Qatar Civil Aviation Authority (QCAA) released (19-Jun-2019) the first version of its 'Aviation Cyber Security Guidelines' in collaboration with Qatar's Ministry of Transport and Communications. The guidelines include standards and principles relating to securing critical aviation systems, in addition to best practices in electronic security, and are in compliance with ICAO recommendations. QCAA stated Qatar is the first country in the Middle East to have released such guidelines. [more - original PR]
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Although Mexican airlines continue to battle currency fluctuation triggered in large part by ongoing tariff threats from the US, overall they remain comfortable with domestic demand, and transborder capacity is starting to rationalise. However, a huge cloud of uncertainty is hovering over the fate of Mexico City’s airport infrastructure.
After Mexico’s president Andres Manuel Lopez Obrador (AMLO) cancelled completion of a partially constructed new airport, he offered less than attractive alternatives that include bolstering Toluca airport and constructing two new runways at an air force base near Mexico City. But the runway construction has come under criticism, and the project is reportedly on hold.
Plans are under way for a third terminal at Mexico City Juarez, but it remains to be seen how much the expansion will alleviate congestion at an airport that is already operating well above its capacity. And ultimately, Mexico City’s potential to become a powerful global hub will be significantly diminished.
22-Jun-2019
CAPA 12-Point Survival Plan for LCCs
Like any business, airline management is expected to manage the airline prudently through a downturn to minimise the impact on profitability and shareholder returns.
Given the inevitability of a downturn in the industry – whether it’s this year or next – that expectation becomes more telling.
Generally speaking, LCCs should be better placed in times of heightened price sensitivity, as their lower cost base should give them an edge. But that alone is not enough.
In this report, CAPA offers some key tactics that LCC management can deploy when things get tough. Many of them are common sense, but in tough times the sense may not be so common.
The full report is available for free download here. Topics in this report will be discussed at CAPA’s annual LCCs in North Asia Summit held in Cebu on 24/25-June-2019.
Philippine Airlines (PAL) will likely follow Garuda Indonesia in suspending services to London, highlighting the challenges smaller Southeast Asian flag carriers confront in sustaining European services.
PAL is now considering instead launching services to Paris and is trying to secure a European airline partner to offer connections to London and other European destinations.
The Philippine carrier is probably better off dropping its European ambitions entirely and reducing the size of its widebody fleet. PAL is looking at acquiring more A350s or ordering 777Xs to replace its older model 777-300ERs, but should instead use upcoming lease returns as an opportunity to cut long haul capacity and improve profitability.
PAL has been serving London since late 2013, but the route has been consistently unprofitable despite aircraft, schedule and frequency changes. Garuda followed PAL by launching London in 2014 and is suspending the service in Aug-2019, following several ultimately unsuccessful route adjustments.
Delta Air Lines has made interesting network moves during the last few years, seizing on opportunities from mid-sized airports. Raleigh Durham has become a focus city for the airline and is one of several non-hub markets featuring nonstop flights operated by Delta to Paris.
In 2018 Delta launched flights from Indianapolis to Paris, joining flights to its French hub from US non-hub airports in Raleigh, Cincinnati and Pittsburgh. After a decade of service, Delta has opted not to resume seasonal service from Pittsburgh to Paris, citing overcapacity in that particular trans Atlantic market.
Officials from Indianapolis appear bullish about Delta’s first year of service to Paris, and unlike its situation in Pittsburgh, Delta has a stronger position in Indianapolis, Raleigh and Cincinnati that should help to sustain long haul flights for now.
The three large US global network airlines are in the early innings of deploying their respective premium economy products on long haul routes, but there is no shortage of optimism at American, Delta and United about the revenue-generating potential of a dedicated product between first/business class and economy.
American is further along in the number of premium economy seats it has on offer after recently completing retrofits of nearly 124 widebodies with a dedicated premium economy section.
United and Delta are at varying stages of a premium economy deployment on long haul international routes, but all three airlines cite encouraging statistics about pricing power and load factors for their latest segmented product.
The roll-out of premium economy by those airlines is the latest development in their product segmentation strategies that are designed to drive upsales and to compete more effectively with lower cost competitors as those competitors enter and exit the market.
Premium economy is a way of ensuring that they cater to all passenger segments that are looking for value in long haul markets.
Recorded at CAPA Middle East & Africa Aviation Summit, 29-30 Apr 2019
Sabre: From Airlines To Retailers – Changing The Thought Process
Sabre VP travel solutions Middle East and Africa Dino Gelmetti believes achieving innovation comes down to a company’s willingness to change and lessons in any future retail like strategy will mainly come from outside the aviation industry.
CAPA Perth SummitMore
Upcoming Event
5
Jul
Perth: CAPA Perth Summit
CAPA’s Perth Aviation Summit explores key issues & opportunities facing the industry in this region. A separate Corporate Travel Summit is being held at this time for buyers and suppliers on how these issues & opportunities impact their travel programmes.
CAPA Australia Pacific Aviation SummitMore
Upcoming Event
7-8
Aug
Sydney: CAPA Australia Pacific Aviation Summit
CAPA’s events attract the highest calibre of thought-leaders in the industry. This includes strong C-Level executive representation from all types of business models – from full service, LCCs and hybrid airlines.
Urumqi Air, via its official Weibo account, announced (26-Jun-2019) plans to remove free inflight meals from economy class, effective 01-Jul-2019. The carrier also plans to adjust free carry on baggage and check in baggage allowance, effective 12-Jul-2019.
Singapore Changi Airport reported (27-Jun-2019) the following traffic highlights for May-2019:
- Passengers: 5.4 million, +2.1% year-on-year;
- Cargo: 172,000 tonnes, -4.8%;
- Aircraft movements: 31,700, -2.0%. [more - original PR]
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27-Jun-2019 11:46 AM
South African Tourism reports 'exceptional growth' in domestic tourism in first four months of 2019
South African Tourism reported (25-Jun-2019) South Africans "showed enthusiasm for travelling" in the first four months of 2019, with "exceptional growth" in domestic tourism. Domestic holiday trips increased by a "staggering" 59.7% year-on-year for the period Jan-2019 to Apr-2019 and overall domestic trips increased 11%. International travel declined 1.3%, with Asia and North America the only regions to show positive growth. South African Tourism will focus on the US, UK, Germany, India, China, Australia and Nigeria markets in the year ahead. South African Tourism said the domestic results are "a healthy indication of the growing strength of the domestic tourism industry". The organisation noted it has been focusing on marketing campaigns to "entice South Africans to travel their country". South African Tourism is targeting another four million international tourism arrivals and one million additional domestic holiday trips by 2021. The organisation stated: "The outlook for rest of the year does look positive with forecasts for most regions showing reasonable growth in line with expected travelling patterns". [more - original PR]
US Secretary of Transportation Elaine L Chao signed (26-Jun-2019) a protocol of amendment with Argentina's Minister of Transport Guillermo Dietrich, which modernises the 1985 US-Argentina air transport services agreement. The new protocol allows for increased competition and service to more destinations, and includes unrestricted capacity and frequency, open route rights, a liberal charter regime and open codesharing opportunities. The modernised protocol will allow airlines to make commercial decisions based upon demand without intervention from government regulators and is expected to benefit travellers, businesses, shippers, airports and localities by permitting increased market access for passenger and cargo airlines to travel between the US and Argentina and beyond. [more - original PR] [more - original PR - US DoT]
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27-Jun-2019 10:20 AM
US FAA 'following a thorough process, not a prescribed timeline' on Boeing 737 MAX return to service
US FAA provided (26-Jun-2019) an update on the Boeing 737 MAX, stating it is "following a thorough process, not a prescribed timeline" to return the aircraft to service. The FAA said it will "lift the aircraft's prohibition order when we deem it is safe to do so". It continues to evaluate Boeing's software modification to the manoeuvering characteristics augmentation system and is still developing necessary training requirements. The FAA is also responding to recommendations received from the Technical Advisory Board, an independent review panel the FAA asked to review its work regarding 737 MAX return to service. [more - original PR]
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