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Aviation History
1996
1996 - 0030.PDF
rVJl£HA3'fSj Lines tipped as a favourite to lead the pack. Also watch for repercussions, if and when Delta launches its new low-cost service to take on the likes of Valujet Airlines. With recovery in place, the industry seems intent on a renewed attempt at rationalisa tion. Although United Airlines ultimately decided against a bid for USAir, the very prospect was enough to spark off a new round of strategic planning. Experience suggests that it would take only one major move to kick-start a wave of merger activity. Also expect the re-emergent US airlines to make their presence felt elsewhere around the world, including the stepping up of pressure for greater access to overseas air markets. There are signs of re-alignments to come across the Atlantic. The interest surrounding USAir has opened up possibilities for British Airways to explore the options for an expand ed alliance, while, on the US side, American Airlines has an obvious lack of partners. As a background, the UK-US bilateral talks will have to restart, with a few tantalising hints that the UK may eventually be prepared to offer something more imaginative than the caution of its "phased" approach towards lib eralisation. Admittedly, BA's talk of a new "bold" initiative is, as yet, just talk. KLM has some fence-mending to do with its partner, Northwest Airlines, after the boardroom tussles during the past year. The Dutch carrier may also restart the search for greater scale within Europe. Speculation has been rife about possible talks with BA and oth ers, although they have so far met with flat denials from KLM. While BA, KLM, Lufthansa and others continue to consolidate their record perfor mances of 1995, the southern European car riers continue to struggle to complete their restructuring before the psychologically important 1997 deadline for completion of the single air market. Alitalia should finally resolve its problems in 1996, perhaps including an injection of pri vate capital. As the Iberia experience has shown, the European Commission is no longer in a mood simply to wave through state aid. Alitalia, like Iberia, is no doubt hop ing that its recapitalisation will be seen as a commercial transaction rather than just a Government hand-out. Asia's flag carriers may also have some re assessing to do in 1996. Although the region's traffic is still on course to show the world's fastest growth rates, competition, too, is growing at a heady rate. A formidable volume of new capacity is scheduled to join the fleet over the next cou ple of years or so, while, at the same time, a second tier of national carriers is emerging to challenge the region's traditional flag carriers. The net result is certain to be a continued impact on yields. Inflation and rising curren cies will not help. • 28 Air transport ANDREW DOYLE/TECHNICAL REPORTER Kevin OToole/BUSINESS EDITOR T HE GOOD NEWS, at least for manu facturers, is that aircraft deliveries reached the bottom in 1995. The less good news is that the upturn in 1996 will be moderate. The big three airframe manufacturers (Airbus, Boeing and McDonnell Douglas), will finish 1995 with something less than 350 jet-airliner shipments. That figure is less than half of the tally at the height of the delivery peak in 1991/2, and the weakest per formance in nearly a decade. Admittedly, the figures have been artifi cially depressed by the Boeing strike, which held up production of around 50 aircraft, but even without this hiccup, 1995 would have been a lean year — a final delayed effect of airline recession from the early 1990s. Such are the cycles of the civil-aircraft business. The outlook for 1996 and beyond is for a steady, but unspectacular, rise in shipments, possibly climbing towards 600 by the end of the decade. The picture of a slow, controlled recovery is backed up by the flow of new orders. Figures for 1995 were certainly more respectable than in the dark years of reces sion when, at worst, there were more cancel lations than new business. There is little evidence, however, that this is the beginning of another great ordering spree. Despite the health of its current recovery, the airline industry appears to be in no mood to repeat the mistakes of the past with anoth er uncontrolled boom. Barring disasters — and the threat of harsh new noise and emis sion controls could be one — the market should remain stable. Meanwhile, manufacturers will be busy looking at the next series of stretches, shrinks and new derivatives to help round off their ranges. Boeing has now determined in detail how it would stretch and re-wing the 747. A launch in 1996 looks possible provided that FLIGHT INTERNATIONAL 3 - 9 January 1996
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