Evergreen Aviation Technologies Corp., a Taiwan-based joint venture between EVA Airways and GE, will carry out the conversion of three 747-400 passenger jets into 747 Large Cargo Freighters that will be used to transport major assemblies for the 787, Boeing said. Modification of the first will begin about mid-year with certification expected during 2006. Separately, Boeing said it selected Gamesa Aeronautica of Vitoria, Spain, as a partner in designing the structure of the 747LCF.
Aloha Airlines said its 30 dispatchers and schedulers, represented by the Transport Workers Union, ratified a new 52-month contract through April 30, 2009. However, the 250 mechanics and inspectors represented by IAM voted down a tentative agreement.
American Airlines will add a second nonstop flight between Dallas/Ft. Worth and Sao Paulo June 9. The new flight will be operated five days a week during peak season and thrice-weekly between Sept. 7 and Nov. 22. The route will be served with a 767-300.
ITA Software will charge airlines 40 cents per segment booked through its new "alternative" GDS, chief executive officer Jeremy Wertheimer said. That's about 10% of what the traditional GDSs charge. And unlike other alternative booking methods, some of which involve direct connections between airlines and major travel agencies, ITA plans to develop a full-service GDS, with hotel, cruise and car rental participation.
Last year, ATW introduced a new award to recognize airlines achieving a commercial rebirth through a life-changing transformation. The first recipient, Aer Lingus, successfully implemented a low-cost business model, demonstrating that a traditional flag carrier can "change its spots." This year's winner, Air New Zealand, likewise survived a near-death experience in 2001 to remake itself into a profitable and innovative competitor across different markets.
Thirty-five years ago, the Grand Duchy of Luxembourg's national carrier Luxair and a handful of other investors got together with the idea of creating a cargo airline. The little airline they launched in 1970, Cargolux, has grown beyond its founders' wildest expectations to become Europe's largest all-cargo carrier, the 11th-largest airline in the world in terms of FTKs and ATW's 2005 Cargo Airline of the Year.
The rapid embrace of low-cost carriers by European travelers has sent shockwaves through the airline food chain, and although embattled former flag carriers may be shouting the loudest, the impact also is felt at those that formerly operated under the radar. Lacking a government owner/protector or a defendable niche, many of Europe's small privately owned airlines are in a competitive no man's land, caught up in the slugfest between money-losing legacy carriers and their LCC tormentors.
This year's Regional Airline of the Year is a company that has completed a successful business restructuring during one of the most difficult periods in the history of commercial aviation. After losing $59 million in the 2001 and 2002 fiscal years, Mesa Air Group recovered to post profits totaling $51 million over the next two years, including $26 million in the year to last Sept. 30. Revenues, meanwhile, rose more than 70% from $523 million to $896.8 million and passenger enplanements more than doubled to 10.2 million.
Don't look now, but US legacy airlines are in better shape to challenge their low-cost rivals than at any time since the start of the millennium. Sure, that sounds farfetched. After all, in many respects the US legacy carriers entered 2005 in much the same way that they entered 2004: Awash in a sea of red ink, facing continued yield erosion and with a cost structure that is not sustainable in today's market. Without the bank of GE, half of them probably would be in liquidation by now.
Remarkable may be the only word to describe the transformation of Air France Group, now Air France-KLM Group, over the past decade as it has climbed steadily into the corporate stratosphere, simultaneously exploiting geographic and national advantages while staking its future on a philosophy of aggressive global growth-the kind of strategy that many had considered impossible in the rapidly maturing network airline industry.
A new epoch in the air traffic management technologies and capabilities often associated with the term Free Flight finally is arriving. ATC providers around the world will be moving with increasing speed to operational use of a satellite-based system that sets aircraft free from the limiting tyranny of locally positioned short-range, line-of-sight navigation aids and radars in favor of a ubiquitous "god-to-ground" technology for surveillance, navigation, precision approach and aircraft separation.
Predictive maintenance solutions for aircraft and engines may be as common someday as yield management systems, but today's cost-conscious environment hampers investment in any product that can't offer an immediate payback. Carriers using the software freely admit the difficulty of quantifying the actual savings in reduced delays or cancellations and improved dispatch reliability. Yet customers with whom ATW spoke confirm its value.
There is an old handyman's saying, equally applicable in our era of programmable televisions and coffeemakers: "When all else fails, read the directions." To its credit, Delta Air Lines has become the first US legacy carrier to read the directions. Its domestic fare reform unveiled last month (see News Briefs, p. 9) belatedly acknowledges what business travelers, Wall Street analysts and just about everybody not employed in a network airline revenue management department have been saying for years-the pricing model is fractured beyond repair.
A sense of style and a commitment to service quality long have been the traits required to remain in the top ranks of the world's airlines. Today, however, courage must be added to those requirements; investing in a major passenger service product upgrade during times of escalating competition and challenged yields requires the boldness to act on the belief that only a superior product will do in the battle for the shrinking premium passenger group.
Jazz brings together a variety of sounds, blending them into a rhythmic pattern of music, merging a wide range of chords and instruments into what could be called a harmonic convergence. The same thing could be said about Air Canada Jazz, a Regional carrier that over the past four years consolidated four airlines with disparate fleets, thousands of employees, separate languages and distinct corporate cultures to create a single product.
ABX Air selected Quint Turner as CFO. ACE Aviation Holdings appointed Montie R. Brewer president & CEO-Air Canada, Jon Turner VP-maintenance-Air Canada, Duncan Dee senior VP-corporate affairs & CAO-ACE, Bradley Moore president & CEO-Air Canada Ground Handling Services and Claude Morin president & CEO-Air Canada Cargo. Alaska Airlines welcomed Caroline Boren as MD-corporate & strategic communications.
This year's winner of ATW's Market Leadership Award deserves credit for launching a travel revolution not simply in one country but across an entire region. In just three years, AirAsia has shown that the Asia/Pacific is ripe for low-fare exploitation, defying conventional wisdom that the LCC model would not work in an area characterized by tightly managed bilateral arrangements. It has made air travel affordable to hundreds of thousands of people and has spawned a number of imitators that will spread the revolution even farther.
Some weeks before the hectic holiday travel period, a British newspaper headlined an article on two of London's airports, "Wonder: Stansted airport . . . Blunder: Heathrow airport."
Boeing's catchphrase in the early 1990s was "working together," but for Singapore Airlines Group Chief Executive Chew Choon Seng it has become "working together quickly." Speed is needed to insulate SIA from the relentless shocks that have ravaged the airline industry and tourism in Southeast Asia over the past four years: 9/11, avian flu, the Bali bombing, SARS and the tragic tsunami in December.
Travelocity is taking fare transparency a step further with a new tool called Flight Navigator. The tool will tell shoppers when three or fewer seats are available at a particular fare with an eye toward eliminating one of the "crap shoot" aspects of buying air travel.
For Christian Heinzmann, these are uneasy times. “The most difficult year Luxair has ever experienced� was 2003, the CEO of Luxembourg’s national carrier told ATW recently, and although he expected the parent company to show a positive operating result for 2004, with the airline breaking even, he recognizes that much remains to be accomplished.
Saying that the airline industry's fortunes will improve somewhat in 2005 is overly optimistic for some carriers while being a bit too dark for others. Yet, on average that's what the year will bring...unless.
Dynamic packaging, a hot topic in the US for a couple of years, has been slow to take off in Europe but is widely anticipated to become a force. For the package tour and charter airline segment, already struggling to come to grips with changes wrought by the advent of low-cost carriers, that looms more as a threat than a promise (ATW, 11/02, p. 30).
At the first annual Association of Asia Pacific Airlines Assembly of Presidents since the retirement of DG Richard Stirland, attendees heard his successor, Andrew Herdman, deliver a message that might have been written by Stirland. Perhaps that's not so surprising given that Herdman, like his predecessor, is a product of the Swire/Cathay Pacific Hong Kong community, having served in a number of positions at both companies, most recently as Swire Pacific's director-corporate affairs and a director of John Swire & Sons.
