April 2009 Archives

British Airways is doing its bit to help encourage small and medium-sized UK businesses to continue to travel overseas during the recession, by unveiling an initative to give them free flights. It has teamed up with the UK Government's business development organisation, UK Trade and Investment, and transatlantic business organsation BritishAmerican Business, to offer 5,000 return flights to help support UK-based small and medium business continue to compete for overseas business. BA says the flights, 4,000 available through UKTI and the remainder through BAB, are worth up to £15 million. Passengers will still need to pay taxes on the flights.

BA chief executive Willie Walsh says: "Small and medium businesses are the backbone of the British economy and they are hurting badly. This initiative gives small businesses the chance to promote and sell their products overseas. We've put up the flights to allow the SMEs to travel to do business and we'd be delighted if other companies would join us by offering services and skills that will bring real value and benefit."

UK minister for trade and investment, Lord Davies of Abersoch, says this shows "what can happen when big business and Government work together to support British firms and the economy" 

For more on the initative click here. 

Just over a week ago I wrote a blog on the Nigerian Minister of Transport frowning on Delta's application to serve Lagos because of the quality of its aircraft and in-flight product.

Well the debate has well and truly raged over the past week with over 20 comments about the issue, including people's direct experience of the service.

I can offer some more background as well. Here is a piece written after the service was launched in Nigeria World by a columnist now living in the USA Dr Femi Ajayi.

And clearly the issue of Delta's service level on this flight is not entirely new, as this story and its comments show.

This article comments on the generally poor airline service levels in Nigeria.

Here's a video about Delta's service launch to Nigeria in late 2007.

My next step is to talk to Delta to see what they have to say about this issue - I will be contacting the carrier, or you are welcome to contact me - mark.pilling@flightglobal.com - and we'll have a chat.

As the title sponsor of this weekend's Formula 1 Grand Prix Gulf Air is naturally everywhere you look here in Bahrain. It is "backing the race" big time as Bahrain works with all of its partners to build a business friendly city.

It was the vision of Bahrain's Crown Prince to bring the Kingdom to a global audience back in 2004 when the first race was hosted.

Gulf Air signed the title sponsorship of the Grand Prix (for an undisclosed amount) for that race and last year extended the deal for another five years to 2013, says the airline's CEO Bjorn Naf.

But sponsoring a Formula 1 team is not on the cards: "We've been approached by teams but it is way too expensive for us," says Naf.

Bahrain is anyway strongly associated with the McLaren-Mercedes team through the Kingdom's investment company Mumtalakat, which has a 30% stake in the McLaren Group. Mumtalakat also owns Gulf Air.

PIX RIGHT: Toyota mechanics prepare Jarno Trulli's car on Saturday. Later in the afternoon he drove to pole position for the Grand Prix.

It is hard to measure the direct effect of sponsoring a Grand Prix for Gulf Air, but the global exposure is huge. "If we can ride with that industry [Formula 1] that certainly makes an impact," says Naf.

Here's a little spin-off seen below, with BBC's Live TV coverage - seen with pundit and former driver David Coulthard - conveniently for the airline using one of its logos as its backdrop.

MORE PIX:ABOVE: The pit lane here at the Sakhir circuit in Bahrain.

BELOW: Measuring the temperature of the track. It got to 53 degrees C at 1300 today!

The 6th Formula 1 Grand Prix of Bahrain this weekend is causing enormous excitement here in the Kingdom of Bahrain - and so it should. This small Gulf state is quietly proud to be the first country in the region to host one the world's greatest motor races.

The title sponsor of the race is home carrier Gulf Air, and its Swiss chief executive Bjorn Naf is outlining how far the airline has come in the past year or so.

Nobody is under any illusions that there is a lot of work to re-establish the Gulf Air brand, and make the carrier profitable. Describing Gulf Air's ambitious "realignment strategy" Naf notes: "We are trying to catch up from times when we have lost a little bit of market share, lost a little bit of our image."

Naf is seen below left with Gulf Air's chief people officer Ahmed Al Banna.

This involves a completely new fleet, starting with Airbus A320s replacing its older ones this year, and then the delivery of A330s and later the first of 24 Boeing 787s.

One of Gulf Air's frustrations has been an inconsistent in-flight experience across its fleet. "We are working on a new in-flight product - it will be rolled out this year," says Naf. "It is part of the plan we are setting out to bring Gulf Air back to its glory days."

But Naf knows going head-to-head with local rivals Emirates, Etihad and Qatar Airways is madness. The carrier is simply too far behind to do that.

So the message from Naf is Gulf Air will be "smarter, not bigger - we are not just looking to compete on size". It is "offering value, not excess".

"We will be a global premium carrier," says Naf. However, the first priority is to build its network to support business travel in the region and from Bahrain. This means making Bahrain the most convenient hub with fast connection times (30 minutes is promised) and making Gulf Air the carrier of choice with double-daily frequencies that allow a day's business at the leading Middle Eastern destinations.

The target is to offer a product that travellers within a flying time of 3.5 hours from Bahrain will select. After developing a network that does this Gulf Air then looks for the East-West transfer traffic that is so important to the region's big three. Naf describes the ability to offer these connections as a "byproduct of the network", but ranks its importance behind the regional mission.

In 2008 Gulf Air carried almost six million passengers. "If I can increase this on a steady base I'm sure we will become a profitable carrier," says Naf.

But like all carriers Gulf Air is feeling the pain from the global recession and seeing a shift in travellers from its premium cabin to economy. "We are challenged," he says. Traffic on its UK route for example is down while "India is obviously tanking, but it will come back". Gulf Air has suspended several Indian routes as it waits for India to rebound. It has shifting capacity to more profitable Middle Eastern routes.

"We are managing on a very tactical basis," says Naf.

For now, route expansion is on hold. "It is very risky and very costly to go into new markets, so therefore we rather increase freqencies in existing destinations," says Naf. "We will not open a new destination in 2009."

Gulf Air is also reviewing its short-term fleet needs. This includes deciding to only keep four Boeing 777s wet-leased from India's Jet Airways for six months and not extending the lease as originally thought. Then there is the decision over the future of its A340s. "We'll see how that goes, we may sell or sub-lease them," says Naf. "This is a very dynamic process, we are not there yet."

Naf doesn't have a magic wand, or unlimited funds to restore Gulf AIr's fortunes overnight but here is one determined Swiss gentleman. As he says to his senior staff when he really wants a solution to a problem: "Fix it."

Read our analysis of Gulf Air from last year as it began to first talk about its new strategic direction. 

Just when it seemed like all obvious ancillary revenue streams were nearing exhaustion, Spanish budget carrier Clickair has come up with a new cash-generating innovation. It has introduced a new Internet booking feature, giving passengers the option of paying a €2 ($2.70) fee to lock their chosen fare for 24 hours, or €5 to guarantee it for up to 72 hours.

Clickair is yet to formally announce the initiative (apparently that's planned for next week), but the airline's chief Alex Cruz referenced it during a session at the French Connect networking conference in Shannon,

Cruz said the 'lock your fare' service was turned on last week, giving passengers an opportunity to hold fares while researching accommodation or other elements of their trip. If the time lapses and the fare has not been confirmed, it is re-released for sale.

He adds: "It takes about 30 minutes to see [web initiatives like this] working. During the first two days we generated low five-digit numbers just from the fees, and we had a 60% conversion rate. It's another revenue stream."

You have to hand it to them; it's simple, logical and - judging by the response of some other airlines at the conference - is unlikely to remain isolated to Clickair for long.

So how do you define being normal these days? Well according to David Moyes, manager of English premiership football side Everton, its flying on easyJet. Fresh from Everton's triumph over the football-millionaires of Man Utd in the FA Cup semi-final, where they will play the football-millionaires of Chelsea in the final, Moyes used an airline analogy to praise his player's work-ethic and the down-to-earth attitude of the club.

'It is refreshing that a club like ours has done well," says Moyes. "We are different, we might still get on Easyjet like the average man would do."

While nobody could dispute the great job Moyes has done in enabling Everton to hang onto the coat-tails of the big four in the Premiership over the last few years, I would still suggest the average wage of a premiership footballers these days would make them unlikely regular budget airline passengers. But am I wrong? Which footballers have you seen on a budget airline?

UK budget carrier EasyJet will from next month start serving Starbuck's coffee onboard selected flights. It will use Starbucks new instant coffee offering, Starbucks VIA ready brew,  which the coffe giant began rolling out earlier this year and describes as a "transformational instant coffee" which replicates the body and flavour of Starbucks coffee.

  Starbucks has provided coffee on United Airlines since 1996, but this is the first UK carrier to offer Starbucks coffee. I'm not sure if there are any other airlines in the world that offer a Starbucks product onboard or which other major coffee chains you see adorning airports around the world have made similar leaps onto the aircraft (any contributions welcome on this!!!)  

EasyJet will offer the Starbucks coffe on flights from Newcastle, Stansted, Gatwick and Madrid and it will cost £2.10 ($3.07). The airline's in-flight category manager, Rob Pickering, says: "This is a significant step forward for the easyJet in-flight Product range, it co-insides at the exciting time when our fresh food range has been transformed to suit local country markets."

Speaking from personal experience, the importance of coffee onboard airlines cannot be under-estimated, especially on those early morning flights. I'm sure everyone will have their own preferences for the best coffee served onboard an airline, so I'll accept nomination here.

The importance of coffee was similarly recognised by Lufthansa when it launched its Malpensa-based operation Lufthansa Italia earlier this year. During the press briefing to introduce the service, executives stressed one of the key service elements they thought would appeal to the Italian business traveller: freshly brewed espressos onboard. 

In the world of newspapers and magazines, the debate on whether to sell advertising on the front cover is one that flares up from time to time.

For some it's the holy grail - a line never to be crossed. For others its standard practice. Flight International, the sister publication of Airline Business, use to sell the front cover all the time, but not now.

So, should airlines sell the equivalent of their front page - the website?

Ryanair of course has just started doing it. Not the whole thing, as you'd never be able to book a ticket, but today's ad - from a UK-based animal charity - is right in the middle of the site and the first thing you look at.

For Ryanair, with its five billion page impressions annually, the website is an extremely attractive property, and certain to raise a substantial sum. But is it worth disrupting the customer experience, if indeed it does, with ads like this?

For websites like Flightglobal.com, advertising is a critical part of how we do business. We have no choice. But airlines do.

What do you think? How would you feel about this trend spreading out among other airlines?

That is the thinly veiled message that may have blunted the push of Delta Air Lines further into Africa.

The story goes, detailed in Nigeria's Punch newspaper here, that Nigerian Minister of Aviation, Mr Babatunde Omotoba, turned Delta back because he wasn't all that happy with the quality of the aircraft - a 767-200 - and its in-flight entertainment. The route in question was to Nigerian capital Abuja.

I got the tip on this story from a US source and would welcome any further details.

In this insightful interview, Cathay Pacific chief executive Tony Tyler opens up to Julian Gairdner about his life, his career and his rise at the Hong Kong-based airline.

Julian will be new name to Airline Business readers. He is actually the web editor of our sister magazine Farmer's Weekly. So what's he doing interviewing Tony? Has Tony just bought a farm or something?

Not quite. Julian and Tony both went to the same school and the Farmer's Weekly web guru did this Q&A interview for his school magazine.

For those who haven't seen this already, check out here the JetBlue online advertising campaign poking more than a little bit of fun at corporate CEOs feeling the heat in the current down and no longer able to afford to travel by corporate jet.

"Have your assistant's assistant book now," goes the tag line, accompanying three short films supposedly aimed specifically at chief executives only, teaching them how to fly on JetBlue

The campaign has certainly succeeded in getting attention since launching last month, prompting a letter of complaint from the National Business Aviation Association (NBAA) which accused the ad of maligning an industry that creates jobs, and latterly a large article in the International Herald Tribune.

This week the great and the good from the world of cabin interiors and the IFE/connectivity business have been meeting in Hamburg at the tenth Aircraft Interiors Expo which finished today.

While there is much gloom in the world over the economic turmoil facing airlines, there has been no let up in wireless and connectivity developments on the ground. Consequently, it appears interest in onboard passenger connectivity solutions in the airline sector remains strong.

Probably heading the news during the show was communications specialist T-Mobile and VT Miltope, ViaSat and TriaGnoSys formally teaming to offer a Ku-band satellite broadband and GSM telephony service for air transport. They form one of the groups looking to fill the void left after the demise of the Connexion by Boeing service, of which Lufthansa has been keen to find a replacement.

Another player in the in the sector, Panasonic plans to launch its eXconnect Ku-band satellite passenger connectivity service this autumn and revealed during the show that it has an initial customer base of five airlines. All five of these have also opted for the eXphone onboard mobile phone service - provided through AeroMobile.

Amid increased momentum this year from deployment on initial customers and airline trials, both AeroMobile and OnAir pointed to further customers for their onboard mobile phone service.

Elsewhere in the cabin, after years of investment in upgrading business class, much attention now appears to be focused on weight saving initiatives for this part of the aircraft and, given the increased gulf with economy, on improving the product offering in the back of the cabin. "Now we are starting to see the flow-through of weight saving innovations in the industry," said Airbus head of aircraft interiors marketing, Bob Lange.

Plus Airbus, having completed the detailed definition of the A350-900 last December, unveiled a new 1:120 scale cutaway model of the XWB aircraft for the first time during the show.

For full details of these and loads more stories, check out our three issues of Flight Daily News from the show

Many at British Airways and BAA probably still have nightmares about the opening of London Heathrow Terminal 5 at the end of March 2008 - one year on have they been replaced by sweet dreams as the airport starts delivering on its promise?

See what BA director Julia Simpson and BAA T5 operations manager Nick Cole have to say.

And hear from both the airline side and the environmental campaigner side about their views on whether further expansion of Heathrow is needed.