Getting a product from point A to point B in good condition for a reasonable price used to be the only thing that shipping customers really wanted. Those days, like 60-cent jet fuel, are long gone as customers require more sophisticated management of their supply chains.
Since 9/11, governments, airlines, freight forwarders and shippers have struggled with ways to improve air cargo security without impinging too heavily upon the flow of commerce. The Transportation Security Administration's soon-to-be issued rule expanding air cargo security throughout the supply chain and existing rules only now being implemented across the European Union are intended to strengthen barriers against terrorism. But the industry remains concerned about whether the new rules and the introduction of costly explosive detection systems will be more trouble than they're worth.
Low-cost carriers now account for about a third of the US market. For the most part, despite five years of restructuring and a few bankruptcy reorganizations, legacy carriers have yet to pare their costs down to the levels of JetBlue and Southwest.
Opportunities to use the adjective Byzantine are few and far between, but even a passing glance at the paperwork labyrinth that confounds the airfreight business process gives one ample reason to whip out that rare modifier. There are around 40 documents that must accompany most kinds of cargo, and a good part of this wood pulp destruction has nothing to do with the business part of the process: It is government rules and regulations that are responsible for the felling of vast forests to feed the voracious paper appetite of the airfreight industry.
Worldspan chairman and chief executive Rakesh Gangwal anticipates that the GDS industry will undergo "major structural changes" in order to meet the needs of a still deeply troubled airline industry. "The airlines are hard pressed," he said during a conference call with investment analysts. "There is a rip-roaring need to change the whole model in how booking fees are established. We have to adapt to new realities, and it's not something we can do over the next three, four or five years. We've got to bring the booking fees down now."
The road to hell is paved with good intentions, and when intentions mix with personal ambition that road can widen quickly into a 10-lane motorway. That's the way Europe's airlines see the European Union's year-old passenger rights legislation. What began as a limited effort to increase the amount of compensation in cases of overbooking morphed into something quite different: An array of new passenger rights and airline responsibilities that have left both groups angry and confused as to their respective rights and obligations in the event of a flight disruption.
FAA is projecting steady growth in the US airline industry over the next decade, topping out at 1 billion passengers in 2017. Last year a record 739 million passengers took to the skies, up from 690 million in 2004. Domestic enplanements are expected to grow 3.2% per year and international enplanements by an average of 5% annually for the remainder of the forecast period. "Aviation is in a period of robust growth," FAA Administrator Marion Blakey said at the agency's annual forecast conference in Washington yesterday.
Cyprus Airways narrowed its annual loss by 41.1% in 2005 to CYP23.2 million ($47.7 million) from a CYP39.4 million deficit in 2004 as cost reductions outpaced a slight drop in revenues. Turnover dipped 1.9% to CYP201.2 million as it shed one aircraft from its fleet. Expenses fell 4.7% to CYP229.3 million despite a CYP9.7 million rise in fuel costs.
IATA DG and CEO Giovanni Bisignani yesterday urged governments to reject a proposal by French President Jacques Chirac to place a tax on aviation to fund Third World development. Chirac repeated his suggestion at the opening of the Ministerial Conference on Innovative Taxation to Fund Development in Paris. In a statement, Bisignani said, "Even those countries that this initiative is supposed to help are opposed to the tax.
ICAO reappointed Taieb Cherif of Algeria as secretary general. His second three-year term will begin Aug. 1. The US had nominated William Voss for the position. Voss, formerly head of the terminal business service of FAA's Air Traffic Organization, currently serves as director of ICAO's Air Navigation Bureau.
B/E Aerospace was contracted by China Southern Airlines to convert six A300-600s from passenger aircraft to freighters. Deliveries will begin in the latter part of 2007. B/E's Flight Structures arm will develop the engineering and certification packages and manufacture required components while China Southern affiliate Guangzhou Aircraft Maintenance Engineering Co. will perform the conversions.
Swissport finalized an agreement with Ukraine International Airlines to operate jointly the Interavia ground handling company. Swissport will hold 51% of Interavia, which was launched last year by UIA and Airline Business Handling and is the leading ground handler at UIA's Kiev hub. Swissport already works with the airline at other airports.
Iberia said sales through its website increased nearly 39% in 2005, reaching €288.6 million ($342.6 million). Domestic customers generated more than 73% of online ticket revenue, a jump of more than 33%. Sales from outside Spain rose 57.4%. At present, 31 versions of the website are available to customers in Europe, the Americas and the Middle East.
WestJet's pilots, represented by the Pro-Active Communication Team, a nonunion organization affiliated with the carrier's nonmanagement employees, ratified a three-year labor agreement yesterday by an overwhelming 96.3% margin. The airline said the contract "will allow WestJet to maintain its low cost structure while addressing a number of challenges put forth by" the pilots.
United Airlines and TACA reached a codeshare agreement giving UA passengers access to TACA's entire network and TACA customers the opportunity to connect to destinations through "several" UA hubs including Washington Dulles, Los Angeles and San Francisco. Regulatory approvals are expected by the second quarter.
South African CAA appointed Zakes Myeza as its new CEO effective March 16. The body has been without a permanent CEO for the past three years. Myeza currently serves as executive director-finance and support services at the Johannesburg Development Authority. Nordam Group named Brian Beair director-aircraft asset management. Beair, reporting to Meredith Siegfried, VP-global sales and marketing, will oversee the procurement, placement and sale of rotables to support Nordam's worldwide repair divisions.
Bawag Leasing of Austria sold an ex-Augsburg Airways Dash 8-314Q to Austrian LCC InterSky. Meridian Jet Prop was the seller's exclusive worldwide agent.
Pilots for GoJet Airlines, a St. Louis-based Regional operating as United Express, chose to be represented by the International Brotherhood of Teamsters. The IBT said it also is seeking to represent the carrier's cabin staff.
German Regional Cirrus Airlines will implement e-tickets on domestic flights starting March 26. It also will add a second ex-Swiss International Air Lines Embraer 145 to its fleet.
Mesa Air Group signed Hendrix Miyasaki Shin Advertising and Bright Light Marketing Group of Hawaii to market its Hawaiian interisland services scheduled to launch in the second quarter.
Star Navigation Systems Group signed an MOU with TAP Maintenance and Engineering under which, subject to a final agreement, TAP will market Star's In-Flight Safety Monitoring System to the airline's existing client base and provide installation. ISMS collects aircraft data inflight, analyses it for anomalies and transmits it to Star's ground station. An alert is sent to the airline if a problem is anticipated or an incident has occurred, according to Star. Separately, Star signed an MOU with Kharkov State Aircraft Manufacturing Co.
