FlightGlobal.com
Home
Premium
Archive
Video
Images
Forum
Atlas
Blogs
Jobs
Shop
RSS
Email Newsletters
You are in:
Home
Aviation History
1958
1958 - 0274.PDF
288 FLIGHT, 28 February 1958 A 50-seat Curtiss Commando C-46R (2 P.W. R-2J00 34s) demonstrated at Southend by the owners, Fred Olsen Airtransport. Conversion of Olsen's three C-46s was carried out in Venice. "Flight" photograph CIVIL AVIATION. . . K.L.M. WAVERING /~\VER the last few years B.O.A.C. has been looking back overv-' its shoulder at its faster-growing rival K.L.M. Five years ago the traffic carried by the Dutch airline was only three-quarters thatof B.O.A.C. By 1956 the margin had been reduced to a few per cent, and by last year the gap was so narrow that until final figuresare published it will be difficult to know whether or not K.L.M. moved into the position of being Europe's second largest carrier.(B.O.A.C. and K.L.M. each carry only about three-quarters the amount of traffic lifted by Air France.) Unfortunately for K.L.M., the loss of the important route toIndonesia has now meant a reduction in the rapid rate of growth experienced in recent years. Capacity will be increased this yearby only 8 per cent. This slowing-down has been reflected in an announcement that K.L.M.'s staff, at present standing at 17,300employees, will have to be reduced by between 500 and 1,000. The Board has proposed that the annual general meeting (to beheld in May) approves of a final dividend of 4 per cent, bringing the annual distribution to 7 per cent. This was based on last year'ssuccessful financial record. At the a.g.m. there will no doubt be a division of opinion between those who feel that reasonabledividend rates must be maintained if expansion is to be financed from public issue of shares, and those who believe that the loss ofIndonesian traffic demands that funds be retained within the organization as much as possible. The loss of revenue has beenestimated at F1.22m (£2m), equivalent to 4| per cent of K.L.M.'s total revenue. To maintain an up-to-date fleet without either straining thecompany's finances or providing excess capacity necessitates reduction in size of the DC-4, L.749 and Convair 340 fleets.Impending additions include two DC-7Cs (K.L.M. has options on three more of these aircraft) and three L.1049Hs, purchasedparticularly to cater for the economy-class traffic. The major development planned for this year is the opening of"Route 75" in November. This route, following roughly along latitude 75 deg, will proceed westward via Anchorage to Tokyo,and then on to Biak. Although this route is 1,200 miles longer than the present service via South East Asia, elapsed time to Biak willbe slightly less as a result of a reduction in transit-stops. How- ever, this new route will cut the distance to Tokyo by 1,500 miles. Other new services include a once-weekly flight to Abadan andfour flights per week terminating at Prestwick. (This last service, using Viscounts, will be the first direct turboprop link betweenScotland and the Continent.) During winter the convertible L.1049H will be transferred to transatlantic freight duties, allow-ing the present frequency of two flights per week to be doubled. K.L.M. also plans changes on the home front. In June the newengine workshop at Schiphol will be ready for use, and in about a year's time the freight-sheds will have been extended to offerabout double the present space. K.L.M. is also collaborating with the Hilton hotel organization, and is contributing funds to facilitaterapid construction of two 250/300-room hotels, one in Amsterdam, • the other in Rotterdam. MUNICH AFTERMATH ALTHOUGH the official inquiry into the accident to a B.E.A.**• Elizabethan at Munich-Riem on February 6 is not to be held until sometime in March, B.E.A. were last week prompted by WestGerman speculation into the cause of the disaster to issue a state- ment that they would make no comment until the result of theinquiry was known. The freely-offered opinion of the West German inspector of airaccidents, that the crash had occurred as a result of wing icing, was taken up at a Press conference in Munich by the director of theairport, Count Dieter zu Castell, who said that icing on the Eliza- bethan's wings had been established "beyond doubt." The directordiscussed also an earlier remark made by Mr. Anthony Milward, chief executive of B.E.A., that "What would have been a simplemishap was turned into a major disaster by the house" [situated near the end of the runway]. On the other hand, said Count zuCastell, if the aircraft had not struck the house, it might have hit the road, exploded and killed all the passengers. The house wouldnot be rebuilt, and the runway would be extended from 6,230ft to 8,530ft. B.E.A., who say that they are impressed with the action of theGerman authorities and with their sense of urgency, said in their statement that "Since the moment rescue work ceased an urgentinvestigation into all possible causes has been going on. We can say that we ourselves quickly formed our conclusions as to themost likely cause of the accident, and immediate action was taken on a number of points with a view to preventing any possiblerepetition." When the report of the inquiry is published B.E.A. may issuetheir own statement on the cause of the accident. B.E.A.'s DOMESTIC FARES PUBLICATION of summer schedules reveals the effect, interms of new fares, of B.E.A.'s efforts to increase the revenue earned on their internal services. The main routes least affectedare those to Manchester and Belfast. Return fares between London and Birmingham, Edinburgh, Glasgow, Jersey and Guernsey havebeen increased by about £1, while that to the Isle of Man will go up by over £2. These increases are part of B.E.A.'s campaign to reduce thedeficit shown on domestic services. Until recently the Corporation's annual reports implied that the domestic services resulted in realfinancial loss. The latest report was more guarded and, noting that the figure was reached after an arbitrary allocation of overheads,pointed out that a deficit of £1,371,000 did "not mean to suggest that we should have been £1,371,000 better off ... if we had notoperated the domestic routes." Unfortunately, the Corporation's allocation of overhead costs is not audited, so it is impossible foran outsider to know how "reasonable" is the basis of allocation. A quick inspection of the accounts, however, gives the impressionthat overhead expenses have been "loaded" on to domestic services. The volume of total domestic traffic carried by B.E.A. in 1956-1957 was exactly one-third of international traffic. Yet, to take two important items of overhead, crew pay and allowances on the onehand and station costs on the other, the cost borne by domestic services expressed as a percentage of that borne by internationalservices was 61 per cent and 57 per cent respectively. (To allocate a Viscount captain's salary, or the expense of running London Air-port, in such a way as to show a realistic balance between domestic and international routes is a problem to tax an accountant'simagination to the limit.) If the basis of overhead allocation were known, then the public would be in a position to judge whetherthe present allocation were "reasonable." On the present evidence there are strong grounds for supposing that the costs of domesticservices are deliberately shown up in a gloomy light. There still remains the fact that B.E.A.'s internal services areless profitable than those to the Continent. Fares are about to be increased on these international flights under the terms of recentI.A.T.A. agreements. But on these routes the effect to the travelling public is mitigated by the extension of mid-week and night-touristreductions. An interior view of the V.I.P. layout provided for the Prime Minister and Lady Macmillan on their recent Commonwealth tour in a Britannia 102. The layout was designed and installed by B.O.A.C.
Sign up to
Flight Digital Magazine
Flight Print Magazine
Airline Business Magazine
E-newsletters
RSS
Events
