Aviation industry stakeholders and fuel experts are split over how to ensure biofuel access for air transport to help airlines reduce their carbon footprint. At issue is the concern that as biofuel production ramps up globally, industries other than aviation, where demand is larger, will control supply, leaving aviation short. “We need to talk about a sectoral allocation of biofuels,” argues Stephan Singer, director, global energy policy at WWF International. “We need to get biofuel out of the road transport,” he says, so aviation can tap supply.
The financial and operational benefits of the NextGen modernization effort will be slower to emerge than previously expected, according to FAA's latest progress report. There is no doubt that NextGen will eventually deliver impressive savings and greater efficiency; however, due to a combination of factors, the FAA has shifted its forecast for achieving these benefits by two years. The latest guidance is part of the agency’s annual NextGen implementation plan.
Click here to view the pdf Fuel Watch: Global Jet Fuel Prices (midpoint) As of March 21, 2012• compared with previous week and previous year cts/gal prev. week prev.
After difficult negotiations, industry officials believe they may be able to meet the International Civil Aviation Organization’s (ICAO) goal of devising the first carbon dioxide certification standard for aircraft in time for next year’s general assembly.
Even though China is holding Airbus aircraft orders hostage because of its opposition to the European Union emissions trading system (ETS), Boeing is warning of the risk of a trade war. “This is not healthy for anybody,” Jim Albaugh, president of Boeing Commercial Airplanes says of the controversial EU system. “Nothing good is going to come of this.”
India’s aviation regulator is scrutinizing Kingfisher Airlines’ safety practices as the financially troubled carrier struggles to maintain operations. “We have to look at how they are meeting safety norms. The [aviation] regulator continues to examine each Kingfisher flight for safety,” Civil Aviation Minister Ajit Singh says. And “if required, the license can be canceled, as passenger safety is a top priority,” the minister warns.
Boeing is recommending that NASA begin studying liquified natural gas (LNG) as a potential fuel for aircraft entering service in 2045 and beyond. In a study completed for the agency, a team led by Boeing Research & Technology concluded cryogenic LNG may offer fuel-burn and emissions reductions relative to conventional jet fuel, as well as potential cost and availability benefits.
Southwest Airlines wants to start international service at Houston Hobby Airport and is willing to spend more than $75 million to build an international terminal there to make it happen within three to four years. The airline is waiting for a decision from the Houston Airport System, the mayor and the city council, but to get approval it will have to overcome the objections of a potentially influential opponent with a big stake in service from the city: United Airlines.
Lufthansa Cargo has signed a letter of intent to sell its 25% share in money-losing Jade Cargo to Shenzhen-based Unitop Logistics Co. CEO Karl Ulrich Garnadt expects the sale to be completed in the second half of this year. Jade Cargo operated six Boeing 747-400Fs until being grounded in late 2011. Talks with several potential investors failed. Lufthansa Cargo and the largest shareholder, Shenzhen Airlines, have been unable to agree on a recapitalization.
AMR Corp. has confirmed that Embraer and Brazil’s export bank BNDES have agreed to take possession of 18 ERJ-135 regional jets grounded by the U.S. operator’s American Eagle Airlines unit, and that talks continue on the return of more aircraft from its ERJ fleet.
Oil prices will continue to be volatile for the near future, due to the temperamental reality of supply and demand. “Price volatility is a new thing, and it’s terrifying,” says Robert McNally, president of the Rapidan Group, a Washington-based energy market policy research firm. Throughout most of the 20th century, the Organization of Petroleum Exporting Countries (OPEC) maintained enough spare capacity to control oil prices. The price spike of 2008, when crude oil prices surged to $147 per barrel, proved that OPEC ran out of spare capacity in peacetime, says McNally.
New York-based JetBlue Airways and Japan Airlines (JAL) reached an agreement last week to place JAL’s code on the low-cost carrier’s flights in the U.S., the carriers disclosed in a March 19 filing with the U.S. Transportation Department (DOT). The code-sharing out of New York John F. Kennedy International Airport and Boston Logan International Airport would begin April 22 if the carriers receive the required authorization from the DOT. The airlines in mid-February announced an interline agreement that did not include code-sharing.
Air France hopes to conclude agreements with its myriad labor unions by June to clear the way for restructuring the airline. The airline says it has now finalized “framework and methodology agreements” that will guide talks with labor groups, including pilots, cabin crew and ground personnel.
Aircraft lessors and financiers are jittery about rising production rates at Airbus and Boeing, worrying that the market could be flooded with an oversupply of jets that would dilute the value of their fleets and push down lease prices.
A senior official at the U.S. export credit agency says he would like to see the government take a smaller role in underwriting aircraft loans, but issued a strong defense of the program’s effectiveness. “Nothing would make me happier if everyone else took bigger slices” of aircraft loans, said Robert Morin, VP for transportation at the Export-Import Bank of the United States. “Clearly it’s not healthy in the long term for export credit agencies to be doing so much.”
Canada’s Bombardier and Chinese airframer Comac have signed a definitive agreement to collaborate in four key areas on their largest commercial aircraft programs, the 110- to 130-seat CSeries and the 168- to 190-seat C919.
The Indian and Russian governments appear to be taking policy steps to express their opposition to the European Union’s move to include airlines in its emissions trading system (ETS), with carriers caught in the cross-hairs.
U.S. Sen. Lindsey Graham (R) was a co-sponsor of Export-Import Bank legislation that the Senate rejected March 20. He was also one of 44 senators who killed its chances of passing. Graham says he voted no to enable Republicans to make changes to the bill that would advance its chances of passing both in the Senate and in the House.
Boeing Commercial Airplanes (BCA) is expanding the C-17 engineering workforce at Long Beach, Calif., by 10% in the next two to three years to support the commercial development of the Boeing 737 MAX and 787 family derivatives.
The International Air Transport Association (IATA) downgraded its forecast for industry profitability in 2012. The body expects airlines globally to make a combined $3 billion profit, down from $3.5 billion as predicted earlier. But it now expects airlines to have posted a $7.9 billion profit in 2011, compared to its earlier forecast of $6.9 billion as Chinese carriers performed much better than expected.
