Tuesday, 22 October 2013

Mr O'Leary takes to Twitter

Full article on economist.com

A lot can change in three months. In mid-July I spoke to Michael O’Leary, the chief executive of Ryanair, Europe’s largest low-cost carrier. He said that Ryanair deliberately “tortures” its passengers when they check in bags; that the airline industry is populated by a bunch of “losers” and “lemmings”; and that Ryanair’s ideal customer is someone with “a pulse and a credit card”. Standard fare, then, for the industry’s most-outspoken boss. But then last month Ryanair issued an unexpected profit warning, and Mr O’Leary grudgingly told shareholders that he will stop “unnecessarily pissing people off”...

Tuesday, 15 October 2013

Frequent flyers: Building custom

Full article in JPG format: page 46/47, page 49 & page 50

A recent survey of 2,500 passengers by Deloitte, the financial advisory firm, found that 72 per cent of high-frequency business travellers participate in more than one airline loyalty programme. Few people will be surprised by that statistic. But it underscores how airlines – which already operate the most complex loyalty schemes of any sector – must continue innovating their frequent flyer programmes (FFP) to incentivise repeat custom.

Texas International Airlines launched what is widely regarded as the first modern FFP in 1979. It was followed two years later by the more advanced American Airlines AAdvantage and United Airlines MileagePlus programmes. Both schemes are still operated today, but their breadth and scope has changed profoundly over the past two decades...

Interview: Philippe Moreels, Czech Airlines CEO

Full article in PDF format

Late last year, CSA Czech Airlines was among the scores of central and eastern European carriers desperately seeking the lifeline of foreign direct investment. Miroslav Dvorak, chief executive of parent company Czech Aeroholding, told local press there was a 70% chance the airline would fail in its hunt for a strategic investor. Comparisons with Malev, Hungary's collapsed flag carrier, abounded.

But in March, Korean Air made good on an early expression of interest and agreed to purchase 44% of CSA. The loss-making Czech flag carrier has since re-entered the long-haul market with an Airbus A330 leased from its new partner. While growth is not on the agenda for now – CSA halved its fleet over the past three years under a restructuring programme – chief executive Philippe Moreels believes the airline has re-defined its "strategic raison d'ĂȘtre" and secured its long-term future...

Friday, 11 October 2013

Married to the job

Full article on economist.com

The International Transport Workers’ Federation (ITF), a grouping of trade unions representing 4.5m transport employees around the world, was never going to be Qatar’s biggest fan. Unions are banned in the ultra-rich Gulf state, where expatriates account for 94% of the total work force. Little wonder, then, that one disgruntled cabin-crew member at Qatar Airways chose to share her employment contract with the ITF. The federation duly pounced on the document’s more contentious clauses, and alleged “flagrant abuses” of workers’ rights. It cited one passage that requires employees to “obtain prior permission” from Qatar Airways if they wish to get married. Another clause says the employee can be fired if she becomes pregnant...

Tuesday, 1 October 2013

Turkish Airlines moves on the Gulf

Full article in PDF format: page 46-51 & cover

Few dispute that Qatar Airways’ expansion rate since launching in 1994 has been exceptional. Its 125-aircraft fleet now serves 130 destinations across the globe, with an average of one new route being launched every month. Orders for another $50 billion worth of aircraft will ensure growth for years to come.

Together with Dubai’s Emirates and Abu Dhabi’s Etihad, Doha’s flag carrier has brought the Middle East to the forefront of global aviation. But the big three Gulf airlines are not the only players seeking to re-align traffic away from legacy hubs in western Europe. Turkish Airlines (THY) is fast becoming a force to be reckoned with, and it is echoing many of the strategies successfully deployed in Qatar and the UAE...

Interview: Tony Tyler, IATA Director General

Full article in JPG format

The European Union's blacklist of foreign carriers lacks transparency and is yet another example of Brussels making up its own rules instead of pursuing international standards, IATA director general Tony Tyler has told African Aerospace.

"What they should be doing – like everybody else in the world – is going with what [the United Nations' aviation agency] ICAO does, which is a global standard," he said. "ICAO does its own inspections of the regulatory authorities and helps them lift their game where necessary. But Europe is going off on its own again, as it seems to love doing in this industry."

IATA has previously criticised the EU for unilaterally imposing its Emissions Trading System (ETS) – a climate change levy that was partly suspended last year amid warnings that it could trigger a global trade war...

Interview: Innocent Mavhunga, Air Zimbabwe Acting CEO

Full article in PDF format

Air Zimbabwe has returned to the skies following a successful IOSA safety audit and the signing of new aircraft leases, but the glory days of Air Rhodesia are unlikely to return soon. Martin Rivers speaks to acting CEO Innocent Mavhunga.

Although Zimbabwe's GDP per capita remains the second lowest in the world, the decision to abandon its local currency in 2009 brought a welcome end to hyperinflation. Economic growth has averaged 7.5% since dollarisation, and amid slow but steady progress the Government is focussing again on its ailing flag-carrier...

A fresh approach in Kuwait

Full article in JPG format:
page 43 & page 44/45

The contrasting fortunes of Kuwait’s two airlines could hardly be starker. Jazeera Airways, a privately owned low-cost carrier founded in 2005, has been profitable in all but two years. Kuwait Airways, the state-owned flag carrier, has not posted a profit once in the last decade. In the past five years alone, it racked up losses of KD462 million ($1.6 billion).

Despite this, Jazeera chairman Marwan Boodai believes there are “green shoots” in Kuwait’s inefficient flag carrier. He says liberalisation of the domestic market eight years ago proved that the private sector is best placed to run airlines – and he is willing to put his money where his mouth is...