Singapore Airlines One good idea can propel a company to the top. Staying there, however, is another story. Companies that want to remain champions over the long term need to innovate and improve. They must constantly raise the bar, not only for their competitors but also for themselves. To stand still is to stagnate. That approach perfectly describes this year's Airline of the Year, Singapore Airlines.
Malaysia Airlines "Depend upon it, sir, when a man knows he is to be hanged in a fortnight, it concentrates his mind wonderfully." Samuel Johnson's pithy observation resonates across time and distance as the recent history of our 2008 Phoenix Award winner, Malaysia Airlines, makes clear.
WHEN INDIAN LIQUOR BARON VIJAY MALLYA LAUNCHED KINGFISHER AIRLINES IN 2005, MOST PEOPLE IN THE AIRLINE BUSINESS SAID IT WAS JUST AN ATTEMPT TO GET PUBLICITY FOR HIS BEER OF THE SAME NAME IN A COUNTRY WHERE DIRECT ADVERTISING OF LIQUOR IS BANNED AND COMPANIES HAVE TO RESORT TO SURROGATE MEASURES TO BUILD BRAND RECOGNITION. ANOTHER REASON FOR SKEPTICISM WAS MALLYA'S LARGER-THAN-LIFE PERSONA THAT IS ASSOCIATED WITH LUXURY YACHTS, SWIMSUIT CALENDARS AND THE GOOD LIFE.
Even people with creative jobs occasionally wonder what they might accomplish if work didn't get in the way. SITA, the airline-owned information technology company, is unleashing the power of "What if?" with SITA Lab, a new research and development facility based in Geneva, Switzerland, that is liberated from day-to-day product development. The company said the goal of the SITA Lab is "to drive innovation for the air transport industry working both independently and in partnership with others."
Firms that acquire, repair and resell used parts reduce the cost burdens of airlines in several ways. Parts move efficiently from where they are expensive excess to where they are affordable requirements. Lifetime value of old parts is exploited fully. Airlines need not stock inventories for exceptional events when parts can be obtained reliably. And the value of retired aircraft is maximized as all useful components are extracted.
LIFE IS RIFE WITH EXAMPLES OF short-term projects turning into long-term templates, initiatives that started out tackling a specific issue and wound up governing the way things would work in general. Southwest Airlines Purchasing VP Ray Sears has seen it happen. The carrier set out not long ago to cut the cost of servicing aircraft at its airport locations. It was spending in the neighborhood of $50 million a year to do things like clean airplanes, verify tickets, provide wheelchair services and employ skycaps.
Star Alliance It is common knowledge that a rising tide lifts all boats, but does that hold true for much heavier equipment? In the spring of 1997, five visionary airlinesLufthansa, United Airlines, Thai Airways, SAS and Air Canadaopted to test those waters, announcing the formation of Star Alliance and setting out to prove that cooperation beyond bilaterals has a place in this most competitive of industries.
Denis Vercherin joined Snecma Services on Oct. 1, 2007, as chairman and CEO. He recently spoke with Airline Procurement about the company's standing and his strategy for future growth. (Edited for clarity and length.) AP: Can you please describe Snecma Services' MRO business and expertise with CFM56 engines?
Flight Safety Foundation It is impossible to overstate the importance of safety in commercial aviation. Despite becoming a routine part of modern life, air travel is still a highly complicated technical exercise in which mistakes can and do lead to catastrophic accidents. Safety always must be the foremost concern of those employed in and around the industry and aviation regulatory agencies.
Amadeus unveiled a three-year, full-content program in Europe and said 34 airlines have signed up for it. Among them are Air France-KLM, Iberia, Alitalia, TAP Air Portugal, Air Europa and Malev. The new agreement is an extension of the one-year Amadeus Full Content Option introduced in 2005. Similar to the DCA-3 agreements introduced by GDS companies in the U.S. in 2003, the new Amadeus deal provides airlines with lower distribution costs in exchange for the full range of their fares.
When an aircraft gets a major engine overhaul, the disassembly, inspection, testing and other manufacturer-approved services and regulatory mandates typically result in invoices topping seven figures. Engines drive more than 50% of maintenance material spending for aircraft and about 60% of the cost to revamp them is for parts. Given the financial pressures airlines face today, the cost of those parts is becoming a huge issue, pushing many toward sources other than the original equipment manufacturers. Thus we have the PMA proposition.
Scotland's City Star Airlines announced Wednesday that it has ceased operations until further notice. The airline said in a statement that it was forced to ground one of its four Dornier 328s following a November collision with mobile passenger steps. According to press reports, a second aircraft was impounded at Aberdeen Airport Wednesday. "Unfortunately, the [November] incident has had a major knock-on effect and we have simply not been able to recover from this," MD Runar Fossadal Arnason said. City Star served three Norwegian destinations and operated charter services.
Kolej TAFE Seremban signed an MOA with AirAsia to support maintenance engineering training at AirAsia Academy. Program includes EASA Part 66 module 1-17 training for DCA certification. Agreement offers TAFE's workshop facilities for modules 6 and 7.
VLM Airlines carried 745,781 passengers last year, up 9% over 2006. Scheduled passengers rose 6% to 697,781 while the number flying on charter or ACMI flights climbed 62% year-over-year.
International passenger traffic (RPKs) increased 7.4% in 2007, up 1.5 points over 5.9% growth recorded in 2006, according to IATA, which announced full-year traffic figures yesterday. Average load factor was 77% last year, up 1 point from 2006 and an all-time record. "This trend will likely end in 2008 as demand growth is forecast to slow to 5% while capacity rises 5.2%," the organization said.
Midwest Airlines parent Midwest Air Group said yesterday that the US Dept. of Justice has completed its investigation of the company's acquisition by TPG Capital and Northwest Airlines, clearing the way for the sale's closing as early as last night ( ATWOnline, Dec. 10, 2007). Trading of Midwest Air Group stock on the American Stock Exchange concluded as of the close of trading yesterday. "Shareholders of record. .
L'Avion celebrated its first anniversary this month and said it transported more than 34,000 passengers in its first year, with a 79% load factor achieved last month. It will introduce a second 757-200 configured with 90 business class seats on Jan. 20, when it will operate Paris Orly-Newark.
Indian government relaxed certain industrial foreign investment rules and now will allow foreign investors to hold 100% of MRO and training organizations dedicated to civil aviation activities. Foreign direct investment in commercial airlines will continue to be capped at 49%, with nonresident Indians allowed to hold 100% as long as no foreign airlines are participating. FDI in ground handling enterprises will be capped at 74%.
Alaska Air Group is not interested in participating in the consolidation rumored to be facing the US commercial aviation industry. "For us, the best future appears to be to remain independent," AAG Chairman Bill Ayer told The News Tribune.
Norwegian took delivery of the first of 50 737-800s. Aircraft is on lease from Babcock & Brown. Norwegian will lease seven more along with its order for 42 directly from Boeing ( ATWOnline, Aug. 31, 2007). Norwegian flew 430 million RPKs in December, a 45% increase over the year-ago month. Capacity climbed 32% to 559 million ASKs and load factor rose 7 points to 77%. Yield fell 15% to NOK0.60 ($0.11).
EADS and Airbus CFO Hans Peter Ring will relinquish his role at the aircraft manufacturer and stay on at the parent company. Airbus Chief Controlling Officer Harald Wilhelm will become CFO on Feb. 1.
GuestLogix will deploy its Mobile Virtual Store onboard solution across the fleet of Sweden's Skyways under a multiyear agreement. Technology features wireless POS devices and application service to streamline onboard sales transactions. Klarago AB assisted in the deal.
Malaysia Airlines flew 3.55 billion RPKs in December, down 0.9% from the year-ago month. Capacity fell 2.3% to 4.8 billion ASKs, lifting load factor 1.1 points to 73.9%. Airberlin transported 1.9 million passengers in December, up 16.6% from the year-ago month. Load factor rose 3.2 points to 71.7% and unit revenue climbed 2.2% to 4.55 euro cents. ATA Airlines flew 397.4 million scheduled RPMs in December, up 8.7% from the year-ago month. Capacity rose 4.4% to 482.9 million ASMs, lifting load factor 3.2 points to 82.3%.
