Boeing 787 Dreamliner Completes First Flight

The Boeing 787 Dreamliner took to the sky for the first time on december 15, ushering a new era in air travel as it departed before an estimated crowd of more than 12,000 employees and guests from Paine Field in Everett, Wash. The flight marks the beginning of a flight test program that will see six airplanes flying nearly around the clock and around the globe, with the airplane's first delivery scheduled for fourth quarter 2010.

The newest member of the Boeing family of commercial jetliners took off from Paine Field in Everett, Wash. at 10:27 a.m. local time. After approximately three hours, it landed at 1:33 p.m. at Seattle's Boeing Field.

787 Chief Pilot Mike Carriker and Capt. Randy Neville tested some of the airplane's systems and structures, as on-board equipment recorded and transmitted real-time data to a flight-test team at Boeing Field.

After takeoff from Everett, the airplane followed a route over the east end of the Strait of Juan de Fuca. Capts. Carriker and Neville took the airplane to an altitude of 15,000 feet (4,572 meters) and an air speed of 180 knots, or about 207 miles (333 kilometers) per hour, customary on a first flight.

"Today is truly a proud and historic day for the global team who has worked tirelessly to design and build the 787 Dreamliner - the first all-new jet airplane of the 21st century," said Scott Fancher, vice president and general manager of the 787 program. "We look forward to the upcoming flight test program and soon bringing groundbreaking levels of efficiency, technology and passenger comfort to airlines and the flying public."

Powered by two Rolls-Royce Trent 1000 engines, the first Boeing 787 will be joined in the flight test program in the coming weeks and months by five other 787s, including two that will be powered by General Electric GEnx engines.

The 787 Dreamliner will offer passengers a better flying experience and provide airline operators greater efficiency to better serve the point-to-point routes and additional frequencies passengers prefer. The technologically-advanced 787 will use 20 percent less fuel than today's airplanes of comparable size, provide airlines with up to 45 percent more cargo revenue capacity and present passengers with innovations that include a new interior environment with cleaner air, larger windows, more stowage space, improved lighting and other passenger-preferred conveniences.

Fifty-five customers around the world have ordered 840 787s, making the 787 Dreamliner the fastest-selling new commercial jetliner in history.

Source: Boeing.com

IATA: The Airline Industry to loose $5.6 billion in 2010

The International Air Transport Association (IATA) revised its financial outlook for 2010 to an expected US$5.6 billion global net loss, larger than the previously forecast loss of US$3.8 billion. For 2009, IATA maintained its forecast of a US$11 billion net loss.

“The world’s airlines will lose US$11.0 billion in 2009. We are ending an Annus Horribilis that brings to a close the 10 challenging years of an aviation Decennis Horribilis. Between 2000 and 2009, airlines lost US$49.1 billion, which is an average of US$5.0 billion per year,” said Giovanni Bisignani, IATA’s Director General and CEO.

“The worst is likely behind us. For 2010, some key statistics are moving in the right direction. Demand will likely continue to improve and airlines are expected to drive down non-fuel unit costs by 1.3%. But fuel costs are rising and yields are a continuing disaster. Airlines will remain firmly in the red in 2010 with US$5.6 billion in losses,” said Bisignani.

The forecast highlights include:

Revenues: Industry revenues are expected to rise by US$22 billion (4.9%) to US$478 billion in 2010, compared to 2009. However, revenues remain US$57 billion (-11%) below the peak of US$535 billion in 2008 and US$30 billion below 2007 when passenger traffic was at similar levels to what is expected in 2010.

Passenger Demand: Following a decline of 4.1% in 2009, passenger traffic is expected to grow by 4.5% in 2010 (stronger than the previously forecast 3.2% in September). A total of 2.28 billion people are expected to fly in 2010, bringing total passenger numbers back in line with the peak recorded in 2007.

Cargo Demand: Cargo demand is expected to grow by 7% to 37.7 million tonnes in 2010 (stronger than the previously forecast 5% in September), following a 13% decline in 2009. Total freight volumes will remain 10% below the 41.8 million tonne peak recorded in 2007. Cargo demand is rising faster than world trade as depleted inventories are rebuilt. Once the inventory cycle completes, growth is expected to fall back in line with world trade.

Yields: In 2009, passenger and cargo yields plummeted by 12% and 15% respectively. Cargo yields are expected to improve by 0.9% in 2010. But passenger yields are not expected to improve from their extraordinary low level. This is being driven by two factors: excess capacity in the market and reduced corporate travel budgets. Capacity adjustments in 2009 were made at the expense of lower aircraft utilization (down 6%). An additional 1300 aircraft due for delivery in 2010 will contribute to 2.8% global capacity growth, putting continuing pressure on yields. On top of this, corporate travel buyers have adjusted their budgets to reflect lower premium fare levels.

Fuel: An average oil price of US$75.0 per barrel (Brent) is expected in 2010, up considerably from the US$61.8 average expected for 2009. As a percentage of operating costs, fuel will be 26% in 2010. This is considerably lower than the 32% of operating costs that fuel comprised in 2008, but twice the 13% of operating costs that fuel represented in 2001-2002.

Cash: Over 2009, the industry raised at least US$38 billion in cash (US$25 billion from capital markets and US$13 billion from aircraft sale and leasebacks). The ratio of cash to revenues improved for European and North American airlines, but was flat for Asia- Pacific carriers. This will provide a cash cushion for the approaching first quarter’s seasonally weak traffic lows.

“The number of travelers will be back to the peak levels of 2007, but with US$30 billion less in revenues. The US$38 billion cash cushion built up throughout this year will help airlines survive through the low season, but there is no recovery in sight for 2010. Tough times continue,” said Bisignani.

Regional Breakdown for 2010

While all regions except Africa will see an improvement in 2010 compared to 2009, performance will vary greatly as follows:

North American carriers will see losses reduced from US$2.9 billion in 2009 to US$2.0 billion in 2010. The relative improvement is largely the result of pricing power and cost reductions gained through capacity adjustments.

European carriers will generate the largest losses of any region at US$2.5 billion. This is an improvement over the US$3.5 billion loss that the region’s carriers are expected to post in 2009. Slow economic recovery in the region combined with limited ability to adjust capacity due to airport slot regulations is hindering the region’s airlines.

Asia-Pacific carriers will post losses of US$700 million. Compared to losses of US$3.4 billion in 2009, this region is showing the most dramatic improvement. This is driven by a recovery in some of the region’s economies. For example, China’s GDP is forecast to grow by 9.0% in 2010. Latin American carriers will be the only profitable regional grouping in both 2009 and 2010. The profit in each year is expected to be US$100 million. This is largely due to the benefit of relatively strong economies in South America and the efficiencies gained through regional airline structures.

Middle East carriers will see losses shrink from a US$1.2 billion loss in 2009 to a US$300 million deficit in 2010. A strong long-haul connection business over Middle East hubs will provide some insulation against the impacts of Dubai’s financial difficulties.

African carriers will deliver a loss of US$100 million in 2010—consistent with the US$100 million loss of 2009. Relatively strong economies and increasingly liberal markets are being offset by competitiveness challenges.

A Structural Adjustment

“The industry is structurally out of balance. The precipitous fall in yields will likely never be fully recovered. It is difficult to see how this can be balanced on the cost-side of the equation. After almost a decade of cost cutting, non-fuel unit cost reductions will be incremental at best. And the risk of rising fuel costs will be constant. There will be some individual airline success stories. But without relaying the foundations of the industry to facilitate structural change, covering the cost of capital for this hyper-fragmented industry will remain a dream at best,” said Bisignani.

In November, seven countries (Chile, Malaysia, Panama, Singapore, Switzerland, the UAE and the US) signed a multilateral Statement of Policy Principles that was also endorsed by the European Commission. These principles represent a commitment by the signatories to modernize the industry and make cross border consolidation possible. They are premised on a level playing field which is a responsibility of governments.

“Consolidation is the great hope for the industry. The round of consolidation experienced since this horrible decade began is a step in the right direction. But it has been confined within political borders as a result of ownership restrictions in the archaic bilateral system. The industry cannot afford the mounting losses of the status quo. The next decade must facilitate consolidation,” said Bisignani.

Source: Air Transport News

U.S and Japan sign an Open Skies Agreement

U.S. Secretary of Transportation Ray LaHood announced that the United States and Japan reached agreement on the text of a landmark Open-Skies aviation agreement, liberalizing U.S.-Japan air services for the carriers of both countries. The agreement was reached after five rounds of negotiations focusing on Open Skies, beginning in May of this year.

“Achieving Open Skies with Japan, a major U.S. transportation and trade partner, has been a long-standing U.S. goal and is good news for air travelers and businesses on both sides of the Pacific,” said Secretary LaHood. “Once this agreement takes effect, American and Japanese consumers, airlines and economies will enjoy the benefits of competitive pricing and more convenient service.”

Under the new agreement, airlines from both countries would be allowed to select routes and destinations based on consumer demand for both passenger and cargo services, without limitations on the number of U.S. or Japanese carriers that can fly between the two countries or the number of flights they can operate. It would remove restrictions on capacity and pricing, and provide unlimited opportunities for cooperative marketing arrangements, including code-sharing, between U.S. and Japanese carriers.

The agreement also would provide opportunities for growth of U.S. carrier operations at Tokyo’s Narita Airport and ensure fair competition regarding the new opportunities at Tokyo’s close-in Haneda Airport.

Although the 1952 U.S.-Japan aviation agreement was greatly expanded in 1998, many U.S. carriers serving Japan were still subject to restrictions on capacity, routing, pricing, and code-sharing.

Once the agreement is finalized, Japan will become the 95th U.S. Open-Skies partner. Both the United States and Japan must affirmatively act in order to put the agreement into effect.

 

Source: Air Transport News

President Obama considers helping airlines fund NextGen equipage

US FAA Administrator Randy Babbitt said that "any number of options have been explored" to determine how to finance equipage of commercial aircraft with NextGen ATC technology such as ADS-B, including consideration of the government's providing airlines with money for early equipage that would be "subject to repayment."

President Barack Obama yesterday proposed redirecting some funds from the Troubled Asset Relief Program, which had been aimed at assisting financial services companies that are returning to fiscal heath faster than anticipated, to stimulate jobs creation in part by investing in transportation infrastructure. Airlines have argued that aircraft equipment should be considered part of NextGen's infrastructure cost (ATWOnline, Oct. 26), and American Airlines Chairman and CEO Gerard Arpey last week suggested that jobs could be created by allocating federal funds to equip aircraft with ADS-B.

Babbitt emphasized that no decision has been made regarding using TARP money for NextGen. But he said that if funds were provided for aircraft equipage, "we would enjoy NextGen benefits 3-4 years ahead of our timeline. . .The benefits would be pretty dramatic."

Speaking to reporters yesterday on the sidelines of the US-India Aviation Partnership Summit in Washington, Babbitt said airlines can expect "billions of dollars in fuel savings annually" once NextGen is implemented. Even though they will benefit in the long run by equipping aircraft, "we have carriers in this country that are financially strapped. . .and [equipping aircraft for NextGen] is a burden that may be financially out of their reach," he said.

Source: Air Transport World

Star Alliance and Ethiopian to discuss membership

Star Alliance is holding exploratory talks with Ethiopian Airlines and will discuss the African carrier's potential membership at its chief executive board meeting today in Brussels, Star CEO Jaan Albrecht confirmed to ATWOnline. "We have been talking to them as part of our strategy to fill in our white spots on the world map," he said, pointing out that that while small in market share, Central Africa is showing strong growth. A decision on ET is not "imminent," he stressed, and an announcement can be expected in the first half of 2010.

ET would be Star's third member in Africa and would provide a good fit with EgyptAir in the north and South African Airways down south. Eleven Star Alliance members serve 81 destinations in 40 countries across Africa at present. Ethiopian carried 2.8 million passengers in its fiscal year ended June 30, a 12.3% increase year-on-year, and net profit jumped 165% to ETB1.35 billion ($105.2 million). It has five 777-200ELRs, 10 787s, 12 A350s and eight Q400s on order.

Source: Air Transport World

Ryanair Says Boeing Deal Now Unlikely

Ireland's Ryanair is likely to shelve plans to buy 200 Boeing aircraft because the US plane maker wants to change the delivery conditions, Ryanair chief executive Michael O'Leary said on Tuesday.

"We have effectively almost reached agreement on price for a 200-aircraft order... but the deal is unlikely to take place because now they want to go back and change delivery conditions," O'Leary said.

O'Leary, renowned in the industry for driving hard bargains, had already warned last month that talks on ordering 200 aircraft for 2013-16 delivery had progressed little and that he might slow down Ryanair's rapid growth from 2013.

"Last week we had pretty much reached agreement with them on price, then over the weekend they wanted to change delivery conditions," he said.

"We're going to make a final decision at the board meeting next Thursday. Unless there's some change in their position over the next week, it's off."

O'Leary said he had no alternative plan to buy aircraft from Boeing's European rival, Airbus. But the European firm said it was not interested in a bidding war over Ryanair.

"With what I know of the pricing levels they have in mind, I think I can say this is one order that Boeing should win," Airbus sales chief John Leahy said.

SLOW RECOVERY

The Boeing 737-800 aircraft used by Ryanair are worth USD$77 million at list prices, but planes are often sold at discounts.

Ryanair still has 102 planes due to arrive from a previous order that have yet to be delivered, according to Boeing data.

Buying aircraft cheaply during industry downturns has allowed Ryanair to pare costs to a minimum and take market share from rivals unable to match its cut-price fares.

O'Leary famously placed an order for 100 new Boeing aircraft and options on 50 more at rock-bottom prices in the wake of the September 11, 2001 attacks on the United States.

"I think you'll see a long, slow recovery here, not some short, sharp rebound," he said of the economic crisis and its effects on the airline industry. "Clearly, I think, we've hit the bottom."

That industry slowdown has hit higher-cost airlines hard, including Ireland's Aer Lingus, which now plans to shed almost a fifth of its staff as part of a plan to cut operating costs by EUR97 million euros (USD$144 million).

But O'Leary, who has previously launched two unsuccessful hostile bids for Aer Lingus, said he would probably not make another offer for the carrier.

"I think we're highly unlikely to make a third bid for Aer Lingus," he said.

Source: Airwise.com

US Airlines See Recovery In Business Travel

The US airline industry is seeing consistent signs of recovery that point to improved outlooks in 2010, executives at several carriers said on Wednesday.

Speaking on webcasts at an analyst conference, industry leaders said business travel demand, which sagged earlier this year amid economic recession, was improving.

"I think we are seeing improvement in both leisure and premium traffic at this point," said Beverly Goulet, treasurer at American Airlines' parent AMR.

"We continue to see strength in close-in bookings," she said.

The US airline industry has grappled in the last year with falling demand -- especially for high-end business travel -- as the recession eroded travel budgets.

Several airline executives have noted improved demand in recent months and said on Wednesday the outlook continues to improve.

Delta Air Lines said demand would remain strong and that it expects to see improvements in unit revenue in 2010.

"When is unit revenue going to go positive? I think we've seen a steady step progression," Delta chief financial officer Hank Halter said. "I don't want to give a specific date or guidance, but clearly it's going to be in 2010 and likely it's going to be in the front half of 2010."

Kathryn Mikells, chief financial officer at United Airlines' parent UAL, also noted "signs of recovery on the horizon."

"We did begin to see corporate and premium traffic improving (in the third quarter)," Mikells said.

US Airways President Scott Kirby said the airline also is seeing evidence of recovering business travel demand.

Gary Kelly, chief executive of Southwest Airlines, said, however, that business travel still lagged leisure and that he did not expect a rebound in business demand in 2010. Low-cost carrier Southwest caters less to business travel than its major rivals.

Source: Airwise.com

SN Brussels joins Start Alliance

At an official ceremony held in Brussels’ historic “Grand-Place” today, the CEOs of the Star Alliance member airlines welcomed Brussels Airlines to the family.

Brussels Airlines is the Belgian airline offering the widest choice of flights to and from the “capital” of Europe. With a fleet of 51 aircraft the airline operates some 200 daily flights to 55 European airports and 14 African destinations.

With the addition of Brussels Airlines, customers on the Star Alliance network can now choose from more than 19,700 daily flights to reach 1,077 destinations in 175 countries. New to the network are more connections from Brussels Airport, which has now become a Star Alliance hub. These include four destinations in Africa which are presently not being served by other Star Alliance member carrier: Bujumbura, Burundi; Conakry, Guinea; Kigali, Ruanda and Monrovia, Liberia. Eleven Star Alliance member carriers serve 81 destinations in 40 countries across Africa.

Belgium has now become a home market for the Star Alliance network, thereby improving the customer proposition for both business and leisure customers. Hence, Star Alliance can now offer an enhanced portfolio of flight connections from Brussels, including a large increase in nonstop flights, to the advantage of many multinational companies as well as the various political institutions residing in Belgium.

On the fares side, Brussels Airlines is participating in three of the alliance’s fare products: the Round the World fare, Europe Airpass and Africa Airpass. For the Star Alliance Round the World fare, customers can make use of Brussels Airlines flights when creating their itineraries, especially for flights within Europe and to and from Africa.

For visitors to Europe, the extensive network from Brussels creates new possibilities to travel on the Europe Airpass. For the Africa Airpass, Brussels Airlines provides numerous connections to Africa, from where customers can commence their travel.

Last but not least, Frequent Flyer benefits have also been enhanced, with customers from all member airlines now able to earn and redeem miles on more flights than ever before.

Brussels Airlines HON Circle and Senator cardholders have been given Star Alliance Gold status while Brussels Airlines Frequent Traveller cardholders have Star Alliance Silver status. All other Star Alliance Gold and Silver status holders will be given the appropriate benefits when travelling on Brussels Airlines. Gold status privileges include access to 980 lounges across the network.

Source: Air Transport News

Halving Emissions by 2050 - Aviation Brings its Targets to Copenhagen

Copenhagen - The International Air Transport Association (IATA) brought the aviation industry’s environmental goals to Copenhagen. Airlines, airports, air navigation service providers and manufacturers are calling for a global approach to reducing aviation emissions and are united in a commitment: to improve fuel efficiency by an average of 1.5% per year to 2020; to stabilize carbon emissions from 2020 with carbon-neutral growth; and to a net reduction in carbon emissions of 50% by 2050 compared to 2005.

A Global Sectoral Approach, through ICAO, to manage aviation’s emissions will ensure a level playing field. The approach consists of three main elements:

1. Full accounting for aviation’s emissions as a global industrial sector, not by state

2. Global coordination of economic measures to ensure that aviation will not pay more than once for its emissions

3. Access to global carbon markets

 

 Accommodating the Needs of Developing Nations

A Global Sectoral Approach through ICAO can accommodate the needs of developed and developing nations. “A good precedent is when ICAO tackled the tough issue of noise, working with the industry. We set global standards that accommodated the needs of developed and developing nations. Today air transport is 75% quieter than four decades ago. Working together in a similar way, we can meet our environmental challenges,” said Bisignani.

 

A Strategy Already Delivering Results

The aviation industry is already working towards its climate change goals through its four pillar strategy. The strategy focuses on investing in new technology, flying smarter, building efficient infrastructure, and taking advantage of positive economic measures.

 

Source: IATA.com

 

Heathrow to Introduce Facial Recognition Technology

London Heathrow Airport in the UK will introduce facial recognition technology by January 2010, following the technology's introduction at Gatwick and Manchester Airports.


The electronic border gates can scan passengers with biometric passports using facial recognition technology.

The gates form part of the larger electronic borders (e-borders) programme, which will help reduce lengthy processing times at Heathrow's border control.

Source: Airport Technology