October 2010 Archives

What Air New Zealand does not have in size it has in character. While it lacks a 300-plus strong fleet that some airlines have, it has safety demonstration videos that have gone viral. While it lacks the A380 as a mascot, it has smut-mouth Rico. Although Air NZ is small it needs to be big as it is the country's flag carrier.

Quirky safety videos and the quirkier Rico are ways to leverage that objective, but Air NZ's greatest point of differentiation comes online at the end of the year when Air NZ takes delivery of its first 777-300ER, which will have the carrier's new product. Importantly, the product hits where it counts. YouTube videos are fun but do not impact every customer the way the new product will.

So what we can expect from the new product on the 777-300ER? Last month I got to try out Air NZ's new long-haul product when CEO Rob Fyfe brought, with a few able bodies, a set of economy SkyCouch and premium economy seats to his address at the National Aviation Press Club. Also with Fyfe was Air NZ'er Kathy Shepherd who knew so much about the products I asked if she designed them (no, no, she's just been giving demonstrations since February). In the above video Kathy gives a tour of the SkyCouch (my apologies for the poor quality--Air NZ didn't alert us the seats would be present, and I only had my iPhone on me).

CHANGES
First I found about about a few changes to the product since it was announced. Air NZ has removed the front-most row SkyCouch, reducing the number of SkyCouches on the 777-300ER to 20 from 22. (The SkyCouch is only featured in the first economy section on the side seat sections, i.e. not in the centre set of seats.) Kathy says Air NZ took out the SkyCouch from row 36 in order to give elite frequent flyers a seat at the front of the economy cabin without having to pay for a SkyCouch.

During certification the seats had to undergo a few modifications, namely tightening the PTV and arm rests so they did not move as freely (a hazard in a crash).

The first 777-300ER has slipped from late November to early December, but entry into service remains on schedule for April 2011 on AKL-LHR-LAX. Until then, the 777-300ER will fly on ad-hoc trans-Pacific routes.

THE SKYCOUCH
The heart of the SkyCouch lies in the simplicity of la-Z-Boy chairs: a part of the seat is flush with legs but can be raised upwards to extend the seat, or in this case, form the SkyCouch. See the series of photos below.



Air NZ is targeting these seats at families with small children or two passengers who want a more comfortable seat without flying in a premium cabin. During booking two passengers can pay extra to have the third SkyCouch seat remain empty while passengers in groups of three can pay extra to be seated on a SkyCouch. For a single traveller, it becomes cost-effective to sit in premium economy rather than purchase two empty seats.

On the arm rest the button closest to the seat (see photo, right) releases the seat extension and from there passengers lift the section up with a side handle and then repeat the process for the other two seats. One advantage of this is if a family is travelling with children and the children are sleeping on the SkyCouch, the parent can stay seated normally. See photos below.




To lower the SkyCouch, there's a side handle to release the lock and then passengers will need to push the extension down with their calves.

I found the process of raising , lowering, and locking the extension clunky and noisy. Kathy said these seats were prototypes and the final version will have smoother mechanics, which it will need to be otherwise non-SkyCouch passengers won't enjoy the clanking.

For the ultimate test, I lied down on the SkyCouch. It was not as comfortable as a home couch, but that was to be expected. For aircraft seats the SkyCouch is very comfy. My biggest accolade for them is the flat seat cushion design. If you try to lie down on most economy seats today, your body will experience the humps of the sides of each seat. The SkyCouch doesn't have those, and with no loss: when sitting down normally, the seat is still just as comfortable as any other economy seat.

After trying out the SkyCouch my reaction was these seats lived up to everything Air NZ hyped them to be. But after more poking and prodding my reaction changed: these seats were much better.

What won me over was the detail put into the design. From the get-go Air NZ said it wanted to understand passenger needs and match them. The big picture in economy was having a hard product that passengers could lie down on (or close to it), but the little details also matter. These little details are featured on every standard economy seat and not just the SkyCouch seats.

THE TRINKET TRAY
My favourite feature is what Air NZ calls the "trinket tray", a split-level blue, 1.25 inch wide dish underneath the PTV:



Its purpose is to keep handy small things you'll need in-flight, like a pen (for immigration forms), glasses, and lip balm.

In three out of the three flights I've been on in the past week I've managed to drop my pen and spend a minute awkwardly placing my hand underneath my seat to locate the bugger. During long flights (and Air NZ's network is full of them) I like to sleep without my glasses on but dislike having to carry a clunky case for them. Solution to both problems? Trinket tray.

While the trinket tray is aimed at passenger convenience, it also serves one of Air NZ's less-known aims: creating a calmer cabin with less passenger movement, like passengers getting out of their seats to open an overhead bin to retrieve a pen or other small item that could go in the trinket tray.

LESS MOVEMENT AND MORE IFE
On the subject of less movement, Air NZ has designed the SkyCouch extensions to each support 300lb of weight, which will allow SkyCouch passengers to climb over seatmates without having them shuffle out of the aisle. (Watch Kathy step on the seats in the video at the start.) My only concern is how many passengers will grab the seats in front of them for support, thus annoying the forward-seated passengers.

Also on the subject of movement, the Panasonic IFE system on Air NZ's 777-300ER will let passengers request food and drinks and have flight attendants deliver the items, a la Virgin America's Red IFE system. (As Rico will have you know, it's a touch screen.) The IFE system includes a PTV, USB port (left of the trinket tray), as well as iPod and iPhone (and presumably iPad) connectivity so passengers can watch their own entertainment on the PTV screen, Kathy says.

Each economy seat--although I'm not clear about bulkhead seats--has its own seat power conveniently located on the seat back in front of you (see photo, left). It will be a breeze to charge up with no more fumbling about underneath your seat trying to find the outlet/powerpoint.

To the right of the trinket tray there's also a third port (see below) that Kathy and I could not figure out what it was. Any idea? Paging Mary Kirby...

Once you have that snack or drink ordered from the IFE system you'll need a tray table, and Air NZ has some innovation there too.

NEW TRAY TABLE
Larger PTVs have eaten away at seat-back space, leading tray tables to be folded and hinged. Air NZ also folded and hinged its tray table but bisected the tray table's second half (the part closest to the passenger) into two sections. That gives you choice with how much tray table space you want, rather than  the previous all-or-nothing option. That's a boon since personal space is at a premium in economy.



Sticking with the in-flight service theme, let's say all you have is a cup of water and don't need a tray table. Air NZ has a cup holder that extends from the setback to do just that. I first encountered such a device five years ago on an Air France 777-300ER and thought it was great until the person in front of me reclined and my cup of orange juice almost became good friends with my pants. But never fear: there's Kiwi ingenuity at work here. The holder pivots so your cup will stay up right even if the seat in front of you reclines.


LEG ROOM TO THE RESCUE
As you've picked up on, these ain't yo mamma's seat backs. There are a number of features in them but the trade off is space. A folded tray table takes up twice as much width as a single-pane tray table. Fortunately the space lost to bells and whistles--or as close as you can get with moulded plastic--does not eat away at legroom as, you'll see below, the part of the seat directly in front of knees has no extra molding, thus maximising leg room.

SEAT POCKET & POUCH
There's one last seat back innovation down there: a second seat pocket designed to hold water bottles. It's less than half the width of the primary pocket and not as deep or long, but if you, like me, are of the large wattle bottle toting persuasion, the second seat pocket will comfortably accommodate a 1 litre bottle.

NO. 8 PILLOW
One smaller innovation is the pillow, which AIr NZ calls its "Kiwi No 8 wire solution". For those short on Kiwi culture, Kathy explains No. 8 wire is multipurpose (like duct tape, or Windex if you're Greek).Yes, you do the math, this pillow is multipurpose. It can function as a normal pillow or attach to the top of your head rest for extra cushioning there. That latter function gets it out of the way of your limited space, which I greatly appreciate. After I stow my carry-on bag, the first thing I do is take the rectangular airline pillow and put it in the overhead bin. With Air NZ's pillow, I might just use it.



My only disappointments were 1) Air NZ will have a tight 3-4-3 economy configuration, although that is becoming more of the norm on 777s, and 2) (and less substantial) the seat covers. They were a blase cloth black. Virgin America has done black seat covers well, as has AirAsia. The blue trim stands out but maybe a bit too much (although the contrast is good for the trinket tray).

THE UPSHOT
WHAT'S GOOD

• serious innovation
• attention to detail (e.g. Trinket Tray)
• top-notch IFE with iPod connectivity and in-seat power for every seat

NOT SO GOOD

• 10-abreast configuration in Y
  
• SkyCouch levers too noisy on demo product. How will the final version sound?
• unattractive seat covers

Check back soon for my take on Air NZ's premium economy seats.

A big thank you to Kathy for her hospitality, knowledge, and patience as I poked and prodded the seats.

Anyone in the Asia Pacific region has heard this line: the Asia Pacific region will become the world's largest aviation market. Yet Asia is relatively absent on the globetrotting footprint Virgin Blue has created in the past two years.

Its service to Los Angeles and codeshare (perhaps soon JV) with Delta plants the carrier in North America while its JV and Abu Dhabi flights will primarily give Virgin Blue reach into Europe and the Middle East.

But Virgin Blue isn't ignorant.

Prospects of corporate Asian services (as opposed to the carrier's existing leisure destinations of Bali and Phuket) ratcheted up with Virgin Blue's intention to lease A330 aircraft, although the carrier says the A330s will be used domestically--for now.

Last week chief executive John Borghetti commented on his carrier's Asian intentions, telling the Business Spectator:

We fly to obviously Phuket; we fly to Denpasar, Bali....[they're] important [destinations], but we need a lot more. We need the Hong Kongs, the Singapores, the Chinas, the Indias, and for that matter, the Orient - Japan and Korea and so on. And all I can really say is it is a very important market.

So what will Borghetti do? "We are going to be active in that market," he says, "but it will take us a little while to put that plan into effect." What plan might that be?

Quote Borghetti:

We can cover Asia by doing it ourselves in part, by doing it with a partner or partners. I'm not really going to comment on which path we're taking or how many of those paths we're taking.

In short, Virgin Blue is looking to replicate its JV with Etihad: Virgin Blue will fly to some ports and work with local carriers from there. For other ports it may rely entirely on codeshares for a virtual network.

That strategy gives Virgin Blue a larger reach without, as Borghetti said at the carrier's annual results, "buying squadrons of aircraft" and the associated costs, which Virgin Blue would be pressed to pay given its order for 50 737s.

A larger reach is critical as Virgin Blue's objective is to increase its corporate market share and boost its domestic network in general. A 1% increase in corporate market share, Borghetti says, equates to a 1% increase in yields.

But Virgin Blue cannot win corporate travelers on domestic services alone. It needs international services for their own sake and, to a lesser extent, for its frequent flyer program so corporate travelers can burn points for personal international travel, where Qantas has an advantage. And so Virgin Blue is on the prowl for international partners. Case in point: V Australia codesharing with Etihad for 800 seats a week to Athens. (Yes, Greece could use accounting help, but not 800 seats' worth.)

So who could Virgin Blue's Asian suitors be? Here are some possibilities, and I stress the word possibilities. I now assume the position of an armchair CEO, albeit, hopefully, informed.

CHINA
Oneworld, as it will despairingly tell you, lacks a Chinese partner. Qantas codeshares with China Eastern, who will join SkyTeam, complicating its future with Qantas. For a codeshare with a major carrier, Virgin Blue is likely left with AIr China, China Southern, or Hainan Airlines.

Virgin Blue operating its own flights to China seems inevitable. Although Qantas has scaled back its direct flights to China, chief executive Alan Joyce is upbeat about Australia's largest trading partner, saying in July at the Australia Pacific Aviation Outlook Summit, "We think China is a very exciting market for us...We see opportunity for Australia to China with both Qantas and Jetstar. The 787 in particular opens up [a] range of routes that we wouldn't see to be economical today."

Virgin Blue operating its own routes and enlisting a partner would require it to carefully dance around its objectives as well as those of its partner. Air China operates to Melbourne and Sydney; China Southern to Brisbane, Melbourne, and Sydney; and Hainan Airlines only operates ad-hoc Australian services, perhaps giving it a bigger incentive to partner with Virgin Blue.

HONG KONG
Cathay Pacific is part of the oneworld alliance, so cross them off. Virgin Atlantic presently has daily Hong Kong-Sydney flights and V Australia has applied for Hong Kong slots. But with a limited number of aircraft, one wonders if Virgin Blue sending its own metal to Hong Kong and launching a sales and marketing campaign is the best use of resources when Virgin Blue could continue to piggyback on Virgin Atlantic's codeshare. Then again Virgin Atlantic's experience and associations could make an easy sell for Virgin Blue at a time Virgin Blue is taking risk with new services.

If Virgin Blue launched its own flights to Hong Kong, the only local carriers not affiliated with oneworld are Hong Kong Airlines and sister carrier Hong Kong Express Airways. They provide service around the region, and notably to mainland China. Hainan Airlines--which lacks regular Australian flights (see above)--is the parent company to both carriers. Hong Kong Airlines has flagged its intention to start services to Australia.

INDIA
Direct Virgin Blue flights could be ripe. At present only Qantas has direct flights to India while Air India is trying to establish a Melbourne service. Even if Air India does realise Melbourne flights, the carrier does not hold a high reputation for service.

Qantas charges dearly on its Mumbai service, sending many passengers on disliked connecting flights. Virgin Blue does plan to codeshare to India with Etihad, but backtracking 2400 miles through Abu Dhabi, making the journey 40% longer, won't be popular. (In comparison, connecting through Kuala Lumpur makes the journey 1% longer in distance, and through Hong Kong 19% longer.)

For an Indian partner for onwards connections, Kingfisher is out due to its plan to join oneworld and Jet Airways is out due to its codeshare with Qantas. (Even if Qantas switches its codeshare to Kingfisher once the carrier joins oneworld, Kingfisher and Jet have their own strategic alliance. You can bet Qantas would pressure Kingfisher to pressure Jet not to align with Virgin.)

Unless Virgin Blue could sway Jet Airways, Air India is the only potential full-service partner. On the low-cost front there's SpiceJet and IndiGo, but how willing is Virgin to partner with LCCs, even if on short-ish flights, when Virgin itself is moving upmarket?

JAPAN
The options are JAL and ANA. JAL, with Qantas, is part of oneworld, so cross them off. Even without discounting JAL, ANA is an interesting option in its own right. There is anecdotal evidence a growing number of Australian corporate travelers fly with Qantas domestically but use Star Alliance carriers internationally, due to Star's larger Asian reach and perceived declining standards over at the flying 'roo.

If Virgin Blue operated on its own metal to Japan, a partnership with ANA could be advantageous for ANA and Star. ANA, and by extension Star, does not have direct flights from Australia to Japan, thus requiring flyers to take Qantas/Jetstar, JAL, or a circuitous route through Asia, adding at least six hours of travel time.

ANA could get reach into Australia at the time some Japanese travelers are shifting their preferred carrier from JAL to ANA because of JAL's bankruptcy (anecdotally that's less to do with a fear JAL will close shop and more with JAL's reduced services and face-conscious Japanese not wanting to be associated with a bankrupt carrier). If Virgin Blue operated the flight ANA would presumably codeshare on it, giving Star flyers a direct flight from Australia to Japan. In turn ANA could help Virgin Blue with Japanese distribution, which Jetstar initially fumbled with.

If Virgin Blue could give those Qantas-for-domestic, Star-for-international corporate travelers a taste for its service on international flights, Virgin Blue could win them for domestic travel.

KOREA
Like with Japan, there are two options: Asiana, which serves Sydney, and Korean Air, which serves Brisbane, Melbourne, and Sydney. At present traffic to Korea is significantly less than traffic to Japan. Looking at December 2009 BITRE data there were 28,060 outbound passengers traveling direct to Korea and 45,769 to Japan.

It's hard at present to see demand for more Korean flights, although that could change once Virgin Blue starts its Asian operations; Korea is making a renewed tourism push.

If Virgin Blue was looking to codeshare, Asiana codeshares with Qantas, making Asiana unlikely, although we have seen Virgin Blue usurp a Qantas partner (Etihad, but it's not clear what Virgin could entice Asiana with). Korean Air is logical with more flights and could be willing to partner with Virgin Blue to (1) work against the Asiana-Qantas partnership and (2) because Virgin partners with Delta, who like Korean Air is part of the SkyTeam alliance.

SINGAPORE
Prepare for a dog fight if Virgin Blue operates its own services. Majors plying the route are Singapore Airlines, Qantas/British Airways, Emirates, Etihad, and Jetstar. Plus Malaysia Airlines frequently undercuts direct carriers' price with a connecting service through Kuala Lumpur.

Virgin Blue plans to codeshare with Etihad on its thrice-weekly Brisbane-Singapore service, but anything less than a daily departure (or a codeshare through a connecting city like KL) is not ideal for corporate travelers. Prospects with Emirates, who fly from Singapore to Brisbane and Sydney, are dim given Virgin Blue's JV with Eithad. Virgin Blue could use a partnership with Singapore Airlines, but Singapore has almost no incentive (except to be a stronger competitor against Qantas), and still bears a grudge about not being able to fly from Australia to America due to V Australia entering.

TAIWAN
Borghetti did not name Taiwan as a focus, but Taiwan is one of the Asian Tigers. Taiwan is similar to Korea in that there are two carriers (China Airlines and EVA Air) one of whom (EVA) already codeshares with Qantas. That makes China Airlines likely. For reference, EVA only serves Brisbane while China Airlines serves Brisbane and Sydney.


Well my armchair CEO derrière is being firmly planted in my seat, so it's time to get up and conclude my reckoning. What's your take?

Christchurch did not disclose a launch date or routing. Earlier this year AirAsia X CEO Azran Osman-Rani said the carrier would consider adding a New Zealand destination as an add-on fight to its service to Australia's Gold Coast, where it flies to daily.

While most of New Zealand is taking today easy on account of it being Labour Day, two pilots were working to extricate themselves from a sewage pond after their C172 overran the runway during a touch-and-go at Thames airport in NZ's North Island (see map below).

The duo were injured--physically, at least--and there was no structural damage to aircraft, owned by South Auckland's Ardmore Flying School. But the C172's engine was completely submerged, making it likely the aircraft will be a write-off, according to an account told to Waikato Times by a chief flying flying instructor based at airfield and who witnessed the accident.

This morning Christchurch-based Pacific Blue was unwittingly promoting flights from Australia to NZ with the tag line "What's ours is yours", which in light of this recent incident, is awfully generous.


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But one wonders who will take up this ancillary fee, which Tiger has, apparently, trademarked as "boardmefirst". 

Unlike Southwest's no-assigned-seats policy, Tiger has assigned seating so there's no cattle call to board (see above screen capture) and thus no reason to board early to secure a seat. Passengers wanting to guarantee a seat can do so in advance--for a fee, of course.

Thankfully Australians haven't--yet--developed the American habit of over-stuffing carry-on luggage, but then again Tiger weighs carry-ons, so overhead bin space isn't a huge factor.

One (okay, me) also wonders how many seconds or minutes time-conscious Tiger will have separating boardmefirstTM boarding from regular boarding. Most of Tiger's ports board via stairs that are a good walk from Tiger's "gate". Presumably a fast walker could surpass the boardmefirstTM-ers.

There will undoubtedly be the occasional passengers who purchase this option, and it is those people who are Tiger's prey.

For now, the carriers and interested parties have been given an extension to 11 October to respond to the draft decision and provide supplementary information. Both ANZ and Virgin Blue say they will respond. A final decision is expected by the end of the year.

New Zealand's Ministry of Transport is evaluating the alliance and has yet to issue a judgment.

I fortunately was flying on Sunday and, even more fortunately, not on Virgin Blue, whose Navitaire-powered IT booking, reservations, check-in, and boarding system crashed following a hardware failure Sunday morning. The carrier later said Navitaire should have "remedied within a short period of time" the problem but for unbeknownst reasons, did not do so until Monday morning. That lack of action lead to hundreds of flight delays and cancellations affecting some 100,000 passengers, long queues at airports, and a blunt PA advising passengers on cancelled flights to "go home". (Undoubtedly one passenger would have quipped, "I'm trying.") By mid-week empty queues indicated normalcy had returned, but the incident left two key take home messages. 

First, new CEO John Borghetti is at work "Qantas-ising" Virgin by moving it up-market: Early on in the Navitaire debacle Virgin said it would reimburse delayed passengers for airport transfers and $220 a night for accommodation. All together that could stretch into the tens of millions of dollars for Virgin but sent the message that Virgin, like Qantas but unlike Jetstar and Tiger, will take care of passengers. Underpinning this was how Virgin's fragile transformation could be rocked by 100,000 displeased-"I'm-never-flying-Virgin-again" passengers.

With the compensation Virgin managed to upstage Qantas, who came a-knockin' on Wednesday morning with an e-mail from CEO Alan Joyce to Qantas frequent flyers extolling the roo's on-time performance with the note, "We are maintaining that industry-leading punctuality this year." Joyce also boasted of new menus, upgraded lounges, cabin modifications, and a growing network. In short: Dear passengers, if you've been dabbling with your carrier of choice and have been swinging with Virgin but got caught up in their delays, return to your ole friend Qantas. And to Borghetti Joyce effectively said, "Game on." 

Second, in the just saying department, the next time a Tiger A320 goes technical because of a bird strike, a Qantas 767 has a flap issue, or a Jetstar A330 has a cockpit fire, remember: $h!+ happens. Headlines like the Australian's front-page "flying shame" were not necessary in this instance. Virgin may have gotten its dose of problems all at once and its on time performance will plummet in September, but for other carriers problems lurk around the corner.