The Most Influential Airlines Of 2013

The Most Influential Airlines Of 2013

By Adrian Schofield , Jens Flottau

Source: Aviation Week & Space Technology

In a constantly changing airline industry, there are always some carriers that act as catalysts for wider upheaval. Aviation Week's commercial editorial team has assembled this list of 25 carriers that are the main contenders to fulfill this role in 2013. Many on the list are poised to make major advances that will present new challenges for their competitors, some will influence the industry as they disintegrate, and others are reaching an inflexion point where either outcome is possible. Wherever they fall on that spectrum, these are the airlines that are likely to provide the industry's biggest talking points over the next year.

Delta Air Lines will be in the spotlight in 2013 due to its acquisition of a Pennsylvania oil refinery as a hedge against the widening spread between crude oil prices and jet fuel costs. Airlines will be watching to see if the move really does produce at least $300 million in savings, as the carrier estimates. Delta is also at the forefront of the shake-up in the U.S. regional airline industry, with plans to remove at least 200 of the 325 50-seat aircraft in its network by 2015. Its plans for achieving these cuts should become clear by early next year. Delta drew even more attention last week when it agreed to purchase a 49% stake in Virgin Atlantic, boosting its access to London's Heathrow Airport.

Southwest Airlines acquired AirTran Airways in May 2011, but it will be in 2013 that the real impact of that acquisition will start to become clear. Customers will be able to book single-ticket itineraries by March, connecting Southwest and AirTran networks for the first time, and Southwest is expecting this to significantly boost revenue and give it a competitive advantage. Southwest also faces some new challenges, with CEO Gary Kelly warning that the carrier must respond to the cost-cutting that American Airlines and other competitors have achieved in bankruptcy protection. That raises the prospect of a problem Southwest usually does not encounter: divisive disputes with its labor unions.

American Airlines is likely to emerge from Chapter 11 bankruptcy protection in 2013, but in what form? US Airways is pushing for a merger, but American's management has long stated its preference to emerge as a standalone carrier, focused on high-value business routes from its hubs in Chicago, Miami, Los Angeles, Dallas/Fort Worth and New York. A merger with US Airways would create an airline with a strong presence on the U.S. East Coast and Midwest, Europe and Latin America. American's three unions have thrown their support behind the deal, saying the carrier will not be able to compete with rivals Delta Air Lines and United Airlines without merging with US Airways.

Pinnacle Airlines will be the focus of the U.S. regional airline industry in 2013. Operating under Chapter 11 bankruptcy protection since April 2012, Pinnacle's reorganization will have a major bearing on the future of rivals SkyWest Inc. and Republic Airways, which are both anticipating a sharp reduction in Pinnacle's operations. It is likely that Pinnacle will bear the brunt of partner Delta Air Lines' planned cuts in regional jet requirements, and the carrier has already shed its contracts with other major airlines. There may still be a future for Pinnacle if its pilots agree to an extensive concessions package, although the likelihood is that the carrier will become another victim of consolidation.

The coming year will be another period of international growth for Hawaiian Airlines, as it continues to look to Pacific Rim nations for new opportunities. It will launch flights from Honolulu to Taiwan and New Zealand in 2013, and nobody would be surprised to see other new destinations also added. This follows the recent expansion of services to Australia, and new routes to Japanese cities and South Korea. All of this is part of Hawaiian's plan to reduce its reliance on the highly competitive routes from the Western U.S. to Hawaii. The airline will also be looking to increase its coverage of its local market, as it plans to launch a new regional turboprop subsidiary.

WestJet is looking to give Air Canada a run for its money next year. The launch of a new regional feeder operation called WestJet Encore is sure to heighten domestic competition. Encore intends to reach smaller communities, and the carrier says fares could dip 50% below those charged by rivals on comparable routes. Could a price war result? The answer to that will become apparent when Encore launches in the second half of the year. One thing that does seem certain is WestJet's commitment to the venture, with 20 Bombardier Q400s on firm order and options for 25 more. The Canadian low-cost carrier has been vocal about the advantages of Encore over competitors, but it will soon be up to consumers to decide.

Air Canada will make an aggressive push into new international markets next year—if all goes as planned. The carrier is awaiting government approval to begin non-stop Toronto-Istanbul service on June 4, as a gateway to Turkey, Central Asia, the Middle East and Africa through a code-share with Turkish Airlines. This expansion could prove particularly valuable for Air Canada as competition stiffens on its home front, where WestJet's planned new regional operation could significantly undercut Air Canada's fares. Although Air Canada remains confident that its hold in domestic markets will remain strong, the new international markets could be important to its fortunes in 2013.
The merger of Chile's LAN Airlines and Brazil's Grupo TAM in 2012 created Latam, one of the world's largest carriers by market capitalization, and furthered airline consolidation in Latin America. Latam expects demand to remain strong throughout South America and is adding capacity in the region. The carrier is taking a page out of the low-cost-carrier playbook and altering its product on short-haul regional routes to compete more effectively with startups and LCCs. The one blight on the forecast is Brazil, where domestic demand has cooled. TAM is shifting its focus to international routes and pulling capacity out of its domestic Brazil operations, but it is poised to grow, should demand recover.
Whether Mexicana DE Aviacion finally emerges from bankruptcy protection and resumes operations is the story to watch in Mexico this year. Newly inaugurated Mexican President Enrique Pena Nieto vowed on the campaign trail to resurrect Mexicana, but it remains unclear if he will make good on that promise. A bankruptcy court dismissed an investment group that had pledged to recapitalize the airline, and although several investors have expressed interest, the court has yet to approve a new restructuring plan. Since Mexicana's grounding, Interjet has emerged as the country's largest domestic carrier and, along with Volaris and Aeromexico, it has filled the gap left by Mexicana.
A major overhaul of Qantas's international operations is going to have serious ramifications for the other big players in Australia's long-haul markets next year. The most significant change will see Qantas partnering with Emirates, giving the pair a more dominant position in the highly contested Australia–Europe market. The link-up will enhance Qantas's network into Europe but will make life more difficult for carriers, such as Singapore Airlines, that draw a lot of revenue from the so-called Kangaroo routes. Next year will also be important for Qantas low-cost subsidiary Jetstar, which is due to take delivery of the first of its 15 Boeing 787-8s.
Jetstar Japan is on this list as a proxy for the three Japanese low-cost carriers that were established in 2012—the other two being Peach and AirAsia Japan. LCCs are a relatively new phenomenon in Japan, and while their fleets of narrowbody aircraft are still small, they are already having an impact on the market. This will be amplified in 2013 as they add new aircraft and continue their expansion into domestic and international markets. Peach and AirAsia Japan were set up as joint ventures by All Nippon Airways, while Japan Airlines set up the Jetstar Japan joint venture. The coming year will provide more clarity on how much traffic the upstarts will siphon from their mainline parents.
China's Spring Airlines is a budget carrier that is a potential threat to the lumbering state airlines, with service and cost levels closely matched to the needs and wallets of Chinese fliers. The experience of low-cost carriers in Southeast Asia suggests that China is superb territory for this model: Income levels there, though varying by region and city, compare closely with those of Indonesia, Thailand and Malaysia, where budget carriers have become dominant. So far, Spring has not been able to realize anything like its growth potential, as it has only about 30 Airbus A320s. But with a new administration taking control in Beijing, market-based reform in aviation could yet appear—to the benefit of Spring.
Tianjin Airlines is the leader in the current fad of subsidized local subsidiaries of Chinese mainland airlines. It is an offshoot of Hainan Airlines backed by the Tianjin city government. Since Tianjin Airlines was formed in 2009, such carriers have been popping up all over China. How big can they grow? Pretty big, if the ambitions of Tianjin Airlines are anything to go by. Originally an operator of Embraer ERJ regional jets, the carrier now uses mainly Embraer 190s, has begun introducing Airbus A320s and has plans for A330s that it could fly on intercontinental routes. Tianjin is a large and well-developed city, and many others are following its example with locally based subsidiaries of the major carriers.
The AirAsia group appears set to make acquisitions next year so it can expand its footprint farther across Asia. Possible takeover targets include Zest Air in the Philippines and T'way and Eastar in South Korea. The group is also believed to be eyeing potential opportunities to launch a carrier in Cambodia. To help fund its expansion and boost its balance sheet, AirAsia plans to float some of its businesses. Its Kuala Lumpur-based, medium-haul low-cost carrier AirAsia X aims to have an initial public offering early in 2013 on the Kuala Lumpur stock exchange. AirAsia also wants to float its Indonesian affiliate, Indonesia AirAsia, on the Jakarta stock exchange.
Lion Air is set to shake up Southeast Asia's airline industry next year. Its Malaysian affiliate Malindo Airways is due to start flying in the first half of 2013 and will compete head-to-head against Malaysia's AirAsia. Malindo may also capture some traffic from Malaysia Airlines, because Malindo will offer frills such as free checked baggage and inflight entertainment. Lion also recently established a Singapore-based aircraft leasing company called Transportation Partners. The airline has a large order-book for 737-900ERs and Boeing 737 MAX aircraft, and Transportation Partners' remit is to secure aircraft financing and place some of these aircraft with other carriers around the globe.
Singapore Airlines (SIA), under CEO Goh Choon Phong, has been transformed from a carrier focused on the premium segment to an airline group with a range of brands for different market segments. No longer content to be reliant on the slow-growing premium business, the group aims to tap into all market segments with its portfolio: SIA mainline (premium), SilkAir (premium short-haul), Tiger Airways (low-cost short-haul) and Scoot (low-cost medium-haul). Tiger and Scoot plan to add aircraft next year, as does SilkAir. In terms of route expansion, China will be a key focus for the group in 2013. It may also look to strengthen relations with Star Alliance partner Air China as another means of accessing China.
Africa's first low-cost carrier, Fastjet, achieved a load factor of 78% on Nov. 28—not bad for its first day of operations. But the jury is still out as to whether the low-cost model will work in Africa, or if the lack of infrastructure and liberalization as well as political opposition will prevent it from becoming as successful as it is in most other parts of the world. Fastjet plans to operate up to 15 aircraft by the end of 2013 and wants to expand beyond its initial base in Tanzania, at least to neighboring Kenya. But the real breakthrough will come if the airline becomes established in the south and west of Africa.
Ethiopian Airlines, based in one of the world's poorest countries, has had an impressive track record in recent years. It joined the Star Alliance and became the first African airline to take delivery of the Boeing 787. Now, with its 787 fleet growing, Ethiopian has to make the next transformation—upgrading its onboard product to industry-standard levels. The airline aims to build a long-haul network between Africa and Asia, so it must compete not only with the onboard products of Asian airlines, but also with those of the big three Persian Gulf carriers. In its efforts to quadruple sales by 2025, Ethiopian also has to further develop its African network and its Togo-based affiliate, ASKY Airlines.
The coming year will be pivotal for South African Airways as it looks to establish its future direction. The airline is in a leadership crisis once again, following the departure of CEO Siza Mzimela in late 2012. South Africa's government has also had to inject a further 5 billion rand ($576 million) into the airline to keep it afloat. The carrier now has to find a new CEO who can craft a strategy that will turn it into a sustainable business again. SAA has to determine where it can grow and how it can participate in the expected development of air transport in the continent. It is looking again at joint ventures in other African countries such as Ghana, although previous efforts have failed.
Qatar Airways prides itself on its five-star service levels, although until now that description would not have applied to its main hub airport. The terminals at Doha are nice, but with no contact gates available, all passengers have to be bused across the airport, sometimes with multiple stops. That will all soon change when the New Doha International Airport (NDIA) opens in 2013. The exact opening date has not yet been made public, following delays in the completion of lounges in the terminal. But once NDIA is ready, Qatar Airways will for the first time have a home base that is designed for connecting traffic.
Etihad Airways has bought shareholdings in Air Berlin, Aer Lingus, Air Seychelles and Virgin Australia, and if CEO James Hogan has his way, this is only the beginning. Etihad appears to be preparing to pursue more acquisitions in Europe and possibly one in India, which would make it an even more serious player in the international long-haul market. At the same time, Etihad will have to prove in 2013 that its current investments are paying off. While Virgin Australia—which is also partly owned by Singapore Airlines and Air New Zealand—looks good, there are major questions about whether its riskiest investment, Air Berlin, can be turned around.
Vueling's impressive performance over the past few years could turn out to be a blessing and a curse. The airline is doing so well that International Airlines Group, which is already a shareholder, plans to fully acquire the carrier in 2013. The question is whether that will be a major advantage or impact the business model and reduce Vueling's ability to grow in its niche. Vueling has been one of the most creative low-cost carriers with CEO Alex Cruz at the helm, and it is going against traditional LCC behavior by opening up to connecting traffic and cooperating with legacy carriers. So far it all looks good, but major challenges are still ahead.
Only a year or so after the merger of Iberia and British Airways, the International Airlines Group (IAG) is already in crisis mode. This time, all attention is on Iberia, which has to implement a draconian cost-savings and capacity-reduction program. This will see the airline withdraw from essentially all European routes that are not needed as feeders for its long-haul network to Latin America. Iberia is also axing 20% of its workforce, and IAG says still more drastic plans are in the cupboard if agreements cannot be reached quickly with unions. As the examples of SAS Scandinavian Airlines and others show, unions have few options to oppose such restructuring moves in tough times.
Germanwings is taking over all Lufthansa short-haul flights except the feeder network into Frankfurt and Munich on Jan. 1. Lufthansa—Germanwings' parent—has finally concluded that it cannot operate short-haul flights profitably while competing against low-cost carriers. The move to allow Germanwings to grow has been long overdue, many observers believe, but internal group politics and concerns over brand dilution had kept Lufthansa from going ahead with it. Now, within a short space of time, Germanwings has to integrate 35 more narrowbody aircraft as well as cabin crew and pilots, and take over dozens of routes. In 2013, it will become clear how the transition is progressing.
Like Iberia and Lufthansa, the Air France part of the Air France-KLM group is in the midst of a major streamlining exercise that it expects will make it 20% more efficient. Putting its short-haul operation back on track is only one of the tasks that Air France has to address in 2013. Its bilateral alliance with Etihad Airways has to be implemented, along with new code-sharing arrangements with Air Berlin, both of which represent deals outside of the SkyTeam alliance. But of even more strategic importance, the group has to determine if it wants to grow further by taking a larger stake in Alitalia or investing in other subsidiaries.

With Andrew Compart, Christine Grimaldi, Darren Shannon and Madhu Unnikrishnan in Washington; Leithen Francis in Singapore; and Bradley Perrett in Beijing.

Addis Ababa, Capital of ETHIOPIA

Boeing uses potatoes to simulate humans in test of Wi-Fi signals

Boeing has tested onboard internet signals with potatoes instead of passengers. (Associated Press / December 19, 2012)

By Hugo Martin

December 19, 2012, 10:44 a.m.

Boeing, the Chicago-based company that has built some of the world's most sophisticated aircraft, has turned to a very basic food staple to test airplane Wi-Fi: potatoes.
About 20,000 pounds of potatoes were used as stand-ins for passengers during tests at the company's laboratories to ensure onboard Wi-Fi signals are consistent through the cabin without interrupting the navigation and communication systems, the company said Wednesday.
The sacks of potatoes replicate the way human passengers reflect and absorb electronic signals, said Boeing spokesman Adam Tischler.
Without the potatoes, Tischler said Boeing would have to employ dozens of people to sit in a grounded plane for hours while Wi-Fi signals are measured and adjusted.
The testing idea has been dubbed Synthetic Personnel Using Dielectric Substitution, or SPUDS.

Namibia: National Airline Enters New Era

By Nyasha Francis Nyaungwa, 20 December 2012

As part of its fleet modernisation programme, national airline, Air Namibia has entered a new chapter in its history by acquiring two brand new Airbus A319 - 100 aircraft for the first time since disposing its jumbo jet in 2004.
The airline management represented by Xavier Masule, the General Manager for Commercial Services and Paulus Nakawa, the Head of Corporate Communications accompanied a group of local journalists to the Airbus factory in Hamburg recently for the symbolic handover of the new aircraft.
The aircraft, powered by CFM International's CFM56-5B6/3 engines, are coming in to replace the ageing Boeing B737 fleet. With a total seat capacity of 112 seats: 16 Business Class and 96 Economy Class, the aircraft will be used in Air Namibia's regional routes between Windhoek and Johannesburg, Cape Town, Luanda and Accra.
Seating arrangement in business class is a classic 2 by 2 format, with no middle seats, affording business class passengers sufficient comfort, and good value for money. In economy class, seating follows a classic wide-body 3 by 3 configuration.
The two will complement two other Airbus A319-100 aircraft already in use since October 2011 through a lease agreement from a financial institution based in Germany.
It was not immediately clear when the aircraft will touch down on Namibian soil. According to Masule, the date will only be known after Air Namibia receives the delivery notification and all documentation has been signed, including the change of ownership.
"After looking at other aircraft types including the new Boeing B737-800 , Air Namibia settled for the Airbus A319-100 as the better from the options we had to select from.
"The Airbus A319-100 was found to be best-suited for our environment and market situation, primarily looking at correct cabin size, given the demand on the various routes where it will be deployed, cost effectiveness, commonality with the Airbus A340-300 used on the long haul flight to Frankfurt (this translates to cost saving ito crew training), dispatch reliability record, as well as new generation design and technology."
Early this year, Air Namibia announced that it had signed 12-year lease agreements with US-based lessor Intrepid for two brand new Airbus A330-200 aircraft. The two new aircraft, currently in production, are expected in the country sometime in October next year. They will replace the existing two A340-300 planes whose lease agreements will not be renewed.

Bombardier announces $3bn deal

Bombardier has announced two major deals to provide airlines with new planes, in contracts that could be worth more than $3 billion.

Production of the Cseries wing at Bombardier, Belfast. (© Bombardier Aerospace)

An unnamed American airline has revealed it intends to place a contract worth up to $2 billion with Bombardier Aerospace.
The order with the aircraft manufacturing firm, which makes plane wings at its factory in Belfast, is to acquire 12 CS100 airliners.
However, an option to increase the order by a further 18 planes would bring the initial £870m deal to $2.08bn.
Also on Thursday, airBaltic revealed it has signed an agreement to buy 10 new CS300 planes, in a contract worth $764m.
The Latvian airline also has the rights to buy a further 10 aircraft which would increase the deal to $1.57bn.
"A modern and efficient fleet is one of the fundamentals of the airline business, and this order is a progressive and exciting move forward for us," said Martin Gauss, Chief Executive Officer, airBaltic.
"Following an in-depth analysis of existing and re-engined aircraft, as well as the new technologies offered by Bombardier's all-new CSeries aircraft, the results were clear and we selected the CSeries airliner."
A spokesman from Bombardier Aerospace, Belfast said, "We're proud to have delivered the wings for the first flight test CSeries aircraft, assembly of which is under way.
"The CSeries aircraft wings are the largest and most complex composite structures manufactured and assembled in the UK using a unique resin transfer infusion technology, developed by Bombardier in Belfast."
Bombardier's Mike Arcamone said they were "thrilled" at the interest in the CSeries craft, which seat up to 149 passengers.
The company now has orders and commitments for more than 350 aircraft including 138 CSeries airliners, from firms including premier carriers and low-cost airlines.

UPDATE 2-Bombardier gets more C-Series good news, firms up order

* AirBaltic firms up tentative order for 10 planes
* C-Series is Bombardier's all-new, in-development plane
* Bombardier got LOI on Wednesday for 12 C-Series jets
* Bombardier stock rises more than 3 percent
Dec 20 (Reuters) - Shares of Bombardier Inc rose on Thursday after its new C-Series jet program received its second dose of good news in as many days when Latvia's airBaltic firmed up a tentative order for 10 of the narrow-body commercial planes.
The announcement came hot on the heels of news late on Wednesday that an airline based in the Americas had signed a letter of intent to buy 12 C-Series jets, with options for another 18 aircraft, ending a five-month order drought for the 110- to 149-seater plane.
Orders for the all-new C-Series, Bombardier's bold $4 billion bet on its biggest plane yet, have been slow, standing at only 148 some 18 months ahead of the aircraft's entry into service.
The tentative order from the unnamed Americas-based airline was positive as it is the first commitment from a customer since Bombardier announced last month that it was delaying the C-Series' inaugural flight by six months, National Bank Financial analyst Cameron Doerksen said.
That said, the back-to-back announcements from Bombardier this week were likely to be coincidence and did not signal a sudden unleashing of interest in the plane, he said.
"Historically we have seen with other aircraft programs that the trigger point for a significant increase in order activity tends to be the first flight," Doerksen said.
Shares of Bombardier, the world's third-biggest commercial planemaker, were 3 percent higher at C$3.68 on the Toronto Stock Exchange on Thursday afternoon.
Doerksen said the unnamed America's-based airline was likely to be a South American carrier as there had been "no rumors or speculation that the major U.S. or other North American airlines are close to making an order for the C-Series".
The airBaltic order contains an option for up to 10 more C-Series planes, Bombardier said. The deal is worth about $764 million, or up to $1.57 billion if all of the options were exercised.
AirBaltic originally signed a letter of intent with Bombardier at the Farnborough Air Show in July this year.
Montreal-based Bombardier in November blamed the C-Series delay on unspecified supplier issues. The plane is Bombardier's biggest aircraft yet, and will compete with smaller regional planes built by industry giants Airbus and Boeing Co.

Kenya Airways and RwandAir at verge of forming major partnership

Kenya Airways Dr. Titus Naikuni & RwandAir Chairman Girma Wake

By Dr. Wolfgang H. Thome, eTN Uganda | Dec 20, 2012 (eTN) - Reliable sources from Nairobi have confirmed that a principal agreement has been reached between Kenya Airways (KQ) and RwandAir (WB), when KQ’s Dr. Titus Naikuni and RwandAir’s Chairman Girma Wake put pen to paper to outline future cooperation and work together to increase connectivity for their respective passengers.
The two airlines fly a total of 7 times between Nairobi and Kigali at present but will now aim at a range of tighter collaboration in cargo handling, crew training – Kenya Airways’ Pride Centre offers a state-of-the-art B737NG simulator in Nairobi – as well as maintenance, where KQ’s MRO at Jomo Kenyatta International Airport can provide the closest such facility for RwandAir’s B737fleet.
Dr.Naikuni was quoted to have said on upon reaching the deal: “In line with our strategy to exploit the untapped economic potential of the African continent, this partnership with RwandAir allows us, together with our colleagues in African aviation, to further strengthen and enhance our services and network.”
In turn, RwandAir’s Chairman Girma Wake responded: “We’re pleased to have agreed this cooperation intent with Kenya Airways. We can now offer more choice for passengers who wish to travel to Rwanda where tourism, trade, and investment are on the rise. It is important that we provide the right infrastructure together with partner airlines.”
It is understood that additional areas the two carriers are eyeing for future cooperation are the possible alignment of RwandAir’s Dream Miles program with Kenya Airways’ much more advanced “Flying Blue,” scheduling alignments, harmonization of the reservation systems, and handling.
There is intense speculation among regular aviation pundits that this newly-found spirit between KQ and WB to work hand in hand is also aimed at regional upstart FastJet to limit their future options vis-a-vis potential partners in the region and start, as one source close to Kenya Airways’ put it “containment measures by raising the thresholds for them.”

Neste Oil to produce aviation biofuels

In Finland, Neste Oil announced that it has joined the Initiative Towards Sustainable Kerosene for Aviation (ITAKA) project, which is being funded by the EU to support the commercialization and use of renewable aviation fuel in Europe. Neste Oil’s role in the consortium will be to produce the renewable fuel used in the project.
The 36-month ITAKA project has been granted approximately €10 million of funding under the EU’s Seventh Framework Programme for Research and Development (2007-‘13). In addition to Neste Oil, the consortium is made up of Airbus, BIOTEHGEN, Camelina Company Espanã, CLH, EADS IW, Embraer, EPFL, MMU, SENASA, RE-CORD, and SkyNRG.
Neste Oil will produce a total of 4,000 tons of NExBTL renewable aviation fuel as part of the project, primarily from sustainably produced Spanish camelina oil, and possibly also used cooking oil. The resulting renewable fuel, together with the camelina oil used to produce it, will be certified in accordance with the European Commission-approved RSB EU RED certification system. The renewable fuel will be blended with conventional fossil aviation fuel in accordance with the appropriate ASTM standard to create a 50/50 blend that will then be distributed to European airlines for use on their commercial flights.

Brazil aviation faces turbulence after rapid ascent

SAO PAULO: After a decade of soaring growth as millions of Brazilians flew for the first time, Brazil's aviation industry has come back down to earth with a thud.

Experts warn the sector is facing higher taxes and fuel costs, inadequate infrastructure and a leveling off of demand.

"2012 can be seen as the worst year for commercial civil aviation," said Paulo Kakinoff, president of Gol, the country's second biggest airline.

"This is due to a series of factors: a nearly 60 percent hike in fuel costs, the 10 percent depreciation of the real in relation to the dollar, higher taxes and new taxes."

Fuel represents 45 percent of the airline's expenses, he said.

The national airport operator, Infraero, has slapped a 150 percent hike on its rates, which had previously not changed since 2005.

With accumulated losses of $500 million up to September, Gol was forced to cut costs, with fever services and greater plane occupancy rates, a strategy pursued by other companies.

Late last month, Gol announced it was shutting down its Webjet low-cost unit and laying off 850 employees. But this week, a judge ordered the airline to take them back.

Brazil's top airline TAM, which merged with its Chilean counterpart LAN earlier this year to become Latin America's biggest airline, was also forced to cut costs.

TAM has yet to release its latest results but in the first quarter its earnings had slumped 21.7 percent over the same period of last year.

"In 2012, we spent a lot because of poor infrastructure, higher fuel prices and new taxes," said Gianfranco Beting, a spokesman for the Azul airline, which operates new routes with smaller aircraft.

According to industry data, the top five airlines are TAM, with 41.1 percent market share, Gol with 33.9, Azul with 9.35, Trip with 4.53 and Avianca Brasil at 5.95 percent.

Azul merged with Trip and Avianca earlier this year.

Although demand in this continent-sized country of 194 million people has stabilized, experts say the potential for further growth remains huge.

In 2002, 33 million air tickets were sold, a figure which nearly trebled to 86 million last year.

"In Brazil, each person makes 0.4 trips a year. In more mature markets, the average rate is 2.7. We have a huge potential," insisted Adalberto Febeliano, of the Brazilian Airline Association.

But he said he expected demand to remain stable in 2013 coupled with a reduction in supply to maintain profit.

His group is pressing the government for lower taxes and lower fuel costs.

Most of Brazil's 70 airports are congested or in urgent need of an upgrade as the country prepares to host the 2014 World Cup and the 2016 Summer Olympics in Rio.

The Miami-based Latin American and Caribbean Air Transport Association has expressed concern.

"The Brazilian market will continue to grow but we are concerned about the infrastructure, which has not been planned with this development in mind," it noted, lambasting the country's "lack of competitiveness."

President Dilma Rousseff slowly began privatizing some airports last year, starting with two in commercial hub Sao Paulo and one in the capital Brasilia.

Next year, she plans to grant concessions for the airports in Rio and Belo Horizonte to the private sector. Last week, she announced the construction of 800 regional airports across the country.

China's civil aviation booms with safer, greener record

(Xinhua)

08:37, December 21, 2012

BEIJING, Dec. 20 (Xinhua) -- China's civil aviation sector has grown steadily this year with an air safety record above the world's average and lower emissions volumes, Chinese civil aviation authorities said Thursday.

Amid the global economic downturn, the Chinese civil aviation market has realized robust growth this year in terms of major traffic indicators, according to Li Jun, deputy chief of the Civil Aviation Administration of China (CAAC).

In the first 11 months, the sector's total flight hours hit 5.64 million hours, up 10.2 percent year on year, Li said at a national work conference on civil aviation in Beijing.

During the same period, China's air safety record has improved, with the rate of casualties resulting from human error down 48 percent from last year, according to CAAC data.

Continuous positive safety records since 2003 have secured China's position among the world's leading countries in aviation safety, with lower death tolls and a smaller number of accidents compared with global industry averages, Li said.

By increasing airports' operating hours and optimizing flight routes, the sector's annual carbon dioxide emissions will fall by 240,000 tonnes, equivalent to a cut in fuel costs of about 540 million yuan (86 million U.S. dollars), according to Li.

SOURCE: Travelong

December 20, 2012 09:51 ET

Travelong Receives Outstanding Sales Award From Ethiopian Airlines

Leading Online Travel Company Ranks Among Top Selling Travel Agencies

NEW YORK, NY--(Marketwire - Dec 20, 2012) - Travelong, a full service travel agency under the Fareportal portfolio of brands that includes CheapOair, announced today that Ethiopian Airlines named them one of the airline's top selling travel agencies for the year. Travelong was ranked at number eight on the list for outstanding sales.
"We are honored to receive this award and the recognition from Ethiopian Airlines," said Sam Jain, President and CEO of Travelong. "To be ranked in the top 15 selling travel agencies is highly gratifying, as it further strengthens our continuous efforts to provide the best service for our customers."
In celebration of the Ethiopian New Year, an awards ceremony was held at the Hilton Mark Center in Alexandria to acknowledge Ethiopia's achievements, current undertakings and its Vision 2025. Invited guests included African Ambassadors such as Mr. Girma Birru, Ambassador Extraordinary and Plenipotentiary of the Federal Democratic Republic of Ethiopia to the United States of America, prominent Ethiopian community leaders, patrons of Ethiopian Airlines and travel agencies, among many others. Ethiopian Airlines also raffled off business and coach tickets to any of its 70 destinations for event attendees.
Travelong continues to be acknowledged for its outstanding work and efforts in the online travel industry. In the past year, Travelong has earned numerous performance awards from partners including: LAN Airlines, Korean Airlines, China Airlines, Avianca and TACA Airlines and been named to Travel Weekly's Esteemed Power List.
About Travelong
Travelong, a Fareportal company established in 1993, is a full service travel agency servicing more than 100 corporate clients and 30 home based agents and independent contractors across the United States. Fareportal is a global online travel company committed to innovation and technological advancements, providing leisure and business travelers, its partners and suppliers with a broad range of travel products and solutions through its portfolio of brands including Travelong, CheapOair, CheapOair Canada, CheapOair UK, OneTravel, HotelPricer and CheapOstay.

Boeing boosts airplane wi-fi with potatoes

How do you simulate a full airliner cabin to test wireless signals? If you're Boeing, with potatoes.
In a news release Wednesday, Boeing touted its new "advanced method to test wireless signals in airplane cabins," saying:

Boeing engineers created a new process for measuring radio signal quality using proprietary measurement technology and analysis tools. This enables engineers to more efficiently measure how strong a signal is and how far it spreads, ensuring safe yet powerful signal penetration throughout an airplane cabin.
Once the new method was established, testing that previously took more than two weeks to conduct was reduced to 10 hours.

Boeing didn't say much about the technical aspects of its test process, other than that it "takes advantage of state-of-the-art technology and ground-breaking statistical analysis to identify strong and weak signal areas and balance them by adjusting the connectivity system accordingly."
Boeing conducted a series of tests using the process on a decommissioned airplane. That's where the potatoes came in.

Read more: http://www.seattlepi.com/business/boeing/article/Boeing-boosts-airplane-wifi-with-potatoes-4132642.php#ixzz2Ff3Aq45G

Tanzania Tourist Board and Ethiopian Airlines Sign MOU

Posted by Mamo Gebrehiwot on Dec 18th, 2012 // No Comment

The Tanzania Tourist Board and Ethiopian Airlines have signed a two-year Memorandum of Understanding.

 The MoU was signed with the intention of increasing the number of visitors to both Tanzania and Ethiopia, increase the presence of Tanzania tourism in key international markets, as well as enhance the business profile of Ethiopian Airlines.

The MoU ceremony took place in Tanzania at Uhuru Hotel in Moshi near Kilimanjaro and was signed by Dr. Aloyce Nzuki, Managing Director for Tanzania Tourist Board and Mr. Hailemelokot Mamo, Sales Representative for Ethiopian Airlines.

Dr. Aloyce Nzuki, Managing Director for Tanzania Tourist Board said, “Ethiopian Airlines currently provides extensive airlift to Tanzania’s three major gateways (Dar es Salaam, Kilimanjaro and Zanzibar) and the new joint promotion agreement will expand the already strong partnership that we have with Ethiopian Airlines, especially in the North American market.”

Tanzania Tourist Board will develop and implement activities to promote tourist traffic to Tanzania via Ethiopian Airlines including promoting Ethiopian on the tourist board’s website, allowing Ethiopian to have a presence at Tanzania stands in trade and consumer fairs as well as organize joint road show promotions.

Other areas of cooperation between Tanzania Tourist Board and Ethiopian Airlines will focus on Tanzania and Ethiopia as twin destinations; and further support Ethiopian in developing programs and packages to Tanzania through its in-house tour operators. In the United States, ET African Journeys already offers a full range of destination Tanzania itineraries including to the northern and southern safari circuits.

Ethiopian Airlines will be responsible for providing support for familiarization programs for trade and media to Tanzania and in facilitating seat reservations on Ethiopian for Tanzania tour operators.

Ethiopian Airlines currently has 36 weekly frequencies from 62 destinations worldwide into Tanzania’s Kilimanjaro International Airport (KIA), Julius Nyerere International Airport in Dar es Salaam (JNIA), and Zanzibar International Airport (ZIA).Ethiopian Airlines’ North American gateways are Washington, DC’s Dulles International Airport and Toronto Pearson International Airport.

2012: The year in aviation

December 18, 2012 -- Updated 1433 GMT (2233 HKT)

Boeing and AirAsia won; SAS and Iberia lost. Here are the stories that had the air industry moving -- or not -- this year. We start with one of Europe's oldest airlines -- and one that still knows the meaning of passenger service -- SAS, which is in dire straits. If the airline fails, and it's been on the brink before, this will continue the trend in Europe toward consolidation that included the acquisition by British Airways of struggling Iberia.

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STORY HIGHLIGHTS

• SAS, Iberia among airlines on the brink
• Boeing and Airbus both suffer setbacks and delays
• China expands its aerospace industry ambitions
• Highly-anticipated EADS and BAE Systems merger collapses

(CNN) -- With 1 billion tourists in 2012, it's little wonder the last 12 months have drummed up some juicy fodder for aviation reporters.

London's Olympic Games were a success -- the expected tourism boon not so much.

"Dark tourism" (travel to sites of death, disaster or the macabre) became a phrase.

And various climatic events conspired to wreak havoc on travel plans across the world.

But which were the stories that really stood out to those who are involved in the industry every day?

These are the top 10:

10. SAS on its last legs

"A new comprehensive plan will pave the way for a new, strong and competitive SAS," read the statement from SAS last month.

"The plan needs to be fully implemented and new collective agreements must be signed in a very short space of time in order for SAS to have access to necessary funding."

One of Europe's oldest airlines -- and one that still knows the meaning of passenger service -- is in dire straits. SAS faces aggressive competition from low cost carrier Norwegian Air Shuttle, which has hundreds of aircraft on order from Airbus and Boeing.

The pioneer of polar flights, fully 40 percent of SAS's workforce is to be chopped.

If the airline fails, and it's been on the brink before, this will continue the trend in Europe toward consolidation that included the acquisition by British Airways of struggling Iberia.

Not that this consolidation under the International Airline Group (IAG) banner has gone well, either.

9. Iberia on the brink

IAG's Iberia will lose 4,500 jobs in a cost-cutting effort after losing €262 million (US$340 million) through September.

IAG characterizes Iberia in a "fight for survival." Nearly 25 percent of its aircraft will exit the fleet and pay might be cut by 35 percent.

There's a January 31, 2013, deadline for labor to reach an agreement with IAG, which is negotiating to buy Spain's Vueling Airlines, which is based in Barcelona.

Iberia cuts jobs in survival bid

8. A380 loved by passengers, but continues to be a profit drag on Airbus

The Airbus A380, a technological marvel and by all accounts a passenger delight, continues to be a thorn in the profit-and-loss statements of Airbus and parent EADS.

Discovery of wing rib bracket cracks in 2011 after the November 2010 high-profile engine failure on Qantas Flight 32 required costly refits.

Never a safety-of-flight issue and affecting only a handful of the thousands of brackets on the A380's wings, the retrofits and airline compensations cost Airbus nearly €300 million (US$394.8 million).

Airline schedules all over the globe were disrupted as fixes took aircraft out of service.

The ad wars that broke out between Boeing and Airbus in late November -- 747-8 versus the A380 -- only add another dimension to the long-running rivalry.

How do you pick up an Airbus A380?

7. Boeing roars back with 737 MAX

The first 737 MAX is scheduled for delivery to Southwest Airlines in 2017.

In 2011, Airbus stunned Boeing by announcing orders and commitments for about 1,500 re-engined A320neos.

This year, Boeing came roaring back, expecting to finish with firm orders for around 1,000 re-engined 737 MAX aircraft.

Boeing still trails market share, and the MAX will enter service two years later than the NEO. But any way you look at it, this was Boeing's year.

2012 annual pax reaches 3 billion, cargo traffic down 1%: ICAO

ICAO released (18-Dec-2012) its preliminary traffic* highlights for 2012, which showed passenger numbers rose 5% year-on-year to 2.9 billion in 2012. According to current projections, ICAO expects passenger numbers to reach 6 billion by 2030. 2012 traffic details include:

• Passenger numbers: 2.9 billion, +5.0% year-on-year;
• Passenger traffic (RPKs): +5.5%;
  • Africa: +6.7%;
  • Asia and Pacific: +6.9%;
  • Europe: +4.9%;
  • Latin America and the Caribbean: +8.4%;
  • Middle East: +16.8%;
  • North America: +1.2%;
    • International: +6.5%;
      • Africa: +7.4%;
      • Asia and Pacific: +5.5%;
      • Europe: +5.6%;
      • Latin America and the Caribbean: +11.7%;
      • Middle East: +17.3%;
      • North America: +1.3%;
    • Domestic: +3.9%;
      • Africa: +2.3%;
      • Asia and Pacific: +8.8%;
      • Europe: -0.7%;
      • Latin America and the Caribbean: +5.3%;
      • Middle East: +7.9%;
      • North America: +1.2%;
• Load factor: 78.8%;
  • Africa: 67.8%;
  • Asia and Pacific: 76.6%;
  • Europe: 79.4%;
  • Latin America and the Caribbean: 74.6%;
  • Middle East: 79.4%;
  • North America: 82.5%;
• Capacity (ASKs): +4.0%;
  • Africa: +5.2%;
  • Asia and Pacific: +5.9%;
  • Europe: +2.5%;
  • Latin America and the Caribbean: +6.1%;
  • Middle East: +11.6%;
  • North America: +0.7%;
• Cargo volume: 51 million tonnes;
• Cargo traffic (FTKs): -1.2%. [more – original PR]

*These figures are preliminary and cover revenue scheduled services only. The statistics are applicable to the traffic by region of airline domicile.

Boeing results share buybacks, boosts dividend

Posted: Dec 18, 2012 1:50 AM Updated: Dec 18, 2012 1:50 AM

CHICAGO (AP) - Boeing Co. says it will buy back $1.5 billion to $2 billion of its shares next year, and it is boosting its dividend.
Boeing says the buybacks and higher dividend are possible because it is generating cash and has a positive growth outlook. Boeing shareholders have been waiting to benefit from its new 787 plane.
The share repurchases will use up the rest of the money authorized for that purpose by Boeing's board in 2007.
Boeing also raised its dividend 10 percent, to 48.5 cents per share. It will be paid on March 8 to shareholders of record on Feb. 15.
Boeing shares have traded between $66.82 and $77.83 over the past 52 weeks. On Monday they rose 63 cents to close at $74.65.

Copyright 2012 The Associated Press. All rights reserved. This material may not be published, broadcast, rewritten or redistributed.

South African Republic to rehabilitate Soviet pilots

17.12.2012

 

South Africa's elite police unit "Hawks" has reopened the investigation of the crash of Tu-134, resulting in the death of Mozambican President Samora Machel. Perhaps now, 26 years later, the good name of the Soviet pilots will be restored.

The news was confirmed by global news agency. A representative of the investigative group Ramoloko told Agence France-Presse that he confirmed that the Hawks would be investigating the circumstances surrounding the incident. 

The death of President Samora Machel of Mozambique in in a plane crash in 1986 caused a great deal of controversy regarding its causes. An international commission investigating the tragedy concluded that the cause of the tragedy was a pilot error. However, the flight engineer Vladimir Novoselov, the only surviving member of the crew, denied it. "I'm sure that this was not an accident, but sabotage. South Americans planned it in advance," Novoselov told reporters.

Indeed, the relations between Mozambique and apartheid South Africa were very tense. Samora Machel (FRELIMO) who came to power in 1975 after the collapse of the Portuguese colonial system, took course towards leaving the area of influence of South Africa and rapprochement with the USSR. The apartheid government strongly resisted it. From the territory of South Africa "the Mozambique National Resistance" (MNS) attacked local authorities, took hostages, blew up facilities. Given that these were the years of the "cold war", and that South Africa had better players behind it - the United States and Great Britain - Soviet specialists always preferred the theory of sabotage. However, documented evidence has never been found.

On the night of October 19, the president's plane Tu-134 was traveling from Lusaka (Zambia) to Maputo. Suddenly, 96 kilometers away from the airport, it turned at 37 degrees to the right of the course and 10 minutes later crashed into a mountain in South Africa, near the border with Mozambique. 39 people were killed. The plane was operated by Mozambique and manufactured in the Soviet Union, and in accordance with the regulations of the International Civil Aviation Organization, the investigation was conducted on a tripartite basis, that is, with participation of representatives of South Africa, Mozambique and the Soviet Union. The first theory suggested that the pilots were drunk, but it was later withdrawn. The Joint Commission has determined that the aircraft was technically not defective; the crew strictly followed the chosen course, with a deviation from the axis of the route at no more than 4-6 km, which is admissible. The weather conditions were also normal.

As for the actions of the crew, the investigation confirmed that it was in good working condition, fully in control of the plane, and had clear communication with the dispatcher in Maputo airport. In January of 1987, the South African government unilaterally decided that the final conclusion would be prepared not by the joint commission but the court that started its hearing on January 20 in the capital of South Africa. As a result, the Soviet pilots were found the culprits of the accident. The Soviets had their own assessment of the tragedy and came to the conclusion that the reason for the deviation of the aircraft from the course was a false radio navigation beacon located outside the airport in Maputo. Soviet experts believed that it was a deliberate and well-planned action to destroy Samora Machel.    

South African journalist Jacques Du Preez who conducted his own investigation shared this opinion. Du Preez talked to local farmers who were the first ones to come to the crash site. In their stories they mentioned an army tent they saw on the mountain where the plane crashed. It was located approximately 150 meters from the remains of the aircraft. According to eyewitnesses, the tent was deserted the day after the accident.

However, these findings were not supported by experts from South Africa, the UK and the U.S. who were involved in the investigation. South African newspaper Times Live reported that the resumption of the investigation was personally authorized by South African President Jacob Zuma on newly discovered evidence. As follows from the above information, the facts were known, but for obvious reasons hidden. Senior Investigator Dumisa Ntsebeza told the reporters that the Ministry of Justice was given 43 documents relating to the catastrophe that they have not been able to fully explore due to the lack of time. These documents contain detailed information, including testimony under oath to military intelligence (apartheid) of witnesses who took part in the creation of false beacons.  

Why was the investigation reopened? The issue was raised at the political level in the framework of the Truth and Reconciliation Commission between South Africa and Mozambique. Ntsebeza told Time Live that people were dying, memory was fading, documents were getting lost, and the time was covering the tracks. If Samora Machel was lured into a deadly trap on South African soil, it was a crime, and a proper criminal investigation must be conducted.

Both Mozambique and Russia want to know the truth and await rehabilitation of the Soviet pilots.

Lyuba Lulko

Pravda.Ru 

Read the original in Russian

Turkey's Pegasus close to landmark Airbus order

(Reuters) - Turkish low-cost carrier Pegasus Airlines appears close to making its first purchase of European passenger jets with an order for as many as 100 Airbus A320-family aircraft, sources familiar with the matter said on Monday.
The decision to switch suppliers by a fast-growing airline that currently operates only Boeing (BA.N) jets follows a tough contest between the world's two largest planemakers.
Initial negotiations for 50 jets between Pegasus and the manufacturers were first reported by Reuters in July and became a flashpoint in the fiercest global battle for market share between Airbus and Boeing for a decade.
If confirmed, the airline's final purchase could reach as many as 100 aircraft worth more than $9 billion at official list prices, the sources said, asking not to be named.
Airbus and Pegasus declined to comment.
Founded in 1990, Pegasus has grown its fleet from just two aircraft to more than 40 mostly Boeing (BA.N) 737-800s over the past two decades and serves 52 destinations in 24 countries.
Its latest expansion highlights rapid growth in Turkish aviation after flag carrier Turkish Airlines (THYAO.IS) recently ordered long-range aircraft from both Boeing and Airbus.
Istanbul-based Pegasus is looking to seize on a 15 percent improvement in fuel consumption offered by the latest revamped models of narrowbody, medium-haul jets -- the Airbus A320neo and Boeing 737 MAX.
Industry watchers said the competition was intense as Boeing resisted efforts by Airbus to secure one of its entrenched customers, a type of duel known as a "flip fight".
Airbus is smarting after suffering the defection of one of its own high-profile customers, Silkair, the regional arm of Singapore Airlines (SIAL.SI), which announced a $5 billion order for Boeing 737 jets in August.
Both companies have accused the other of waging a price war.
Airlines often stick with one supplier for the same aircraft category to save on maintenance and training costs. But the arrival of more efficient jets sparked a scramble for orders and allowed each supplier to woo customers previously loyal to the other side.
The step-up in technology has also produced wild swings in the fortunes of U.S. and European exports as first Airbus then Boeing sold more than 1,000 jets in 2011 and 2012 respectively.
Airbus is expected to lose the annual order race to Boeing heavily this year after winning for four years in a row.
Longer term, the planemaking unit of Europe's EADS says it hopes to keep a 60 percent share of the 150-seat narrowbody segment, a market estimated at $2 trillion over 20 years.
Industry sources say Boeing is determined to defend a roughly 50 percent share of the same market. The A320 and 737 families are the world's most popular passenger planes and both serve as 'cash cows' for larger aircraft developments. (Editing by James Regan)