Various Aviation News

[Guest Darren Masters]

Source: Australian Aviation Xpress

 

AIRLINES

 

* JETSTAR CUTS TIES WITH JETSTAR ASIA:

 

In a move which could have repercussions for the airline's Asian expansion, Jetstar Asia has ended its affiliation agreement with Jetstar.

 

Orangestar Holdings Pte Ltd, which is the holding company for Jetstar Asia and ValuAir, has been operating under an MoU in which Jetstar provided reservations, revenue management, marketing, and a number of other services to the two carriers. It is believed that the two partners have been working together to change the arrangement to bring it into line with the Business Services Agreement which Jetstar has with its Vietnamese affiliate Jetstar Pacific.

 

"This move essentially reflects the confidence we have in our own talent and ability,†Jetstar Asia's CEO, Chong Phit Lian told Singapore media. “It also gives us better cost advantage. Still, we will continue working with Jetstar Australia in many areas including maintaining a common website."

 

Jetstar spokesman Simon Westaway said that the two carriers would continue to have a close working relationship, adding "Jetstar Asia wants to do a few things more independently and we can deal with that. They have decided for local reasons to have more independence."

 

But that independence is likely to cause some strain between the airlines, particularly as Jetstar embarks on its plan to expand its presence in Southeast Asia, and may influence Jetstar not to choose Singapore as its hub for long-haul flights to Europe.

 

Qantas will maintain its 49 per cent stake in Orangestar Holdings, but is believed to disagree with Orangestar's second biggest shareholder, the Singapore government owned Temasek Holdings, about how to expand Jetstar Asia. Temasek is also a major shareholder in key rival Tiger Airways and has the controlling shares in Singapore Airlines.

 

* JETSTAR LAUNCHES PERTH SERVICES:

 

Jetstar launched its newest services from Perth on June 16, which will see it replace Qantas's services to Jakarta and Denpasar.

 

Jetstar will operate JQ116 to Denpassar on Mondays, Fridays and Saturdays from October 27, while the JQ114 service to Jakarta will operate on Tuesdays, Thursdays and Sundays. In addition, Jetstar will start its five times weekly Sydney-Darwin-Ho Chi Minh City service to be operated by an Airbus A320 from September 2.

 

“We are excited by the prospects that these three new international routes present for Jetstar,†said Jetstar's GM Commercial, Bruce Buchanan. “They will broaden our footprint across Southeast Asia and see us establish our seventh Australian port for international operations.â€

 

Jetstar will soon begin recruiting pilots and cabin crew for its Perth base to support these operations, which are likely to initially use a single A320.

 

* VIRGIN BLUE CEO FINDS FUEL ‘CHALLENGING':

 

Virgin Blue CEO Brett Godfrey says that the current record fuel prices are the “biggest challenge ever that the airline industry has faced,†and that it is “worse than September 11 and SARS.â€

 

Godfrey made the comments on ABC TV's ‘Lateline Business' in an interview on June 19, but emphasised that the deepest impact of the fuel prices would be felt worse in North America and Europe rather than in the Australian market.

 

“I'm quite comfortable that in this market it's going to be tough – it's definitely tough already in fact – but with good management, and good cash management in particular, I think all airlines in the country will get through it,†said Godfrey. “[but] not one single airline, not one single company in Australia is going to be unaffected if fuel hits $200 a barrel.â€

 

He also said that the carrier was in talks with Embraer about delaying deliveries on some of its E-Jets, as well as a number of other “levers†which the carrier could pull should the price of fuel rise above the current US$166 (A$175) per barrel level. These include charging for checked baggage, withdrawing more capacity or increasing fares further.

 

But he denied that the airline would need a capital injection in the short term under any of the scenarios which the airline has been modelling. “None of those three year scenarios have us looking at any further capital,†he said.

 

* V AUSTRALIA, QANTAS BEGIN PACIFIC DUEL:

 

Qantas has drawn first blood in the competition with V Australia on the Sydney-Los Angeles route by offering a limited number of return airfares from LA for US$380 (A$401).

 

The fare was a promotion ex-USA only to coincide with the launch of A380 services on the LA route in October, but has been seen widely as also a competitive move against V Australia which has vowed to offer fares up 16 per cent lower than the lowest Qantas fares. Qantas has not publicly committed itself to further sales on the route but is likely to launch some promotions before V Australia's first flight in December.

 

Meanwhile, there has been some speculation that V Australia will either defer or not take up options on additional Boeing 777-300ERs due to the high cost of fuel. V Australia had been expected to announce further routes over the last few weeks, but may instead choose to focus only on the US market in the current climate.

 

* QANTASLINK TO CANCEL MELBOURNE-WOLLONGONG:

 

QantasLink has announced that it will cancel its service between Melbourne and Wollongong and dispose of the last of its DHC-8-100s in response to the high cost of fuel.

 

QantasLink will suspend the underperforming route from July 18, and will withdraw the remaining six Dash-8-100s by August. The retirement of these aircraft will also necessitate the closure of QantasLink's Mildura maintenance facility. “We will work closely with the affected staff in Mildura to minimise redundancies by offering alternative job opportunities at other QantasLink locations,†said Qantas Group CEO Geoff Dixon.

 

QantasLink will also permanently withdraw from the currently suspended services to Melbourne and Sydney from Newcastle. The services were suspended earlier this year due to a crewing shortage, but Jetstar will continue to serve both routes, while Aeropelican offers up to eight daily services on Newcastle-Sydney.

 

* AUSTRALIA, EU START OPEN SKIES TALKS:

 

European transport ministers have approved a mandate which will allow the European Commission to negotiate a collective open skies agreement with Australia, possibly opening the way for more flights.

 

“An 'open skies' agreement could remove many - if not all - of the existing regulatory limitations on Australian and European airlines operating between our two continents - allowing them to offer more flights and a wider range of services at the most competitive prices,†said Transport Minister Anthony Albanese in a statement on June 17.

 

An open skies agreement would open up significant opportunities for Qantas, Jetstar and V Australia, including the possibility of opening up new city pairs which were not possible or not economic under the previous system of bilateral agreements. Any move into Europe for the Qantas Group would likely depend on the delivery dates for its Boeing 787s, the first of which is not expected to be delivered to Jetstar until late next year.

 

The new agreement could also entice European operators to return to Australia, as most currently only codeshare on services via Asia, although this may be largely dependent on the price of fuel falling in the medium term.

 

* OIL PRICES TO LEAD TO CATASTROPHIC LOSSES IN US AIRLINE INDUSTRY:

 

The US Air Transport Association predicts that US carriers will lose US$10bn (A$10.5bn) this year due to the high price of fuel, which another report predicts will devastate one of the biggest industries in that country.

 

The ATA says that 14,000 jobs have already been lost from the industry and over 100 communities have lost their air services as a result of cuts by airlines at all levels. The Association has also warned that losses could blow out to US$13bn (A$13.7bn) this year and another 100 communities face losing their services if oil prices push upwards.

 

“The impact of these unprecedented jet fuel prices on the airlines is devastating and airlines may see 2008 losses nearing $10bn (A$10.5bn), on par with the worst financial year in aviation history," ATA President and CEO James C. May said. “This year, airlines will spend more than US$61bn (A$64bn) on fuel, slightly more than the total fuel bill combined for the first four years of this decade.â€

 

Meanwhile, a report commissioned by the Business Travel Coalition and conducted by AirlineForecasts LCC says that with oil prices at US$130-140 (A$136-146.50) a barrel that the industry is headed for a major collapse and has called on Congress to make stabilising the industry a national priority.

 

“We urgently need a new energy policy that will give the airlines a fighting chance to survive and recover – and serve all members of the travelling public for many years to come,†the report said.

 

* VIVAJET TO LAUNCH DOMESTIC FLIGHTS IN NOVEMBER:

 

VivaJet, a new Melbourne-based airline, says it intends to launch in November this year, offering both passenger and freight services between a number of east coast cities.

 

The company has been registered in Victoria since October 2006 and is backed by a number of German investors. VivaJet says it will operate Embraer E-170s and E-190s, ATR 72s and an Airbus A300 Freighter, and plans to connect Sydney, Canberra, Melbourne, Brisbane, Hobart, Adelaide and the Gold Coast. It is believed that VivaJet has already secured slots at a number of these airports and It is believed that the airline will start flying in November with four E-190s and one E-170.

 

According to a press release circulated by the Centre for Asia Pacific Aviation the carrier will offer a service standard, “never experienced before in Australia. And all this on a low fare basis, including complimentary meals and drinks.â€

 

Few of the existing competitors in the domestic market have made any comment yet on VivaJet's ambitions, except for Virgin Blue CEO Brett Godfrey who said in an interview on ABC TV's ‘Lateline Business', “I've never discounted any competitor, but I think it would be kind of moronic to be trying to come into this market now, and I wish them the best of luck.â€

 

Airline briefs

 

* Virgin Blue has launched a new ‘airpass' for non-Australian residents which will allow international visitors to access any available seat within three bands. Bookings will be able to be made through a dedicated website which will go live in August.

 

* Etihad Airways has received a commendation for its work in preventing improperly documented passengers using the airline to travel to Australia.

 

* Emirates will donate $150,000 over three years to support the Bradman Foundation. The majority of the funds will go towards the Bradman Foundation XI cricket team.

 

* Singapore Airlines has once again increased its fuel surcharge. SIA and Silk Air will now charge US$40 (A$42) per sector on flights within ASEAN, US$150 (A$158) per sector on North American routes and US$110 (A$116) on all other sectors, including those to and from Australia.

 

* Continental and United Airlines have announced a new cooperation agreement, with Continental being invited to join the Star Alliance on June 19. Continental is currently a member of the SkyTeam alliance alongside Northwest and Delta, which are set to merge later this year.

 

* Skyairworld will commence services between Brisbane, Cloncurry and Cairns from August, operating two 50 seat Embraer ERJ-145s. The first ERJ arrived in Brisbane earlier this month, with the second due to arrive by month's end.

 

* Singapore Airlines and Saudi Arabian Airlines have signed a Memorandum of Understanding for further cooperation on routes to Saudi Arabia. The two carriers will introduce code-sharing, joint marketing and other initiatives under the MoU.

 

* MacAir Airlines has joined with Woolworths in sponsoring a program which rewards students at some outback schools in northern Queensland if they regularly attend school. Most of the schools involved in the program are in cities served by MacAir.

 

* Air Korea, the low cost subsidiary of Korean Air Lines, will change its name to Jin Air. Jin will commence domestic services in mid July with three Boeing 737-800s and will later add an Airbus A300.

 

* American Airlines is reportedly considering accelerating the delivery of its 737-800s as it phases out its ageing fleet of MD-80s by August. The airline is currently scheduled to take delivery of about 70 737s over the next two years, but needs to replace more than 300 of the 20+ year old MD-80s.

 

ENVIRONMENT

 

* LUFTHANSA COMMITS TO USING BIOFUELS BY 2020:

 

Lufthansa has committed to using a 10 per cent mix of biofuel across its aircraft fleet within the next 12 years.

 

Lufthansa announced the commitment on June 16 as part of a wider set of 15 environmental guidelines which also apply to its other flying subsidiaries such as Swiss. Other guidelines include pursuing noise abatement projects, support for ecologically-oriented incentives to reduce emissions and also the endorsement of the IATA efficiency targets, which would see it reduce emissions by 25 per cent by 2020.

 

“Our strategic environmental programme for safeguarding mobility clearly demonstrates that we are firmly intent on doing our share in the future in shouldering our responsibility for environment and climate protection,†said Lufthansa's chairman and CEO Wolfgang Mayrhuber.

 

Lufthansa is the second airline after Air New Zealand to have set a timeline for introducing biofuels into regular passenger services. Lufthansa is believed to be focused on biofuels which may be sourced from algae and other sources which would not compete with food plants.

 

Environment briefs

 

* The Commercial Aviation Alternative Fuels Initiative says that it is on target to achieve certification for 50 per cent synthetic fuels in aviation fuel by the end of the year. Synfuels may be generated from biomass, coal and natural gas through the Fischer-Tropsch catalytic process, but creates more emissions than petroleum fuel due to the extra processing required.

 

GENERAL AVIATION

 

* Heliflite has opened its newest Robinson and AgustaWestland sales and service centre at Jandakot Airport. Tony Bates will be the centre manager and Heliflite plans to recruit a number of staff in the near future.

 

BUSINESS AVIATION

 

* Gulfstream has rolled out the 200th G550/G500 jet from its Savannah, Georgia, manufacturing facility. There are 172 G550/G500s currently flying, which have collectively logged over 200,000 flying hours since the first G500 was delivered in September 2003.

 

* The Hawker Beechcraft Company delivered the first Hawker 4000 on June 18. The aircraft received its certification a week before, following a protracted development which required the original aircraft to be re-certified.

 

* An unnamed Middle East client has ordered two A318 Elite Airbus Corporate Jets (ACJs). The ACJ can fly up to 7800km, sufficient range to cover anywhere in Europe from the Middle East or one stop to the US.

 

MAINTENANCE, SUPPORT & TRAINING

 

* QANTAS ENGINEERS STRIKE SET TO AFFECT SCHEDULES: Qantas engineers are again striking on June 23 in their push for a pay increase.

 

Engineers in Sydney and Melbourne are striking for four hours on Monday June 23. As a contingency, Qantas has already cancelled a number of flights and is rebooking affected passengers on other services. The airline says that it expects to get all passengers to their destinations on the day, although some may be delayed.

 

“It's about the money,†said Steve Purvinas from the Association of Licensed Aircraft Engineers of Australia (ALAEA) in an interview with ‘Bloomberg'. “We are almost in agreement about work conditions but Qantas said they won't negotiate while we have action planned.â€

 

The ALAEA also claims that the airline is dispatching aircraft with more “allowable defectsâ€, claiming that on just one recent day, there were more than 750 allowable defects across the Qantas fleet. "If they don't have enough engineers to repair those defects that are reaching their final days ... well then they will have problems and will have to remove some aircraft out of service I dare say," Purvis told ABC Radio.

 

The engineers have been waiting for a new pay deal for 18 months, having refused a previous offer from Qantas of a three per cent pay rise with an additional one per cent superannuation. The ALAEA has implemented overtime bans and limited strike action since May in an effort to push for a five per cent pay rise.

 

* JANDAKOT AIRPORT SPONSORS HIGH SCHOOL AVIATION PROGRAM:

 

Jandakot Airport Holdings has announced that it will provide funds to allow more students from Kent Street Senior High School to undertake instructional flights as part of the school's specialist aviation program.

 

JAH is making the sponsorship through its Community First Program, which aims to engage with local community programs around the airport. “Given the current staffing shortage in the aviation industry we see this partnership as an investment in the future of these students and that of general aviation,†said JAH managing director John Fraser.

 

The support was welcomed by Kent St principal Rod Beresford who said, “The funding will allow two members of staff, who are both practicing commercial pilots, more time in the air with students.â€

 

Kent St currently has 125 students in its aviation program, which was the first aviation high school program in the southern hemisphere. The school operates three aircraft, including a student-built Vans RV-6, which are used for familiarisation flights.

 

CARGO

 

All Nippon Airways has taken delivery of the first 767-300ER Boeing Converted Freighter after it was handed over on June 16 at ST Aerospace's facilities at Singapore's Changi Airport. ANA has seven 767-300BCFs on order, all of which will be converted by ST Aero.

 

* US-based ACMI operator Gemini Air Cargo filed for Chapter 11 bankruptcy protection on June 18, but plans to continue operating. Gemini operates DC-10 and MD-11Fs for a number of clients including airlines and freight forwarders.

 

Commercial briefs

 

* Boeing is investigation using manganese-lithium ion batteries on the 787 as part of the main and auxiliary power supplies of the aircraft. The manufacturer is considering the new batteries due to concerns about the service life of regular lithium ion batteries.

 

SALES

 

* Brazilian regional carrier TRIP Linhas Aereas has ordered five Embraer E-175s and has taken options for 10 and purchase rights for another 15 E-Jets.