Libyan Airlines fights back

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Of all the images broadcast during the Libyan uprising, few encapsulated the chaos of war more than the charred tailfin of an Afriqiyah Airways Airbus A300 – caught in the crossfire as rebel fighters descended on Tripoli International Airport.

Alongside the grave humanitarian toll of the eight-month conflict, Libya's fledgling civil aviation infrastructure was razed almost beyond recognition.

Just two of Afriqiyah's aircraft emerged from the war unscathed, and sister flag carrier Libyan Airlines fared no better at escaping the carnage. The older state-owned airline lost one A300 and one Bombardier CRJ900, in addition to suffering gunfire and mortar damage on its remaining seven CRJs and four Airbus A320s...

Qatar's diplomatic act

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In April 2011, Syrian state media reported that Sheikh Hamad bin Khalifa al-Thani, the Emir of Qatar, had sent a letter to Damascus pledging his support against "the conspiracy targeting its security and stability". Just one year on, and the same government mouthpiece now accuses Qatar of masterminding that conspiracy. Such is the nature of international diplomacy.

Qatar's new perspective of Syrian president Bashar al-Assad could not be clearer – Sheikh Hamad closed the Qatari embassy in Damascus last July, and by February 2012 was openly calling for the arming of Syrian rebels. What is less apparent, though, is how this hawkish approach fits in with Qatar's self-styled reputation for being a regional peacemaker...

Qatar making a noise

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Speaking at the Global Aerospace Summit in Abu Dhabi last month, Akbar al Baker, the chief executive of Qatar Airways, surprised no-one when he announced that the flag carrier expects to double in size by 2020. While that prediction would be met with derision if uttered by one of Europe or North America’s legacy airline bosses, Qatar has for years been staking its claim in the rising fortunes of the Gulf aviation market.

From its humble beginnings in 1994, when it started operations with a wet-leased Boeing 767, Qatar Airways has lived up to the emirate’s reputation for punching above its weight...

Saudia looks for direction

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Despite being the Middle East’s third largest carrier by revenue, Saudi Arabian Airlines, or Saudia as it is often still known, rarely features in discussions about Gulf aviation. The kingdom’s flag carrier has a reputation for shying away from the limelight, due in part to its beleaguered domestic market, and in part to the pre-eminence of more media-savvy rivals in the United Arab Emirates (UAE) and Qatar.

This coming year, however, Saudia will throw itself onto the global stage like never before. Against a backdrop of gradual privatisation, the airline will join the SkyTeam airline alliance in May – kick-starting a strategic plan which, if successful, will see business travellers in the Americas, Asia and Europe fuelling profitability...

The runway that won't go away

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Before Britain’s Conservative Party could form a coalition government with the Liberal Democrats in May 2010, negotiators from both sides had the unenviable task of reconciling some of their less-than-complementary policies. One issue that required no wrangling, however, was the proposal for a third runway at London's Heathrow Airport, which was buckling under the pressure of operating at 98% capacity. David Cameron, the Conservative leader, had already broken with party tradition by opposing expansion at the airport, and the greener Liberal Democrats had long supported west London's NIMBY (Not In My Back Yard) residents. Ironically, this easy consensus has now become one of the coalition's toughest dilemmas...

Still waiting for the tide to turn

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Bahraini flag carrier Gulf Air has made no secret of its desire to cut underperforming routes, nor has it downplayed the impact of the Arab Spring on its operations. Even so, last month’s culling of four more destinations from the airline’s route network – Athens, Milan, Kuala Lumpur and Damascus – caught many observers by surprise. Set against a backdrop of intense parliamentary scrutiny that has at times bordered on enmity, some are beginning to ask questions about its future.

There is no denying Gulf Air had a torrid time in 2011. Bookings fell by 25 per cent in the first five months of the year as regional unrest spooked foreigners and parliament banned flights to Iran, Iraq and Lebanon – fearful that groups like Hezbollah might antagonise the country’s Shia population. Factor in high oil prices, and it is little wonder that Gulf Air’s much-lauded recovery plan, which had targeted profitability by 2013, was aborted in January...

Interview: Khaled Taynaz, Libyan Airlines CEO

Libyan Airlines planning CSeries order, EgyptAir wet leases

Libyan Airlines has conducted a viability study into the Bombardier CSeries and will likely order four to eight of the aircraft, chief executive officer Khaled Taynaz has said. The Libyan flag carrier is currently repairing its existing Bombardier CRJ900s, which were damaged during last year's revolt against Muammar Gaddafi, but has received a "very good offer" to upgrade the models in about four years. Taynaz is also poised to sign a short-term lease with EgyptAir for some of its Airbus A330s, though the paperwork has yet to be finalised and upcoming merger partner Afriqiyah Airlines may alternatively loan the aircraft.

Outlining Libyan's fleet renewal plans in his first interview since the civil war, the CEO said repair work on damaged aircraft had progressed well and that the carrier is now turning its attention to long-term expansion. Five of the airline's eight CRJ900s have already been restored by Lufthansa, while two more should be airworthy by April and the eighth will be decommissioned. Libyan had also signed a five-year maintenance contract with Air France-KLM, which will complete repair work on the last of four damaged Airbus A320s by the end of February.

Flagging carriers out east

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The grounding of Malev, Hungary’s national carrier, shows once again how Eastern European countries are struggling to fly their flags around the world. According to a report from CAPA, Hungary is now expected to follow Slovakia in switching to a predominantly low-cost carrier (LCC) market. The report notes that, prior to Malev's bankruptcy, LCCs accounted for just 24% of capacity in Hungary, compared with more than 70% for its neighbour to the north. That figure shot up to 40% overnight, and with Ryanair circling covetously above will only rise further.

But there are few positive signs for Eastern Europe's older airlines. Slovakia has a high LCC penetration because it abandoned its flag carrier in 2007. Lithuania did the same thing two years later, while Latvia clung onto its national airline, but only by marketing it as a pseudo-LCC with pan-Baltic aspirations...

Headwinds over Europe: ETS

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Last month, Malaysian low-cost carrier AirAsia X called time on its flagship services to Europe, under the pretext that the continent’s Emissions Trading Scheme (ETS) – essentially an environmental tax – had made flying to London and Paris unprofitable.

Behind the whitewashed press release, its hand was in truth forced by the short-sightedness of a business plan conceived in 2009, when oil prices stood at just $40 per barrel. With Brent crude surging to three times that level in recent months, the viability of a low-cost, long-haul product – absent of any high-yielding corporate passengers – was well and truly blown out of the water.

But while blaming the ETS was undoubtedly a face-saving exercise, AirAsia X will have many sympathisers both within the industry and beyond. Europe’s carbon trading scheme has been an unremitting source of contention for foreign governments, who say the tax violates their sovereignty and who are increasingly talking up the prospects of a trade war...

The future of biofuels

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Talk to an airline executive anywhere in the world today, and you're virtually guaranteed to hear the same fundamental complaint. With Brent Crude prices hovering around $110 per barrel – up 350% in the space of two years – it's now all but impossible to make money from the business of flying people around.

Of course airlines have several tricks up their sleeves. Hedging fuel contracts is one strategy, albeit a risky one if you misjudge the market. Cutting operational costs and hiking airfares are two others. Perhaps the most pragmatic approach is to fork out a few billion dollars for some next-generation, fuel-efficient jets. In the current financial climate, though, few have that option.

The inconvenient reality is that aviation is well and truly addicted to oil. In order to get a 650-tonne Airbus A380 off the ground, the high energy density required makes anything short of the black stuff a feeble substitute. And that means, in contrast to electric cars, battery-powered planes will never make their commercial debut in our lifetimes...