Aviation and Airlines Industry Will Return Growth by 2010

The aviation industry which is affected by the global economic slowdown is expected to recover in two years’ time, said International Civil Aviation Organization (ICAO) president Roberto Kobeh Gonzalez here on Monday.

He said, “ICAO has formulated a medium-term forecast which points to an industry recovery by 2010. Financially, airlines of ICAO member states post an operating loss for 2008 and profits in 2009 and 2010.”

Passenger traffic growth will also recover by 2010, he said when addressing delegates at Singapore Aviation Academy 50th anniversary lecture.

He said the volatility of oil prices and uncertainty of the global economy make it difficult to predict what will happen to the industry.

“Many airlines have taken steps to counter the rapid increase in oil prices, such as retiring older, less energy efficient aircraft, abandoning non-productive routes, reducing the workforce and contemplating mergers,” he said.

He also pointed that the industry is short of highly skilled workforce. In the next few years, there will be a massive wave of retirement from the current workforce, so training and retaining qualified personnel is key for the industry.

At the function, Kobeh signed a memorandum of understanding (MOU) with Lim Hwee Hua, Singapore’s Senior Minister of State for Finance and Transport, to provide 50 training fellowships to ICAO member states for training at Singapore Aviation Academy in 2009.

Aviation Services on Europe Expected to Recovered Next Week

Icelandic volcanic eruption forced the entire European aviation services halted and thousands of passengers stranded at various international airports waiting for the scheduled departure.

The mood among passengers was one of cautious optimism. After days of endless waiting, many reserved their celebrations for when they were airborne.

“I think when we land down in America, then we’ll know we’re there. But at the minute, we’re a bit cautious,” said Georgina Evett.

She was part of a group trying to fly from Manchester, England, to Florida for a world cheerleading championship this week.

Manchester Airport was among many where flights are now taking off and landing.

The closure of so much European airspace for nearly a week left untold numbers of travelers stranded, and it’s not clear how long it will take to get everyone home.

Many airlines added or rearranged flights to try to clear the backlog.

The crisis set off a surge of emergency requests from stranded Americans, prompting the U.S. State Department to scramble to arrange everything from housing to, in one case, dialysis treatment for an elderly patient in Frankfurt, Germany.

At its peak, the crisis affected 1.2 million passengers a day and 29 percent of all global aviation, according to the International Air Transport Association.

It was the worst disruption of air traffic since the September 11 terrorist attacks in the United States in 2001. Following those attacks, the United States closed its air space for three days, forcing Europe to postpone all transatlantic flights.

In addition to clearing a massive backlog of passengers and cargo, airlines now face financial headaches as well as logistical ones.

Budget carrier Ryanair indicated Wednesday it does not plan to pay compensation to passengers other than lost ticket costs.

The European Union’s top official for transport had said Monday that airlines were responsible for taking care of them while they were stranded.

The International Air Transport Association estimated Wednesday that the Icelandic volcano crisis cost airlines more than $1.7 billion in lost revenue through Tuesday. Between Saturday and Monday, when disruptions were greatest, IATA said lost revenues reached $400 million each day.

The crisis began after the volcano beneath the Eyjafjallajokull glacier erupted Wednesday and sent a cloud of ash into the atmosphere. By the next day that cloud had reached Europe, where authorities quickly closed the airspace over safety fears.

Volcanic ash can shut down engines and electrical systems and damage a plane’s windscreen.

By Tuesday, however, airlines had started to complain that the measures were too restrictive.

Ash levels in most parts of Europe, they said, were low enough to allow the safe operation of flights.

Scientists in Iceland said Wednesday the volcano has decreased its ash output by 80 percent compared to the first day of eruption, April 14.

Armann Hoskuldsson, a volcanologist at the University of Iceland, told a briefing that the volcano’s output is now “insignificant,” though it will continue to be active for a while.

That reduction in volcanic activity appeared to be the main reason that flights resumed operating in Europe on Wednesday, along with European countries relaxing their restrictions on flight, according to a spokeswoman for Eurocontrol, an intergovernmental body that manages European air travel.

In Britain, the Civil Aviation Authority (CAA) issued revised guidance on flying through volcano ash clouds, allowing airlines to conduct their own risk assessments and requiring them to report any ash damage to the authorities.

The 27 countries of the European Union also agreed with Eurocontrol to split the airspace into zones based on their ash content and to allow flights in the unaffected areas, said Spanish Minister of Public Works Jose Blanco.

“Airspace was being closed based on theoretical models, not on facts,” said Giovanni Bisignani, director general and CEO of IATA. “Test flights by our members showed that the models were wrong.”

He said the EU’s decision to categorize airspace based on risk was a “step in the right direction,” but Europe still needs uniform rules on air travel to avoid a repeat of the chaos of the past week.

NATS, the air traffic authority in Britain, said it is confident it had made the right decision in restricting flights.

“The primary concern for all the people involved — the regulator, the government, and NATS — has been to ensure flight safety,” NATS Senior Manager Alex Bristol told CNN. “Until such time as we had evidence to give us different assurances, then the regulations which existed, and which we were using eight days ago … then we had to restrict the airspace, and we did the right things.”

Malta Tourism Authority in Talks With Ryanair and Easyjet About New Rroutes

The Malta Tourism Authority is in talks with Ryanair and Easyjet about new routes, which it hopes to finalise in the coming weeks, chief executive officer Josef Formosa Gauci told www.di-ve.com.

Mr Formosa Gauci was the guest for the monthly video interview with www.di-ve.com editor Vanessa Macdonald.

Insufficient seat capacity has been blamed for the downturn in Malta’s tourism in recent years but this had been solved to a large extent by the introduction of low-cost airlines, which made last winter one of the best in terms of capacity.

He said that with forecasts of near zero growth in 2009 tourism, Malta had to make sure that it aimed its advertising at those sectors that would still continue to travel – but the most important thing is to make sure that there are enough seats to get them here.

However, the price of oil has affected people’s income and propensity to travel – and also forced airlines to think hard and long about their routes.

Mr Formosa Gauci gave the example of Germanwings, which decided months ago to drop the Malta route – even though oil has now gone back down to more reasonable levels. Efforts are underway to entice it back, he confirmed.

Ryanair has also dropped Valencia and Bremen while Volare will not operate to Malta next year.

But it is not all bad news. For the first time ever, Air Malta will use all its 12 aircraft on the local hub, while SAS will fly from Stockholm as from April. Emirates is already operating daily to Dubai while Lufthansa is planning to use larger aircraft on the Malta route, he said.

“Capacity will be around 2-3 per cent down for winter, which it not as much of a disaster as it could have been,” he said.

Still, it was crucial to ensure that there are enough seats next year for those who do want to come to Malta, hence the talks with Germanwings, Ryanair and Easyjet.

The MTA is approaching the UK and the Continent in different ways. Flights from the UK are already operating at over 85 per cent capacity – full, to all intents and purposes – but flights from the Continent are only two-thirds full.

“The strategy is to increase seat capacity from the UK and load factor in our other core markets, France Germany and Italy,” he said.

This means discussions with Ryanair and Easyjet on summer routes, and a repeat of last year’s post-Christmas television campaign.

However, for the first time ever, MTA will also advertise on television in Italy, Germany and France, he confirmed.

Once the scale of the international crisis unfolded, the authority set up a core group with the parliamentary secretariat for tourism, Air Malta, Malta International Airport and industry representatives. Its task was to identify who would travel in the current economic climate.

Mr Formosa Gauci explained that Malta would benefit from those people who opted for short-haul holidays rather than for long-haul destinations like the Far East and the Caribbean. However, it would lose out on those who decided to forego overseas holidays and stay in their home countries – as well as those who used to take second and third holidays, often long weekend breaks.

“We have to target our campaigns as aggressively as possible to get those who still plan to travel,” he said.

United Airlines, Jet Blue Tweeting Cheap Fares

Tech-savvy fliers who are members of the micro-blogging site Twitter have a new way to find last-minute fare deals.

United Airlines and JetBlue have introduced Twitter-exclusive promotions — “twares” in the case of United and “cheeps” for JetBlue. These deals reward the companies’ Twitter followers, or those that sign up to receive the airlines’ updates via the site. The deals are announced on Twitter and can disappear within hours, so consumers either need to be glued to their screens or have great timing.

“Our goal really was to take advantage of all the great followers we already had on Twitter,” said JetBlue spokesman Bryan Baldwin.

JetBlue’s main Twitter account has roughly 988,000 followers. The company set up a new account, “JetBlueCheeps,” that posts fresh deals every Monday morning. For example, JetBlue is currently offering a $9 one-way fare from Burbank, Calif. to Las Vegas this Saturday. Customers have to book by 6 p.m. Eastern time on Monday to get the deal.

“The goal with Cheeps is to put options out there for really great fare deals that are close-in — within that week,” Baldwin said. “It’s for customers who have flexibility or want a last-minute getaway.”

United Airlines, meanwhile, offers its “twares” through its main Twitter account, “UnitedAirlines.” The deals can come at any time and usually expire within two hours. United Airlines has nearly 21,000 followers.

Jetblue Airways And Lufthansa To Offer Seamless Travel Worldwide

JetBlue Airways Corp. and Deutsche Lufthansa AG of Cologne, Germany, said Wednesday they have signed an agreement to share flight codes at Rochester and 11 other JetBlue locations in the United States and Puerto Rico. That means JetBlue will offer Lufthansa’s connecting service to 180 overseas destinations.

The strategic agreement could mean big things for JetBlue, which has become the largest domestic carrier based at John F. Kennedy International Airport in New York City.

And it could mean smoother traveling for people who are used to buying two tickets and making at least two sets of arrangements when they leave Greater Rochester International Airport heading to Europe, Africa or Asia.

Sebastian White, a JetBlue spokesman, said JetBlue will carry the Lufthansa code at 11 U.S. cities and San Juan, Puerto Rico. In addition to Rochester, the cities are Buffalo, Syracuse, Pittsburgh, Austin, Texas, New Orleans, Raleigh-Durham, N.C., and four in Florida — Fort Lauderdale, West Palm Beach, Tampa and Fort Myers.

Customers traveling from these cities on JetBlue will be able to connect via JFK or Boston’s Logan Airport onto Lufthansa flights.

New York City’s three major airports are the No. 1 destination for Rochester fliers and many of them are headed overseas, said David Damelio, executive director of the Rochester airport. But travelers have had to buy secondary tickets when heading to a city such as Paris or Tokyo. Fliers have also had to personally gather their luggage to get it to the international airline before leaving the United States.

The agreement, if approved by the U.S. Department of Transportation, could mean that fliers travel more seamlessly between Rochester and international locales.

“People can buy a single ticket … and pick up their bags in Paris or Rome,” said White.

Jens Bischof, vice president of Lufthansa’s operations in the Americas, said the agreement will allow fliers a range of advantages, from cost savings to the luxury flying that Lufthansa promotes. Bischof and White said the agreement is a rare combination of a low-fare airline and a premium international carrier.

Fliers would be routed to the two German hubs of Lufthansa and then fly out to any worldwide location that the airline serves. It is likely the hub choices will expand to include Switzerland.

Lufthansa, one of the largest airlines in the world, owns a 16 percent share of JetBlue and recently acquired Swissair AG and a controlling interest in Austrian Airlines.

White said more U.S. cities can expect Lufthansa to show up on JetBlue codes as the two carriers expand their partnership. JetBlue currently serves 56 cities with 650 daily flights.

Lufthansa flies to 206 places in 78 countries, with hubs in Munich, Frankfurt and Zurich.