Mary Kirby: June 2008 Archives

Bombardier has updated the specs on its GTF-powered CSeries 110, 110ER, 130 and 130ER. The figures differ from what is being currently advertised on the manufacturer's site, particularly with respect to range at max payload. Check out the increase in range for the 110. Also check out the new 130XT. Here is the original document, folllowed by a snapshot of some key metrics.

CSeries_May 08.pdf

Many gals harbor big aspirations for walking the catwalks of Paris and Milan. But they often don't achieve such lofty heights, and instead find themselves splayed across vehicles at the local convention centre car show. I'd like to say for the record that these ladies' talents should not be underestimated.

I recently received a copy of Finnish aeronautical publication Ilmailu in the mail, and there on page 28 is a photo of yours truly looking far too demure beside Embraer's ethanol-powered Ipanema aircraft. I'm rather certain that the  photo would have been more effective if I had mounted the aircraft, legs akimbo, in a bikini. But then again, Embraer may never invite me back to Sao Paulo.

Nonetheless, I'm grateful for Ilmailu's inclusion of this pic in its magazine. Now could somebody tell me what the article says?

Aircell in May promised that it would have major news to discuss this month. We now know what that news entails. Tomorrow, American Airlines will start testing Aircell's Gogo connectivity service on two Boeing 767-200 flights linking JFK to/from LAX.

The entire system (end-to-end) will be tested to "make sure we're ready to launch", says American. Passengers will be able to take the system on a free ride - for now.

During testing this week American "will be observing the performance of the network to ensure that it operates the same way in 'real life' as it has during the months of testing we've conducted".

The rest of the 767-200s earmarked for the carrier's broader 15-aircraft test will be turned on in the coming weeks pending the outcome of this test.

As the Farnborough air show rapidly approaches, excitement is building about order prospects for the Pratt & Whitney Geared Turbofan-powered Mitsubishi Regional Jet (MRJ) and Bombardier's proposed CSeries.  Mitsubishi has already secured All Nippon Airways as launch customer, and is reportedly closing in on a second deal. Bombardier is rumoured to launch the CSeries at Farnborough (which runs 14-20 July) with as many as 200 orders, including 50 from China Southern.

A big draw for both aircraft is the high-bypass GTF, which is attracting increasing interest, including from former sceptics of the project. "I think what you're seeing is an industry that is starting to understand the facts and the figures, and maybe being able to separate [these] from myth," says Benjamin Boehm, director, programme management office and director of marketing, new commercial aircraft programmes at Bombardier Aerospace.

P&W recently held technical symposiums in Asia and the USA to show would-be customers what the GTF can deliver as the exclusive powerplant for both the MRJ and CSeries. "Customers are coming to us at these events we're hosting. There is absolutely a great push and emphasis on better fuel economy and better emission performance [to be made available] in a timely fashion," says Mary Ellen Jones, VP of marketing for P&W Commercial Engines.

But if you're looking for P&W to let the cat out of the bag on orders, think again. Jones sees Farnborough's July timing as somewhat of "an arbitrary date", but she has no doubt we'll see some order action this year.

The first flight of the GTF on a Boeing 747SP test-bed will occur "around the time of Farnborough", says Jones. "The biggest expectation is to have a flight test programme as successful as our ground test programme."

Clearly the GTF proposal - which promises to reduce fuel burn by at least 12% compared to current high-bypass ratio turbines - is "going in the right direction", says consultant Bob Mann, who suggests that if Bombardier and Mitsubishi can deliver on their promises "those look like some of the leading programmes in [improving] economics".

So what does Bombardier have to say as Farnborough nears? "I think the best thing for me to say of the show is that our calendar of airline face-to-face executive meetings is filling up fast and our calendar for supplier that want to get on the programme is filling up fast," says Boehm.

"That pretty much says I'm going to very busy during that week."

Tugging an aircraft from A to B might not sound like such a big deal. But if you're an airline trying to cut your fuel bill, you might see the benefit of WheelTug's electric nose drive for aircraft ground manoeuvring.

The last time we checked in with our friends at WheelTug, they were brokering risk-sharing partnerships, and working to secure supplemental type certification on the system for Boeing 737NG aircraft.

The company now reveals it is in serious discussions with potential customers about adapting the system for other types -  including the military!

"A formal response has already been submitted for one military aircraft, with more to follow," reveals the firm in a recent newsletter. "Military airplanes do not have the same commercial certification hurdles, so in many cases the effort can be accomplished in parallel."

Meanwhile, a motor designed specifically for the wheel envelope and geometry of the 737NG is underway at parent Chorus Motors, with aircraft testing by WheelTug scheduled for this summer, says the company.

The overall program schedule includes completion of all hardware for certification testing by early 2009, with the remainder of the year dedicated to certification. Corporate objectives include installation for revenue-generating flights by the end of 2009 or very early 2010.

WheelTug currently works with partner and US launch customer Delta Air Lines. Over the coming months, WheelTug expects to select the next target commercial aircraft type.

"There is increasing interest in the Airbus A320, since a WheelTug-equipped 737NG will have substantial operating and cost competitive advantages over an A320 without a WheelTug," says the firm.

"Regional Jets as well as the Boeing 757 are potential candidates but in the end, the decision will be based on the level of interest and commitment from customer airlines and regional carriers."

In the face of soaring fuel costs, WheelTug says it can save an airline tens of thousands of dollars per month for every aircraft.

Movement is afoot on the satellite-based connectivity front. In-flight broadband provider Row 44, which notably secured agreements to trial its system on Alaska Airlines and Southwest Airlines Boeing 737 aircraft, has officially applied for Federal Communications Commission (FCC) authority to operate up to 1,000 technically-identical aeronautical-mobile satellite service (AMSS) transmit/receive earth stations (AMES) abroad commercial and private aircraft.

An industry colleague was kind enough to forward the above link to me. Also be sure to check out Row 44's technical description document.

"The AMESs will provide two−way broadband communications services to passengers and flight crews, allowing in−flight access to email, the Internet and virtual private networks," says Row 44's John Guidon in the firm's FCC filing.

"The AMESs will operate in conjunction with a previously licensed VSAT hub station and will use capacity on the Horizons−1 (127 W.L.), AMC−2 (101 W.L.) and AMC−9 (83 W.L.) satellites."

Separately, but not completely unrelated, the WSJ has published an interesting piece on Aircell's air-to-ground Gogo system. Check it out here.

As struggling airlines continue to look for new ways to strip the bare necessities of life from economy class, the disparity between the front and back of the cabin is getting greater. Carriers are now racing to see who can be the fastest - and cleverest - at unbundling products that have traditionally been part of the basic economy offering.

American Airlines got the ball rolling with first-checked-bag fees. And US Airways kept it moving with a $2 charge for water. Everybody is asking what might be next, with many speculating - some seriously - that the next logical downgrade will involve charging passengers to use the restroom. Perhaps they'll even go so far as to glean some ideas from the comedy motion picture Soul Plane, whereby a fictional airline outfits its aircraft with opulent first- and business-class cabins as well as a "low class" section that offers pay-to-use lockers in place of overhead bins.

As carriers redefine economy class, they continue to boost their front cabin offerings. During this week's Merrill Lynch global transportation conference in New York, United Airlines CFO Jake Brace said that while capital expenditure is being reduced, United is targeting investment in key products and services. See for yourself. Boy that looks comfortably high class.

One of the few, true pre-deregulation legacy guys left in the industry who has seen it all is leaving, says US Airways. The man in question? US Airways senior vice president, technical operations Hal Heule, who's 41-year career spanned  Pan American, Texas International Airlines, Continental Airlines, America West Airlines and US Airways, as well as seven years in aviation consulting with Strand Associates.

Hal will retire in September, but continue to serve as an advisor to US Airways until the end of the year.

He is known amongst his US Airways colleagues as being a modest man, despite playing an instrumental role in several milestones during the America West and US Airways merger, most notably when the FAA granted the airline a single operating certificate in September of 2007.

Hal, your fellow US Airways cohorts - and the industry - will miss you. It's sad to see him go, says a US Airways staffer.

(Photo from US Airways)

Privately-held ACMI operator Gemini Air Cargo has filed for Chapter 11 bankruptcy protection. Here in its entirety is the letter from Gemini's acting CEO George Gonzalez to employees:

"Today, Gemini filed for protection under Chapter 11 of the US Bankruptcy Code.  Nevertheless, we will continue operating our business as usual.  To fund this process, we have secured an additional loan commitment of up to $14 million from the company's existing senior lender. We will have more details for everyone on Friday, after the court has ruled on our initial filing requests.

The decision to file for bankruptcy was brought on by the difficult times facing the airline industry - most visibly record-shattering fuel prices - coupled with revenue shortfalls we have encountered over the past 12 months:  First the MD11 tail tip in Dubai last June, followed by disappointing activity during this year for the DC10s from the U.S. military and ACMI customers (driven partly by fuel prices). 

Yet Gemini continues to have strengths, and in important ways we are stronger than a year ago.  The MD11 operation has stabilized, with reliability and other performance measures at record levels.  Demand for MD11s has increased as it is a highly fuel-efficient freighter, increasing its cost advantages over the B747-200 classics, DC10s, and other competitors.

We also have taken actions to cut our costs.  With the softening demand for the DC10s, earlier this year we elected to C check only 3 aircraft, yet these are not currently operating at full capacity.  Yesterday we reduced our crews to match our current operating needs, and also the marketing staff focused on the DC10s.

During the bankruptcy, we will be seeking investors for Gemini.  As part of our filing, we submitted bidding procedures and expect to have a transaction complete during the summer.  This we believe is in the best interests of the employees, customers, investors, vendors, and other stakeholders.

We know there are lots of questions and concerns, and we will give you all of the answers and information we can.  During this time, it remains essential that we continue to serve our customers and do a great job.  I look forward to giving you more information when we are together on Friday."

Photo by Phil Gengler at: http://en.wikipedia.org/wiki/Image:Gemini_Air_Cargo_MD-11.jpg  

A US government programme that could help struggling carriers boost their ancillary revenue hasn't garnered a whole lot of attention since it was unveiled on 11 July. The reason may have something to do with the fact that the Department of Commerce, Office of Travel and Tourism Industries (OTTI), in announcing that its 25-year-old paper-based "Survey of International Air Travellers" will be made available to all major booking engines and airline  reservation web sites, was a little dry in its delivery.

Perhaps the OTTI should have followed the logic of Flight Global Editor Michael Targett, who this week proclaimed that "sex sells and you just can't get away from it" and had the indecency to name this very blog as number nine in his list of "Ten Most Blatant Uses of Sex for an Aviation-related Marketing Purpose". The absolute bloody nerve of some people!   

At any rate, while I might not be able to bring sexy back to the OTTI's press release, I can tell you that it missed a key point. Airlines and online travel agents will be paid $1 every time a passenger completes the survey online.

Here's how it works. The survey will appear as a screen popup when passengers make their online reservations. Promotions, such as $25 gift card drawings, will be used to entice people to complete the survey.

"An airline could easily generate 10,000 surveys per month and that would be $10,000," says Addison Schonland, president of Innovative Analysis Group, a consulting firm that is subcontracting to the OTTI's contractor, CIC Research.

This could prove a lucrative little endeavour if carriers adopt it quickly and with gusto. Additionally, the programme holds a ton of promise for airlines, travel planners and tourism boards that mine this sort of data to determine origin-destination travel patterns, traveller demographics, consumer choice resources, trip characteristics and spending patterns.

"Having good consistent numbers to drill down and look at segments - all of that requires a greater sample size to do a better job at analysis," says Tiffany Urness, research director for the California travel and tourism commission.

She says a greater respondent rate "opens up wonderful new possibilities of analysis not only for us but to share with members of the California travel industry".

At present, a total 60 airlines participate in the paper survey programme. Schonland says one US major and another low-cost operator have already shown strong interest in the online method.

Just how potable is the tap water on US commercial aircraft? That's the question this frequent traveller is asking after US Airways announced it will charge $2 for bottled water in its domestic coach cabins beginning 1 August. The answer, it seems, is "not so much".

A noted Wall Street Journal investigation in 2002 found "a long list of microscopic life you don't want to drink, from Salmonella and Staphylococcus to tiny insect eggs" in water samples from aircraft. A few years later a round of testing by the Environmental Protection Agency (EPA) showed that 17.2% of 169 randomly selected passenger aircraft carried water contaminated with total coliform bacteria. And now reports say the EPA is proposing rules designed to better test and limit the level of bacteria in the water. 

Should we even bother washing our hands, let alone brush our teeth on a long flight? Who wants to even have a thimble-full of this stuff in their mouth?

But I digress. Apparently US Airways is ready to just say "no" to even the thirstiest of its domestic travellers. The airline will allow exceptions for extended taxi delays or when a passenger needs to take medication. Off-duty employees travelling "on business or pleasure will have the option to purchase a beverage or not", says the carrier in its latest employee newsletter. On-duty crewmembers, it says, "may consume complimentary non-alcoholic beverages while on board".

It will be interesting to see just how well flight attendants adhere to the new rules. Will water be denied to a mother who needs it to mix baby formula for a bottle, for instance? What if someone is simply crying out for thirst, after perhaps forgetting to purchase water just before a flight?  

Additionally, US Airways will only accept cash for beverage sales. "Cash will be the only method of payment beginning Aug. 1. We are working to launch in-flight credit card readers allowing customers to pay for all in-flight items with a credit card, so stay tuned for more on this in the near future," says the carrier.

The message is clear. Either buy a bottle of water or hit the ATM machine before your US Airways flight. And may I suggest that you don't allow yourself to be tempted by the siren song of a free trickle from the tap in any US carrier's loo.

Photo by Fir0002 at http://en.wikipedia.org/wiki/Image:Water_droplet_blue_bg05.jpg 

In recent days a number of readers have asked me why I haven't blogged about LiveTV's acquisition of the Verizon Airfone network. Isn't this a big deal, they ask. Don't you get the teddy bear warm and fuzzies when you write about this stuff? Well yes and no, and yes, respectively.

The transaction, which calls for LiveTV to assume Airfone's assets, including 100 US air-to-ground (ATG) towers from 1 January, certainly makes life a little easier for LiveTV. The JetBlue Airways subsidiary doesn't have to wait until 2010 to assume full rights to the 1MHz narrowband slice of spectrum in the 800MHz band allocated to ATG services that it acquired through FCC auction in 2006 (Aircell placed the winning bid for the 3MHz broadband licence).

You see, Airfone - whose vision of in-flight broadband grandeur was put to rest by Aircell's $31.3 million smack-down at auction - was still guaranteed the use of 1MHz for five years under a prior FCC decision, and given a two-year grace period to relocate its business to that portion of the band.

"They [Airfone] had to be out of Aircell band by October of this year and our band by 2010," a LiveTV spokesman told me recently.

However, that didn't stop the two from sides from working together. LiveTV has been using the Airfone network of base stations to support JetBlue's test of "BetaBlue" light connectivity onboard one of its Airbus A320s.

And in a December 2007 letter to Airfone's Magnastar business aviation customers - which has been sitting on Airfone's web site for months - then president Bill Pallone said: "There is a possibility that Airfone's air-to-ground services will continue without interruption beyond 2008. We are currently in discussions with LiveTV, an affiliate of JetBlue, to sell Airfone's business and operations to LiveTV. If those discussions are successfully concluded, LiveTV would take over the Airfone business effective December 31, 2008, and would continue to provide service to Airfone's customers under the terms of their existing service agreements. However, if we do not enter into a definitive agreement to sell our business to LiveTV, we will terminate operations effective December 31, 2008."

Needless to say, Magnastar customers are pleased that the arrangement has been finalized. So too are Frontier Airlines and Continental Airlines, which have joined JetBlue in planning to offer LiveTV's connectivity service for free to passengers.

Free is key, according to LiveTV. The LiveTV spokesman says: "Many, many systems have flown but none are still in operation due to the business case. Unfortunately, pricing for services in-flight are set by what you can get on the ground. With WiFi going free at airports and hotels, there will quickly become a market battle for the frequent flyer. Will he/she use broadband at airports or wait until on the plane?  Not only is this hard to determine now, but we are all making decision for 5-10 years."

He adds: "We see the marketplace right now in the 'scissor effect'.You either have to be very fast like at home (Ku-band satellite is the only solution long term) or very cheap (Free). Anything in the middle gets chopped up. This divide "chop zone" widens as time goes on. Ground networks get faster and faster while pricing plummets."

Reading between the lines here, I'd say LiveTV doesn't see Aircell's offering (which will cost passengers in the $10-$12 range) as a viable strategy since it is neither A) free nor B) Ku-band-based.

But what about WestJet, whose narrowbodies are equipped with LiveTV's live television system? Will the Canadian operator seek to offer the same sort of service as its LiveTV hardware-equipped counterparts in the USA?

"On Canada, [it's a] more difficult market to serve [with a] large area but less airplanes and passengers," says the LiveTV spokesman. "We are working on a couple of options for this market (WestJet) since we already handle their TV system." Mexico and Caribbean are similar to Canada, he notes.

For its part, Aircell has been rather quiet about its progress in Canada. The company has said it expects to extend coverage to Canada, the Caribbean and Mexico within a year of introducing its ATG broadband service in the continental USA, which is expected to start shortly.

US Airways' annual shareholders meeting was nothing if not entertaining today. Outspoken shareholder Evelyn Y Davis, also known as the 'Queen of the Corporate Jungle', dressed down management for lots of "outrageous" things like holding the event on the same day as Continental Airlines' shareholders meeting and for considering a so-called "virtual merger". Shareholders seemed largely amused by Davis' verbal lashing.

That is with the notable exception of Seymour Licht, another outspoken shareholder who remains outraged over the 2005 merger of America West and US Airways. Exasperated by Davis, Licht ordered her to stop speaking, but almost got thrown out in the process. "I own more stock than you, now sit down! Sit down!" Licht repeatedly shouted, nay screamed. "Sit her down now. I don't want her to say another word."

It all got rather fiery from then on. And when all was said and done, US Airways CEO Doug Parker joked: "That was supposed to be the boring part of the meeting."

I'm going to take a wild guess that there is method to the alleged madness that Continental - of which Davis is a shareholder - also held its annual meeting today. Davis thinks there is a conspiracy too. Check her out on the CNBC video at the following link:  http://www.cnbc.com/id/15840232?video=697940463 

I'd also wager that Parker, who gave a lightening-fast speech following the Davis and Licht show, was glad to get the hell out of there.

But for those of us in the aviation journalism world, the event was a lovely comedic reprieve at a time when bad news is hitting fast, furious and fuelled with Jet A.

If you've got the time, it's worth a listen at http://www.usairways.com/awa/content/aboutus/investorrelations/calendar.aspx

If you ask me, something seems to be missing from Bombardier Aerospace's showcase at the AIREX 2008 exhibition being held in Istanbul, Turkey. The Canadian airframer has five aircraft on static display - its Learjet 60 XR, Challenger 300 jet, Challenger 605 jet, Global Express XRS aircraft and a CRJ900 NextGen aircraft. But there is nary a CSeries cabin mockup in sight. Why? I should think that AIREX would make a good platform to flog the CSeries to Middle Eastern operators, a region being targeted by Bombardier for the proposed 110/130-seat aircraft.

During a recent interview, Bombardier Aerospace's director, programme managment office and director of marketing, Benjamin Boehm said the CSeries is being evaluated by Middle Eastern airlines for a possible role in providing feeder services. "We're finding that areas such as the Middle East - they are starting the whole hub-and-spoke phenomenon there," he said.

And in a statement today, Bombardier touts its growing presence in the region "as major airlines adapt their operations with more cost-efficient regional aircraft to feed their larger mainline aircraft networks".

Qatar Airways is rumoured to be one of several carriers that will launch the CSeries at the Farnborough air show.

Okay, so where is the much-travelled mock-up? A Bombardier spokesman tells me it was "too heavy and expensive" to lug to AIREX. "Next step: Farnborough, and no this does not confirm anything," he says. Well thank you kindly.

What is to become of me? The question, memorably posed by Eliza Doolittle in the musical My Fair Lady, must surely be on the minds of Embraer executives these days when considering the ERJ-135. The 37-seater is playing a fast-diminishing role in the USA.

Continental Airlines has just brokered a new feeder deal with ExpressJet that will see the regional's 30 ERJ-135s culled (Wells Fargo Bank appears to own the lot of them). AMR is slashing regional capacity at its American Eagle subsidiary; the unit's 38 ERJ-135s are widely expected to be the first to go.

Additionally, an amended agreement between Republic Airways Holdings and Delta Air Lines will see the company remove from service all 15 of its Chautauqua-flown ERJ-135s at a rate of two aircraft per month beginning in September 2008.

"We expect to sell these aircraft to Embraer or another party as the aircraft are removed from service," says Republic.

This "does not leave many E-135s flying, but I am not surprised, with today's fuel price, the aircraft is not economically viable", says Saab Aircraft Leasing president and CEO Michael Magnusson.

But could someone launch a corporate conversion programme and would this be supported by Embraer, which manufacturers its own corporate version of the ERJ-135, the Legacy 600?

Magnusson says: "Personally I think they are 'toast' unless they can be turned into corporate aircraft. They are too expensive for the cargo market."

It would be an understatement to say that American Airlines' pilots are PO'd at management right now (that recent stock compensation boost certainly didn't help). But in a 5 June internal memo to membership, the Allied Pilots Association (APA) lambastes CEO Gerard Arpey for another reason - not flying American on a recent trip to San Juan.

According to a report that originated from members of APA's DCA domicile, Arpey flew to San Juan "to feel out prospects for further employee concessions and announce dramatic reductions in SJU flight operations", says the APA.

I don't know the reason behind Arpey's alleged decision to take a private flight, so I'll reserve any comment or judgement on the matter. But for its part, the APA sees it as "our CEO's vote of no confidence" in American's operations, and the union has created the following:

TOP 10 REASONS AMR CEO ARPEY WON'T FLY ON AA!

10. He refuses to fly on an airline that no longer offers peanuts.

9. Fearful he would be ejected in-flight by an angry mob of inconvenienced passengers.

8. Fearful he would be ejected in-flight by an angry mob of betrayed employees.

7. Fearful he would be ejected in-flight because his shoddy maintenance program results in a gaping fuselage hole.

6. Unlike any other passenger on American, he needs to arrive on time.

5. He refuses to pay the $15 bag fee.

4. On a private jet, he doesn't have to bring a "food taster"

3. AA employees have placed him on the "no fly" list.

2. He's implementing a new marketing logo: AA, Service SO Bad, the CEO Won't Fly with Us!

1. He isn't worth the fuel it would cost to fly him there.

Bombardier is studying whether it can ramp up production of its Q400 turboprop. At present, the barrier to increasing production has nothing to do with demand and nearly everything do with supply.

That's because Bombardier is in the midst of a rather significant undertaking - transferring Q400 fuselage work from Japan to China and Belfast, explained the airframer's new president and CEO Pierre Beaudoin during an earnings conference call yesterday. "It has been a huge ramp up in a business most suppliers had given up on four years ago," he says.

Bombardier is offering a NextGen version of its Q400, which features a suite of upgrades and improvements, mainly to the cabin. No engine modifications are planned but the operating manual will be altered to improve fuel burn in certain conditions.

But what about making the 70-seat Q400 bigger? After all, isn't the regional airline industry grappling with the hard reality that bigger is better?

For some time now, Bombardier has been studying a stretched version of the Q400, dubbed the Q400X. While the firm has not yet green-lighted the programme, it seems pretty confident that there is a market for a larger model. Considering the fact that the Q400 has been doing so well, says Beaudoin, there is "great potential for that [Q400X] aircraft in the long-term". Q400 customers are "talking about it", he adds.

Separately, Beaudoin also took some time to address a recent Research Capital report that claims China Southern Airlines will become a launch customer for the proposed CSeries airliner. Check out what he said here.

Bombardier's annual meeting of shareholders is currently underway. The company has just fielded shareholder proposals, including one that calls for better parity of men and women on the board of directors.

"Open your wings and name more women on the board," urges a Bombardier shareholder, who notes that the women of today are going "beyond what men are doing right now" and should be better represented on the board.  

Bombardier's management team might also benefit from a shot of estrogen. But I digress. Kudos to this ballsy shareholder, who also suggests Bombardier has the ability to set a standard by naming more female directors and shaming its competition (ahem, note to boy-heavy Embraer).

And since we're talking girl power, I'd like to highlight one female pilot's answer to the pilot shortage. Captain Karen Kahn, one of the nation's first female commercial pilots has written and published Flight Guide for Success: Tips & Tactics for the Aspiring Airline Pilot to help guide individuals entering the aviation field or considering flying planes as a career. The book is in its third reprint.

"Pursuing a career as a pilot, particularly a commercial pilot, is a painfully complex business," says Kahn. "Having gone through the process myself, I knew I could assist others more easily navigate the process by writing this book."

Additionally, Kahn addresses what she considers to be the myths associated with starting a pilot career later in life. "The average age for hiring an airline pilot is 35," says Kahn. "With age discrimination looming as a legal deterrent, airlines no longer list upper age limits for new hires, preferring to consider pilot qualifications on their own merits. Further, older pilots bring a maturity level to the job that instills confidence in passengers as well."

I'm sifting through Embraer's rather rosy annual "20-F" report to the US Securities and Exchange Commission (SEC), and there appears to be some interesting titbits in the filing. For those of you who are overworked, stressed out, or don't have enough time to think - let alone read this 120-plus page beast - and for the just plain lazy, I've broken out the following key air transport-related points:

1)      Embraer this year expects its research and development (R&D) costs to total approximately $243 million, including estimated costs of $123 million related to development of its new Phenom executive jets, $48 million related to improvements in its commercial aviation segment products, and $72 million related to development of technology. This excludes contributions from risk-sharing partners.

2)     By comparison, total R&D expenses for 2005, 2006 and 2007 were $93.2 million, $112.7 million and $259.7 million, respectively, net of cash contributions provided by risk-sharing partners. Research and development costs as a percentage of net sales were 2.5% in 2005, 3% in 2006 and 5% in 2007.

3)      Embraer remains fully committed to continuing to market its ERJ-145 regional jet family. As of 31 March, the company had more than 850 units in commercial operation. The manufacturer says it is currently evidencing increased demand for the family in the secondary market.

4)      Embrear continues to develop the E-170/190. It also continues to "analyze new aircraft demand in the jet market to determine potentially successful modifications to aircraft we already produce".

5)      As of 31 March, Embraer's largest customers were JetBlue Airways, US Airways, HNA Group and the new Brazilian airline recently founded by David Neeleman, called Azul. These accounted for 42.3% of Embraer's firm orders in backlog for E-170/190s. Embraer believes it will continue to depend on a number of key customers and warns that the loss of these could reduce sales and reduce market share.

6)      Embraer's ECC Leasing subsidiary, which manages and remarkets the aircraft portfolio that may be acquired by Embraer as trade-in or re-purchase transactions, is contributing positively to the company's financial results. Since its 2002 inception, the unit has reached an accumulated net income of $26.4 million up to 31 December 2007. Also during this period, ECC Leasing and two other Embraer subsidiaries managed a total portfolio of 57 aircraft, of which 29 aircraft were under operating lease and 28 aircraft were sold to airlines, corporations and government entities in North America, South America, Asia and Europe.

7)      Embraer currently expects investments in property, plant and equipment to total approximately $330 million in 2008 and an additional $270 million in 2009, primarily related to the production of the E-170/190 family, as well as its executive jets and defence aircraft.

(Photo from Embraer) 

CoKinetic Systems, which develops IFE systems software, has been flying under the radar for the last few years. The company is best known for supplying its AirPlay software to Virgin America's "Red" system (which uses Panasonic hardware), but precious little else has been openly discussed. That's about to change. Expect a big announcement around September when the World Airline Entertainment Association (WAEA) conference kicks off in Long Beach.

But if you need a quickie refresher about CoKinetic, check out my September 2004 article below called "Virgin America's IFE plans could prove industry changing". It was written before Panasonic was revealed as the IFE system maker for Red. Keep an eye on this space. We may soon find out just how industry changing is CoKinetic.

Virgin America's IFE plans could prove industry changing
Mary Kirby, DC

Virgin America has made the unprecedented decision to pick separate providers for its planned inflight entertainment (IFE) platform and the interface engine that will run software on the system.

The airline has contracted US startup company CoKinetic to supply a new interactive engine called AirPlay, an XML-based product which can run a wide range of IFE applications on any major IFE platform.

It is separately in talks with an unnamed IFE system manufacturer to equip its recently ordered Airbus A319s and A320s with the necessary hardware.

The decision - which appears to be the first of its kind - could represent a shift in how airlines seek IFE solutions in the future.

Traditionally, major IFE manufacturers - including Matsushita, Rockwell Collins and Thales - supply airlines with both the platform and the "windows-like" operating system that runs software applications on the hardware.

"As a result, the airlines become beholden to the capabilities of that IFE software...and every time they want new features they have to go back to [the IFE platform makers]," notes IFE industry veteran Alan Pellegrini, who is on the board of directors at CoKinetic.

Speaking to ATI, Pellegrini says that "Virgin America stepping forward has enabled that break allowing airlines to explore their own creativity in bringing new functionality to passengers".

In the future, he adds, this move "could mean that airlines will separate the hardware from the software purchase", and force "the hardware guys to basically accept that and integrate the interactive engine on their platform".

CoKinetic also considers its contract with Virgin America to be landmark. "For the first time, airlines can combine applications hosted on their IFE servers with additional content from other sources," says CoKinetic in a statement. "The content and overall look and feel of the IFE system can be quickly and inexpensively refreshed - much the way web pages are today."

Under its deal with Virgin America, CoKinetic will also develop a number of software applications that will reside on AirPlay.

CoKinetic is "totally responsible for the interactive experience on that airline. [Virgin America] will still license movies and audio programming but the entire user experience has been handed over to CoKinetic", says Pellegrini. "It is a pretty substantial project for them," he adds.

A Virgin America spokeswoman will only confirm that the carrier has entered a contract with CoKinetic. "We are very excited about their capabilities. We have publicly stated that we are going to offer a high-style, low-fare airline service carrying the world renowned Virgin brand and the Virgin style of service," she says.

While she declines to disclose the specific details of the deal, the spokeswoman notes that the IFE presently offered by US low-cost carriers JetBlue Airways and Song "are truly the launch pad, instead of the ceiling of the product offering that you can anticipate from Virgin America".

Virgin America also has not yet revealed what IFE platform will equip its Airbus narrowbodies. Other Virgin brands, the UK's Virgin Atlantic Airways and Australia's Virgin Blue, have Rockwell Collins IFE platforms installed on their aircraft.

Source: Air Transport Intelligence news