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Wellington International Airport plans NZD300million runway extension to attract long-haul services

Wellington International Airport (WIAL) plans to extend its existing 2,000 metre runway by 300 metres so as to allow New Zealand’s capital city to attract direct long-haul services to Asia and North America using the Boeing 787 and Airbus A350.

The airport argues its geographic position at the centre of the country, and the nation’s domestic hub, means it is well placed as a third international gateway to Auckland and Christchurch. Based on its research the airport says sufficient numbers of passengers already fly to Auckland to connect with onward long-haul services to sustain a daily direct service to an Asian hub.

The exponential growth forecast from Asian markets combined with the lower operating costs and improved performance of new generation widebody aircraft are likely to make direct services to secondary destinations like Wellington a more viable proposition by the end of this decade, reducing the financial risk of extending the runway which could not have been contemplated a decade ago. Nonetheless, risk it is. But the rewards are (potentially) high.

Turkish Airlines: narrowing the strategic Gulf: Part 2

Rapid growth in Turkish Airlines’ passenger numbers has been driven by international traffic, in particular international-to-international transfer traffic. By region, North America, Africa and the Far East have seen the highest growth rates, but Europe remains its biggest region by passenger numbers. This strategy has parallels with those of Emirates, Qatar Airways and Etihad. In part two of our analysis, we compare Turkish Airlines’ network with those of the latter three.

The geographic location of its Istanbul hub means that, compared with the three Gulf carriers, it is closer to Europe, North America, Latin America, North and West Africa (and western parts of Central Africa). Relative to Emirates, Qatar Airways and Etihad, it has a low percentage of its international seats on routes to Africa and, most strikingly, to Asia-Pacific.

In spite of operating narrowbody aircraft (more than 80% of its fleet) to a high proportion of international destinations, it has a lower average frequency per international destination than Emirates, particularly in Africa and Asia-Pacific.

Turkish Airlines: narrowing the strategic Gulf: Part 1

Turkish Airlines’ mission statement includes the aims: “To become the preferred leading European air carrier with a global network of coverage,… whilst maintaining its identity as the flag carrier of the Republic of Turkey in the civil air transportation industry.” It also has a vision statement with a number of additional aims, including being an air carrier with “a continued growth over industry average” and “unit costs equating with low cost carriers”.

Turkish Airlines has the world’s second largest network by number of international destinations, but is only eighth by number of international seats and Turkey itself is only the number 15 aviation market globally. Its considerable success in meeting the aims noted above owes much to its strategy of attracting global transfer traffic flows via its Istanbul hub, an approach that both involves competing with, and invites comparison with, the three fast-growing Gulf carriers.

Royal Jordanian profitable (again) and awaits the 787; cost reduction and codeshares are key focuses

After heavy losses in 2011, Royal Jordanian has reversed its fortunes and managed to scrape a narrow profit in FY2012.

The carrier has been buoyed by the result, even in a difficult year marred by continued unrest in neighbouring Syria and economic uncertainty in Europe, one of its largest markets. Even so, the indicators are that the carrier can continue its positive momentum in 2013.

By cutting marginal and loss making routes and substituting codeshares, services can be continued, while reducing losses. But, as the carrier receives 787s starting next year, new routes in Africa and the US are in Royal Jordanian's sights.

airberlin 1Q losses widen, but restructuring will deliver benefits later. Pain now for gain later

airberlin’s losses widened in 1Q2013 on restructuring costs, but the message from CEO Wolfgang Prock-Schauer is that today’s pain will lead to tomorrow’s gain as the group’s “Turbine 2013” restructuring programme starts to show in the results.

Capacity cuts, network refocusing, headcount reductions and supplier renegotiations are all under way and the positive impact should be more visible from 3Q2013 onwards. Meanwhile, codeshare relationships with Etihad and oneworld partners are delivering growing passenger numbers.

Etihad, airberlin’s 29% shareholder and benefactor, has ploughed close to EUR500 million of cash into its German partner since last year. airberlin’s efforts on many fronts will need to translate into profits and a strengthening of airberlin’s flimsy balance sheet if Etihad is to see a return. Etihad's network traffic feed has been stimulated by the partnership, but it will want to see airberlin profits in due course.

Why Emirates and friends will soon reshape American aviation

Shortly after Emirates Airline announced its remarkable breakthrough partnership with Qantas in Sep-2012, Emirates CEO Tim Clark said he had also been talking to American Airlines for some time and publicly expressed hopes that the two would also establish a close relationship. This was despite the fact that American already had an extensive codeshare relationship with Etihad; and the third Gulf carrier, Qatar Airways, has since been invited to join the oneworld alliance – which American leads.

The Gulf airlines, and particularly Emirates, have had a devastating impact on European long-haul hub carriers. The impact will be different for US airlines, but despite the different geography, it will be much bigger than most expect. For one thing they will cut across the developed boundaries of the global alliances.