April 2010 Archives

 One of my contacts has just sent me these, the first flight of the Republic of Korea Air Force F-15Ks that are powered by the Pratt & Whitney F100-PW-229 engines.

The one-hour flight took place over St Louis on Monday.

The aircraft is part of an order for 21 fighters that the country ordered two years ago, and switched to the P&W powerplants from the GE Aviation ones that were ordered for its earlier batch of F-15s. South Korea never really revealed the reason for the engine switch.

These are the first two EEPs in flight. P&W has said that the engines boost the lifecycle from 4,300 TACs to 6,000 TACs.

Okay, that is not a trick question. In a speech yesterday, Qantas CEO Alan Joyce said that consolidation is necessary in the airline industry and his airline could participate in it. He added that Qantas would keep its name and Australian heritage, and that it would be the lead partner.

There are various regulatory and governmental issues that must be overcome, something Joyce spoke about in an interview with Airline Business magazine recently, before something like this can be considered.

Here is the thing - who would Qantas want to explore a merger with? There are several possibilities I reckon.

Etihad - they have a close relationship through codeshares, but would it make sense to go with a Middle Eastern carrier? There is access to the growing Middle Eastern hubs, but is that really crucial for Qantas?

AirAsia - while both Qantas' low-cost subsidiary Jetstar and AirAsia have consistently said that their tie-up that was announced in January is focused on cost-savings rather than revenue generation, there remains speculation that it could lead to more in the future. Why would Qantas, however, go with a partner that could cannibalise the highly successful and profitable Jetstar's market?

Malaysia Airlines - this could be an interesting tie-up, with some people telling me that Qantas wants to do more out of Malaysia (its Asian hub, perhaps, with Jetstar going with Singapore as its hub). MAS needs help, but the governments could be a barrier.

British Airways - yes, it may be time to revisit this old chestnut. But again, would they really want to go through it again?

Japan Airlines - the Oneworld partners could actually be great for each other if, again, governmental regulations can be overcome. They actually complement each other very well (Northeast Asia and the Southeast Asian/Pacific markets), trans-Pacific and flights to Europe. JAL needs the money, and Qantas would gain access to markets it does not have right now.

Here is a quick one on Capt. GR Gopinath, the founder of the former Air Deccan who now runs cargo carrier Deccan 360.

He is genuinely one of the nicest guys in the Indian aviation industry, and I am absolutely chuffed that Reliance - India's largest company - is buying a stake in Deccan 360.

India, which suffers from a shortage of proper supply chains and logistical solutions, desperately needs an integrated air and surface cargo firm like Deccan 360. Reliance's investment is a shot in the arm for the company, which appears to be on the right track for success.

A company like Reliance will not cough up money without doing its sums, but something tells me that they also like what people like Gopinath stand for. On behalf of all those who wish that nice guys would win in the end, I hope that Gopinath and Deccan 360 are successful.

China Eastern Airlines' decision to join SkyTeam leaves Oneworld as the only alliance without a member in China, one of the world's most lucrative and fastest growing markets.

Sure, it has Hong Kong's Cathay Pacific on China's doorsteps but even that will not be enough in the coming years. Cathay's increasingly close relationship with Air China, a Star Alliance member that is looking like the bigger partner of the two, may also be a concern.

Hainan Airlines, China's largest privately-owned carrier and the fourth largest in the country, has applied to join Oneworld. But it is not the same - Hainan just does not have the reach of the big three.

For SkyTeam, adding two out of the three major Chinese carriers in its fold is a coup - Guangzhou-based China Southern Airlines is already a member.

The decision is also a strategic one for the Chinese carriers, which will be able to align their moves against the larger Air China, which is slowly but surely moving into their turf.

Could a merger between China Eastern and China Southern be the next step?

Yesterday's Merpati crash puts the spotlight on Indonesia's airline safety and maintenance standards once again.

What is worrying is that despite several accidents over the last year, and nothing seems to have been done to force Merpati to conduct an overview of its safety and maintenance standards.

Indonesia's DGCA needs to come down hard on airlines like Merpati, or it will simply bring down the good work that some of the other carriers in the country have done over the last year to improve standards, and finally gain access again to markets like the European Union.

Normally, a jail term for tax evasion for the owner of East Star Airlines, a privately-owned Chinese carrier that went bankrupt in August last year, would not be of too much interest.

But Lan Shili's case comes amid an attempt by the Chinese authorities to force its carriers to consolidate, and Air China's interest in expanding its footprint in the domestic market.

The bankruptcy and jailing comes months after Air China's offer for East Star was rebuffed by the latter's owners. Air China then picked up East Star's assets for a snip in November.

Separately, in March, Air China bought a majority stake in Shenzhen Airlines, months after Shenzhen's majority shareholder Li Zeyuan came under investigation for "economic crimes".

These events bring up two issues: it is increasingly difficult for privately-owned carriers to operate in China, and Air China is the biggest beneficiary of the Chinese consolidation.

Whatever Lan's and Li's crimes, it will be difficult to shake off the perception that the investigations are linked to the consolidation in the Chinese airline industry.

                                                                                                                                                                                                                    Singapore's Ministry of Defence

So Singapore has finally brought home its first Boeing F-15SGs, almost a year after taking delivery of the aircraft.

This is probably the most advanced fighter operating in Southeast Asia (versus the Malaysian Su-30MKMs, Indonesian Su-30MKIs and Thailand's Saab Gripens), continuing to give the island's air force a crucial air superiority edge over its neighbours.

It would be interesting to see how these countries proceed with their future procurments, especially since all of them are expected to either launch fresh competitions or firm up existing options.

Singapore continues to assess whether it should buy another batch of F-15s (which is what I reckon will happen at some point), or move on to the Lockheed Martin F-35 (something that will eventually happen, but not just yet as due to the problems that the programme faces).