ryanair to introduce standing room on its aircraft will not happen for at least two years and may never materialise if the airline fails to meet stringent European safety requirements.

The budget airline's boss, Michael O'Leary, will talk about his plans to replace 10 rows of seats with a standing area as well as introducing a coin-operated toilet on some planes in an interview on ITV's How to Beat the Budget Airlines tonight.

However, safety officials at the European Aviation Safety Agency (Easa), which regulates safety issues on European airlines, said its rules would have to be ripped up and rewritten in order to allow standing room on Ryanair flights. In Easa's certification specifications it states: "A seat (or berth for a non-ambulant person) must be provided for each occupant who has reached his or her second birthday."

"This idea [of Ryanair's] is unprecedented and unlikely to be certified in the near future," said a spokesman for Easa. The Civil Aviation Authority, which regulates UK but not Irish airlines, added that Easa's safety requirements were "quite stringent" and include rules on restraint during take-off and landing; restraint during periods of turbulence; the "crashworthiness" of airline seats; the ability of the seating to withstand a certain amount of gravitational force; and evacuation and flammability issues.

Ryanair itself admits both ideas – for standing room and paid-for toilets – were in the "very early stages". It first mooted the plans a few months ago when it was in talks with Boeing over a new order for planes. The order didn't come off, said a spokesman for the airline, but it is now in talks with the aircraft manufacturer over the idea again.

"We are aiming at starting safety testing in about 12 months with a view to going into service with the new arrangements in about 18 months to two years' time," he said. "We think this would work well on our winter services so would hope to eventually introduce it for a winter timetable."

Toilet charges would be introduced at the same time as the standing area, as the idea to charge £1 for using the lavatory only came about after the airline started to look at how to introduce standing room. It wants to remove both toilets from the back of the plane as well as a row of seats in order to go ahead with its plans. "This means we'll only have one loo left at the front of the plane and so clearly we need to discourage overuse, hence the charge," he said.

The refitted planes would only run on commuter routes of under one hour to start with, such as London to Dublin, although O'Leary hopes to introduce standing room on some longer flights at a later point. A certain percentage of the standing slots will be free to passengers and the others charged at €5 to €10 (£4 to £8).

Ryanair defended itself against accusations that the two ideas are nothing more than an attempt to seek publicity.

"People are always slow to accept the changes that face the aviation industry, even though it is already almost unrecognisable from 20 to 30 years ago," said a spokesman for the airline. "We have already done away with check-in desks, an idea that two years ago people dismissed as a joke. We absolutely believe that these new proposals are the future."

Meanwhile, the airline is upping its prices by increasing the price of check-in luggage from today for the next two months, from £15 to £20. It also announced earlier this week that it will cut the number of winter flights from the UK by 16% from November, reducing the number of passengers it carries from UK airports by 2 million. It blamed a rise in air passenger duty, which is due to rise in November from £22 to £24 for short-haul flights and £50 to £75 on long-haul returns.

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