British Airways should not be allowed to buy Flybe

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Within days of putting itself up for sale, Flybe, a beleaguered regional airline based in Britain, has attracted interest from the country’s two largest carriers. Its executives are hoping for a bidding war between International Airlines Group (IAG), which is the parent company of British Airways (BA), Britain’s flag carrier, and Virgin Atlantic, its main rival. Flybe’s shares have surged in value due to the tussle. But only one of the bids would be good for the travelling public...

Flybe is in urgent need of a new strategy

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Despite plying European skies for nearly four decades, Flybe, a regional airline based in Exeter, Britain, has never suffered a major safety-related incident. Its pilots and technicians deserve much praise for this stellar safety record. Sadly, investors in the airline have not been looked after nearly as well. Those who bought shares in the firm when it listed on the London Stock Exchange in 2010 and still have them are nursing a massive 97% loss in value. Recent profit warnings have compelled Flybe’s board to put it up for sale–nine months after spurning a takeover attempt...

How Syria’s flag carrier plans to remain airborne

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About a decade ago Syrian Arab Airlines, the state-owned flag carrier of Syria, was planning an order for 50 shiny new Airbus jetliners. They never arrived. Today it operates five elderly ones. The country’s ability to expand its civilian fleet with Western aircraft stumbled when President Bashar al-Assad took the reins from his father in 2000. It disintegrated 13 years later, when civil war swept across Syria and Mr Assad shocked the world with his indiscriminate military tactics, including the use of chemical weapons against civilians. With a helping hand from Russia, his brutal methods have succeeded. His troops now control about 85% of Syrian territory. And SyrianAir is once again shopping for planes—albeit, this time, in Moscow...

Syphax back from the dead

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Mohamed Frikha could not have picked a worse time to establish his airline than 2011, the year in which Tunisian President Zine El Abidine Ben Ali was ousted in a popular revolt that served as the spark for the Arab Spring uprisings.

Although it seemed like a period of renewal and change in Tunisia – and, indeed, the North African country has fared much better than its neighbours in the years that have followed – fortune was not smiling on Syphax.

Flag-carrier Tunisair threw down the first hurdle by instructing its ground-handling division to block its rival’s very first flight. Then airspace in Libya – a vital market for any Tunisian airline – was shut down as that country spiralled into civil war. Soon after, a pair of Daesh terror attacks targeting holidaymakers in Tunis and Sousse decimated tourism demand in Tunisia. And finally, technical problems with the airline’s Airbus A330 grounded its only long-haul route to Montreal.

“We did not have luck,” Frikha shrugs...

Interview: Nevzat Arşan, AtlasGlobal CCO

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AtlasGlobal’s chairman, Murat Ersoy, turned heads last year when he pledged to create an alliance of nine different airlines spread across the world.

The Turkish carrier’s appetite for overseas subsidiaries was not by itself surprising. The company rebranded from AtlasJet in 2015 to underline its global aspirations, and it already holds shares in three such ventures: AtlasGlobal Ukraine, Iraq’s ZagrosJet and Kazakhstan’s Jet One.

But the scale of the plan – and its focus on protected markets like Saudi Arabia and Russia – shocked many, particularly given the difficulties that Ersoy has encountered with his existing subsidiaries...

A brand new passenger jet crashes in Indonesia

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On October 29th a Boeing 737 MAX 8 airliner, one of the newest and most technologically advanced passenger planes in the world, crashed into the Java Sea shortly after leaving Jakarta, the capital of Indonesia. If, as is feared, none of the 189 passengers and crew aboard Lion Air Flight 610 survived, the crash will become the second deadliest in Indonesia’s history. It is also the first involving a MAX aircraft, which only entered service last year. Speculating on the causes at this early stage is both unhelpful to investigators and disrespectful to victims. Most aircraft losses stem from a web of technical, environmental and human factors, the nuances of which take months to unearth. But, as they get to work, investigators will inevitably have Indonesia’s poor air-safety record at the front of their minds...

Primed for failure

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Primera Air changed its low-cost business model this year by adding scheduled long-haul flights to its predominantly short-haul charter network. Hrafn Thorgeirsson, its chief executive, had said that the change was necessary to avoid the structural decline of the European market for charter flights. He could have saved himself the bother. The airline entered administration on October 2nd after failing to secure further funding for its loss-making long-haul operation, which was beset by delays and cancellations during its first and only summer season. Its collapse leaves thousands of customers stranded and tens of thousands more out of pocket...

Ethiopian Airlines is founding new African flag carriers

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When The Economist wrote about Ethiopian Airlines in 1989, we praised the company’s “unqualified success” despite operating in a “disastrous economy” infected with civil war, famine and Marxist inefficiency. Having grown its passenger count 17-fold since then–to the benefit, not the detriment, of its profits–Ethiopian is now the envy of all African governments. Most are saddled with loss-making flag-carriers or none at all. Tewolde GebreMariam, Ethiopian’s boss, wants to change this by helping some of his neighbours set up new companies and others overhaul existing ones. But while his intentions are good, he cannot fix the broken sector alone...

Interview: Thomas Hallam, Somon Air CEO

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Tajikistan’s Somon Air launched operations in 2008 with the aim of breaking the monopoly enjoyed by state-owned flag-carrier Tajik Air.

Chief executive Thomas Hallam makes no bones about the challenges of running a business in Tajikistan – an impoverished central Asian republic where corruption and cronyism still dominate the corporate landscape.

But by learning from the success of Air Astana, Kazakhstan’s flag-carrier, Somon Air is rapidly overcoming these obstacles. An obsessive focus on safety, transparency and international standards has secured the company both IATA membership and TCO (Third Country Operator) authorisation in Europe – two recognised benchmarks for operational excellence...

Back to the Silk Road

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Distilling complex economic strategies into straightforward, digestible terms is never an easy task, and China’s Belt and Road Initiative (BRI) is no exception.

Originally launched in 2013 as the One Belt One Road Initiative, Beijing renamed its pet-project two years ago following confusion about the use of the singular word “one”. In fact, the BRI encompasses an array of land and maritime trade routes that collectively bind together the economies of Europe, Asia and Africa.

Many of the BRI’s land corridors overlap with the ancient Silk Road networks that allowed traders to move their goods from East to West for more than a thousand years. But there are new pathways too – in regions once skirted by the cart-pulling camels and horses – and there is even now a “Digital Belt and Road” that focuses on e-commerce and scientific cooperation.

Put simply, the BRI means whatever the administration of Chinese President Xi Jinping wants it to mean – and its definition and scope changes year by year...