Airports and politics

Airports and politics don't mix. As in Heathrow you might think. But what is going on n Bangkok takes it to a new level. Since Tuesday, dozens of airlines have canceled all flights to and from Bangkok.

"What's happening in Bangkok is going to be very damaging to our business," said Tony Tyler, chief executive of Hong Kong-based carrier Cathay Pacific, which has two 777s stranded in Bangkok. Bangkok's Suvarnabhumi Airport, the main gateway to Thailand, is one of the world's most "densely connected" airports, serving about 100 airlines with flights to 184 cities in 68 countries, said Andrew Herdman, director general of the Association of Asia Pacific Airlines.

On a normal day, about 100,000 passengers pass through Suvarnabhumi. It also handles about 3% of the world's air cargo. So the political disruption in Thailand is now a problem for people around the world. Yest another example of how aviation is a system of systems. Disruption in one place ripples around the world quickly.

As political forces around the world consider how successful the Thai government's opponents have been, effectively closing a nation down by cutting its global aviation links, you can be certain that copycat action will follow. Any state violence against the opposition will be within mobile phone cameras and video cameras owned by travelers. Images of any violence will be transmitted instantly to YouTube. As some may know, the tragedy in Mumbai this week was first announced via Twitter - not the traditional media.

The truth is, the government is stuck and cannot win, no matter what it does. Police said 4,000 protesters were at Suvarnabhumi since seizing the airport on Tuesday. At Don Mueang another 2,500 had blockaded the building since its capture late Wednesday.

In other news --

• The merger fantasy
• A320 crash - watch out for quick blame of pilot error
• Dubai - land of dreams?
• The slump start to bite

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Biofuel test next week

Air New Zealand Chief Pilot David Morgan with samples of jatropha oil and the first ever “J50” biofuel blend. The world's first commercial aviation test flight powered by a sustainable second-generation biofuel is ready to go next Wednesday, December 3.

The jatropha fuel has now been blended 50:50 with standard Jet A1 fuel by Air New Zealand at its Auckland Engineering Base. The biofuel blend, named J50, has now been transferred into an RNZAF fuel tanker ready to fuel the Air New Zealand 747-400 early next week.

The two-hour test flight is scheduled to take off from Auckland airport on Wednesday morning, with the jatropha biofuel blend powering one of the Air New Zealand 747-400 Rolls-Royce engines.

The pilot in command of the test flight is Air New Zealand 747 Fleet Manager Captain Keith Pattie. Other crew will include Boeing test pilot Captain Thomas Imrich and Air New Zealand’s Chief Pilot and General Manager Airline Operations Captain David Morgan.

Captain Pattie and the crew will operate the flight predominantly out over the wider Hauraki Gulf area. During this time they will undertake a number of fuel tests confirming and measuring the performance of the engine and fuel systems at various altitudes and under a variety of operating conditions.

The test flight is a joint initiative between Air New Zealand, Boeing, Rolls-Royce and UOP, with support from Terasol Energy, as part of commercial aviation's drive for more sustainable air travel for future generations.

In other news --

• Some good 787 news
• Aussie air force needs to borrow airline pilots - seriously
• IATA - more bad news
• TUI sees synergy benefits

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Note to Gulf carriers

The note can be summed up as follows: Watch out.

The relatively stable travel consumption that continues in the Gulf region is not going unnoticed. Competitors are going to step in and increase competition that these airlines have never seen before.

For example: British Airways expects revenues from the Middle East and Asia to hold steady this fiscal year despite the global economic slowdown, its regional director said on Wednesday. "Asia and particularly the Middle East have a solid base of business and premium traffic driven by economic growth and we are turning some of our capacity to the Middle East," he told reporters. "There's pressure on your profitability because of fuel costs but there is huge demand in passengers," he said, adding the region adds about 17% to airline revenues.

In Abu Dhabi, Baird said BA planned to increase weekly flights to the Gulf Arab region to 61 from 56 currently. "We have to stay competitive and fight on quality and price. We had to stimulate demand and so followed other airlines (in cutting prices)."

With this move BA will of course attract the attention of AF/KLM and Lufthansa. Watch for them to match this move. The let's see how Etihad, Gulf, Qatar and Emirates respond.

In other news --

• The Fighting French
• Falling fuel price hammers United
• Show over at Eclipse?
• Lufthansa launches Italia - good bye Alitalia?

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Something you never wanted to know

At least this is how we feel. We have grown weary of the TSA and its abusive obsession with security. Read this article and you might also start feeling the same way, if you don't already.

"18 air marshals have been charged with felonies, including at least three who were hired despite prior criminal records or being fired from law enforcement jobs. A fourth air marshal was hired while under FBI investigation. Another stayed on the job despite alarming a flight attendant with his behavior." This sort of news one expects from a third rate nation, not the US. It is appalling and we all know what happens next - the TSA leadership will obfuscate and rally around to shut this all down.

The primary problem here is government with no checks and balances. Everything has been allowed or covered up under the blanket of security. Every stupidity has been glossed over - all in the name of protecting the public. The article is an appalling testimony to what happens when people in government are given unbridled power. Americans may want to pay special attention to the new administration and its plans for this insanity. Let's hope that change starts with the TSA.

In other news --

• Airbus and Boeing may need to help customers in 2009
• Qantas makes cuts
• Revised airport reports
• Slowly the truth comes out

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ILFC set for management buyout

Bloomberg reports that SUH and friends will buy back the firm from troubled AIG. In 1990 AIG bought ILFC for $1.3bn. Now it seems the sale will be at ~$10bn. ILFC has $50bn in assets.

What everyone seems to forget is that ILFC grew astoundingly under the AIG flag. It got access to cheap capital - certainly at lower rates than it would have paid for otherwise. So leaving the protection of AIG may be necessary now, but almost certainly it will also mean a sharply higher cost of capital. This should also mean the firm will have to increase its lease rates. This in turn allows lower cost of capital competitors like ALAFCO an "in". Similarly, BOC should also be able to now lease at lower rates than ILFC. Not that ILFC will lose its top spot any time soon. But this does mean a change of long term impact.

In other news --

• Norway and the F-35 - more info
• F-22 trouble
• Fuel hedging continues to hurt
• Air France delays order - says Airbus & Boeing not ready

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Ethiopian buys Q400

Bombardier said on Thursday it signed a contract with Ethiopian Airlines for eight Q400s worth about $242m. The deal is for eight Q400NG with options for four more. A handy order for Bombardier and another sign that Africa's top airline (in terms of management) is making smart decisions. These planes will replace now old Fokker 50s.

For many African airports turboprops are still the way to go. And having the world's best and fastest turboprop can only ensure better service for Ethiopian.

In other news --

• More F-35 news
• Qantas fake engineer
• Boeing's fumbles
• IATA number

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CAI goes ahead with sale as Alitalia strikes keep on

Does this deal make any sense yet? The Italian government agreed to sell Alitalia's assets to a group of Italian businessmen at an improved price, paving the way for the relaunch of the bankrupt carrier in private hands after a two-year (read desperate) hunt for a buyer/investor.

That would be funny - Alitalia has assets? Anyway, CAI is buying something. It has not been announced yet exactly how much of the €1bn+ deal is really cash and how much is assumed debt. Meanwhile the pilots and flight attendants are striking anyway. They really do hate to work, and a privatized airline will see their lifestyles brought down to earth rather suddenly. Protesting workers have canceled hundreds of flights over the past 10 days and Alitalia will have to cancel 100 flights a day until the end of November. Thankfully this is about 10 days away.

The new airline will have less staff they say. Also its till not clear if the airline will stay with Skyteam or go over to the dark side with Star. Its actually a wonder anyone wants anything to do with this company.

In other news --

• C-130 fire bomber video
• RR to cut 2,000 more jobs
• Leisure travelers want WiFi - shock!
• The SJ-30 lives
• AF/KLM results

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Tourism industry guidelines

This is not public information, but gives a clue to where the US travel industry is headed. Just wait for January 5th, airlines will have to start fare sales.

Arkansas - So far we seem to be holding our own compared with 2007.

Arizona - statewide room demand is down 4.1% September CYTD.

Florida - a drop of 3.2% in visitor volume to the state

Florida Keys - occupancy is -1.8%

Hawaii - Visitor days: -7.6%; Visitor arrivals: -9.1%; Domestic arrivals: -10.6%; International arrivals: -4.5%

Illinois - Down 1.1 percent for room demand through September YTD

Iowa - January - September had a -3.1% drop in visitation to attractions. January - October had a -6.6% drop in travel parties to the welcome centers. January - October casinos are down -1.4%.

Las Vegas - year-to-date visitation thru September is -2.5%; 10% drop in visitation for the month of September

Massachusetts - rooms sold dropped 4.5% in September and October looks even worse

Michigan - hotel occupancy declined 9.2% in September 2008, as compared to the same month in 2007.

Missouri - Hotel occupancy down statewide: - 3.2%

Montana - down 3.7% through September.

New Hampshire - for June-August, experienced a 5.5% drop in lodging occupancies and a 2% drop in visitor trips.

North Carolina - YTD room demand is down 4.2% through September. September was the worst month of the year with a 10% decrease in demand.

Pennsylvania - Welcome Centers experienced a strong downturn in the number of visitors assisted in July and August (more than 20% drop each month compared to 2007. Calls to the state's toll-free tourism number have also really dropped off. Some of this is due to the ever increasing use of the internet for travel information, but the total number of travel guides ordered via the state's tourism website and tourism number are both way down -- when the total number ordered has been relatively stable over the past several years.

South Carolina - Room demand was down 3.7% September CYTD.

Vermont - vacation planning requests have gone to an 30 year low, except for overseas international requests since mid September.

Washington State - September shows demand for this year down 2.5% over September 2007

Southwest moves into LGA

Southwest plans to buy ATA Airlines so it can obtain the bankrupt carrier's operating slots at LaGuardia, the airline confirmed Tuesday evening. This is BIG news that no doubt kept many people up late last night. Southwest just entered the fray in an unexpected way by jumping into the market. When Southwest does this, watch out everybody else. Take a look here for details. With 14 slots, Southwest can play a highly disruptive role. This airports is the closest to Wall Street - before you laugh, there are still a lot of people working there. Many of them have had to curtail their travel. With Southwest at LGA, guess what, travel might be allowed again. Once the Wall street crowd discovers that flying this airline does not make anyone sick - and hey they have in-flight Internet - the decision by Southwest to attract business fliers is on. This move shows that Southwest management is very smart. It also helps they so much money. Great move Southwest. Now watch the NYC fares drop in certain markets as if by magic.

In other news --

• China spoils the Su-30 market - again
• SAA fleet renewal - advantage Airbus
• United wins over pilots
• BA win for Thales
• Stelios, the orange man, goes red; MOL sees green

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US airlines struggle to offload older planes

Bloomberg has a good story here. The bottom line is that US airlines, mismanaged for so long, missed a step (yes surprise!) in the industry evolution. That meant living with a generation of planes longer than they should have. But for the oil shock, it may have been OK. But this industry is always running into something.

The consequence of starving the fleet for a generation means that what they have now is basically crap. That's the word with the "s" missing up front. No airline can afford to buy these older planes for fear of fuel burn and even if they did, they can't get loans. Moreover, traditional places like Africa and South America are less interested in worn out planes. Nigeria's airlines, once a key market, cannot buy these planes by law now.

Which goes to show that airlines, and US airlines in particular, should have invested in their business rather than skip a generation. While they were focusing on cost cuts, perhaps those cuts were in the wrong places. Too much at the bottom of the labor pool and too little at the top. Oh well. The most important question is, have they learned their lesson? The answer is up for debate.

In other news --

• Outsourcing is no panacea
• GOL losses continue
• China's airlines get lost of help
• easyJet's results - and clouded future
• Qantas 744 jinxed?

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Vijay Mallya pushes the edge

There is interesting news about the evolution of India's airline industry. Clearly the business has seen some shocks - deregulation, many start ups, massive capacity increases, horrible pricing, collapses and now all manner of co-operation.

However, in this link you will notice the following key words "The Indian government currently doesn't allow overseas airlines to purchase stakes in local carriers. Overseas investors that aren't airlines are allowed to own up to 49 percent of an Indian carrier."

Mr. Kingfisher, not satisfied with the collaboration with Jet, wants to reduce his risk further. He wants the state to allow him to sell 25% of his airline to another airline. This tells us quite a bit about him. He pushed the state into granting his airline overseas flights. He had to buy them, but the deal was allowed. Now he is at it again. Pushing for something the state may not be able to handle easily.

Note the three airlines named. Of these Virgin is the least likely as it has the least money. Then comes BA, but it too is cash strapped. That leaves Singapore. The latter, bruised by its China experience will tread very carefully in India. Singapore is also familiar with being seduced by a charismatic airline CEO and should not believe anything he says unless it is verifiable.

Mr. Mallya needs the cash - badly. His airline is not really strong - he had to give up its A345s to Nigeria after all. People are not drinking enough Kingfisher beer (we are doing our part by the way) to help him. It will be interesting to see how the state reacts. After all, the state sort of helped Jet already, so why not a hand to Mallya? But allowing foreign airlines in is a really monumental step. Is India ready for this?

In other news --

• Great Gripen update
• easyJet upsets
• Another ASPIRE success
• EADS' results
• Gatwick and the easyVirgin consortium

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China's airlines are in deep trouble

Readers are aware that we have been going on about how tight the industry has become in China. The seemingly unstoppable airline industry with its voracious appetite fro new planes is nowhere near as big and strong as the Chinese government would have us believe. Take a look here.

$878m in late fees may not look like much. But much of this is over 90 days old debt. The sad truth is that China's airlines don't have the money because the state keeps interfering in the industry. The question is how much longer the state will mess with fares and fuel prices - the bet is a long time - before the industry simply seizes. It seems clear to us that a big Chinese airline bankruptcy is a real possibility. Therefore one has to think how the state will handle that. Obviously they will fudge it as something else - maybe a merger. But a forced merger will simply hurt the industry even more.

By the way, you need to wonder where all those new planes are going to go, too.

In other news --

• The VLJ is dead
• Predator - the most successful post Cold War airplane?
• It's nearly over for Austrian
• Pilot union action reignites
• Eurostar shines

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Handy A320 order - EU airlines wary

Air Arabia firmed options for 10 A320s, following up on their order for 49 aircraft (34 firm, 15 options) signed at last year's Dubai Air Show. The airline said it needs the additional planes for expansion and its new Moroccan base opening next year.

Morocco has an open skies regime with the EU, and therefore Air Arabia Maroc (AAM) has an open door out of Casablanca. This operation is being viewed skeptically by a number of EU airlines.

Even if AAM starts small, it can cherry pick and this is irritating for legacy carriers. LCCs always pick away at the margins to establish themselves. With lower labor rates they they lower costs and therefore are able to create traffic. Clearly Air Arabia will be watched warily.

In other news --

• European Air Transport Fleet - savior of the A400M?
• Oman and the Typhoon
• Another fastener snafu for Boeing
• Visa waiver to boost South Korean traffic
• Delta's big push overseas - but what about Oceania and S. America?

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Virgin is watching you...

We took a look at site traffic and came across this weird URL. Something about Virgin.... so we dug a bit deeper and lo! What did we find. Take a look at this link. Mouse over any of the dots and you get a link, click on that and you get to see the original source. This means SRB and Co. can monitor everyone who says anything about them in near real time. No wonder they are able to respond to everything overnight. Sneaky and clever all at the same time.

Think the US airlines have had a bad year? Guess what? Its going to get worse. Sure the price of fuel dropping has helped, as has a stronger dollar. In fact, the combination of a weak dollar and high fuel costs hurt US airlines more than their competitors, and now that scenario has reversed.

The big fear now is plummeting consumer confidence and ever softer forward bookings. The fall-off-the-cliff date is January 5th. By then all holiday traffic will be over and its up to corporate travel to sustain the industry through winter. Fat chance of sustaining anything you might think.

Continental and Southwest recently downgraded their outlooks for future revenue trends. American Express' corporate travel arm predicts airline revenue outlook will worsen in the coming months. Delta CEO Richard Anderson warns employees that it is "moving into an unprecedented time in all of our lives in terms of the financial crisis around the world, and we just don't know what it's going to do to our demand." AirTran CEO Bob Fornaro says "We're going to be cautious about how we manage our expenses, and we're going to be biased toward having fewer airplanes."

So we expect to see more capacity cuts this winter. Which means more layoffs and consequently an even tougher economy to work with for the new President. Given Obama's pro-labor views, how he copes with the rising unemployment matter is going to be interesting. As the Chicago-Tribune points out, "the airline industry is embroiled in contract talks on an unprecedented scale: 16 airlines in 2009 ... (face) negotiations with all their unions," It does not look like 2009 will be a good yer, does it?

In other news --

• Alitalia - the show that never ends
• 787 keeps 767 sales ticking
• BAA and cheap labor
• Emirates' results

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Bad times are back for the aviation sector and, says Tony Tyler, CEO of Cathay Pacific Airways, there is no point pretending otherwise. Tyler spoke at the Australian Airports Association National Convention in Perth.

He went to say, “Cathay Pacific has only once recorded a full-year loss in our 62-year history. That was 10 years ago during the Asian financial crisis; what happened then was that the Asian economies went into severe recession, people stopped traveling, businesses went bust, employees lost jobs, and so on. Sound familiar? I’m sure it does, only this time, it’s not Asian, it’s global.”

“Our front end business has been hammered, as the great majority of our corporate customers are in the banking and financial sector. Unlike some, we haven’t adopted a slash and burn policy. That means not cutting back on the premium product we deliver that separates us from many of our competitors. The heart of our strategy is to keep our network intact and our team together. But we’ve had to adjust our services to fit in the environment in which we now find ourselves operating. That has meant redirecting some of our services from non-profitable routes to ones where we are more likely to get a return."

Tough times but Cathay will maintain its premium product and service levels. Its not the easy thing to do, but it is the right thing.

In other news --

• China and the recession
• Amazing nuke story
• Obama and open skies
• Heathrow - pressure mounts
• Lufthansa takes a breather

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How can one explain this? The five unions representing Alitalia's pilots and flight assistants said they would strike for one day on November 25 in protest at a takeover of the ailing airline by the Italian investor group, CAI.

The unions have rejected new contracts offered by CAI, refusing to join other key employee groups that have backed the takeover deal. CAI has decided to go ahead with its bid anyway, offering to pay €375m for the bankrupt carrier's assets and take on debt worth €675m.

The five unions rejecting the deal complain that the new job contracts discriminate against mothers with small children or employees with handicapped family members. CAI denies the accusations and has said it will approach pilots and flight staff directly to offer them a job. There you go, right out the US manager playbook - appeal directly to staff.

The truth, as many know it, is that the airline's flight crews have had it easy - no, they have been living in fantasyland. The example given before of crews working a Rome-Bangkok flight, getting five days off and then deadheading back to Rome is obviously not the way to run an airline. If a flight crew on this route qualifies as a "mother with small children", it would seem the mother needs adjustment of her own, not the airline.

In other news --

• LiveTV adds new services
• BOC plays the strong hand
• Qantas sees falling traffic
• Israel and the F-35

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Kuwait's Aviation Lease & Finance Co (ALAFCO) is pressing ahead with its $10bn deal to buy aircraft from Airbus and Boeing despite the global financial crisis, and still sees positive growth in 2008. Chairman Ahmad Alzabin told the Reuters Middle East Investment Summit that ALAFCO confirmed orders to buy 70 aircraft from Airbus and Boeing for delivery between 2009 and 2017.

ALAFCO is set to announce "good" earnings in the fourth quarter of this fiscal year to September 30, but could see a margin squeeze next year with higher financing costs. While ALAFCO expects aircraft prices to fall as airlines struggle through the downturn, it does not anticipate making any writedowns as a result. This is surely putting on the bravest of brave fronts.

Clearly if this firm has access to capital, now is the time to get deals like never before. OEMs are ready to do really good deals to avoid white tails. The key here is access to capital. If ALAFCO has to tap banks then it will face tough scenarios. Even if the banks start to ease credit, it will take a while to undo the squeeze. On the other hand, ALAFCO might be clever and start with tapping regional sovereign funds as an interim step. This means it gets the best prices on planes now - even airlines may be selling delivery slots or be keen on sale and leasebacks. With these deals in hand, ALAFCO can then wait a year or two to refinance the deals with banks, and with these deals award sovereign funds for the bridge finance.

As the downturn bites deeper, access to cash could give ALAFCO is critical opportunity to move into the top tier ranks of the industry. How it moves next will be crucial. Which brings us back to the brave front. For now ALAFCO is playing cool, giving the impression it is not in need of the banks' capital. That can only mean it has a line into the region's alternative capital sources.

In other news --

• Flydubai plans quick start
• Airbus' quiet tanker orders
• South Korea sees service shrink
• BA's results

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Here is a summary of the most recent reports--no good news

easyJet said its load factor in October, a key industry measurement, was 83.9%, up from 82.5% a year ago. It also said in a statement it carried 3.96m passengers in October, up 18.4% year-on-year.

Thai Airways returned to a net profit in the third quarter on Wednesday as a huge foreign exchange gain more than offset high jet fuel costs. Passenger revenue rose 10% to THB43bn, but it posted a loss from operations of THB3.2bn versus a profit of THB2.43bn a year earlier. The airline posted a foreign exchange gain of THB4.73bn in the quarter versus a loss of THB3.36bn a year earlier, mostly due to the conversion of a loan into baht terms.

Cathay Pacific warned potential fuel hedging losses of about $360m would contribute to "disappointing" results for 2008. Last week Cathay said it planned to shed five jets from its fleet and warned of slowing bookings as it cuts costs in a worsening travel and aviation environment. Cathay also said that in the week ended October 25, net revenue from passenger services, cargo and mail and excess baggage was 4.4 percent below target.

SAS posted a bigger-than-expected pretax loss on Wednesday after a large goodwill write down at its Spanair unit, sending its shares lower. SAS plans to sell off non-core units, including its stake in Britain's bmi. CEO Mats Jansson said SAS was eying developments at bmi. SAS owns the last 20% in bmi.

JAL will probably report a 40% drop in group operating profit for the half-year to September 30 and is likely to fall short of its projected profit of Y50bn for the full year, the Nikkei financial daily reported.

Continental Airlines said it expects domestic revenue per available seat mile to rise only 4 to 6% in November, citing softer yields and a weaker economy.

In other news --

• Remember those huge orders?
• westJet links with oneworld
• Greece names Olympic interests
• Singapore results

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China Airshow news -- In addition to the GECAS order for the ARJ21, Airbus got an order from BOC for 20 A320s. Of the 20, 17 were Skybus positions. So the order is really only 3 new planes. BOC Aviation, the largest Asia-based aircraft leasing company, now has orders for 98 single-aisle aircraft from Airbus, of which 58 had been delivered.

The Rostov Helicopter Production Complex (Rosvertol) signed a contract for the delivery of a Mi-26TS helicopter to China at Airshow China 2008. This would be the second Mi-26 China has bought. Of course China is likely to take the helicopter apart to see how its made. But this particular helicopter is the world's biggest and requires highly sophisticated part manufacture. China is not there yet we would think.

In other news --

• Saudia selects Rockwell Collins
• Turkey's UAV dilemma
• Emirates enters a dogfight - quietly they say
• Changes - after the US elections, what next?

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We will continue to hold personal views out of this election, but there is some news readers might find interesting. In Pennsylvania there is a hot race and it may well be that John Murtha, famous for his mouthing off, is about to get canned. The reason this gets any attention here is this: Big Mouth is chairman of the House Appropriations Committee. What does this mean? he's the man who decides where the money goes - as in, where the Pentagon gets to buy tankers.

If Murtha loses - and it looks likely - his replacement at the hot seat will be Norm Dicks (D-Washington). You do not need an MIT PhD to figure out what comes next. Dicks is closer to Boeing than the clothes you're wearing. Northrop Grumman may as well pack up and leave town if Dicks gets the seat. Then again, the Pentagon may be in for awful times too. Barney Frank (D-Massachusetts) wants to cut the Pentagon's budget 25%. Oh boy, what a day we are in for.

In other news --

• China's odd spacewalk
• China, Taiwan and Hong Kong
• Competition is good - US DoT discovery
• Singapore discovers ancillary revenue - not good news

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Yes, we expected this. But so soon? MOL obviously thinks he can get planes really cheaply now. The plan will be revealed when MOL announces the firm's quarterly results on tomorrow.

"Economy class will be very cheap, around €10, but our business class will be very expensive," he said in a newspaper interview. Ryanair's second quarter profits are expected to fall, due to higher fuel prices and its decision to cut fares.

MOL is expected to announce plans to buy more than 50 extra aircraft, as part of plans to beat the recession by undercutting more expensive rivals. "We'll just have to keep flying more aircraft, opening up more routes and offering people more cheap flights." Talk about hubris.

The destination list includes New York, Florida, Los Angeles, San Francisco and Boston (all from STN and/or DUB).

But lest we forget - even the east coast will be a five hour flight - maybe five hours 30 minutes to save fuel. That means a lot more than €10. Baggage costs and buying refreshments will be serious cost impacts - probably 500% increase in the up front costs. Also, can anyone sit in a 29inch pitch for that long and not suffer DVT?

By the way we hear the folks at Hartford are frantically working on something. Wonder if there is any relation to this news?

One more thing - what airplane will they get their hands on? A330s perhaps. But how about 767s with a dirt cheap trade in deal for 787s when these become available?

In other news --

• Lots of BA news
• Air Asia X adds Thales IFE & connectivity
• China's air show
• Ryanair's results

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