News around the Globe
It’s been a busy month as the summer ends and the industry moves towards a brief lull before the robust holiday season begins. A brief look at some recent events:
China Routes – Big story with the recent liberalization of bi-laterals between the U.S and China. Delta: Atlanta to Shanghai and U.S. Airway: Philadelphia to Beijing both enter this burgeoning market for the first time. Continental, United, Northwest, and American are adding new route authority to their existing China service. China as host of the upcoming summer Olympics is hoping the number of visiting American intensifies next year.
Brazil Aviation – We spoke extensively about the July 18th crash of Brazil’s Tam Airways at Sao Paulo’s Congonhas airport several months ago.. Subsequently, the CAB director was fired; the airline admitted one of the aircraft’s thrust reversers was placarded inop.; and the airport itself underwent extensive scrutiny with the Brazilian government issuing a 25% reduction in flights per hour. One casualty of the accident, though, was Gol Airline’s 3rd quarter earnings and their stock experienced a significant price drop after the crash as the entire Brazilian aviation community was impacted. We are still very enthusiastic about Gol’s long-term prospects.
Air Canada – Initiates a tech-savvy means of checking in at the airport by introducing paperless boarding passes. You don’t say!! A traveler’s PDA or cellphone, which captures the boarding pass in the format of a SMS message, is presented to the ticket counter agent and then the airport screener to access the checkpoint. Very cool!!
Boeing – Forecasts a need for nearly 1,800 aircraft totaling $120 billion USD over the next 20 years. That is an estimated 10% of the world-wide demand during the same period. The B-747’s or A380’s jumbo jets, however, are expected to make up as little as 1% of the aircraft orders.
Singapore Airlines – Hey, and let’s talk about the world biggest airliner-- the A380. Launch customer Singapore is auctioning off the first flight in October of next year on EBay, with the proceeds going to charity. The highest bidder paid $100,380 (of course) for 2 first class seats to Sydney, which is where he lives. That’s a tad much for a one-way ticket.
Aeromexico Airlines – The bid for Mexico’s largest carrier is heating up again. It was thought that the consortium headed by Banamex, the Mexican banking arm of Citigroup would acquire the airline for $151 million USD. However, Saba family, who had submitted a bid of $100 million last month, countered with $158.8 million. The airline is currently controlled by the government holding company Consorcio Aeromexico. We wonder what The Donald would say about a bidding war for – an airline (as oil lifts above $80.00 per barrel)!
British Airways – Taking advantage of the new Open Skies initiative between the U.S. and Europe, BA is expanding its service across the pond next summer. In addition to increasing service to New York with 55 ops. a week, they will fly to 18 destinations in the U.S. The schedules undoubtedly will coincide with Oneworld Alliance partner American Airlines in their hubs.
Bolivia – This one fall under the category of: “Don’t do it!”: This relatively-obscure South American country bordering Brazil to the west, without an ocean port but with a navy, has decided to require U.S. citizens to have a visa due to the U.S. requiring Bolivian citizens apply for a visa. The 30-day tourist visa will cost $134 USD (Brazil’s tourist visa costs U.S. citizens $100.00). The Bolivian government explains that is a “matter of reciprocity,” but they add: “we are working hard not to hurt the flow of foreign tourists.” Anybody booking a trip to La Paz, your dream vacation just went up by a Benjamin! Ciao James Alexander
