The U.S. Air Transport Association (ATA) finally got its day in court in the battle over the EU's plan to regulate the greenhouse gas emissions of non-EU aircraft flying into and out of Europe. But a final verdict to resolve the situation may not be in hand before airlines become subject to the EU Emissions Trading System (ETS) at the beginning of next year.
The Italian airline landscape is once again shifting as carriers deal with increasing costs and changes in the competitive makeup of the market. A main facet of the latest turmoil is Lufthansa's decision to shutter its Italian venture, which alters the prospects for airports and airlines in the region.
Linking networks is a central goal of airline alliances, yet the latest announced addition to the Star Alliance, Air China affiliate Shenzhen Airlines, has few connections with the group's foreign partners. At first glance, the decision to admit Shenzhen next year looks like a great boost, since it adds to Star a fleet of 102 aircraft based in mainland China's richest city. And it gives the alliance a home in the Pearl River Delta, an area that has been an economic leader in China since the country began liberalizing in the late 1970s.
Shenzhen Airlines plans to expand its fleet to at least 171 aircraft by 2015, ramping up capacity by 10% a year in its role as the Air China group's challenger in the home territory of rival China Southern. That fleet forecast is conservative, says an airline official. “If possible, it will be more than 180,” she notes.
The FAA's NextGen air traffic modernization plan may not have slews of enemies on Capitol Hill, but to become a reality, it will still need the right kind of friends. Republicans are targeting domestic discretionary spending to deflate the deficit, and plan to roll back the Transportation Department's budget to 2007 levels. Since the FAA still needs to maintain the salaries of air traffic controllers and other essential personnel, even without lawmakers calling for NextGen's demise, the amount left over for the effort is under serious pressure.
Leading Asian airlines are gaining a valuable competitive advantage from their proximity to China, as this market's enormous potential transforms into rapid growth. The big question now is how long it will take China's own carriers to exploit the boom and join the Asian giants in the industry's top echelon.
Michael J. Dyment Managing Director, Nexa Capital Partners George W. Hamlin President, Hamlin Transportation Consulting Craig Jenks President, New York-based Airline/ Aircraft Projects Inc. Raymond E. Neidl Senior Aerospace Specialist, Maxim Group Bryan Terry Director, PwC Transportation and Logistics
Comparing the operating performance of low-cost and mainline airlines highlights that while growth can be a good thing, sometimes restraint can pay off even more. The low-cost/niche carrier segment is generally weaker than the mainline category in the latest Top-Performing Airlines study, and the low-cost carriers (LCC) did not see the same sharp improvement through 2010 that their legacy counterparts enjoyed.
While Regional Express Holdings (REX) was the top performer in the regional category for the third year running, the performance of the category overall was lackluster. Only Australia's REX and U.S. carrier Republic Airways saw their scores increase, with the other carriers sliding. The TPA council of advisers sees a bleak future for U.S. regionals and believes more consolidation is likely.
This year's ranking of publicly traded airlines identifies those that have lifted their operating performance as they recover from the 2008 global recession and deal with new challenges such as oil price spikes. Scores represent the composite of five performance categories, with emphasis on financial fitness and earnings performance. The five categories (and their contributions to total score) include:
Notwithstanding significant consolidation in their ranks, the U.S. legacy carriers remain firmly ensconced in the mid-range of the mainline/network carrier category in this year's Top-Performing Airlines (TPA) rankings. Meanwhile, Southwest Airlines ranks in the top five in the low-cost/niche category, and Alaska Airlines—which a number of observers would categorize as more of an LCC than a legacy—is in third place overall in the mainline/network category.
German airship manufacturer Zeppelin Luftschifftechnik says it has made a breakthrough as the leading company in its field, following a major order by the Goodyear Tire & Rubber Co. However, it concedes that, overall, zeppelin use remains flat. Goodyear recently decided to replace its three U.S.-based aging blimps with three zeppelins. The airships, to be stationed in Akron, Ohio; Miami and Los Angeles, will take on the advertising roles performed by their predecessors.
A growing competition for rare-earth elements (REEs) could soon hamstring a wide swath of the aerospace industry, from companies that build precision guided-weapon systems to suppliers for commercial widebody jets.
Even though the longtime Airbus-Boeing duopoly is slowly coming to an end—courtesy of Russia's United Aircraft Corp. and China's Comac, among others—it will likely take a few years before the new entrants can capture a big enough market share to rattle their European and American rivals.
India's first home-built fighter for carrier operations is being readied for its first flight, following an extensive remake of the design. The naval Light Combat Aircraft (LCA) is likely to complete its milestone flight in the next two months. But first the naval Tejas has to complete a month of ground runs, including high-speed taxi tests, to give several components a clean bill of health after technical problems slowed progress in 2009-10.
One of the most curious pairings in business aviation today is that of Lilliputian Eclipse Aerospace and Brobdingnagian Sikorsky Aircraft. Although the former manufactures nothing, the reconstituted firm inherited a short but storied legacy of failed promises regarding a new very light jet (VLJ) age, stilled production lines and breathtaking fiscal ruin. Meanwhile, the latter, a unit of the United Technologies conglomerate, is a maker of massive helicopters that the Pentagon buys by the thousands and for which it pays in the billions.
Rep. Chip Cravaack (R) had objected to the sale of Cirrus Aircraft, which was headquartered in his Duluth, Minn., district, to China Aviation Industry General Aircraft Co. on the grounds that the Chinese military would benefit from a transfer of technologies. Despite those objections, the U.S. government approved the merger, which was completed on June 28.
