November 2008 Archives

The iconic luxury liner the QE2 - Queen Elizabeth 2 - arrived in Dubai this week and was greeted by a new air transport icon - the Airbus A380.

As she steamed into Dubai on her final voyage, where she will be converted into a luxury hotel and entertainment complex, the third A380 to join the fleet of Emirates put on a little flypast.

Air France-KLM has created a new home for its shareholders on the web, where they will be able to take a "high-flying tour through the different structures that are open to them, powered by their special 'jetpack'".

Gone are the days of trawling the airline's website for the Investor Relations section, where quarterly results and other information of interest to shareholders is unexcitingly laid out in list format.

Instead, Air France-KLM shareholders can visit An island in the sky, a website hosted by Second Life which the carrier is billing as "a new platform where shareholders can meet, share information and get updates on the latest financial news from the group".

Among the documents available to shareholders will be an interactive library containing the carrier's most recent financial publications, interactive 3D stock market information, and a virtual auditorium for interactive meetings.

Air France-KLM chairman Jean-Cyril Spinetta says of the new website: "The Second Life universe gives our shareholders a place to learn about the group and exchange information and ideas in a convivial, interactive environment."

For more information, see this press release.

A press release arrived in my inbox from Finnair this morning, announcing that a baby girl had been born on one of its flights from Bangkok to Helsinki.

As a pregnant woman, the press release caught my eye and got me wondering how common this is. So I did a google search to find out how many babies are born on planes each year, but I couldn't find any actual numbers.

Finnair's press release says pregnant women are permitted to fly up to the end of the 36th week of their pregnancy and up to 38 weeks on its short-haul flights, provided the pregnancy has proceeded normally.

I was surprised by this - I didn't think airlines would allow travel so late in pregnancy. Speaking for myself, I wouldn't want to take the risk of giving birth on a plane. I can't imagine there'd be much privacy!

It also got me thinking - what would the baby's nationality be? Does anyone know what the rules are on this?

For those interested in the Finnair case, here's the rest of the press release:  

Flightglobal.com's mascot Stefan, see this blog earlier this week, is soaking up the atmosphere here at the ALTA Airline Leaders Forum in Cancun.

That's when he not reading the Airline Business Daily we are producing here at the event of course! The lead story from Day Two's paper was a scoop for Washington-based senior editor Brendan Sobie with TACA and Copa both announcing moves towards the Star Alliance.

Travelling from the UK to Cancun in Mexico for the Latin Airline Leaders Forum has taken me via Atlanta, my first visit to the world's busiest airport (as the TSA guard reminded us) for some time.

Atlanta is almost the perfect transfer airport: anonymous and devoid of personality but it works.

So I was pleasantly surprised to see Atlanta injecting a little bit of atmosphere into the centre of Concourse E with some live music. Michael B - pianist, composer, arranger - as his card says, was treating the Tuesday late afternoon crowd to a few easy tunes.

I am part of the Airline Business team travelling to Cancun to cover the Leaders Forum, which is run by the Association of Latin American Airlines and also features its annual meeting.

We are producing a daily paper at the conference, as we did for the IATA AGM this year in Istanbul and at Routes in Kuala Lumpur. We've done one issue in advance and issues 2 and 3 will be available from Friday and Monday next week respectively.

An interesting feature of the Latin market is that it is the only region of the world where traffic is still growing. Just how long that is the case will be a topic of debate in the next couple of days.

For the eagle-eyed among you, see if you can spot in the photograph Stefan, the "action man" pilot puppet given to me for the trip by my colleagues at Flightglobal.com.

I will leave it to our community editor Stuart Clarke to explain the significance of Stefan. This is a test to see if he is reading this blog.

Over to you Stu!

Even by Michael O'Leary's press conference standards, this morning marked a new low/high. To mark the UK launch of Ryanair's 2009 Cabin Crew Charity Calendar, O'Leary countered charges of sexism and criticism the calendar contained no male cabin crew by donning his own swimwear for the cameras this morning.

Say what you like about O'Leary, he certainly has balls - something which but for the grace of god could have been all too apparent today.

Finnair has put its recently reported dismal set of third-quarter financial results firmly out of its mind for a moment to celebrate its 85th birthday through the launch of a retro aircraft.

The carrier has taken the trouble (not to mention expense) of painting one of its Airbus A319s in the livery of a Convair aircraft operated by Finnair in the 1950s.

In addition, Finnair has tracked down passenger Arna Davies, who flew on the original Convair aircraft on her honeymoon in 1957, and convinced her to fly from Helsinki to London Heathrow on the repainted A319.

The A319, which Finnair has dubbed the Silver Bird, can be seen in the picture above. If you want to see more shots of the Silver Bird, click here.

Finnair has also created its own retro website to celebrate its old age.

Fuel hedging. Hard to understand and hard to get right - especially in the past year with prices as volatile as they have been.

This article from John Bowker at Reuters nicely sets out the current state of play on airline hedging.

It follows our very own Kerry Ezard's article in the August issue of Airline Business that set out what airlines were doing when oil was at or around its peak of $140+ a barrel.

Since then many caught a cold, having hedged at over $100 a barrel when it was up in the $140 pirce range, only to see the price drop back well below $100.

Then there are the US carriers like Southwest and United that have had to account for losses in their fuel hedge contracts.

As ever when people are trying to second guess the market the potential for error is large. But who have thought fuel hedging would have become so critical and topical as it has been in the past months.

It seems Virgin Atlantic is very protective over the design of the seats in its Upper Class cabin. According to this report, the carrier is taking UK seat manufacturer Contour to court to try and prevent it from selling the seat to rival airlines.

Apparently the seat was designed by Virgin's in-house design team, so they're quite tetchy about the prospect of it being copied by other carriers.

I've been lucky enough to fly Virgin Upper Class once (one of the perks of being an aviation journalist back when times were better and airlines flew journalists around on press trips).

It was the first time I'd ever flown anything other than economy and I can remember being quite impressed with the fact that I could not only stretch my legs out, thus avoiding bruising my knees on the seat in front for once, but could also lay flat, say night-night and go to sleep.

However, I, like every other journalist on board, was even more impressed with the in-flight bar. As soon as the fasten seat belt sign was turned off, there was a stampede of hacks to the bar, which quickly resembled Saturday night at a popular nighclub. 

After hosting some Chelsea soccer stars yesterday at its World Travel Market stand Etihad has turned to the celebrity world of pop to take care of Miss Dannii Minogue, a pop star and judge of X Factor (UK version) and sister of a certain Kylie.

Poor old Clive Wratten, UK country manager, had to break off selling lots of seats to pose for a few snaps with the lovely Miss Minogue and a replica Formula 1 racing car.

In return for doing a stint at WTM Miss Minogue seems to get seats on Etihad to fly back to her home country of Australia, and in particular her home town of Melbourne. Etihad flies to Melbourne daily from Abu Dhabi.

I received a press release from Aeroflot today, telling me that the carrier has entered an agreement with several Russian oil companies on a fixed pricing formula for jet fuel.

It says this is "part of the Russian government's plan to stabilise fuel prices". This is the first time I've seen such an agreement between an airline and an oil company - is anyone else aware of any similar agreements that have taken place in the past?

If fuel prices shoot up again to the levels seen earlier this year, this could give Aeroflot and other Russian airlines a significant competitive advantage.

Here's the full text of the press release:

AEROFLOT AGREES ON FIXED JET FUEL PRICING WITH RUSSIAN OIL COMPANIES

Moscow, 11th November 2008 - Aeroflot has agreed on a new jet fuel pricing formula with several leading Russian oil companies as part of the Russian government's programme to stabilise fuel prices.

The Gazprom-led group of oil companies will sign long-term contracts with Russian airlines incorporating a fixed pricing formula for the entire contract period. Price quotations by Platts, a leading global provider of energy information, will be used as the basic benchmark indicator for determining the price formula.

"The newly agreed jet fuel pricing formula will be an effective instrument enabling Russian airlines, like Aeroflot, to become more flexible when planning fuel expenses and hedging risks connected with price fluctuations," said Aeroflot's Chief Executive Officer Valery Okulov.

Staying loyal to the path trod by Emirates in associating itself with sporting greatness, neighbour Etihad Airways was seen doing the same at London's World Travel Market today.

The airline's UK country manager Clive Wratten is seen posing with Premiership stars Ashley Cole (far left), Didier Drogba and Florent Malouda of Chelsea.

Now I suspect Clive is not a Chelsea supporter - maybe he can tell us? That's the trick with sponsoring a team - you don't really care except in a business way if they win or lose.

At least Chelsea can be confident of the financial health of their sponsor. Unlike poor West Ham with XL Airways, which went bust forcing the "Hammers" backroom staff to get the needle and cotton out and hastily patch over the Excel logos.

Tell us of any other "stars" you saw at WTM.

In my blog the other day I highlighted some cases of airline employees using social networking sites to slag off their passengers.

Now, Air France-KLM has launched its own social networking site for passengers to hook up with other passengers ahead of flights.

Called Bluenity, the site has been launched to enable passengers to interact with one another ahead of taking flights, to swap tips on hotels and restaurants and to arrange to share taxis to the airport or meet up in the lounges.

Always a good idea to get hotel and restaurant tips from a local, or someone who's visited where you're flying to, but I'm not sure I'd want to be arranging to meet up with other passengers ahead of a flight.

What if you end up making contact with some weirdo, who then won't leave you alone for the duration of the flight?

I didn't have room for this shot in the recent "Reopening the shop" article I wrote for the November issue of Airline Business.

But I thought it said a lot about what went on behind the scenes when the Caribbean Airlines engineering team, together with Boeing Commercial Airplane Services experts and facilitators from consultancy Catalise worked on restructuring the airline's maintenance operation.

The full story is in the article, when explains the detailed and rigorous process the teams undertook to remodel Caribbean's M&E department.

  There was quite an amusing little story in The Telegraph over the weekend about British Airways staff using the Facebook social networking site to describe their passengers as "smelly and annoying".

The report says a Facebook page created by "London Gatwick Ground Staff" features BA staff complaining about passengers who put their boarding passes in their mouths before handing them over, and showing their distaste for passengers with "stupid American accents".

This follows an incident in which several Virgin Atlantic staff were fired after using a social networking site to describe their passengers as "chavs".

For those of you who are unfamiliar with the term "chav", here's an explanation. (Also see picture.)

In the past, disgruntled workers went for a pint after work with their colleagues to vent their frustration about their boss/customers/other colleagues, but it seems that Facebook has now replaced that. Welcome to the modern age!

Following up on my blog yesterday that Ryanair's Michael O'Leary might announce his long-haul low-cost plans today he scotched that one this morning, putting it down to an over zealous writer bigging a story.

On BBC Radio 4's Today programme he repeated that he needs to see a "collapse in aircraft prices" for the venture to take the next step, and that the industry is "many months away from that".

He did say however that he sees the market being "cleaned out" over the coming months as some carriers fail. "Five or six airlines will go bankrupt in Europe before Christmas," said the Ryanair boss, and that "Ryanair would be one of the big four airlines in Europe".

That in itself is interesting as previous conventional wisdom has put Air France-KLM, BA and Lufthansa as the network big boy survivors and Ryanair and easyJet as the big low-cost ones. Now O'Leary sees only 4 - so who's gone?

Here's a link to its second half results. O'Leary is guiding to a full year breakeven for the carrier, but says that profits will rebound strongly next year if oil stays at $70 a barrel.

Our friends at Flight scooped this story ages ago, and since then Ryanair boss Michael O'Leary is continuously asked if and when he is going to launch a long-haul low-cost airline.

A few weeks ago the main hurdle in the way appeared to be cheap aircraft. O'Leary seems to have several investors lined up, including himself of course.

Now hints have emerged that at tomorrow's press conference to announce the carrier's second half results O'Leary will tell us more - perhaps he has finally got the aircraft at the price he needs to make the plan make sense.

In early October he said the plan could be activated "if aircraft fleet values collapse and there's every prospect of that happening now in this kind of recession, particularly with long-haul traffic collapsing".

Thing is, I didn't think prices had really fallen spectacularly - at least not yet? If they have that's big news in itself.

O'Leary rarely disappoints at his press conferences, and tomorrow's looks like being no different.