This digital startup is stamping out the ‘tax-free shopping’ scam

Full article on forbes.com

I was awestruck last year when I visited Milan’s Galleria Vittorio Emanuele II, the most famous and perhaps the most beautiful shopping mall in the world. Few can resist gawping upon entering this masterpiece of neoclassical architecture, with its sweeping mosaic tiles, palazzo-style facades and huge iron and glass dome. An even bigger shock awaits ordinary folk who glance at the prices in the posh fashion outlets lining its streets. But not everyone is left aghast. For some tourists the Galleria Vittorio is a place to spend, not gaze. And for non-Europeans, in particular, the splurging comes with the expectation of a 22% VAT refund at the airport. Yet few tourists receive their dues. By the time retailers and middlemen have had their fun, these shoppers are lucky to get 14% back. And it’s a problem that affects more than just super-rich visitors to Milan...

Boeing needs a new boss

Full article on guardian.co.uk

Dennis Muilenburg, Boeing’s chief executive, last week told US lawmakers that he would have grounded the 737 Max in a heartbeat – if only he’d known about the dangers posed by the aircraft’s anti-stall mechanism. His apparent ignorance of this design flaw led to the deaths of 189 people in October 2018, when Lion Air Flight 610 slammed into the Java Sea. Five months later, once Boeing had convinced most of the world that poorly trained Indonesian pilots were probably to blame for the disaster, another 157 people died on Ethiopian Airlines Flight 302.

To the ordinary person in the street, glaring similarities between the crashes – both of which involved the same, brand new aircraft type nosediving at the same stage of their flight – made it obvious that the 737 Max should be grounded...

MEA: Beirut force

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During the early years of Syria’s civil war, Middle East Airlines (MEA), the flag-carrier of neighbouring Lebanon, benefited from an uncomfortable spike in demand due to its proximity to the battleground.

With Syrian airspace all but closed to civilian traffic, most refugees who could afford airline tickets drove 110km from Damascus to Beirut before boarding their flights.

That footfall has subsided in recent years as the war-torn state hobbles towards some semblance of normality. At home, flag-carrier Syrian Arab Airlines is plotting to re-build its network with new Russian aircraft that are not subject to Western sanctions. Abroad, a handful of international airlines have tentative plans to resume operations in Damascus.

And while less cross-border demand seems like bad news for MEA, Mohamad El-Hout, the airline’s longstanding chairman, actually wants the trend to continue...

Interview: Belarnicio Muangala, Fly Angola General Manager

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Angola’s aviation sector took a symbolic step forward in April, when the European Union lifted all restrictions on TAAG Angola operating in its airspace.

The state-owned flag-carrier had been trying to shake off its EU ban for more than a decade: first gaining an exemption for Portuguese flights; then securing the right to serve elsewhere in Europe with specific aircraft; and finally being given unfettered access to the continent.

By removing TAAG from its blacklist, Brussels signalled that the mismanagement and corruption associated with the airline no longer poses a danger to the safety of flight.

But, on a broader commercial level, there remains little positive to say about civil aviation in Angola...

Interview: Desiré Balazire Bantu, Congo Airways CEO

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Desiré Balazire Bantu was appointed chief executive of Congo Airways in 2016 with a mandate to deliver sustainable growth at the state-owned flag-carrier, which launched services the previous year.

His aim of deploying 10 aircraft by 2020 quickly unravelled when the then president, Joseph Kabila, refused to step down at the end of his term, igniting a full-blown political crisis in the Democratic Republic of the Congo (DRC).

It was not until this January that a successor replaced Kabila and relative calm returned to capital city Kinshasa...

Interview: Vipula Gunatilleka, SriLankan Airlines CEO

Full article in JPG format: page 36/37 & page 38

In the decade since Sri Lanka’s civil war came to an end, tourism in the island nation has grown fivefold to more than 2.3 million visitors per year.

The sector accounted for 5% of GDP in 2018, almost exactly matching the amount of money that Sri Lanka’s government spends on servicing its foreign debt. With an ambitious target of 5 million visitors in 2021, officials had been hoping that tourism could pull the country out of its budgetary crisis.

That optimism evaporated on Easter Sunday, however, when a team of suicide bombers inspired by Islamic State killed more than 250 people in coordinated attacks on hotels and churches across the island...

British Airways centenary becomes PR nightmare

Full article on forbes.com

British Airways poured money into marketing this year by re-painting four of its planes in heritage liveries and running a series of TV and online advertisements hailing 100 years of flight by the flag carrier.

The campaign – which drafted in celebrities like Olivia Colman – sought to rekindle BA’s historic reputation as “the world’s favorite airline”.

Yet the company seems oblivious of the thing that made it so popular in the past: looking after customers.

Striking pilots are not due to walk off their jobs for another fortnight and BA is already in the doghouse over its chaotic handling of the situation. As well as forcing affected customers to wait for hours on its chronically under-staffed call centers, the airline has spread the misery by wrongly telling other passengers that they need to re-book...

Interview: Neil Sorahan, Ryanair CFO

Full article on forbes.com

Ryanair wants to grow its existing subsidiaries rather than setting up more airlines, though management will not rule out acquisitions if rival carriers fly into difficulty during the winter season.

The Irish company has adopted a multi-brand strategy in recent months by establishing three sister carriers to Ryanair DAC: Austria-based Lauda, Poland-based Buzz and Malta Air. It has also set up a dormant UK subsidiary to minimize brexit-related disruption.

“With the airlines that we have at the moment we've got a huge amount of options,” chief financial officer Neil Sorahan told me...

How bitcoin is taking flight with Norwegian Air

Full article on forbes.com

When Norwegian Air Shuttle launched budget flights to America in 2013, it forced the airline industry to look again at a market segment dismissed by many pundits as commercially fanciful: low-cost long-haul flying.

Six years on, it’s hard to say whether the gamble has paid off. The airline’s balance sheet is weaker than when it only served short-haul markets. Early competitors like WOW Air and Primera Air have collapsed. Yet Norwegian’s Boeing 787 Dreamliners still criss-cross the Atlantic daily – holding their own against a new breed of low-cost long-haul services run by Europe’s legacy carriers.

The decision by Norwegian’s founder, Bjørn Kjos, to relinquish financial and managerial control of the company has meanwhile put a younger generation of executives – including his son, Lars Ola Kjos – in charge of strategic planning.

And their opening gambit appears no less ambitious or transformative than the elder Kjos’s foray into long-haul operations...

Interview: Ahmed Adel, EgyptAir Chairman

Full article in PDF format: page 22-24 & cover

Like any state-owned flag carrier, EgyptAir’s fortunes are tied inexorably to those of its home nation. That has translated to heavy losses and weak demand in recent years as the country was buffeted by successive waves of political and security unrest.

Two devastating air disasters – the bombing of Metrojet Flight 9268 and the still unexplained crash of EgyptAir Flight 804 – only added to the airline’s troubles.

However, with improved security and renewed investment under President Abdel Fattah el Sisi, optimism is rising on to the streets of Cairo.

Large-scale projects like the Grand Egyptian Museum and a new high-speed rail network are fuelling hopes of a happier future – one in which both locals and foreigners can travel across this ancient land without fear of violence or persecution...

Interview: Naji Majdalani, Wings of Lebanon CEO

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As a charter carrier with just one aircraft on its registry, Wings of Lebanon rarely gets the media attention that is afforded to larger, better known airlines in the Middle East.

The company has found itself in the spotlight only twice in recent memory – and management would happily forget both instances.

In 2016, a Boeing 737 carrying the Wings name was photographed at Ben Gurion Airport in Tel Aviv, Israel. The sighting sparked outrage in a country that officially remains at war with the Jewish state, and whose leaders are deeply paranoid about Israeli intelligence operations.

Then, last year, Wings had its European Union licence suspended after regulators flagged a series of apparent shortcomings in its flight training and aircraft maintenance processes...

How ham-and-cheese paninis are saving Ryanair’s dough

Full article on economist.com

Few readers of Gulliver will be surprised to hear that Ryanair is the largest low-cost carrier in Europe. Having flown 139m passengers last year, the Irish company is second only to Lufthansa, a group of full-service carriers, in terms of passenger traffic on the continent. At Ryanair’s current rate of expansion, it will almost certainly take the top spot next year. Slightly more surprisingly, the airline has become huge in the catering world as well. “We’re the largest seller of ham-and-cheese paninis in Europe”, claims Neil Sorahan, the airline’s finance director. He likens its food-and-drink sales to putting “the equivalent of 455 7/11s [convenience stores] in the sky every day”...

Interview: Jim Belemu, Mahogany Air CEO

Full article in PDF format

When Zambia’s late president, Michael Sata, called for Zambia Airways to be resurrected in 2011, local entrepreneur Jim Belemu sensed an opportunity to move into a new sector.

The molecular scientist had already enjoyed a colourful career since obtaining his doctorate, working as a veterinary surgeon, a civil servant, a United Nations researcher and more recently setting up a successful mining company. With metal prices peaking in 2011, he and wife Cynthia were actively searching for their next business venture.

“We decided we needed to do something else which is long-term, maybe not very profitable but at least which keeps us going,” Belemu recalled...

Boeing loses another 737 MAX customer

Full article on forbes.com

Tajikistan’s Somon Air has dropped plans to lease a Boeing 737 MAX, blaming uncertainty about the timeline for its re-entry to service and shattered public confidence in the model.

“The MAX has been put on hold,” chief executive Thomas Hallam told me, referring to a contract for a single leased unit that Air Lease Corporation (ALC) had been due to place with Somon this year.

The unit in question was purchased by the lessor, so the lease cancelation will not affect Boeing's orderbook.

However, it illustrates waning confidence in the MAX following two crashes in Indonesia and Ethiopia that claimed 346 lives and led to a worldwide grounding of the new aircraft type. Boeing is widely perceived to have bungled its response to the crisis by downplaying the severity of problems with its flight control systems and pressuring America’s aviation regulator to keep the model flying even after the second crash...

EgyptAir set for restructuring as questions linger over 2016 crash

Full article on forbes.com

EgyptAir is aiming to reach a 100-strong fleet under a new plan led by chairman and chief executive Ahmed Adel, but the flag carrier appears no closer to explaining the loss of one of its planes in the Mediterranean Sea three years ago.

Speaking to me in Seoul, South Korea earlier this month, Adel said EgyptAir has finally “levelled off” after a series of political and security crises in its home nation. Tourism in the country was decimated by the 2011 revolution against President Hosni Mubarak and has struggled to recover in recent years, hampered by a military coup, the terrorist bombing of a Russian charter jet in Sinai, and the crash of EgyptAir Flight 804.

With Islamic State in decline across the region and Egypt’s government delivering stability at home, the flag carrier is now embarking on a “complete restructuring plan” aimed at returning to growth – albeit while providing few answers about the May 2016 disaster that claimed 66 lives...

Lebanon's MEA poised to become Airbus A321XLR launch customer

Full article on forbes.com

Lebanon’s flag carrier has thrown its weight behind Airbus’s widely anticipated A321XLR project and plans to become an early operator of the type if it launches in 2023 as expected.

“Middle East Airlines is one of the first launch customers of the 321XLR,” Mohamad El Hout, the airline’s chairman, told me during the annual meeting of the International Air Transport Association (IATA) this month...

Mutton dressed as lamb

Full article on economist.com

Ryanair, Europe's largest low-cost carrier, has long defied conventional wisdom when it comes to branding. Its garish yellow and blue livery–much like its loud-mouthed chief executive, Michael O’Leary–is an assault on the senses. While other airlines try to woo passengers with sophisticated marketing, Ryanair slaps them in the face with its low prices. The strategy has served it well, appealing to a majority of short-haul flyers who prize cheap fares over other frills. Since last year, however, Ryanair has changed course. Rather than relying on just one brand, it is now diversifying...

Interview: Clifford Chetcuti, Air Malta CEO

Full article in JPG format: page 30/31 & page 32

Air Malta was profitable last year after nearly two decades in the red, soothing worries about its financial health and validating the new strategy launched by the country’s Labour government.

With a dozen European carriers closing their doors since the beginning of 2018 – including well-known names such as WOW Air, Germania and Flybmi – pressure had been mounting on the Mediterranean island flag carrier to end its lossmaking streak.

An earlier restructuring plan focused on contraction was not successful, and in 2016 Brussels ruled that Air Malta was not eligible for further state aid...

A Sukhoi Superjet meets a fiery end in Moscow

Full article on economist.com

In video footage that will make even the most seasoned air-safety experts wince, a Sukhoi Superjet operated by Aeroflot, Russia’s flag carrier, has erupted in flames while attempting an emergency landing at Moscow’s Sheremetyevo Airport. The devastating crash was filmed by at least one CCTV camera and four handheld devices, including two wielded by passengers on the stricken jet. None of the recordings is easy to watch. But it is the CCTV footage, which shows the airliner make a hard landing, bounce perhaps 20ft in the air, and plunge back down with sufficient force to break the undercarriage and set the fuel tanks alight, that is most distressing. At least 41 of the 78 passengers and crew on-board died...

Interview: Rammah Ettir, Medavia CEO

Full article in PDF format

Until 2014, when Tripoli International Airport was razed to the ground by warring militias, Mediterranean Aviation Company Ltd (Medavia) conducted most of its aircraft maintenance work in Libya’s capital.

Relocating its operational facility to Malta, the Mediterranean island situated 350km north of Tripoli, was a difficult but logical response to the security crisis. Medavia had been set up in 1978 by the governments of Libya and Malta, and the European island already hosted its management headquarters as well as a base maintenance station.

Despite losing one aircraft to the violence and sacrificing much of its revenue for evacuation flights, the company has adapted well to the challenges of recent years...

New doors open at Nesma

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Ashraf Lamloum knew he was taking a risk in 2016, when he opened a base in Jeddah and launched narrow-body flights under the Nesma Airlines brand.

The chief executive was taking advantage of the long-awaited liberalisation of domestic air transport in the Kingdom of Saudi Arabia (KSA), which had for years been dominated by just two airlines: flag-carrier Saudia and Flynas. Another two carriers – SaudiGulf and Flyadeal – were also granted licences around the same time.

From day one, Nesma KSA struggled to make a profit on the busy Jeddah to Riyadh trunk route...

Why does Stockholm Arlanda Airport hide its buses?

Full article on economist.com

Always on the lookout for a bargain, Gulliver takes great pride in using public transport when he travels abroad. Journeys between airports and city centres are no exception. Most of the time finding the cheapest route takes no more effort than logging onto an airport’s website or opening a navigation app such as Google Maps. Sometimes, however, airports are not co-operative, trying their best to shove visitors onto convenient but overpriced transport links. Arlanda Airport near Stockholm, the capital of Sweden, is by far the worst offender Gulliver has encountered...

Boeing counts the cost of grounding the 737 MAX

Full article on economist.com

When Boeing grounded the global fleet of 737 MAXs in March, Ryanair, the biggest buyer of the plane in Europe, insisted that the move will have little impact on its network. That was either wishful thinking or misinformation. Just three weeks later, the number of flights it had scheduled from London to Edinburgh, Britain’s busiest domestic route, fell 85%. Frequencies from London to Belfast plummeted 91%...

Interview: Philippe Bohn, Air Senegal CEO

Full article in PDF format: page 16-18 & cover

When Air Senegal began operations in May 2018, it marked the West African nation’s third attempt at a state-owned flag carrier.

The failure of predecessors Air Senegal International and Senegal Airlines would come as little surprise to anyone familiar with the challenges of African aviation.

Senegal has a relatively small air transport market: just 2.3 million passengers pass through Dakar’s Blaise Diagne International Airport, its main hub, each year. The country’s population of 16 million would be a limiting factor even in the developed world, where most people can afford to fly. In the developing world, it makes running a commercial airline all but impossible.

Yet closed skies are not an option for Macky Sall, Senegal’s president, who was re-elected in February with a mandate to further advance his Plan Senegal Emergent (PSE) – a 20-year economic and social strategy aimed at delivering long-term prosperity...

The ow factor

Full article on economist.com

As is always the case when an airline goes bust, the collapse of WOW Air, an Icelandic low-cost carrier, has left a trail of financial destruction at home and abroad. More than 1,000 airline employees have lost their jobs. Tens of thousands of customers will face a battle to recover money spent on unused tickets. Those in the middle of their trips are stranded. With a population of less than 350,000 people, Iceland’s economy is neither large enough nor diversified enough to shrug off the failure. Last year the government warned that WOW’s collapse would shrink GDP and send the krona, the local currency, plummeting...

Boeing, FAA's inaction over 737 MAX must be probed

Full article on forbes.com

The Boeing Company and the Federal Aviation Administration (FAA) finally bit the bullet on Wednesday and grounded the global fleet of 737 MAXs – a new aircraft type that has suffered two catastrophic crashes in recent months despite being touted as one of the safest flying machines ever built.

America’s FAA should have been the first to ground the jet on Sunday, when prima-facie evidence pointed to similarities between the loss of Ethiopian Airlines Flight 302 that day and Lion Air Flight 610 on October 29th.

Instead, the U.S. regulator was dead last among respected international agencies to make the call. It waited more than 80 hours from the time of the second crash, with President Donald Trump announcing an emergency grounding Wednesday afternoon...

The facts have spoken: Boeing's 737 MAX needs to be grounded

Full article on forbes.com

‘If it ain't broke, don't fix it’ is one of my favorite maxims.

I find it odd, then, that Boeing has committed to making “an already safe aircraft even safer” by upgrading software on its 737 MAX series.

Coming on the heels of two major crashes by the type with glaring parallels – the first of which Boeing is already publicly linking to its existing software – the company’s narrative appears confused and contradictory...

Another brand new Boeing falls from the sky

Full article on economist.com & video summary

For the second time in five months, a virtually new Boeing 737 MAX airliner has crashed within minutes of taking off, killing all 149 passengers and eight crew aboard. On March 10th Ethiopian Airlines Flight 302 departed from Addis Ababa, the carrier’s home airport, for what should have been a routine two-hour flight to Nairobi, Kenya’s capital. It fell out of the sky just six minutes later...

Zambia's Mahogany Air eyes regional expansion via northern towns

Full article on forbes.com

Mahogany Air is looking to turn Zambia’s northern border towns of Mbala and Nakonde into transit points for Burundi and Tanzania as part of a new push into international markets.

“What we are trying to do is to fly to northern Zambia and connect to the neighbouring countries,” founder and chief executive Jim Belemu told me in a telephone interview.

“So we will fly to northern Zambia, Mbala, and then from Mbala we can connect to Bujumbura [in Burundi]. There is traffic which is so untapped there. Then we are also trying to fly to the Zambian border town of Nakonde and connect from there to Dar es Salaam [in Tanzania]...

Is Kosovo about to get a national flag carrier?

Full article on forbes.com

Speculation is mounting that Kosovo, the partially-recognized Balkan state that declared independence from Serbia in 2008, could soon have a functioning national airline.

The scenario is considered possible after news broke that Leyla Ibrahimi-Salahi, a Swiss national with Kosovan ancestry, has completed a takeover of Germania Flug, the Swiss subsidiary of insolvent airline Germania. The acquisition was made through her investment company Albex Aviation...

The Boeing 747 jetliner turns 50

Full article on economist.com

Earlier this month, a decommissioned Boeing 747 airliner was towed down a Dutch motorway to its final destination as a novelty hotel complex. Its owners reckon they can turn the jumbo jet into a tourist attraction. They are not wrong. Sweden’s Stockholm Arlanda Airport is already using one as a hostel (its best room is the cockpit suite). In Bahrain, developers are planning to turn a submerged 747 into the centrepiece of a new underwater theme park. Having celebrated the 50th anniversary of the 747’s first flight this month, fans of the iconic jumbo jet know that it is falling out of favour with airlines. Before long, ground-based encounters will be the only way of getting up close and personal with these planes...

Malta's Medavia unveils plans for domestic Libyan airline

Full article on forbes.com

Libyan travelers should be able to fly with a new domestic airline next year thanks to Mediterranean Aviation Company Ltd (Medavia), a charter operator and aircraft maintenance firm based in the southern European island of Malta.

Provisionally named Medlib, or Medavia Libya, the new airline is in the process of applying for an Air Operator’s Certificate (AOC) from the Libyan Civil Aviation Authority.

“The overall idea is to offer more frequent, reliable services between the Libyan cities,” chief executive Rammah Ettir told me during an interview at the company’s headquarters in Malta. “The services that are being offered at the moment are not really good and the Libyan travelers deserve much better...

Airbus calls time on the A380

Full article on economist.com

After a century of refining their craft, planemakers have become masters of building safe, reliable jets that bring air travel within reach of the masses. Occasionally their products win cult status among passengers. But commercial success and popular appeal rarely overlap. Concorde, the world’s only reliable supersonic passenger jet, wowed travellers for nearly three decades. Beloved by all, it was nonetheless a financial disaster that only stayed airborne because of political will and vast government subsidies. Sixteen years after Concorde’s final flight, another game-changing aircraft that passengers love to fly is facing an uncertain future: the A380...

Interview: Paulo Mirpuri, Hi Fly CEO

Hi Fly finds new customer for 'Save The Coral Reefs' A380

The world’s most recognizable Airbus A380 has been allocated to a new customer for the coming summer season.

The coral reef-themed jet is operated by Hi Fly, a wet-lease company that provides aircraft and crew to airlines on short-term contracts. Hi Fly acquired the double-decker plane from Singapore Airlines last year in the first transaction of its kind in the secondary market.

Having undergone maintenance work this winter the aircraft is now ready for commercial service and will be placed with a single customer during the IATA summer season, which runs from late March to late October.

Interview: Talal Abdulkarim, Syrian Arab Airlines CEO

Full article in PDF format

Syrian Arab Airlines provoked a curious mixture of applause and raised eyebrows at the annual meeting of the Arab Air Carriers Organisation (AACO) in Cairo in November, when chief executive, Talal Abdulkarim, urged the industry group to hold its next get-together in Damascus.

The Syrian capital would not have been the first venue to spring to mind when AACO began making plans for its 2019 meeting. In all honesty, it was probably dead last.

Syria has been torn apart by eight years of brutal civil war that began with an Arab Spring uprising but quickly morphed into a multi-faceted battle between regional governments, world powers and a spectrum of rebel groups – most notorious among them the fanatical Islamists of Daesh, who at one point controlled roughly half the country...

Pichler flies the flag against the high threat of low-cost

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Ryanair’s decision to launch 14 routes to Jordan last year could easily have been a disaster for Royal Jordanian Airlines, the country’s flag-carrier.

Only two other Middle Eastern and North African nations – Israel and Morocco – have experienced a large-scale influx of low-cost airlines from Europe. The flag-carriers of both countries struggled financially when their markets opened up to no-frills competition.

Yet, despite facing the same headwinds, Royal Jordanian delivered an 87% rise in net profits in the first nine months of last year, accelerating the turnaround launched by new chief executive Stefan Pichler...

Europe’s largest regional airline is bought for the price of a West London flat

Full article on economist.com

If a good compromise is one where all parties are left dissatisfied, this week’s bailout of Flybe by Connect Airways—a consortium led by Virgin Atlantic, Britain’s second-largest airline—must be a very good deal indeed. Bosses of the regional airline, which is Europe’s largest, have the ignominy of selling a company once worth a quarter of a billion pounds for just £2.8m ($3.6m). Investors will be paid just 1p for shares they might have purchased for £3.41 when the airline was listed on the London Stock Exchange eight years ago. And the consortium—including Stobart Group, which owns an Irish regional airline—inherits £82m of debt and relatively few assets for its trouble...