Emirates rules out Airbus A380 Freighter for cargo arm

SOURCE:Flightglobal.com By Max Kingsley-Jones

Emirates' cargo arm is unlikely to revisit the Airbus A380 Freighter should the programme be revived, as it is unconvinced that the aircraft has enough to offer in the cargo role as now planned, reports Flight International magazine in its 6 November issue.

The Dubai carrier was a launch customer for the A380F in 2001, placing an order for two freighters as part of its original deal for the ultra-large aircraft that included 20 of the passenger variant.

However, in 2006, Emirates was the first A380F customer to drop its order in the wake of delays in Airbus finalising the definition, and later last year placed orders for up to 20 Boeing 747-8Fs. Since then Airbus has lost all the other A380F customers and has deferred the service entry until at least 2014.

Although Emirates said when it dropped its A380F order that it would "have another look" when the design was completed, Emirates senior vice-president cargo Ram Menen says that the aircraft will not figure in its future plans unless there is "a drastic improvement" in its specification.

In an interview with Flight International ahead of this month's Dubai air show, Menen says: "I like the A380F for its volume, but little else - its numbers have got to change a lot for example, the weight."

Menen says that the airline originally committed to the A380F because it had not expected Boeing to develop a successor to the 747-400F, but that changed in 2005 with the launch of the 747-8F.

"The 747 is a lot more flexible as it can be handled at virtually any airport, whereas the A380's upper-deck loading is a challenge as not many airports will have the equipment to do that."

Emirates has 19 freighters on order - one 747-400ERF, 10 747-8Fs and eight 777Fs. Menen says that the drive to boost the airline's all-cargo fleet is partly due to the fact that it has so many passenger A380s on order.

"The A380 passenger aircraft has reduced belly cargo volume. We are in a transition from freighters being supplemental to our belly cargo capacity to them being the larger contributor to our cargo volume."

Martinair to pilot eco-driven maintenance package

By David Kaminski-Morrow

Dutch carrier Martinair estimates that it has saved up to $2.2 million in fuel costs over the past year after conducting a year-long test of on-stand engine washing for its aircraft fleet.

Martinair has been co-operating on the project with Pratt & Whitney and Amsterdam Schiphol-based Stella Aviation Technics, which claims to be the first independent maintenance company to offer an ecological package of services aimed at reducing environmental damage.

Stella managing director Coen Smit sees the engine wash as a way for the company to move into more specialised operations

The engine wash involves connecting a nozzle array to the nacelle which directs high-pressure water from a portable trailer through the fan, washing off internal contaminants which reduce the compressor’s efficiency. An effluent collector behind the engine collects and filters the run-off, which is returned to the tanks for recycling.

Martinair believes that the project, initiated in May last year, has decreased fuel burn on its fleet by 2,400-3,300t and generated the additional benefit of cutting carbon dioxide emissions. This equates to a cost saving of $1.6-2.2 million.

Stella managing director Coen Smit sees the engine wash as a way for the company to move into more specialised operationsThe engine wash involves connecting a nozzle array to the nacelle which directs high-pressure water from a portable trailer through the fan, washing off internal contaminants

“If an A-check doesn’t run on time, the first thing you end up cancelling is the engine wash,” said Martinair vice-president for maintenance and engineering Paul Horstink, speaking to ATI, flightglobal.com's sister premium news source, during a demonstration of the system at Schiphol.

Typically the wash programme comprises three cycles, each lasting around 90s, and the whole operation – from set-up to dismantling – can be performed in 60-90min. Martinair operates a range of aircraft and Horstink says the system can handle its entire fleet, including the fin-mounted engines on its Boeing MD-11s.

Stella Aviation Technics is an equal partner in the strategic alliance European Maintenance Solutions, formed a year ago, which includes European Aviation and Louro Aircraft Services and which concentrates on a network of some 35 line-maintenance stations.

The company is intending to consolidate a range of fuel-reduction maintenance activities into an ecological package. Martinair will participate in a pilot programme to refine this package, after which it will be put in place across the network.

“We’ll definitely roll this out on our stations,” says Stella managing director Coen Smit. “It’s a different way of doing aircraft maintenance – it’s not just safety but also fuel savings. We believe this is the upcoming market in maintenance.”

He sees the engine wash as a way for the company to move into more specialised operations, adding that diverse services are a “necessity” in the cyclic aircraft maintenance business.

Smit says the pilot programme will begin in a month or two and the initial phase will include the company’s Paris, Madrid and probably its Frankfurt stations. “Quite a few airlines are interested,” he says.

“Martinair took the risk to be the first European airline to start seriously reducing emissions. Initiatives like this should be rewarded. Investing in these kinds of washes and actions means investing in a lower fuel consumption and a cleaner environment.

“Our ambition is, together with Martinair, to build up this ecological package to a stage that, at yearly or half-yearly intervals, aircraft will undergo a series of maintenance actions resulting in the aircraft operating maintenance-wise in the most efficient way.”

AirAsia X launches

SOURCE:Flightglobal.com By Brendan Sobie

New long-haul low-cost carrier AirAsia X has launched commercial services, with its maiden flight taking off from Kuala Lumpur tonight (2 November) for the Gold Coast in Australia.

The carrier, which is part-owned by Malaysia’s AirAsia Group and Sir Richard Branson’s Virgin Group will initially operate four weekly flights on the Kuala Lumpur-Gold Coast route with a used Airbus A330-300 configured with 279 economy and 36 premium economy seats.

Here the aircraft is towed from the gate at about 10:00pm Malaysia time this evening as it prepares to depart on the maiden scheduled flight.
The flight is scheduled to land in Australia tomorrow (3 November) at 07:40 Queensland time. AirAsia X, which was conceived early this year by AirAsia founder and its chief executive Tony Fernandes, has 15 new A330-300s on order and is expected to soon place an order for up to 25 Airbus A350 XWBs.

Flights to China are expected to commence before the end of this year followed by flights to the UK via the Middle East after the A330 is delivered in the second half of next year.

Fernandes (sixth from the right) celebrates prior to boarding the first flight with AirAsia Group deputy chief executive Kamarudin Meranun (fourth from the left), Australia High Commissioner to Malaysia Penny Williams (seventh to the right) and AirAsia X chief executive Azran Osman-Rani (third to the right)

Emirates seeks A380 and 747-8 weight control

By Victoria Moores

Emirates president Tim Clark is optimistic that Airbus’ A380 weight-reduction programme will be successful, but outstanding weight concerns are hampering the airline from committing to the Boeing 747-8.

Dubai-based Emirates is due to take delivery of its first Airbus A380 next August. This will be followed by a further four in 2008 and within two years Emirates will operate 22 of the type.

Speaking at the World Air Transport Forum in Cannes, Clark said: “It is six tonnes overweight, that’s a fact about the A380, but the good thing about it is that Airbus has been working very hard to take weight out of the aircraft.

“We are very pleased to see that there is a definitive weight-reduction programme over the next few years to reduce the manufacturer empty weight by a few tonnes. Of course, that is of great interest to us and I am optimistic that they will get 50% of that weight out, maybe more.”

Clark is eager to take delivery of Emirates’ first A380. He says he is immensely relieved that the first aircraft has been delivered and describes Singapore Airlines’ A380 cabin configuration as “an absolute show-stopper”.

He remains tight-lipped on Emirates’ initial A380 routes, while awaiting definitive dates from Airbus. But he says: “The aircraft that we are taking is the long-range version, so that will be operating on our very long-haul network to New York and Australasia. It may be flying, when we first get it, on some of our European operations.”

Emirates will operate its A380s in three configurations. Its crew rest-equipped long-range versions will house 489 passengers in a three-class configuration, while the non-crew rest version will accommodate 531 passengers. Emirates is also planning to operate some of its A380s in a two-class layout, with 617 passengers.

Clark says Emirates is still interested in the larger A380-900, which he claims would be a simple, but low-demand, stretch. Emirates would configure the aircraft with 531 seats in three classes or around 700 in a two-class layout.

He says: “We are still interested in [the A380-900]. We could do with a few of those now. It is an easy one to do because the wing is there, the propulsion is there. All they need to do is stretch the fuselage and ‘bingo’. I am sure it will come.

“There won’t be many of us who want it, but at that point it doesn’t matter because the manufacturing economics become incremental. They’ll have gone through the 200 or 300 they need to break even and beyond that, to stretch the aircraft, would be a $2-5 billion investment. We’d take it straight away.”

Clark says Emirates would consider the 747-8 if it met the airline’s requirements, but he is again concerned about weight. He says: “It is not there yet either. We are not ready to sign a contract. We’ve got to be sure that they would deliver the aircraft on the table at the moment, which will require some copper-bottomed guarantees.”

Emirates is also working with both Boeing and Airbus to find ways of cutting controllable weight across its in-service fleet, evaluating options such as shifting some of its paper literature into its in-flight entertainment system.

Clark says: “We are looking at multiple ways to take weight out of the aircraft – that’s weight that we control, like catering, galleys, carts, carpets, seat weight, water, magazines. We are working with both Boeing and Airbus to find ways and means of stripping weight out from the aircraft in a very pro-active manner.”

Losses confound Pakistan Airlines chief

Karachi: Six months into the job, the head of Pakistan International Airlines (PIA) said he was still wondering how to turn the company around as losses since the start of 2006 exceed half a billion dollars.

PIA chairman Zafar Ahmad Khan said he was "confused and disappointed" after the airline on Wednesday reported a quarterly loss of Rs3.2 billion, taking its accumulated loss from the start of last year to Rs35.5 billion ($584.3 million).

That total is about 2.5 times the market capitalisation of the state-run company.

"Right now there is disappointment over the results but this is reality and now we have to come up with a new game plan and new techniques," Khan said.

His predecessor Tariq Kirmani resigned in March 2007 in the wake of a humiliating ban by the European Union on most of its aircraft from flying to the continent because of safety concerns about its ageing fleet.

Ageing planes

The ban was lifted in June for specific Boeing 747s and Airbus A310s. The EU ban did not apply to the carrier's fleet of Boeing 777s.

Khan said while privatisation of PIA was 'way down' on the government's agenda, he personally would prefer it.

"I come from a school of thought that these institutions should be privatised, but this is my personal view," he said.

Khan gave no clues as to when he expects PIA, which has been losing money since 2005, to turn profitable.

"I am confused right now, disappointed, and was hoping the airline would do better in these three months and it is my responsibility," he said.

"However as long as I am sitting in this chair, I will look at the future and I will want to make plans in the best interest of PIA." Khan said for now PIA's top priority was safety and a fleet replacement plan that could help reduce costs by getting rid of old, fuel guzzling aircraft.

PIA plans to replace its Boeing 737-300 fleet with seven new Airbus A320-200s leased from Kuwait's Aviation Lease and Finance. Deliveries are expected in 2009.

PIA plans to then replace its fleet of Boeing 747s and finally its Airbus 310s, Khan said.

Khan said cutting cost by laying off some of the 18,200 employees at PIA, which has a fleet of 42 aircraft, was not an option he was looking at right now.

"I reckon by international standards, PIA does have more people per aircraft. Down the road we will look into that, but this is not a priority or problem number one right now."

Abu Dhabi airport passes security audit programme

Abu Dhabi: Abu Dhabi International Airport (ADIA) has successfully passed the security audit programme administered by the Internal Civil Aviation Programme (ICAO). Mohammad Ganem Al Gaith, director-general of the General Civil Aviation Authority (GCAA) said: "Abu Dhabi International Airport's impressive compliance with ICAO's Universal Security Audit Programme is a testimony to the professionalism of the Airport management and staff and the high efficiency of the security system in place.

Jet Airways launches New Delhi - NY flights

Jet Airways announced the launch of a daily flight from New Delhi to New York’s John F Kennedy (JFK) International Airport, via its hub in Brussels. Jet Airways already operates daily flights on the Mumbai-Brussels- New York (Newark) sector. With the induction of this new daily Delhi- Brussels - New York (JFK) service Jet Airways will further complement and enhance the airlines’ services offering its passengers a second flight to New York city.

At Brussels, flights will be synchronized in order to provide passengers a seamless transfer between Delhi, Mumbai and Chennai to cities in North America - New York (JFK), Toronto and New York (Newark).

For the Delhi - New York (JFK) flight, Jet Airways will use a brand new Boeing 777-300 ER aircraft, which has been especially configured in a three-class configuration for international operations.

Jet Airways will operate into American Airlines’ brand new terminal at JFK and passengers will be able to connect to the American Airlines network.

Germany agrees to move Lufthansa cargo hub to Russia

FRANKFURT (AFP) - Germany has accepted the transfer of Lufthansa Cargo's central Asian hub from Kazakhstan to Siberia, bowing to pressure from Moscow after it blocked the carrier from flying over Russian territory.

"Discussions with the Russian transport ministry continue. At this time, it is above all a question of a timetable for the transfer of Lufthansa Cargo towards the Russian airport of Krasnoyarsk," Transport Minister Wolfgang Tiefensee said Friday in a statement.

The announcement signalled a possible end to a dispute that had seen Lufthansa cargo planes forced to make a costly detour around Russian airspace en route to the group's current Asian refueling and distribution point at Astana, Kazakhstan.

Russia banned Lufthansa Cargo from Russia airspace earlier this week after a permit allowing the airline to fly over the country expired. The ban was seen by some as an attempt to strong-arm Lufthansa into moving its hub from Kazakhstan to Russia.

Detours to avoid Russian airspace have increased the carrier's fuel costs by about 400,000 dollars (280,000 euros) per week.

The Russian transport ministry agreed on Friday to extend a temporary authorisation, allowing Lufthansa Cargo to resume flights over the country.

Tiefensee said that a precondition for a final accord was "the creation of infrastructure to enable flights to that airport (Krasnoyarsk) in any weather condition."

According to the Financial Times Deutschland, Krasnoyarsk lacks guides for fog-bound landings.

Lufthansa Cargo, a major air cargo carrier, uses McDonnell Douglas MD-11 freighters with a range that prevents direct flights to Asian capitals.

Lufthansa Cargo had appeared earlier Friday to be categorically opposed to a move to a Siberian city, with a spokesman telling Thomson Financial news agency it was "out of the question."

"Technical conditions at the airports mentioned absolutely do not satisfy international standards," the spokesman said.

Later, the group stressed that conditions at the airport needed to be upgraded and that the location of the hub should not be linked to the issue of overflight rights.

A statement said: "We don't agree that talks about overflight rights should be linked to demands for the transfer of the cargo hub.

"Lufthansa Cargo will only consider a move once operational and commercial conditions are established."

German officials had promised to respond by November 7 to Russian conditions that include a requirement that Lufthansa freight flights to southeast Asia make a stop on Russian territory, the Russian trade ministry said.

The spat is another example of trade tension between Russia and a European Union member, with relations strained between the EU and its giant neighbour to the east.

Polish meat exports to Russia and gas shipments from Russia via Ukraine to EU states have also raised tensions in the past year.

On Monday, cargo flights by the Russian airline Aeroflot were barred from landing in Frankfurt, but the measure was lifted the next day "as a goodwill gesture," according to a German transport ministry spokesman.

AIRPORT NEWS

Cologne-Bonn targets 10 million in 2007

Above: Record numbers of passengers travelled through Cologne-Bonn airport in September

Cologne-Bonn airport is well on target to reach the 10-million-passenger milestone in 2007. The airport registered a 6% increase in passenger traffic to eight million passengers during the first three quarters of the year. Cologne-Bonn expects traffic to increase by 5% this year, bringing the total number of passengers travelling via the airport to 10.4 million.

Another milestone was celebrated in September when the airport handled a record 1,061,151 passengers. Cologne-Bonn attributes much of the traffic rise to the increasing popularity of low-cost carriers. Five years after the first low-cost carrier took off at Cologne-Bonn, the airport claims it is now the largest low-cost airport on the European Continent.

The airport’s management has put much emphasis on the passenger business in recent years. “Our emphasis on low-cost traffic in recent years has enabled us to achieve stability in growth,” said Michael Garvens, the airport’s chief executive officer.

Cologne-Bonn Airport continues to expand and improve its terminal facilities. The interior of Lufthansa’s Business and Senator Lounges in Stern C will be refurbished this month and are scheduled for reopening in January 2008.

The shopping areas in both the airport’s terminals will also be improved. Terminal 1 will be expanded with a 1,100m² shopping area, while Terminal 2 will get a new food court.

By 2009 the airport expects to have expanded its space for retail, and food and beverage facilities to 10,000m² – three times greater than the space in 2002.

Schiphol forced to lower tariffs

Schiphol's fees for airlines will be cut following intervention by Dutch competition officials

The Netherlands Competition Authority (NMa) has decided that Schiphol Group must lower its landing and departure taxes as well as its passenger charges from the start of the airport’s next business year.

According to Dutch civil aviation law, Schiphol must take its financial performance in the period 2005-2006 into account when setting tariffs for this year. The NMa says the new tariff system that became effective yesterday (1 November 2007), does not include this calculation.

The NMa’s pronouncement means that Schiphol must charge around US$53 million (Euros 36.8 million) less to airlines than it had projected.

The competition watchdog began investigating Schiphol’s tariff structure following a complaint by KLM about the airport’s charges for transfer passengers and the procedure used by the Schiphol Group to stipulate its charges.

That complaint was rejected by the NMa as was an objection from the Schiphol Airline Operators Committee (SAOC) and the Board of Airline Representatives In the Netherlands (BARIN) about the tariff settlement procedure.

The enforced charge reduction is good news for airlines operating at Schiphol since they face a new environmental tax initiated by the Dutch government.

Stewart’s new owner announces Skybus launch

Stewart International Airport is now under the control of the Port Authority of New York and New Jersey

Transport operator National Express yesterday completed the sale of its lease of Stewart International Airport to the Port Authority of New York and New Jersey. The Port Authority marked its first day in control of the airport with the announcement that on 6 January Skybus Airlines will begin twice-daily flights from Stewart to Columbus, Ohio.

The airline also plans to launch a twice-daily service to Greensboro, North Carolina from 25 February.

Skybus will be the sixth major commercial airline at Stewart, which in the past year has attracted JetBlue Airways, AirTran Airways and Delta Connection.

Stewart can accommodate up to three million passengers annually, but is expected to handle more than 800,000 passengers this year, up from around 300,000 in 2006.

“We’re working with the other carriers to see if they’ll consider expanding some of their services,” says Diannae Ehler, Stewart’s new general manager. “We’re working with carriers we’re familiar with and other ones, like Skybus, that we don’t currently have a business relationship with.”

Pittsburgh hikes fees following US Airways cutbacks

Above: Pittsburgh plans to raise fees in January following US Airways cutbacks

Cutbacks by US Airways at Pittsburgh International have prompted airport officials to hike fees from January next year. Landing fees will jump by 33%, terminal fees will increase by 35.9%, and ramp fees will rise by 64.5%.

The Allegheny County Airport Authority says the US Airways cutbacks will cost the airport an estimated US$5 million in revenue next year. To help offset the losses, the authority will also close 27 gates at the ends of two of four concourses, saving about US$1 million. The board authorised the increases in landing, terminal and ramp fees when approving a US$87.4 million budget for 2008.

Southwest Airlines spokeswoman Whitney Eichinger says the airline is very concerned about the fee increases. The increase in fees is not expected to affect the airline’s plans for growth in Pittsburgh next year, she adds, but warns it could have some impact long term if fees continue to rise.
AirTran Airways and Delta Air Lines have also expressed concern about the fee increases, but like Southwest, neither expect them to have a big effect on their growth plans at Pittsburgh.

Beijing unveils T3 retail plans

Above: T3 will double the retail space available at Beijing Capital International Airport


When Beijing Capital International Airport opens its third terminal, T3, next February it will double retail space at the airport. The T3 air mall will cover 52,670m², accounting for around 5% of the total space within the new terminal.

It will include domestic retail areas in T3A, while international duty free shopping areas, various convenience stores and around 15,000m² of food and restaurant outlets will be in T3B.

BCIA officials say that the retail shopping area per one million annual passengers will be 1,115m², which is comparable to the airports in Hong Kong and Singapore.

Beijing Capital Airport Commercial & Trading Company holds franchise rights to all commercial activities at Beijing Airport and is looking for specialist branded shops to come into the new T3 retail space.

Earlier this year Beijing Capital International Airport pledged to lower retail prices at the airport to bring them in line with levels downtown by year-end. Customers will also get a seven-day return guarantee. The airport is seeking to improve its services ahead of the 2008 summer Olympics.

United drops plans to use Dewbridge jetways

United Airlines has decided to abandon a new type of high-tech jet bridge it has been trialling in Denver following an accident earlier this year, when part of a bridge collapsed onto an aircraft wing.

No one was injured in the incident, but United stopped using that part of the bridges while it and Canada-based Dewbridge Airport Systems, which developed the bridges, conducted investigations. The Chicago-based carrier had planned to deploy the jetways in other cities across its network if they proved successful at DIA.

The bridges connect to both the front and rear doors of a plane, allowing passengers to get on and off aircraft more quickly. United began using the bridges at Denver International Airport last year and eventually operated five there.

United spokeswoman Megan McCarthy says, “We want to be absolutely sure that any new technology meets the needs of our customers and our business.”

United is now removing the arms of the bridges that connect to the rear of aircraft but will continue using the main sections that link to the front doors.

Dewbridge Airport Systems says it remains committed to the technology and is disappointed at United’s decision.

Changi opens Terminal 3 for sneak preview

Above: Singapore's new Terminal 3 will be open to the general public for tours from 12 November

Members of the public will be able to tour Changi Airport's new Terminal 3 (T3) even before it opens. The Civil Aviation Authority of Singapore (CAAS) has announced it is organising an Open House, from 12 November to 9 December 2007, during which visitors can tour the terminal.

A visitor gallery will feature various display panels showing T3's highlights, and a range of T3 souvenirs, such as limited edition T3 Swatch watches, will be on sale.

Lim Kim Choon, CAAS director-general and chief executive officer, says, “We hope to give members of the public an opportunity to get a first-hand view of the landmark terminal before it opens for flight operations. We welcome everyone to join in the excitement of seeing Terminal 3 come into being and becoming a significant milestone in Singapore's civil aviation development.”

The Open House will be open from 10am to 5pm on weekdays and 9am to 6pm on Saturdays and Sundays. A T3 Open House guide brochure (available in English, Chinese, Malay and Tamil) will be available to assist visitors in exploring the new terminal on their own.

While visits to T3’s public areas will be free, CAAS will charge a small fee to those visitors who choose to tour the restricted areas.

Bristol begins security update

Bristol Airport in south-west England has begun work on a US$15 million upgrade of its security search area, which should increase passenger capacity at peak times.

The work has been prompted by the introduction of additional security measures at UK airports.

Piarco shuts twice in a week

Piarco International Airport in Trinidad and Tobago was shut down for the second time within a week yesterday when a blackout forced the authorities to close the runway. A broken electrical cable caused the lights to fail, grounding several local flights. International flights were re-directed to Crown Point International Airport in Tobago. A full investigation will be launched into the power outage. Representatives say the cables are being repaired but could not say when the runway would be re-opened.

Work begins on new Panama City-Bay County airport

Officials broke ground yesterday (Thursday) on the new, US$330 million Panama City-Bay County International Airport in Florida. The 1,600 hectare airport is scheduled to open in 2010.

Construction starts on Kashi’s terminal

Expansion of Kashi airport will raiuse capacity to 1.2 million passengers per year.

Construction of the new terminal at Kashi airport in southern Xinjiang province in China has begun. The 17,000m² terminal marks the latest stage in the US$22.67 million (Yuan 170 million) redevelopment of the airport, where a 930m² air traffic control tower and 2,000m² airport authority administration building are already complete. The whole project is due to be finished by the end of 2008.

Xinjiang Airport Group said that the redeveloped airport would be able to handle 1.2 million passengers a year, with peak passenger flows of up to 911 people per hour.

The airport was last upgraded in 1999 when the runway was extended to accept all commercial airliners – though not the new Airbus A380. The airport’s existing terminal building is 4,856m².

Kashi is a city with strategic importance in southern Xinjiang, China’s gateway to central, west and southern Asia. Kashi Airport is located 10km from the centre of Kashi City.

Air Malta switches Heathrow handling

Air Malta has announced that Alitalia Servizi has taken over the handling of the airline’s flights at London’s Heathrow Airport. The contract, which commenced yesterday (Thursday), is expected to improve ground services to Air Malta’s customers.

Air Malta operates two daily flights into and out of London Heathrow. It will continue to operate from Terminal 4, but check-in desks will now be moved to Zone A. Air Malta club class customers and Flypass members entitled to use the VIP Holideck lounge may continue to use the lounge facilities. Air Malta’s ticket sales desk will still operate from Zone D at the airport.

Air Malta officials said the changes form part of the airline’s programme to increase efficiency, reduce costs and focus more on its customers.

Silverjet to use Dubai as business only hub?

Business-class only airline Silverjet is considering using Dubai as a hub for future expansion

Luton Airport-based airline Silverjet is considering making Dubai a hub for its future expansion. The business-class-only carrier is due to launch its Luton to Dubai route on 18 November, and the airline’s director of sales, marketing and international development, Katherine Gershon, said that it is eyeing expansion to the west coast of the USA, South Africa and the Far East from the emirate.

Gershon said Silverjet will add two long-range aircraft to its three-strong fleet next June. This will open up destinations across the world for the UK-based airline, including San Francisco from Luton and Shanghai, Singapore and Hong Kong from Dubai.

Gershon added, “If Dubai really takes off, as we expect it to, then we can use this as a hub to launch to other destinations. Nobody has taken this business-class-only model anywhere else but transatlantic before. We’re looking to take it south, east, west and possibly north of Dubai.”

There are currently around three and a half million passengers travelling the London to Dubai route each year. To make a profit, Gershon said Silverjet needs to capture around 25,000 of those travellers.

Weak Dollar Helps British Airways Cut Costs

Reuters-British Airways reported record first-half profit on Friday, up 26 percent due to cost cutting, but its shares fell after it cut its full-year revenue guidance due to the weak US dollar.

Profit before tax was GBP593 million pounds (USD$1.23 billion) in the six months to September 30, GBP122 million more than a year earlier after it slashed GBP150 million off costs.

"Our cost performance was excellent, helped by the weak US dollar," said Chief Executive Willie Walsh.

The market focused not on the way the weak dollar would help cut costs, but on the way it would reduce revenues after BA cut its view of full-year revenue growth to 3 to 3.5 percent from earlier guidance of 4 percent.

"What we see is premium bookings remaining strong," Walsh told reporters. "The North Atlantic non-premium market is still soft but other non-premium markets are more encouraging."

Walsh said BA remained committed to the consortium looking at buying Spanish airline Iberia.

"We're still working on finalizing the financing on Iberia," added Finance Director Keith Williams.

The airline said it was on track with its goal of keeping operating margins at 10 percent or more, having hit 12.5 percent in the first half.

It predicted costs excluding fuel were now expected to be GBP100 million lower than previously forecast in the full year due to the weak dollar.

But fuel costs are expected to be up by GBP100 million on last year.

"Fuel costs remain a major challenge and our fuel bill for the year is expected to top GBP2 billion for the first time," said Walsh.

"The fuel surcharge is constantly under review, but there's no plans to adjust it at this moment," he added.

Walsh brushed off media reports that BA's plans to start flights to the United States from European cities could be threatened by opposition from its pilots or by plans to cut flight capacity at New York's JFK airport.

World Tourism Day Award

As part of World Tourism Day, Four Seasons Resort Sharm El Sheikh, Egypt has been recognised by the Ministry of Tourism for excellence in promoting tourism in Egypt. The award was presented by the Minister of Tourism, His Excellency Minister Zoheir Garranah, to Resort Manager, Charlie Parker. “We are very proud to have been recognised by the Ministry for our contribution to tourism in Egypt,” says Charlie Parker. “We think it reflects our commitment to both Egypt and the Middle East as a whole, and we intend to continue our efforts in making Sharm El Sheikh one of the most desirable destinations in the world.”

More industry leaders call for government liberalisation of aviation

The topic of liberalisation – and the need to effect more of it – stayed front and centre during the second panel discussion of the CAPA's Outlook Summit. Stakeholders from all parts of the industry reiterated the need for the region's governments to remove the shackles holding back the industry from its potential – and even natural – level of growth.

Stanley Hui, CEO of Airport Authority Hong Kong and former chief of Dragonair, noted that more generously granted access to rights always stimulates more traffic, which in turn is always good for the economies on both ends of a new route. Noting that deregulation is something that "benefits airlines, passengers and the community at large", Mr Hui illustrated how Hong Kong's recently enlarged air service agreement with Mainland China has seen traffic between the two double in a short period of time.

IATA's Regional Vice-President for Asia Pacific and former Silk Air CEO, Mike Barclay, also spoke on the benefits of a more open aviation system. Saying that the idea that flag carriers instinctively oppose liberalisation is a misconception, Mr Barclay allowed that deregulation would create losers as well as winners, but that the overall industry would be healthier because of it.

Pointedly remarking that flag carriers generate from new route opportunities just as much as the LCC market participants, Mr Barclay furthermore stated that ASEAN's gradual moves towards a more open air service environment were "a step in the right direction, but fall well short of what's needed."

Also addressing the assembled aviation leaders was Waleed Youssef, Head of Strategy and Development at Abu Dhabi Airports Company, who discussed the pro-liberalisation views that currently mark a growing number of the Middle East states and the need for that mindset to spread throughout the region.

Aviation Outlook Summit 2008 is the fourth meeting of the Centre's annual review of the Asia Pacific and Middle East airline industry and its future prospects. This year's gathering is focused on the need for Asian industry participants to play a leadership role in the events that continue to shape the global aviation sector, especially as the region begins to generate the largest share of world traffic.

Aviation leaders from all segments of the industry have assembled in Singapore to discuss and debate how the regional sector can proactively assert itself in such vital fields as the environment, liberalisation and the necessary evolution of the aviation business model, for both full-service and low cost airlines.

World airports executives to gather at Buenos Aires conference

Over 450 executives from the world’s airports begin to gather in Buenos Aires this weekend ahead of the Airports Council International world annual assembly, 5 – 7 November. This year, the world assembly is being held in conjunction with the ACI Latin America and Caribbean annual regional conference. The conference is being hosted by Argentinean airport operator Aeropuertos Argentina 2000. An exhibition that runs alongside the conference showcases airport technologies. Airport CEOs, board members and senior managers will join other leaders from the aviation industry to discuss issues of importance for the industry.

This year, the focus is on leadership and the importance of good management for running an efficient airport, with discussions on effective leadership, sustainable growth and the environment, the state of the industry and a focus on the future of aviation in the Latin American region. ACI Director General, Robert J Aaronson, says that the annual event is an opportunity for airport executives to meet and take stock of the changes occurring in the industry, “With globalisation, international organisations take on a greater role and importance – particularly in an industry like commercial aviation whose many parts must work effectively in concert to serve air transport consumers.”

As hosts of this year’s event, AA2000 is able to showcase Argentina to the global airport community. President and Chief Executive Officer, Ernesto Gutiérrez, says, “We are proud to have this opportunity to bring so many of our colleagues from airports around the world to our home. We will provide a memorable experience for them all and it is an occasion to talk about the importance of air transport to our region.”

Aaronson commented, “Leadership is vital in our industry and that is why this theme is so important. One of ACI’s main services to members is the training that we provide. This occurs at several levels – executive leadership, middle management, practical operations skills and also a special programme aimed at airports in developing nations.”

“We are thrilled to be holding this year’s conference in Buenos Aires and thank AA2000 for hosting us. Buenos Aires is a vibrant city, which reflects the dynamic Latin American aviation sector. We are seeing steady growth in this region and are projecting that passenger numbers will more than double in the next 20 years. From 270 million passengers currently to 610 million in 2025, this will present some real growth and capacity challenges, but also some exciting opportunities for Latin American aviation.”

“Of course the region always must keep safety and security as the top priorities in the aviation industry and with growth comes responsibility to be an environmentally sustainable industry.”

Delegates will have the opportunity to hear from, and interact with, Roberto Kobeh Gonzalez, President of the ICAO Council and Jaan Albrecht, CEO of Star Alliance, who will give keynote addresses. Other speakers include: Iñigo Meirás, CEO Ferrovial Aeropuertos and BAA Vice-Chairman; Javier Marin, Director of Spanish Airports, AENA; Héctor Navarrete, Director Regional Airports, ASUR; Bijan Vasigh, Ph.D., Professor, College of Business, Embry Riddle Aeronautical University; Benjamin de Costa, Aviation General Manager, Hartsfield-Jackson Atlanta International Airport; Nancy Graham, Director of the Air Navigation Bureau, ICAO; Catherine Mayer, Vice President, Airport Services, SITA; Miguel Southwell, Director Business Development, Miami Airport; Alexander ter Kuile, Secretary General, CANSO; José Maria Palencia Saucedo, CEO, Aldeasa; Angela Gittens, Vice President of Airport Business Services, HNTB.

SIA's strong operating results lift net profit

An operating profit of $982 million for the first half of financial year 2007-08 was reported by the Singapore Airlines Group; an increase of $449 million (+84.1%) from the corresponding period last year. This was underpinned by strong performance from the Parent Airline Company.

Group revenue rose to $7,589 million, up $560 million (+8.0%) over the same period last year, on the back of strong passenger demand.

Group expenditure also increased, but was contained below revenue growth; up $111 million (+1.7%) to $6,607 million. Fuel cost remained high in US Dollars, and accounted for 36.5% of the Group expenditure.

The Group's net profit attributable to equity holders of $932 million was a $64 million improvement (+7.3%) over the first half of the previous year. The results for last year included an exceptional gain of $223 million from the sale of the SIA Building in Singapore. Excluding that exceptional gain, profit attributable to equity holders this year was $287 million (+44.5%) higher.

The Parent Airline Company posted an operating profit of $781 million (+112.2%), more than double the same period last year. The Airline contributed 79.6% (+10.6% points) to the Group's operating profit. The operating results of the three major subsidiary companies are as follows:

Singapore Airport Terminal Services (SATS) Group: Profit of $94 million (-3.8%) SIA Engineering Company (SIAEC): Profit of $63 million (-6.6%) Singapore Airlines Cargo (SIA Cargo): Profit of $19 million (Loss of $29 million in 2006-07)

Second Quarter 2007-08

The Group had a strong second quarter, posting a net profit attributable to equity holders of $508 million, up $215 million (+73.2%) from the second quarter of the previous year.

Group operating profit doubled to $519 million; a year-on-year increase of $259 million (+99.9%), led by the Parent Airline Company, turning in a strong performance in the second quarter.

Group revenue increased $359 million (+9.9%) year-on-year to $3,967 million. Passenger demand from both business and leisure markets remained buoyant in the second quarter, pushing passenger load factor to 81.6%.

Dividends

The Company is declaring an interim dividend of 20 cents per share (tax exempt, one-tier), amounting to $237 million, for the half-year ended 30 September 2007 (15 cents interim dividend in the previous year). The interim dividend will be paid on 30 November 2007 to members on the Register as at 16 November 2007.

First half 2007-08 operating performance: Strong passenger traffic

Singapore Airlines carried 9.4 million passengers (+5.0%) in the first six months of the financial year. Revenue passenger kilometres grew 2.6% despite a capacity reduction of 1.0% in available seat kilometres. As a result, passenger load factor improved 2.8 percentage points to 80.3%.

Passenger breakeven load factor was 2.8 percentage points lower, at 70.1%, because yield grew at a higher rate (+9.3%) than unit cost (+5.1%).

Fleet and Route development

During the first half of the financial year, Singapore Airlines took delivery of one Boeing 777-300ER, leased in one Boeing 747-400, and de-commissioned four Boeing 747-400s. As at 30 September 2007, the operating fleet comprised 92 passenger aircraft - 19 B747-400s, 68 B777s and five A340-500s, with an average age of six years and six months.

Outlook

Singapore Airlines took delivery of the first Airbus A380 on 15 October 2007 and inaugurated commercial service with a flight in aid of charity on 25 October 2007 from Singapore to Sydney and return. The new cabins and seats on the aircraft have been well received by customers and industry observers.

The business landscape however remains challenging. While advanced bookings are holding up, slowing economic growth sparked by tight credit markets and increasing volatility in financial markets cast a cloud of uncertainty over the strong revenue environment.

On the cost side, the price of fuel remains a significant variable for the second half of the financial year.