Archive for January, 2008
First It Was Nude Beaches…Then Nude Tourist Resorts…
Now a German travel agency has unveiled what is believed to be the world’s first nude airline. It is fairly well known that a lot of Germans like getting their kit off, now there is an airline for them. An Eastern German travel agency is taking bookings for the country’s first nudist air service. Passengers can strip off on board but will have to get dressed again before getting off the plane. The flight is to be part of a summer day trip which flies from the Eastern German city of Erfurt to a popular Baltic Sea resort.
The Board of Directors of the Caribbean Hotel Association (CHA), at their meeting during Marketplace 2008, heard and commended a report from the International Air Transport Association (IATA) on the need for a regional approach to aviation policies.
In his report on the state of the aviation and airport industries in the Caribbean, Cyriel Kronenburg, Assistant Director Airport & ATC Charges for IATA, urged governments to “remove obstacles such as fragmentation and unduly taxation in order to become profitable.” Complaining that the airline industry is unfairly taxed at higher rates than the cruise lines with the average airline passenger paying $30 versus the cruise passenger tax of $1, he said that “the Caribbean needs to ensure independent economic regulations.”
He also noted that “airports need to work together with the airlines on long term strategies,” and added that the airports need to “create commercial revenue opportunities.” He also suggested implantation of cost-cutting efficiencies such as installation of kiosks at airports in the Caribbean. He urged the Caribbean airport authorities to establish a “harmonization of services, standardization of infrastructure and reduce the number of providers as the key to reduced costs.” Peter Odle, president of CHA and the Board strongly endorsed the IATA report and joined in the call for new aviation policies across the region. It was noted in the Board report that in 1993, Stephen Wheatcroft, in his paper entitled “Aviation and Tourism Policies: Balancing the Benefits” said “a sound aviation policy for the Caribbean is critical for the future development of the tourism industry.”
He also noted that the Caribbean is often expensive to operate and the lack of intra Caribbean cooperation and lack of economic regulations prevents further growth in the airline sector in the Caribbean. CHA, appreciating the dire consequences of the state of the aviation industry intends to continue to work with IATA to further the issues discussed in the report.
January 28, 2008
American Airlines, United Airlines and US Airways have doubled their fuel surcharges to USD$40 from USD$20 on domestic roundtrip tickets, matching a move by Continental Airlines last week.
After two industry efforts to raise fuel surcharges failed, airlines were more selective in increasing the fees, raising them on 66 percent of their respective networks, according to fare tracker FareCompare.
“This slightly less aggressive approach may be an attempt to give this airfare increase a greater chance of ’sticking’,” said FareCompare Chief Executive Rick Seaney.
The previous two attempts — one led by United and the other by American — were initially matched by other major airlines but failed to hold after consumers resisted the higher fees.
With the US economy slowing, airlines have struggled to pass higher fuel costs on to passengers.
In the last few days, American Airlines parent AMR, United Airlines owner UAL, Delta Air Lines and US Airways all posted fourth-quarter losses because of high fuel costs.
(Reuters)
January 28, 2008
The United States is likely to keep a high threat designation for the airline industry because militants still see air travel as a target, US Homeland Security Secretary Michael Chertoff said.
Chertoff said the orange, or high, threat level assigned to the airline sector — one level higher than the overall alert level for the United States — was based on a general assessment rather than a specific threat.
“We’ve seen again and again interest in this sector,” he said, pointing to an alleged British-based plot to blow up transatlantic flights using liquid explosives in 2006 and an attempted car bomb attack on Glasgow Airport last year.
“So people think of aviation not only in terms of the aircraft but the whole infrastructure including the airports,” Chertoff said.
The Department of Homeland Security was itself created in response to the attacks on the United States on September 11, 2001, when al Qaeda hijackers commandeered four planes, crashing two into New York’s World Trade Center, one into the Pentagon outside Washington, and crashing the fourth in a field in Pennsylvania.
More than six years after the attacks which killed nearly 3,000 people, “there continues to be a focus on air travel as a target,” he said, adding the threat level was unlikely to be changed in the near future.
Chertoff, who warned last week that one of the biggest threats to US security could come from Europe, said European counter-terrorism authorities acknowledge their countries “are both a target and a platform” for militants.
But over the last year he and his European counterparts had broadly agreed on what measures needed to be put in place including exchange of information about potential attackers and greater border security.
In an effort to stem militant recruitment, they had sought to understand the process of radicalization which could lead towards militancy, Chertoff said.
Highlighting one perceived difference between the United States and Europe, Chertoff said Muslims in the United States were well integrated into society. “I don’t think there is a perception that they are marginalized and we want to make sure they don’t feel marginalized,” he said.
But he said US authorities were paying particular attention to the potential for militant recruiting inside jails.
“Prisons are always a fertile area for recruitment of all extreme groups, whatever the ideology,” Chertoff said.
(Reuters)
Customers can log on to AA.com wherever their cell phone or PDA works without the need for a desktop or laptop computer.
Initially, customers will be able to utilise the mobile version of AA.com to check in for a flight, view their itinerary, check schedules, check the status of their flights, get information on destinations, weather or airports and contact American Airlines. Later this spring, further enhancements to the mobile AA.com Web site will enable travelers to book flights, change their reservations, view fare specials — even request upgrades and enroll in the AAdvantage programme — all from their web-enabled cell phone or other web-enabled device. Many pages also will be viewable in Spanish.
“With our new mobile AA.com site, customers will have access to American Airlines and AA.com virtually anywhere and at any time they can use their mobile devices. We are focused on offering convenient and efficient services, and this enhancement is just another example that underscores our commitment,” said Bella Goren, American’s Senior Vice President - Customer Relationship Marketing and Reservations.
Accessing AA.com on a mobile phone or device is easy by simply typing www.aa.com into an Internet-enabled browser. The system recognises when customers are accessing AA.com via a mobile device and redirects them to the mobile version of AA.com.
From the mobile home page, customers have easy access to many of the same features currently available on AA.com. The content is condensed, the design is simplified and the connection is fast, as the new mobile site is specifically designed to make it easier to navigate on a mobile device. If mobile users would like to access a full HTML version of the traditional AA.com site, they also have that option by clicking on the HTML link located at the bottom of the Web page.
January 17, 2008
Prospects for a speedy settlement in the tit-for-tat transatlantic clash over aircraft subsidies appeared dim on Wednesday as a case involving Boeing resumed at the World Trade Organization (WTO).
The European Union and the United States are pursuing competing complaints with the WTO over tens of billions of euros and dollars in state support provided to Boeing and Airbus, rivals who both posted record results in 2007.
While both sides could be found in violation of international trade rules if the WTO cases unfold to the verdict stage, industry and government sources said no meaningful negotiations were underway to resolve the issues.
As the WTO panel gathered to hear a second set of arguments in the European complaint against Boeing, Rainer Ohler, Airbus’s senior vice-president for public affairs and communications, accused officials of the US group of having imposed “unrealistic” preconditions on talks.
“We have suggested from the beginning that a balanced, negotiated settlement would be the best solution for all sides as, in a case of this complexity and scope, any delay in inevitable discussions benefits only the lawyers,” Ohler said.
Boeing, in turn, said its European Commission (EC) counterparts had offered no momentum towards negotiation.
“Thus far we have seen no evidence of an EC interest to resolve this dispute,” Boeing lawyer Robert Novick said.
The US and European aircraft makers compete in a market worth about USD$80 billion a year. Both recorded strong orders and deliveries in 2007, though they may suffer in 2008 if the global economy falters.
It remains unclear when the twin WTO dispute panels will release their initial rulings.
The panel in the case against Airbus, in which the United States alleges the company got grants and loans at unfairly favorable rates in the form of “launch aid”, is expected to release a descriptive section of its report to parties in May.
The two sides would then have a week to comment on the evidence included, before the panelists draw up their analysis and conclusions in an interim report, which could take weeks or months, officials said.
In the case against Boeing, which hinges on the provision of research and development assistance from NASA and the US Department of Defense, the WTO panel is expected to meet again for at least one round of questions before proceeding to the report-writing stage later this year.
A ruling issued in the Airbus case before the Boeing conclusions are finished could put the European Union at a disadvantage in any negotiations that do occur.
An EU official, who spoke on condition of anonymity, said it was possible the two reports would be issued together.
“It may make sense to deal with these issues more or less at the same time,” the EU official said.
(Reuters)
January 17, 2008
Airbus confirmed 2007 as a record year for plane makers on Wednesday by posting orders for 1,341 aircraft while boosting cost savings aimed at catching rival Boeing.
Boeing took top spot with 1,413 orders and has suffered less from a weakened dollar than Airbus, which has launched its Power8 cost-savings drive in response.
“These are enormous numbers; it was a staggering year. Now it becomes a question of how we manage the backlog,” Airbus chief Tom Enders told journalists.
“Power8 delivered cost savings very considerably ahead of schedule in 2007. The official version is more than EUR300 million euros; I can tell you it is close to EUR500 million,” he said.
The plane maker aims to cut 10,000 jobs and sell plants to lower costs. It said it had achieved 30 percent of its planned reduction in overhead positions in 2007, or 3,000 jobs, equally split between Airbus and its suppliers.
Yet despite the reductions achieved mainly through attrition, Airbus still needs to hire production workers and skilled engineers to deliver ambitious new projects.
The overall Airbus head-count of around 55,000 fell slightly in 2007, Chief Operating Officer Fabice Bregier said.
Airbus orders were valued at USD$157.1 billion at list prices. The company’s backlog stood at 3,421 planes or six years of production.
Airbus said its 2007 deliveries reached a record 453 aircraft, topping its forecast of 440 to 450 planes.
For 2008, Enders predicted a drop in orders but deliveries above 470 aircraft, including a target of 13 A380 superjumbos.
“We will put every effort into reaching our target for (13 A380) deliveries in 2008,” he said.
The delivery race is set to be a close contest this year as Boeing delays first deliveries of its 787 Dreamliner and Airbus pulls out all the stops to prevent a repeat of production problems which have delayed the A380.
Analysts pay close attention to deliveries since that is the point at which plane makers get paid for each plane produced.
The Airbus announcement came on a day when Boeing announced a second delay to its 787 Dreamliner, threatening to push deliveries of the new, hot-selling plane further back.
Airbus is recovering from a two year delay to its A380 superjumbo, which entered service last year, and has been forced to push back its A400M military airlifter by 6-12 months.
“We are fierce competitors, but if anybody can understand the problems our colleagues at Boeing are probably facing at the moment, it’s us. I wish (Boeing commercial airplane chief) Scott Carson and his team good luck,” Enders said.
He repeated that Airbus was planning further cost-saving measures to combat the value of the dollar falling further, to around USD$1.48 to the euro from USD$1.35 when the 2007-2010 restructuring plan was first announced.
The original plan calls for recurring operating savings of at least EUR2.1 billion by 2010 but the sliding dollar means this could fail to deliver the planned improvement in profit.
Enders said while the main savings target could still be met, it would be difficult to meet another target for a mid-single-digit 2010 return on sales at current dollar rates.
Bregier said the additional savings plan would be defined around the end of the first quarter.
Airbus’s net order tally was adjusted for 117 cancellations in 2007 as cargo carriers walked away from a freight version of the A380 and airlines began switching to a redesigned version of the A350, trading up from an earlier version.
Airbus received 290 orders in 2007 for the A350 XWB, a challenger to Boeing’s 787. That brought total orders for the mid-sized twinjet to 292 aircraft.
Sales chief John Leahy predicted more than 100 A350 orders in 2008 and 30 orders for the A380.
(Reuters)
January 15, 2008 in Airline Industry
Over the last year, close to a dozen airlines have announced plans to allow passengers to send text messages from their own cell phones. Passengers in Australia, France, Turkey, Ireland, Malaysia, India, and other countries are now using mobile devices in flight, or will be able to do so sometime in 2008. However, passengers in the United States will have to wait.
While many point to interference with ground networks, or the intrusiveness of chatty seat mates, the ability to send data to the ground is allowing Middle Eastern, Asian, and European business travelers greater chances to be productive on commercial jets than U.S. fliers, who are constrained by the FCC ban on cell phones in flight.
“Independent agencies have been testing mobile devices’ interference with cockpit communications and navigation equipment for the last five years. But with live systems now installed on passenger planes in a variety of countries, there is growing operational evidence that picocell-based systems can allow phones to be used in flight without harming a ground network or an aircraft’s avionics bus,” according to David Gross, author of two reports that have looked at the matter. “We know Wi-Fi is safe, particularly with some airlines using the technology internally to connect cabin security cameras to Electronic Flight Bags in the cockpit. However, GSM and CDMA are becoming equally important as text messaging is emerging as one of the first major applications for in flight connectivity. As long as the United States maintains its current policy banning cellular antennas from being used on jets, it is allowing other countries to leap ahead with in flight productivity, while facing mounting evidence that there is no safety benefit to passengers.”
The analysis of U.S. competitiveness in the sky is part of the firm’s recent report, “In Flight Text Messaging” as well as its forthcoming study “Airborne Picocell Networks”. More information about Freesky Research and the in flight connectivity industry is available at www.freeskyresearch.com
January 15, 2008
Two more US airlines withdrew part of their USD$25 each-way fuel surcharges on Tuesday further jeopardizing the efforts of top carriers to pass on their fuel costs to customers, a fare tracker said.
United Airlines, which was the first to raise its surcharge last week, and American Airlines rolled back their increases. Delta Air Lines, which had withdrawn its increase, later reinstated it.
As of midday on Tuesday only Delta, Northwest Airlines and US Airways retained the increased surcharges. Continental Airlines rolled back an increase on Monday.
“The bottom line is that this attempted increase is most likely going to completely fail by the end of the day,” said FareCompare Chief Executive Rick Seaney.
Airlines have struggled in recent months to offset record high fuel prices through fare increases and surcharges.
The faltering surcharge casts doubt on the ability of top airlines to transfer their record high fuel costs to customers as economic weakness threatens to erode travel demand. Fare increases and surcharges require widespread matching in order to last.
Airline shares were broadly higher on Tuesday with the Amex airline index up 2.05 percent.
(Reuters)
January 15, 2008
Business class-only airlines defended their strategies on Tuesday after one of their peers collapsed last month and a brokerage said a second was “doomed to fail”.
MAXjet, Silverjet and Eos were all launched in recent years to compete on the lucrative transatlantic business market.
But last month MAXjet filed for bankruptcy protection after being hit by rising fuel costs, weakening business traffic and tough competition from the likes of British Airways and American Airlines.
UK brokerage Daniel Stewart questioned Silverjet’s business model on Monday and said its shares would be worthless within a year because it would run out of cash.
But Silverjet Chief Executive Lawrence Hunt aid on Tuesday the airline was on track to enter profit by the end of March, had just had a record week of US bookings and was nearing its target of charging GBP1,100 pounds (USD$2,157) per seat.
Hunt said weakness in the US economy might be helping Silverjet by forcing corporations to look for cheaper alternatives to traditional business-class travel.
“We had a record sales week last week in the US,” he said. “We’ve seen a massive increase in corporate enquiries by companies looking to cut costs.”
Analysts at Blue Oar Securities said the demise of MAXjet should help Silverjet gain customers.
“Hardly a risk-free investment, but after yesterday’s fall to 35p, the shares are below net asset value of 48p a share and the possibility of an approach from one of BA’s European rivals should not be ruled out,” they added.
Eos operates at the top end of the business-class market with just 48 seats on each of its four Boeing 757s rather than the maximum of around 200, so is less likely to feel the benefit of business travellers trading down from the traditional carriers.
But Eos Chief Executive Jack Williams said January had started well, with planes 70 percent full.
“We’ve seen a pretty good bounce-back since the New Year,” he said. “We’re not running at full corporate break-even, but we are covering the flight variable costs.”
Williams said the tough competition that MAXjet had complained of had come as no surprise.
“You need to be careful when you enter a rich, premium market like London to New York,” he said. “We expected a competitive response, and we can compete with anybody.”
One London analyst said that while both Silverjet and Eos had strong business models, new routes would often take 18 months to build up profitable passenger volumes.
“You can burn through a lot of cash waiting for that,” he added. “These companies’ biggest enemy is time.”
(Reuters)