New entrants continue to be launched, despite challenging economic environment

In this update, we review the start-up progress of carriers based in Russia (Avianova and Arkaim), UK (Excelsis Airways), Malta (Efly), Greece (Olympic Air), USA (Jet America and Viza Air), Canada (Enerjet), Brazil (Sol & Noar), China (China Joy Air & Tianjin Aviation), Japan (Fuji Dream Airlines), Cambodia (Angkok Air), Thailand (Happy Air), The Philippines (Pacific Pearl Airways), Vietnam (VietJet), Malaysia (Silverfly), Australia (Pacific Wings and Strategic Airlines), Egypt (Air Arabia Egypt and AlMasria), Cameroon (Camairco), Tanzania (Air Zara International), Zimbabwe (Fly540 Zimbabwe, Fly Kumba and VicFalls Airways), Nigeria (Nigerian Eagle Airlines), as well as cargo airlines (AeroLogic, Cargoitalia, Air Cargo Germany & Medallion Air).

Start up details: as at Sep-2009

Country	Carrier	Launch
Europe
Russia	Avianova	27-Aug-2009
Russia	Arkaim	2009
UK	Excelsis Airways	Unknown
Malta	Efly	19-Sep-2009
Greece	Olympic Air	01-Oct-2009
Germany	AeroLogic	19-Jun-2009
Germany	Cargoitalia	09-Sep-2009
Italy	Air Cargo Germany	Relaunched on 28-Jul-2009
Romania	Medallion Air	07-Jun-2009
North America
USA	Jet America	Suspended indefinitely
USA	Viza Air	Sep-2009
Canada	Enerjet	Leisure services postponed
Latin America
Brazil	Sol	Sep-2009
Brazil	Noar	Unknown
Asia Pacific
China	China Joy Air	15-Aug-2009
China	Tianjin Aviation	Jul-2009
Japan	Fuji Dream Airlines	3Q2009
Cambodia	Angkok Air	28-Jul-2009
Thailand	Happy Air	26-Oct-2009
The Philippines	Pacific Pearl Airways	Dec-2009
Vietnam	VietJet	2009
Malaysia	Silverfly	Sep-2009
Middle East
Egypt	Air Arabia Egypt	End of 2009
Egypt	AlMasria	2009
Africa
Cameroon	Camairco	Late 2009
Nigeria	Nigerian Eagle Airlines	Rebranded on 17-Sep-2009
Tanzania	Air Zara International	24-Aug-2009
Zimbabwe	Fly540 Zimbabwe	Oct-2009
Zimbabwe	Fly Kumba	Sep-2009
Zimbabwe	VicFalls Airways	Nov-2009

Source: Centre for Asia Pacific Aviation and airline reports

EUROPE

Russia: Avianova to take LCC fight up to SkyExpress

Avianova commenced operations on 27-Aug-09, with four services from Moscow Vnukovo Airport to four Russian cities, with one-way tickets starting at RUB250 (USD7.70) (excluding charges).

Avianova key launch details: Aug-2009

Key Information	Details
Base	Moscow Vnukovo Airport
Fleet	Two 12-year old A320s on five-year leases from ILFC and previously operated by US Airways, with the carrier planning to acquire two additional aircraft for the Winter Schedule. The carrier reportedly plans to take delivery of a total of 12 A320s by 2011
Initial destinations	Serving domestic destinations with sector lengths of up to three hours, with no plans to launch international or charter services. Initial services to include Sochi, Krasnodar, Rostov-on-Don and Samara, with Naberezhniye Chelny and Astrakhan to be added within a month
Ownership	Controlled by Alfa Group and Indigo Partners, through Russian company Luch. Alfa Group is the ultimate majority shareholder through its investment subsidiary, A1. Private investors, Willam Frank and Jeremy Wilson, are also reportedly part owner of the carrier.
Passenger targets	Targeting 500,000 passengers in 2009
Executive Team	Vladimir Gorbunov as Director. Andrew Pyne, the founder and former CEO of Viva Macau is a representative of both Alfa Group and Indigo. There have been reports that Mr Pyne will have an active role in the operation of the airline, but could not be appointed as Director during to regulatory restrictions. The carrier had reportedly named Mr Pyne as CEO although this was rejected by Russian Aviation Authorities.
Launch date	27-Aug-09
AOC	Received on 30-Jul-09

Source: Centre for Asia Pacific Aviation and airline reports

Avianova is controlled by Alfa Group and Indigo Partners (a US investment firm founded by Bill Franke and David Bonderman in 2002), through Russian company, Luch. Indigo Partners also has stakes in Tiger Airways (Singapore/Australia), Spirit Air (USA), Wizz Air (Hungary) and Mandala Airlines (Indonesia). As such, the Russian venture is a key step in Indigo Partners' increasingly global presence in the LCC segment.

Indigo Partners airline investments

Source: Mandala Airlines

Avianova's main competition will come from the only other domestic LCC, Sky Express. Commenting on the launch of Avianova services, Sky Express Director, Marina Bukalova, stated the carrier would likely face problems with its tight flight schedule and two aircraft, stating, "it's a very risky schedule, even before two more cities are added". Avianova is reportedly targeting a turnaround time of 25 minutes, which Ms Bukalova stated would be "challenging" at Vnukovo, where typical turnaround times are 40 minutes.

Russia: Arkaim - proposed regional airline

Russian Republic of Bashkiria reportedly plans to establish a new regional airline, to be named Arkaim. Details of the project have yet to be officially disclosed, although an investment of approximately USD154 million is expected.

Under the plans, the airline will reportedly operate routes previously serviced by Bashkiria Airlines, a regionally-owned carrier that declared bankruptcy in 2005. The airline will reportedly commence operations with seven new leased Boeing and Airbus aircraft. The airline is reportedly scheduled to commence operations by the end of 2009.

UK: What is happening with Excelsis Airways?

Excelsis Airways is set to become the first airline to be based in the Tees Valley region for more than 35 years (since British Airways took over Northeast Airlines in 1973). The carrier plans to launch operations with service from Durham Tees Valley to London City Airport.

However, it appears the carrier's launch plans have been delayed, as the carrier, which previously stated it plans to launch service on 19-Sep-2009, is yet to have a functioning booking system on its website. According to the carrier's website, it is currently "in the process of obtaining our operating license".

According to the carrier, Excelsis Airways is the "only short-haul premium carrier in the UK. Excelsis will deliver refined customer service raising the bar and bringing smart, sophistication back to flying. Excelsis wants to be more than the airline of choice for our discriminating passengers. Excelsis's convenience, speed and service should be extended to your entire journey. Excelsis is building hotel, transportation, retail and entertainment partnerships that will grow with us as we expand to more destinations".

The carrier plans to acquire up to four Q400 turboprop aircraft, configured in a two-by-two layout, to support its operations.

Excelsis Airways branding and aircraft

Source: Excelsis Airways

Excelsis Airways named Andreas Blass as its CEO, with Keith Watson named as CCO and Andrew Bray as Flight Operations Director.

Meanwhile, according to reports by The Northern Echo in late Aug-2009, the carrier has yet to sign a lease for its headquarters and London City Airport has not been approached by the carrier regarding the prospect of a new services. The report also stated that the text from Excelsis' new website is very similar to that of Canadian carrier, Porter Airlines.

Excelsis Airways and Porter Airlines website similarities: Direct select quotes from the carrier's websites

Porter Airlines	Excelsis Airways
Porter wants to be more than the airline of choice for our discriminating passengers	excelsis wants to be more than the airline of choice for our discriminating passengers
An emphasis on customer service and a willingness to consider innovative ideas make them leaders in their areas of business	An emphasis on customer service and a willingness to consider innovative ideas sets us apart.
The Q400 is an extraordinary modern-technology turboprop. Designed to meet the requirements of airlines for more seats and greater speed in the high-density regional arena, the Q400 is also replacing and supplementing jets on many regional and mainline routes worldwide.	The Q400 is an extraordinary modern-technology turboprop. designed to meet the requirements of airlines for more seats and greater speed in the high-density regional arena, the Q400 is also replacing and supplementing jets on many regional and mainline routes worldwide.
At Porter, we believe that even short-haul passengers deserve a refined in-flight experience. Our attentive crew is pleased to offer snack and beverage service on all flights, including complimentary soft drinks, wine and beer.	At excelsis, we believe that even short-haul passengers deserve a refined in-flight experience. Our attentive crew is pleased to offer snack and beverage service on all flights, including complimentary soft drinks, wine and beer.
Short-haul travel is stressful enough. Why not relax for just a few minutes in the Porter passenger lounge?	Short-haul travel is stressful enough. Why not relax for just a few minutes in the excelsis passenger lounge?
From top to bottom, inside and out, we've raised the bar. This new standard in air travel is evident not only in our ultra-modern facilities, but in the quality of our staff. Each team member has been specially selected and trained to put travellers first with impeccable and innovative service. (Their uniforms are pretty sharp too!)	From top to bottom, inside and out, we are raising the bar. This new standard in air travel is evident not only in our ultra-modern facilities, but in the quality of our staff. Each team member has been specially selected and trained to put travellers first with impeccable and innovative service. (Their uniforms are pretty sharp too!)
How's this for a change? The next time you fly into Toronto, you can actually fly into Toronto. That's right, avoid the additional expense and unpredictability of trips to Pearson	How's this for a change? The next time you fly into Durham Tees Valley, you can actually fly into Durham Tees Valley. That's right, avoid the additional expense and unpredictability of trips to Newcastle.
Porter Airlines has streamlined the entire travel process to give you the ultimate in convenience. It all starts with an airport that's located at the foot of Bathurst St.	excelsis airways has streamlined the entire travel process to give you the ultimate in convenience. It all starts with an airport that's easy to reach. It's just a short cab ride away, but if you want to save the fare you can take our free shuttle directly to the airport runs from Durham bus/train & Darlington train stations.

Source: Centre for Asia Pacific Aviation and airline websites

Nigerian businessman Victor Bassey, who is reportedly behind the airline, stated that these revelations were "embarrassing," but insisted "when the time comes, everybody will see." Much of the content on the excelsis website has since been amended, but it still has the reference to its "sharp" uniforms.

Malta: Maltese private airline, Efly, commences operations

Efly launched commercial operations from Malta International Airport on 19-Sep-2009, with four times daily Malta-Catania service, operated with the carrier's BAe 146-300 aircraft.

Efly aircraft and logo

Source: Efly

The airline, founded by Italian businessman, Luigi Crispino, plans to expand its services following "overwhelming" response to its inaugural route.

Greece: Olympic Air to replace Olympic Airlines in Oct-2009

Olympic Air, Greece's new private carrier replacing Olympic Airlines, confirmed plans to launch services on 01-Oct-09.

Marfin Investment Group (MIG) Executive Chairman, Andreas Vgenopoulos, revealed the carrier would commence services with 21 aircraft, and operate domestic and international sectors. The carrier will also codeshare on services to New York, operated by Delta Air Lines and is currently finalising a codeshare agreement with Air France-KLM, as a first step to gain entry in SkyTeam.

The carrier plans to increase its fleet, based around A319/A320s and Bombardier turboprops, to 32 aircraft, investing approximately USD1.1 billion.

The core units of Olympic Airlines, including flight and ground operations and the MRO unit, were sold to the Marfin Investment Group in Mar-2009. MIG won the bid for the carrier over rival Aegean Airlines, among other bidders.

NORTH AMERICA

USA: JetAmerica suspends operations before launch

JetAmerica suspended operations indefinitely on 19-Jul-2009, with CEO, John Weikle, stated that the carrier is "reluctantly suspending our public charter operations effective today".

Mr Weikle, who was also the founder of failed LCC, Skybus, added, "we still strongly believe that there is an unmet need for affordable air service to secondary markets and we look forward to offering this option again in the near future."

Earlier in the month, JetAmerica announced that it would delay the launch of operations by a month and refunded its first USD500,000 in sales, due to problems securing landing slots at Newark Liberty International Airport.

The carrier was to be headquartered near St Petersburg-Clearwater International Airport, with a network connecting small and mid-sized cities to the New York metro area and Minneapolis with 34 services per week.

USA: Viza Air to target "business clients flying to Reagan National"

Viza Air announced plans to launch service from Gary/Chicago International Airport to Washington DC and Newark in Sep-2009. According to Viza Chairman, Derric Price, the carrier's target market is "business clients flying to Reagan National".

The carrier has obtained slots at Reagan National and Newark Liberty International, with the carrier planning to operate twice daily between Gary and Washington, using B737-800 equipment. The carrier also plans to launch service from South Bend to Reagan National and Boston.

Viza Air previously stated it was in the process of raising USD25 million in capital, with the carrier seeking to raise USD20 million from institutional investors and USD5 million from small investors and businesspeople in Northern Indiana.

Meanwhile, the carrier stated it would use names for its flights rather than flight numbers. Those include the 'Obama Express', 'Notre Dame Express', and 'Manhattan Express'.

Canada: Enerjet indefinitely postpones plans for leisure flights

Canadian start-up, Enerjet, indefinitely deferred plans to launch leisure services in Jul-2009, with the carrier planning to instead focus exclusively on workforce transportation.

The Calgary-based carrier launched services in Dec-2008 with domestic charter services for Suncor Energy and Sands. Enerjet had been planning to launch public charters connecting smaller Canadian cities with international leisure destinations in 3Q2009, but CFO, Alan Mann, stated these plans are "not a priority right now. It's not something we want to explore at the moment."

According to Mr Mann, the Canadian leisure market remains highly competitive, with several leisure carriers remaining and WestJet being "very aggressive" at expanding its network of leisure destinations in Mexico and the Caribbean.

Mr Mann added that the workforce transportation market is more lucrative and less competitive, stating, "we found our nice. We'll focus on the workforce market". Enerjet now competes mainly against Canadian North which operates ageing B737-200s, while Enerjet operates a pair of former AirTran Airways B737-700s.

Originally called New Air and Tours, Enerjet was first established in 2007 by a team of former WestJet executives. It planned to launch as a low-cost leisure carrier serving small Canadian markets, following a similar model to Las Vegas-based Allegiant.

However, these plans were delayed in late 2008, before the carrier took delivery of its first aircraft. At this time, the carrier stated it would expand into leisure flights in 3Q2009.

LATIN AMERICA

Brazil: Two new airlines by year-end?

Brazil will reportedly have two new airlines commencing services by the end of 2009, following the National Civil Aviation Agency's (ANAC) authorisation for Sol Linhas Aéreas (Sol) and Nordeste Aviação Regional Linhas Aéreas (Noar).

Sol: On 01-Sep-2009, ANAC passed an operating concession authorising Sol Linhas Aéreas, based in the city of Cascavel (Paraná state), to operate regular domestic passenger, cargo and postal services.

The carrier reportedly plans to commence operations by the end of Sep-2009 and has already received the first of five aircraft and hired and trained employees.

Sol initially plans to operate to Cascavel, Curitiba, Foz do Iguaçu and Maringá (all in the state of Paraná), with future plans to operate to other domestic cities in Paraná and to the states of Santa Catarina, Rio Grande do Sul, São Paulo andMato Grosso do Sul. The carrier also plans to launch service to neighbouring Paraguay in the future.

Noar: Nordeste Aviação Regional Linhas Aéreas (Noar) has also obtained a license, and now only needs to meet the requirements for obtaining the Certificate of Homologation for Air Transport Companies (Cheta) to commence operations.

According to ANAC, over the last five years, nine other new companies were awarded concessions to operate regular domestic passenger, cargo and postal services. Two other companies were authorised to transport cargo/mail only services.

The carriers are entering a growing market, with the number of domestic Brazilian passenger increasing 6.6% between Jan-2009 and Jul-2009, according to ANAC. LCCs currently comprise almost 50% of total domestic capacity (seats) in Brazil.

Brazil domestic capacity (seats per month), LCCs as a percentage of the total: Jan-Aug-2001 to Jan-Aug-2009

Source: Centre for Asia Pacific Aviation & OAG Facts

ASIA PACIFIC

Cambodia: Angkok Air takes off

Cambodia's Angkor Air (CAA) commenced service on 28-Jul-2009, becoming the new national airline of the Kingdom of Cambodia.

The airline is a JV between the Royal Government of Cambodia (51%) and Vietnam Airlines, as part of a 30-year agreement with an initial investment of USD100 million. Cambodia Angkor Air receives comprehensive technical support from Vietnam Airlines including crew training, aircraft maintenance and flight operation.

Cambodia Angkor Air currently offers domestic and international services between Phnom Penh, Siem Reap, and Ho Chi Minh City, with service to other regional cities (including Sihanoukville, once the new airport is opened) to be added "soon". All flights are codeshared with Vietnam Airlines. The carrier also plans to launch services to Europe in the future.

Cambodia Angkok Air route network: Sep-2009

Source: Cambodia Angkok Air

Thailand: Happy Air targeting Oct-2009 launch

Happy Air, a Thai start-up, reportedly plans to launch operations with daily Phuket-Hat Yai service on 26-Oct-09, after obtaining permits from the Thai Department of Transportation.

The carrier plans to position itself as a Premium-service airline, targeting Business and leisure travellers, and also plans to launch three times weekly Phuket-Langkawi service in late Oct-2009. Happy Air will launch operations with two SAAB 340A aircraft.

The Philippines: Pacific Pearl Airways establishes base at Subic Bay

The Philippines' Pacific Pearl Airways, a new private carrier in the Philippines, has established its base at Subic Bay International Airport, as part of plans to launch operations in Dec-2009.

The carrier plans to initially commence operations with domestic services to Bohol, Boracay, Cebu and Davao using turboprop aircraft before expanding into chartered international services with two B737-200 aircraft.

Pacific Pearl Airways is a private corporation that proposes to operate a charter airline with direct services to the Philippines. It plans to operate and manage charter flights in both domestic and foreign routes.

Pacific Pearl Airways aircraft

Source: Pacific Pearl Airways

Japan: Fuji Dream Airlines launches service

Fuji Dream Airlines launched service in recent months, with the carrier targeting an initial passenger load factor of 65% operating two E-175s from Mt Fuji Shizuoka Airport to Komatsu, Kumamoto and Kagoshima.

The carrier, which expects to become profitable from 2012, plans to add three more aircraft and three additional destinations.

Japan is a high cost market with high barriers to entry. The two major carriers, Japan Airlines and All Nippon Airways and their various subsidiary airlines dominate most of the market.

In addition, these carriers are slowly but surely drawing the independent smaller operators into their networks, such as the business-focused StarFlyer and Ibex Airlines and domestic LCCs such as Skymark, Skynet Airlines and Hokkaido International Airlines (Air Do). LCCs currently have slightly under 5% of the domestic Japanese capacity (seats).

Japan domestic capacity (seats per month), LCCs as a percentage of the total: Jan-Aug-2001 to Jan-Aug-2009

Source: Centre for Asia Pacific Aviation & OAG Facts

There is also the national high-speed rail line, the Shinkansen, to compete with. Handling in excess of 150 million passengers p/a, it is one of the busiest fast-rail networks in the world, and, with more than 2,500 km of track, one of the most extensive.

Japanese high-speed rail network

Source: Japan Railways Group

Fuji Dream Airlines aims to be a little different from most Japanese airlines, challenging the common view that regional carriers are a marginal proposition in the country. Instead of basing itself in Tokyo, or one of the major regional/business centres such as Fukuoka (StarFlyer) or Miyazaki (Skynet), the carrier has chosen to base itself at the brand new Mt Shizuoka International Airport, which opened at the beginning of Jun-2009.

Shizuoka Prefecture lacks a major city, with its eponymous main city having just 720,000 residents. It is the tenth most populous prefecture in Japan, with more than 3.8 million people. The new airport's location, just 80 km from Mt Fuji, makes it a prime tourist destination. Mt Fuji receives between 200,000-300,000 visitors per year, of which approximately a third are foreign tourists.

The prefectural government is eager to support more tourism efforts. It aims to increase the number of Shizuoka residents going abroad to 500,000 and the number of overseas visitors to Shizuoka to 500,000 p/a by 2010,

The carrier will commence operations in late Jul-2009, with a fleet of two brightly painted 76-seat E 170 regional jets. Its initial destinations - Komatsu, Kumamoto and Kagoshima - are all secondary regional destinations with "strong business traffic", important as Shizuoka is a major region for light manufacturing. Crucially, there is little competition on the routes, from either ground or air transport. Neither JAL or ANA (the only other domestic carriers at the airport so far) operate to any of Fuji Dream's initial destinations, and there are no direct fast-rail lines to the cities.

A third aircraft has already been ordered from Embraer, and the carrier plans to expand its fleet to five aircraft by 2012. Three other destinations, Toyama, Matsuyama and Sendai, will be added over the next two years, but the carrier is avoiding adding major cities such as Sapporo or Fukuoka, due to competition from major carriers.

With no direct competition on the routes, Fuji Dream faces little chance of the fare wars that have marked the appearance of other small carriers in Japan over the past decade. The carrier hopes to quickly achieve load factors of 65% on its initial routes, but realises it could face a tough time initially, due to the unfavourable operating environment.

However, the carrier is well supported by its Suzuyo & Co parent and the Shizuoka prefectural government, which has provided USD13.5 million in no-interest loans to help with aircraft acquisitions. If it can ride out the next 18-24 months without major mishap, Fuji Dream Airlines is confident that it can become profitable by the end of FY2012.

Vietnam: VietJet license to expire at the end of the year

VietJet Air's operating license is due to expire on 20-Dec-09 if it does not launch operations. However, according to the carrier's website, it still plans to commence services in 2009, although no further details were provided.

The carrier had proposed to launch Hanoi-Ho Chi Minh City-Danang service in late 2008, adding routes to Bangkok, Singapore, Hong Kong and South Korea in due course. The carrier deferred its launch, citing the effects of the global financial downturn, high fuel prices and the swine flu outbreak.

The carrier stated it plans to operate either B737 or A320 equipment.

VietJet Air logo

Source: VietJet

Malaysia: Silverfly targeting launch this month

Silverfly Sdn Bhd reportedly plans to launch operations this month, with three times weekly Ipoh-Medan service, in conjunction with Riau Airlines. The airline will be using the Fokker-50, which has a 48-passenger capacity, to operate the service.

Australia: Pacific Wings to launch service next month

New Australian-based airline, Pacific Wings, has reportedly negotiated a favourable start-up capital arrangement and has applied to the Australian International Air Services Commission for unlimited capacity for services to New Zealand and 0.25 units of capacity between Australia and New Caledonia, under the air services agreement negotiated with France.

The airline, which filed an application with the International Air Services Commission on 02-Jun-2009, plans to commence commercial operations using wet-leased B737s from Our Airline by Oct-2009.

Pacific Wing's application stated the start-up is 100% Australian owned. The application named Geoffrey Bowmaker, the former CEO of Nauru carrier, Our Airlines, as being involved in the carrier, with Non-Executive Director, Manish Sundarjee, who has been a special advisor to the Nauru Government and "was also involved in the early days of Virgin Blue".

Pacific Wings has stated it is a "well capitalised company" and has been able to negotiate "valuable start-up support with various partners". The carrier added that "the wet lease arrangement with Our Airline does not require upfront payment of deposits (as per other aircraft leasing arrangements), thereby reducing the start-up capital outlay considerably".

The carrier plans to launch services from Brisbane to Noumea in New Caledonia and from cities in Australia to secondary cities in New Zealand. The carrier also plans to launch trans-Tasman routes that Air New Zealand has abandoned over the past few years, potentially including services to Dunedin, Hamilton and Palmerston North.

Australia: Strategic Airlines receives first airline, acquires OzJet Airlines

Strategic Airlines received its Air Operator's Certificate from France's Direction Generale de l'Aviation Civile (DGAC) in mid Aug-2009. The carrier, on its website, stated the carrier plans to "grace the skies" this month.

On 29-Jun-2009, Strategic announced the purchase of Ozjet Airlines from administration after gaining support of Ozjet staff and creditors. At the time, Strategic stated it intended the change in ownership would have very little impact on the existing operations of the airline.

Strategic Airlines logo

Source: Strategic Airlines

China: China Joy Air takes off

China Joy Air commenced commercial operations on 15-Aug-09, with the launch of Xi'an-Yan'an service, following the receipt of an operating licence from the CAAC on 02-Jun-2009.

The airline, JV between Aviation Industry Corporation of China and China Eastern Airlines, will perate MA60 and ARJ21 aircraft on domestic routes, with plans to increase its fleet to 100 aircraft by 2017. Further details include:

• Base: Xi'an Xianyang International Airport;
• Operating scope: Domestic passenger and cargo services, with related businesses. The carrier plans to operate routes of less than 600 km;
• Ownership: 95% owned by Aviation Industry Corporation of China (AVIC) and 5% owned by China Eastern Airlines, which has agreed to transfer some staff to the airline, including 28 pilots, nine flight attendants and 40 MRO engineers;
• Launch details: The carrier plans to launch services "shortly", with AVIC previously stating the carrier expected to launch operations in Jun-2009;
• Fleet: Will initially operate ten domestically made aircraft, including Ark 60s and MA 600s, with plans to expand its fleet to 50 ARJ21s and 50 MA60s within a period of eight years;
• Registered capital: CNY 1 billion (USD146 million);
• Qiangtang Airlines founder, Chen Xijian, confirmed the carrier reached a preliminary agreement with Zhejiang Provincial Government and Hainan Airlines to jointly establish a new carrier. Zhejiang Provincial Government, Hainan Airlines and private investors will hold 15%, 40% and 45% shares, respectively.

Joy Air Logo

Source: Joy Air

China: Tianjin Aviation commences operations

Tianjin Aviation Ltd, a JV between HNA Group, Tianjin Port Free Trade Zone and Hainan Airlines, commenced operations on 10-Jun-2009. Details include:

• Registered capital: CNY1.3 billion (USD190 million);
• Ownership: HNA Group contributed CNY1.1 billion (USD158 million), accounting for 83.2% of the registered capital, while Hainan Airlines Co Ltd contributed CNY19 million (USD2.8 million), accounting for 1.47% of the registered capital, and Tianjin Port Free Trade Zone invested CNY200 million (USD29 million), accounting for 15.4% of registered capital;
• Business scope: Covers "domestic sub-line air services" for passengers and freight;
• Network: The carrier will initially operate 20 daily services, to destinations including Tianjin, Guiyan, Xi'an, Hohhot, Taiyuan, Qingdao and Dalian. Services to Weihai, Nanchang, Zhengzhou are also planned in the short-term. By 2012, the airline plans to operate 500, including some international flights;
• Traffic: The carrier expects to handle more than 15 million passengers p/a;
• Fleet: Received its first new E190 on 08-Jun-09. The carrier plans to operate a fleet of more than 100 aircraft by 2012.
• Base/Headquarters: Tianjin Binhai International Airport.

CAAC Deputy Director, Li Jian, stated the founding of Tianjin Aviation fully conforms with China's overall strategic development plan for the civil aviation industry and that Tianjin Aviation will play a "positive role" in further improving the network of airline routes across China, diversifying civil aviation products offered by domestic airlines, promoting "orderly competition" within the industry and facilitating the development of regional aviation services throughout China.

MIDDLE EAST

Egypt: Air Arabia to launch LCC in Egypt with Travco Group; the Middle East's seventh LCC

Air Arabia, one of the world's most efficient and profitable airlines, has announced another breakthrough in its rapid development as a pan-regional LCC powerhouse. Less than five months after launching a JV operation in Morocco, Air Arabia has signed a joint venture agreement with Travco Group, a leading tourism and hospitality group, to establish Air Arabia Egypt.

The airline aims to serve destinations in Europe, Africa and the Middle East, contributing to the growth of travel and tourism in Egypt and the wider region. Click here to access full report

Egypt: AlMasria still planning to launch private commercial airline

AlMasria Universal Airlines plans to launch service as a private commercial airline in Egypt in 2009 (the carrier was previously targeting a Jun-2009 launch date), although the carrier has not provided any further clarification of its launch plans. The Cairo-based carrier is privately backed by four Egyptian businessmen.

AlMasria, whose name derives from the Arabic word for Egypt, previously stated it aims to capture traffic in the North of Egypt for Hajj pilgrimages to Mecca, and also plans to operations services from the Egyptian capital to destinations in Libya, Bahrain, Kuwait and some European destinations. The carrier expects a short-term network covering 20 destinations.

Fleet wise, AlMasria has secured an initial two A320s from BOC Aviation, with the aircraft previously belonging to Kingfisher. The carrier plans to dry-lease the first aircraft for the first three years, with its fleet growing to four aircraft within the next four months. By 2014, the carrier plans to purchase aircraft from Airbus, with a targeted fleet size of ten aircraft. AlMasria will configure its aircraft with 180 all-economy seats.

Aircraft maintenance will be outsourced completely to EgyptAir under a total service agreement, with the airline also training AlMasria flight crew and the technical team. Ground handling will be through EgyptAir, with passenger services undertaken by Egypt Aviation Services and catering by a JV between EgyptAir and LSG Sky Chefs.

AFRICA

Zimbabwe: Fly540 Zimbabwe could commence operations next month, part of expanding African operations

Fly540 Zimbabwe stated it could launch services by the end of Oct-2009. Fly540 Zimbabwe will operate to key domestic and regional cities from its Harare hub, with domestic routes to Bulawayo, Victoria Falls, Kariba and Mutare, as well as international services to Johannesburg and Beira. This capability will be complemented by a freight service, with the carrier also planning to expand this network once established.

The move to Zimbabwe is part of Fly540's strategy to roll out operations across Africa with local partners in each country, and will boost the company's operations to cover nine African countries by the end of 2009.

LonZim stated the launch of Fly540 Zimbabwe is "central to LonZim's investment strategy of identifying current market opportunities in Zimbabwe and establishing companies that will benefit from the economic recovery of the country". The company added that "the potential aviation market on a domestic and regional basis is significant and currently underserved".

LonZim Air, a wholly owned subsidiary of LonZim plc (a UK-based conglomerate with business interests in Africa) has invested USD200,000 in the acquisition of 90% of Zimbabwe company Sol Air (private) Limited. Lonrho holds a 24.5% stake in LonZim and a 49% stake Fly540.

A further USD4.3 million (resulting from an independent valuation) will be invested in acquiring an ATR 42 turbo prop from the Lonrho Aviation fleet and USD2.0 million for the operational costs associated with commencing operations and a working capital provision of USD3.9 million for the first twelve months.

The carrier had initially planned to launch operation by Sep-2009, but did not receive its Air Operator's Certificate from the Civil Aviation Authority of Zimbabwe in time. Fly540 Zimbabwe, however, has now obtained the Air Services License and following completion of the arrangements with Lonrho's Fly540 it will be possible for Fly540 Zimbabwe to finalise the necessary permissions to operate.

Fly540 Africa will reportedly receive USD100,000 to initiate flight operations in Zimbabwe, and thereafter a license fee of 2.5% of gross turnover and a monthly management fee of USD35,000 for managerial services.

Lonrho is a pan-African company with a diverse portfolio of investments focusing on Africa. Its investments range from primary infrastructure to transportation, support services, hotels and natural resources, with the ultimate aim of re-establishing a significant presence on the African Continent through strategic investments across sectors in fast-growing African economies. According to the company, it is "focused on servicing Western investment and African business by investing in emerging sectors across Africa, creating hubs of business through key investments".

Fly540, also known as Five Forty Aviation, commenced operations in Nov-2006 from its base in Nairobi, Kenya. It operates domestic and international passenger and freight services in East Africa.

Separately, Lonrho, was issued in Apr-2009 with an Air Services License (ASL) in Angola for Fly540, enabling the carrier to operate to Angolan destinations including Luanda, Soyo, Benguela, Huambo and Malanje.

Zimbabwe: Fly Kumba - another new LCC for Zimbabwe

Fly Kumba, a Zimbabwean start-up carrier, also expects to launch operations this year.

Details include:

• Maiden flight: Sep-2009;
• Routes: Primary route will be Harare-Johannesburg, with services also to be launched on Harare-Bulawayo, Harare-Victoria Falls, Johannesburg-Victoria Falls and Harare-Kariba sectors;
• Fleet: B737-200s;
• Executive appoints: CEO - Lloyd Muchaka; CFO - Patrick Chapwanya;
• Ownership: Unnamed local investors;
• Mission: "To ensure that flying is affordable to everyone";
• Fares: Below USD80 per sector.

According to Fly Kumba CEO, Lloyd Muchaka, "we intend to become Zimbabwe's preferred low-cost airline, delivering the lowest air fares with the highest consumer value add offering world class service to price sensitive consumers".

Mr Muchaka added that "Fly Kumba intends to fulfill everyone's dream of flying based on a fare of below USD80, departure tax included in this price for a flight from Harare to Johannesburg…By 2010, Fly Kumba would be a regional and international airline offering flights in the SADC region and beyond…It is Fly Kumba's objective to build a sustainable National and Regional low cost airline".

The carrier will provide competition to the national airline, Zimbabwe Airlines, which has, up until now, been the only airline in the country, and will operate Harare-Johannesburg as it major route, with a target market of the more than three million Zimbabweans living and working in South Africa.

The visa waiver between South Africa and Zimbabwe, which became effective in Jun-2009, has increased travel and also the connections between the two neighbouring countries.

Zimbabwe: VicFalls Airways to launch domestic operations in Nov-2009

VicFalls Airways, a Zimbabwean start-up, announced plans to launch services in Nov-2009, operating from Harare to Johannesburg, Bulawayo, Victoria Falls, Blantyre, Lusaka and Maputo. The carrier is also considering services to the UK and Dubai.

VicFalls Airways logo

Source: VicFalls Airways

The carrier has been registered in Zimbabwe for two years, but delayed its launch due to the high cost of fuel in 2008 and the subsequent world economic downturn.

The carrier has its Head Offices in London and Harare International Airport, with plans also underway to open offices in Kinshasa (Democratic Republic of Congo) and in Johannesburg (South Africa). The airline is registered under the name Tab Mark Enterprises (Private) Limited and trades as Vic-Falls Airways.

VicFalls Airways has announced the following route and aircraft plans.

VicFalls Airways proposed routes and aircraft: Sep-2009

Source: VicFalls Airways

Nigeria: Virgin Nigeria rebranded as Nigerian Eagle Airlines

Virgin Nigeria was formally rebranded on 17-Sep-2009 as Nigerian Eagle Airlines, with the carrier's former name now ceasing to exist.

The carrier also confirmed that plans for a private placement to inject additional funds are under way, with the placement expected within the next six weeks.

The new name and search for international investors is part of an agreement to drop the Virgin brand following shareholder Virgin Atlantic's decision to withdraw from the airline. As part of this, Virgin Atlantic will also withdraw much of its 49% ownership stake.

Cameroon: Camairco planning late 2009 launch

Camairco, the new national carrier of Cameroon replacing the defunct Cameroon Airlines, announced plans to acquire Boeing aircraft to support its launch, planned for late 2009.

The Cameroon Government has raised approximately USD125 million to support the acquisition of three aircraft.

According to Cameroon Transport Minister, Bello Bouba Maigari, "our defunct national air transport company Cameroon Airlines always worked closely with Boeing and we would want this to continue. All our pilots have been trained (in) Boeing technologies as well as our maintenance staff".

Cameroon is currently looking for an external partner to acquire a majority stake in Camairco.

In Mar-2009, a Cameroon high court charged the former administrator of Cameroon Airlines with embezzling almost USDD250 million.

Tanzania: Air Zara International promises cheap fares

Air Zara International, a Tanzania start-up that commenced operations on 24-Aug-2009, launched Dar Es-Salaam-Moroni service with 110-seat B737-200 equipment this month. The carrier also announced plans to launch services from Zanzibar and Dar-es-Salaam to Kilimanjaro and Johannesburg.

The carrier plans to fill the gap left after Tanzania's national carrier, Air Tanzania, was grounded early this year. The carrier currently operates a fleet of B737-200s, Beechcraft 1990Ds and King Air B200 equipment, with the carrier also planning to add B767-200 equipment to its fleet in the future.

CARGO CARRIERS

Germany: AeroLogic launches operations in Jun-2009

AeroLogic, the JV cargo airline established by DHL Express and Lufthansa Cargo, officially launched operations on 19-Jun-09, with a first commercial service on 29-Jun-09.

The carrier will serve new routes between Europe and Asia, transporting cargo for customers of its parent companies, including weekday Leipzig-Bahrain-Singapore-Delhi-Leipzig service and weekend Leipzig-Tashkent-Hong Kong-Tashkent-Leipzig service. The carrier plans to gradually expand its network.

AeroLogic route map: Sep-2009

Source: AeroLogic

AeroLogic will operate with eight leased new B777Fs, the first four of which are expected to be delivered this year. The carrier plans to gradually expand the network to offer new direct connections to most of Asia's major metropolitan areas by 2010. AeroLogic expects to breakeven by 2010, but stated it was unsure how the air cargo industry will continue to perform.

According to Deutsche Post DHL CEO, Frank Appel, "Our business [AeroLogic] is an early indicator, but we have no order backlog, so I cannot say how things will develop. Until Apr-2009, we saw neither an improvement nor a deterioration, so it looks as thought the floor of the crisis has been reached…We will surely not give a guidance for individual parts of the business if we do not give a target for the business as a whole."

AeroLogic's cargo capacities will mainly be used by DHL Express and Lufthansa Cargo. The two partners will also be responsible for sales and warehouse handling. Operations are being planned around both partners' requirements: on weekdays, freighters will fly to Asian destinations in the express network operated by DHL Express. At weekends, they will supplement Lufthansa Cargo's services.

AeroLogic aircraft

Source: AeroLogic

Germany: Air Cargo Germany launches service

Air Cargo Germany, based at Frankfurt Hahn Airport, operated its maiden service on 28-Jul-2009, after receiving its Air Operator's Certificate on 14-Jul-2009. The carrier currently has a fleet of two B747-400SFs.

Air Cargo Germany fleet

Source: Air Cargo Germany

Italy: Cargoitalia relaunches operations

Cargoitalia relaunched operations on 09-Sep-2009, with twice weekly Milan-Hong Kong service, after six months of "intensive preparation" and a few" inevitable" delays and following its relaunch under new ownership and management.

The carrier plans to launch services to the US and Canada later in Sep-2009, with both services to be operated with MD11-SFs. The carrier also plans to increase its network to include the Middle East, China and India, as it takes delivery of additional aircraft.

The growth of the fleet is ensured by the delivery from 2012 of five A330Fs purchased in Jul-2008, with an option of three additional aircraft.

Cargoitalia was originally founded in Nov-2003 and operated until Oct-2008. On 01-Dec-2008, Cargoitalia was acquired by ALIS, a new all-cargo player founded by Alcide Leali, also founder in 1989 of Air Dolomiti, now part of the Lufthansa Group.

In Mar-2009, ALIS also acquired the former Alitalia Cargo division, which will be merged with Cargoitalia. The company's headquarters and operational base is located at Milan Malpensa Airport.

Cargoitalia's new owners are ALIS (Aerolinee Italiane SpA - 66.7%) and Intesa SanPaolo (33.3%). ALIS in turn is owned by the family of Chairman and CEO Alcide Leali (62%), other private investors (8%), and Ricerca SpA (Benetton), Selin SpA (van den Heuvel) and Banca Intermobiliare, each having 10% stakes.

Cargoitalia route map: Sep-2009

Source: Cargoitalia

Romania: Medallion Air becomes newest Romanian airline

Medallion Air, a new private airline based in Bucharest, obtained its Air Operator's Certificate from the Romanian Civil Aviation Authority (an EASA full member) on 15-May-2009 and performed its first flight on 07-Jun-2009.

The carrier will be mainly involved in ACMI and Charter operations, using MD-83 aircraft. The carrier has signed a short-term wet-lease contract with a major European LCC for its MD83 aircraft, with plans to expand the fleet with two more MD80 aircraft by the end of 3Q2009.

According to the carrier's AOC, Medallion Air is able to operate in Europe, Middle East and Africa.