LCC’s go places

In what may be considered as the latest evidence that Low cost Carriers are doing exceedingly well in a crowded passenger market, Ryanair reported a jump of 20% in its profits YoY to around USD 190 Million.  Seperately Spicejet also reported good numbers clocking a profit of Rs 20 Crore in the latest quarter. All this is evidence that if you have cost in control, the product can always be sold competitively and can also eat into your full cost market. Both stocks have responded very positively to the news, each up above 5% over last closing price.

Seperately, it is learnt that Ryanair is interested in picking up a stake in Spicejet. LCC’s are here to stay and for good.

Innovative check Ins at Indian Airports

Been to the airport lately on a quick business trip? If so, you would have noticed the various new alternatives for check in processes such as Kiosk Checkin, roving agents etc… These along with new innovative concepts such as SMS and Internet web checkin are helping airlines reduce costs tremendously and thus offer competitive airfares to travellers. Some of the airlines that use these concepts are almost all LCC’s, Jet, Kingfiher, Paramount to name a few.

Experience it yourself sometime soon if you are flying the ever increasing friendly but congested domestic skies in India.

Russian Air crash

Barely 10 days after the horrendous TAM crash at the Sao Paulo Congonhas Airport, yet another fatal disaster has struck the world of  air transport. This time its the turn of Russia based cargo carrier which crashed 7 minutes after takeoff from Moscow’s Dodomodevo airport. 7 people are said to have died in this crash. The age of the plane was 43 years old. I mean who the heck flies 43 year old planes. It was a disaster waiting to happen.

Air India’s new 777-200 is here

AI’s new 777-200 LR landed in Mumbai on the 28th of July heralding the first of the 68 deliveries that the carrier will undertake. Its starrting up Mumbai-NYC-Mumbai from Aug 1. AI is well on its path to recovery starting this new flight. AI is proposing to start several new intercontinental flights as well expand flights on to Asian destination. It will be interesting to see how the International carriers will respond to not only AI’s expansion but also Jet’s aggressive International expansion in the coming months. Fares ares all set to come down with competition and other factors of rising rupee etc…

I have a gut feeling that with revamp of service by AI and its appeal to Indian travellers, its going to give BA, AF, LH etc a run for money on the India-US sector. Lets see how Aug 1 starts out!!!

Alitalia faces liquidation

Alitalia faces liquidation after all 3 potential bidders walked out of buyout talks with the carrier.  This precarious situtation means that the last potential option for this carrier is to liquidate and reincarnate as a new carrier. Alitalia is losing a Million Euros a day currently. Alitalia has been crumbling for quite some time with  a very strong union pressing for strikes time and time again on various issues. Lets hope someone buys out the carrier at a ridiculous price maybe if the goverment is able to let go of it.

The shares of the carrier have slid close to 8% in the last 2 days and are trading at 0.75 Euro at the Milan Bourse.

Safety at Indian airports

With the Sao Paulo incident bringing to light the short runways at cities, Indian airports don’t fare too well either. A clutch of airports across the country including Patna, Pune, Varanasi, Dibrugarh, Bhopal, Madurai etc… have compartively shorter runways at or less 7000 feet. This monsoon season has bought a spate of slippage incidents on Indian runways, the most recent being an Jet Airways ATR72-500 slipping out of runway’s bounds at Indore. Several other incidents have been reported across the country at Cochin, Patna and Vizag. It would be wise for the DGCA to impose weight restrictions on aircraft operating on to smaller airports in India. While the aviation sector is booming in Inida, safety of passengers should never be put at stake.

Sao Paulo Aircraft crash

It was a bad week for aviation with a very major accident at Congonhas Airport, Sao Paulo a couple of days back. The TAM A320 landed on a slippery and wet runway, crossed the highway beyond the runway and slammed onto a fuel station killing almost 200 people. Initial investigations point to a mechanical fault in the thrust reversers which are meant to slow down the plane once it touches down on the runway.  Apparently the fault was discovered on July 13. Airbus stipulates that any fault be checked and rectified within 10 days of the discovery.

Video footage also showed the TAM A320 coming into landing with a speed greater than other incoming planes.  While TAM says that that no fault was found as on July 16, only time will tell as investigations are on to find the reason of this crash. The accident at Sao Paulo’s Congonhas airport is South America’s worst airplane disaster ever.

Tiger airways links South India to Oz

Tiger airways launched 4 new flights linking Kochi and Chennai to Darwin and Perth. These flights allow passengers to go to Australia with the most minimum stopovertimes. Fares start from $65 to Darwin and $78 to Perth one way. True low cost International flights are here to stay in India for now. Travellers rejoice!!!

US airlines seeking more non stop routes to China

Several US airlines have applied for direct US-China Routes. Routes under consideration are Newark-Shanghai, Atlanta-Beijing, Chicago-Shanghai etc… Three routes will commence operation in 2010 while two more commence in 2011. There is fierce competition to gain a toehold in the fast growing US-China sector. This comes on the backc of United’s DC-Beijing route which was launched earlier this year. The Department of Transportation expects these routes to yield as much as $5 billion in revenues for the airline industry. Ripe pickings indeed !!!

India-Malaysia Bilateral air services agreement signed

India and Malaysia ratified their present air services agreement comprehensively that will allow carriers to operate between 18 points in India to Malaysia. The rights will progressively increase over the next 24 months. Some of the new destinations that Malaysian and Indian carriers will operate out of include Patna, Lucknow, Gaya, Goa and Jaipur. Air India Express is expected to commence direct services into Malaysia very soon as a direct outcome of the bilateral talks. An open sky policy was also reached for cargo operations between the two countries.

Air India to start Direct Non stop on Mumbai-New York from Aug 1…Competition lurks around the corner

Air India is starting its new non stop Mumbai-New York on its newly acquired Boeing 777-200 LR. The flight is expected to take approximately 15 hours on both directions. This will be the first Indian carrier to fly Mumbai-New York direct non stop.  But competition is not very far away. Jet Airways, India’s premier domestic airline is launching its Mumbai-Brussels-Newark on August 5 on its newly acquired Boeing 777-300ER. Jet airways has tied up with SN Brussels Airlines for onward connectivity to Europe. These two pairs of flights enters into a already crowded India-US sector where Continental is already flying Newark-Mumbai non stop.

What can we say…let the competition begin… Its the passenger who will benefit the most.