March 2008 Archives

"I take responsibility for what happened. The buck stops with me." These were the words of British Airways chief executive Willie Walsh today, following the debacle that was the opening day of London Heathrow's Terminal 5.

Walsh will no doubt be facing a barrage of criticism for yesterday's botched opening of T5, and I would not like to be in his shoes today. But it's refreshing to see someone taking full responsibility for their actions and not pointing the finger at everyone else for a change.

Having recently interviewed Walsh at T5 ahead of its not-so-grand opening, it was clear to see that the terminal meant a great deal to him and, if it's any consolation to the passengers left stranded or luggageless (it's probably not), I'm sure he'll be feeling pretty rubbish right now.

Need a reason to go to New Zealand? How about the mountains; the beaches; the friendly people; the Lord of the Rings scenery; the great food and wine? Yeah? Well, then, what about leaf-peeling?
Air New Zealand is promoting “leaf-peeping” to lure travellers to the Land of the Long White Cloud in autumn.
So just what the devil is leaf-peeping?

Poor British Airways - it would have been hoping that the long-awaited opening of its spangly new Terminal 5 at London Heathrow today would have generated headlines lauding its spaciousness and super-efficient baggage system.

But, alas, a quick Google news search of Terminal 5 brings up headlines such as "Baggage hitch mars opening of new terminal", "Delays, protests as Heathrow's T5 opens" and "Heathrow Terminal 5 opens amid baggage delays".

It appears that the baggage system boasting of its ability to process 12,000 bags an hour has left passengers waiting for two hours to collect their luggage. These frustrated passengers would be forgiven for thinking that some things never change!

Hopefully for BA this is just a slight teething problem that will quickly be resolved. The new terminal is a big deal for the carrier, as outlined in our recent cover interview with chief executive Willie Walsh, which took place at T5. The new terminal was supposed to put an end to the baggage delay headlines - I'd say the engineers charged with putting right whatever went wrong today will be working under just the slightest amount of pressure!

Despite its small size, operating a single leased Airbus A330, Malaysia's AirAsia X has managed to generate enough hype to ensure it is never out of the headlines for too long. The carrier had hoped to launch with more than one aircraft but the leasing market for A330s is incredibly tight.

Today the long-haul, low-cost carrier set its PR team in motion once again to publicise the signing of a firm contract with Airbus for 10 A330-300s, adding to the 15 A330-300s ordered by the airline in June 2007. Air Asia X will begin taking delivery of its first purchased aircraft this October.

The carrier assembled a group of local big wigs and Airbus representatives to celebrate today's signing. Pictured from left to right are: Airbus executive vice-president Asia-Pacific, Africa and Corporate Jet, Eduoard Ullmo; AirAsia X chief executive Azran Osman Rani; AirAsia X chairman Dato' Seri Kalimullah Hassan; Malaysian transport minister YB Ong Tee Keat; Airbus chief operating officer customers John Leahy; German ambassador to Malaysia Herbert D Jess; French ambassador to Malaysia Alan Du Borispean; and director general of Malaysia's civil aviation department Datuk Azharuddin Abdul Rahman.

There is still sceptism over whether the concept of a long-haul, low-cost airline can actually work - especially with fuel prices continuing to skyrocket - but AirAsia X certainly seems to be doing a good job of getting its brand out there, which is surely an important first step.

After hearing Robert Milton speak in London two weeks ago I thought out loud that the next step for our Canadian friend could be as an airline investor.

Well, a release from Malaysia today tells me that Mr Milton has indeed been active on this front already: he has been revealed as one of the founding investors in AirAsia X, the low-cost long-haul carrier starting up from Kuala Lumpur.

Having edited the Airline Business appointments page for what, seven years, now, I feel comfortable reading the tea leaves when it comes to career progression.

So, the revelation that Ghaith Saeed Al Ghaith, currently executive vice-president of operations at Emirates, is being rewarded with the job of leading Dubai's soon-to-be launched low-cost carrier leads me to believe that the next step for this accomplished airline manager will be to lead Emirates itself someday.

The apparent collapse of a proposed Delta/Northwest airline merger is likely to leave other possible combinations on the drawing table for some time. A possible Continental tie up with United, conceived as a response or domino reaction, is probably not going to happen. See Left Field for a discussion.

My colleague and expert in all matters business aviation over at Flight International, Kate Sarsfield, has written an excellent story explaining Lufthansa's move to buy its own business jets to woo high-end passengers.

Lufthansa is alone it seems, at least for now, in having a strategic vision that goes from providing ultra-exclusive, first-class services (business jets, dedicated first-class terminal etc) right through to low-cost flying (germanwings).

Robert Milton is nothing if not frank about the business he loves so much. "Airlines are the most fun to talk about even though they are the worst business we have," he told the audience at London's Royal Aeronautical Society on Tuesday evening.

Milton gave a lecture on "The ACE Equation: The sum of parts is greater than the whole." The story is how the Air Canada group - the airline, maintenance arm, frequent flyer plan and regional carrier - has gradually been split up and spun off. He discussed the concept in depth with Airline Business in a cover interview in 2006.

Since 2006, when holding company ACE Aviation began selling off parts of these four companies it has returned over $3.7 billion to shareholders, said Milton.

The week that some wish never was saw Southwest Airlines, beloved of Wall Street and frugal flyers, caught up in fight for its fame and the public trust. In the course of six days, it found itself facing a record FAA safety fine of $10.2 million, a probe by the FAA, by a congressional committee, by a federal whistleblower-protector and by its own internal watchdog.
This reversal of fortune eclipses any possible merger or acquisition in the States. Flightglobal’s worldly globetrotter, Kieran Daly, discusses this week with Airline Business's Left Field here, and you can hear more Left Field here and read more here. Kieran also gives some insight into the recent performance of EADS, the parent company of Airbus.

With just under two weeks to go until London Heathrow's Terminal 5 finally opens, the frenzy of events surrounding the beginning of operations is hotting up.

This Thursday sees BAA and BA unleash a string of senior managers to brief all and sundry about the terminal ahead of the "official" opening of T5 by Her Majesty The Queen at a ceremony to be held on Friday 14 March 2008.

Operations at T5 begin on Thursday 27 March.

Capitol Hill’s leading aviation expert went on the attack against the FAA after the agency proposed its largest-ever safety fine- $10.2 million – against Southwest Airlines. Jim Oberstar, the House Transportation Committee’s chairman, told reporters, “Complacency has likely set in at the highest levels of FAA.” He said at a news conference that “we’ve seen the pendulum swing away from vigorous enforcement of compliance toward a carrier-favorable, cozy relationship with the airlines.” Oberstar, the Congressional "go-to" guy on aviation, says the FAA ignored safety whistleblowers, and invited other airline whistleblowers to step forward. While a labour group leaps in on the FAA-bashing, a senior Republican charges it’s just politics as usual. And a former NTSB investigator defends Southwest. See Left Field for a full discussion.

Airline Business and the San Diego airport are wrapping up Network2008 out here on the West Coast. Airports and airlines may be worried about mergers and acquisitions, but some airports are pushing ahead. They're doing their homework and spadework to keep their routes profitable no matter who flies the route and no matter what livery and name are on the plane. Some airports such as Dayton, Ohio, and Hartford, Connecticut, have some upbeat reports. Go to Left Field for a report and some podcasts straight from the source.

Decked out in a casual shirt and against the backdrop of a colourful garden, British Airways chief executive Willie Walsh has started to state his case for the airline’s green credentials in a new column in BA’s High Life in-flight mag.

According to the blurb “The Green Wing” is going to be Willie’s way for customers to put “eco questions” direct to him.

Alitalia just can't seem to get a break. As the beleaguered carrier continues to bleed cash (I'm surprised it's not suffering from anaemia by now) news broke yesterday that an Italian court has declared that the 2006 decision to sell budget operator Volare to Alitalia was irregular, and the tender must be rerun.

Alitalia's management team must have put their heads in their hands and cried at this decision, which comes at an inopportune moment less than two weeks before potential knight in shining armour Air France-KLM is due to decide whether to come to the rescue and make a binding offer for the Italian carrier.

This latest setback follows an ongoing political storm in northern Italy over Alitalia's decision to drastically cut capacity at Milan Malpensa, which I wrote about here. Does anyone truly think Alitalia can be saved? Answers on a postcard to somewhere in Rome...