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As one of the most visited countries in the world, aviation is a significant industry in France, with international airports in all of its big cities and regional airports in almost all parts of the country. The aircraft manufacturer, Airbus, which produces around half of the world’s aircraft, is headquartered in France. The French civil aviation authority is the Direction Générale de l'Aviation Civile, which oversees aviation security and safety, environmental regulation, the air transport market, aviation service providers and training institutions. France’s main international gateway, and its busiest airport is the Paris-Charles de Gaulle Airport (IATA: CDG), while the Paris-Orly Airport (IATA: ORY) is the country’s busiest for domestic travel. Other main gateways are located in Nice (IATA: NCE), Lyon (IATA: LYS) and Bordeaux (IATA: BOD).
Airports in France
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Malaysia Airlines (MAS) plans more rapid expansion over the short to medium term albeit at a slower rate compared to the torrid 20% capacity growth recorded for 3Q2013. The carrier – which has been expanding its domestic, short-haul international and long-haul international operations at similar rapid clips in 2013 – will focus in 2014 primarily on regional international growth.
MAS has been able to grow passenger traffic so far this year by 28%, including a 37% jump in 3Q2013, easily outstripping the large increase in capacity. But the load factor improvements have come at the expense of yield, pushing MAS back into the red in 3Q2013.
The flag carrier hopes it can eventually improve yields across both cabins, leveraging the improvements in its product and new membership in oneworld. But the intense competition in Southeast Asia could make it difficult to achieve higher yields, clouding the carrier’s outlook.
Etihad's announcement that it was buying 33.3% of Switzerland-based Darwin Airline was made on the first day of the Dubai Airshow and was easily lost in the fury of orders announced that day.
Darwin only flies aircraft with 50 seats, less than the number of premium seats that will be on many of the 350-plus widebody aircraft Gulf carriers ordered at the airshow. But the announcement is significant, and three reasons stand out.
First, for Etihad the carrier will "connect the dots" in Europe for itself and partners, linking hubs but also tertiary cities, which have largely been passed over by Gulf carriers. Many of these cities are served by the Lufthansa Group. This gives rise to the second significant impact: on Europe's legacy carriers. Gulf carriers changed their long-haul business while European LCCs decimated short-haul. Regional traffic was always typically a burden, and will come under further pressure following Etihad's announcement. Third is that Darwin Airline will re-brand as "Etihad Regional", and Etihad openly states Darwin is only the first carrier to use this new brand. As the industry still digests Etihad's partnership and equity strategy, Etihad promises to change another component of aviation – and raise the stakes in the liberalisation of the industry, especially by stamping its name on a European carrier.
Emirates Airline carried 15% additional passengers in the first half of 2013/2014 compared to a year ago. The growth in volume has been led by Europe and the Middle East while Australia has seen the highest percentage growth. Saudi Arabia, the UK and Thailand have received some of the largest capacity injections. India and the UK remain Emirates' two largest markets based on seat capacity, but Saudi Arabia has overtaken Germany as the third-largest while Australia overtook the US, and Thailand overtook South Africa.
In terms of the rate of growth, the standouts were Portugal, Vietnam and Zambia – all with 100%-plus growth, albeit from a low base. But Emirates saw 40-50% growth in seven other countries, including Australia, Saudi Arabia and France.
Overall, 15% passenger growth and 16% capacity growth for an airline the size of Emirates is a considerable achievement. Full year capacity growth, however, is likely to be closer to 12%, making 2013/2014 one of the slower years at Emirates in recent times. Asia will be the largest market for growth, followed by Europe and the Middle East.
As Delta Air Lines continues a seemingly open attack on its partner Alaska Air Group at its Seattle hub, Alaska Airlines is stressing that alliances like its long-time pact with Delta are complicated. Its overall message is that it will work with Delta where it is mutually beneficial and compete vigorously as Delta continues its encroachment.
Delta’s latest moves are in two of Alaska’s key north-south markets on the US Pacific west coat – Portland and Seattle. Ironically, Delta seems to be practicing what Alaska executives recently stressed to analysts – removing emotion from evolving competitive dynamics. As Delta continues its moves into Alaska’s markets unabated, it certainly is showing no emotion as Seattle continues to rise in prominence in Delta’s domestic and international network.
Just how the current competitive build-up by Delta in Alaska’s markets will affect their long-term relationship is uncertain. But in the meantime Alaska continues to post financial results that are among the best in the US industry, which means that it has a strong foundation from which to defend itself.
Air France-KLM reported an improved operating result for 3Q2013 and confirmed its aim to increase 2H2013 operating profit by the same year-on-year amount as in 1H2013. It has provided more details on the additional restructuring measures previously announced relating to headcount reduction and planned capacity in medium-haul and cargo.
However, while the group expects losses in medium-haul and cargo to reduce significantly in 2014, it does not expect to see the full impact of these measures until 2015.
As a result, it has pushed back its net debt reduction target by one year and focused its 2014 EBITDA target at the lower end of its previous range. Unfortunately, targets that start to slip have a habit of becoming more slippery.
A 16-day US Government shut-down and continuing pressure created by the devaluation of Japan’s currency did not hinder Delta’s 3Q2013 earnings growth as profits improved by USD444 million year-on-year to USD1.2 billion (excluding special items).
With corporate demand holding steady and holiday bookings looking relatively solid for Nov-2013 and Dec-2013, Delta CEO Richard Anderson is declaring the carrier will post an all-time record profit during 2013.
Delta throughout much of 2013 has been riding a wave of positive momentum despite some miscalculation in the spool-up of its Trainer refinery, and the continuing pressure from the devaluation of the Japanese yen. Even as it makes proclamations of record profits for 2013, Delta’s CEO Richard Anderson stresses that the carrier is keeping its head down as it works to continue the carrier’s advancement.