Emirates abandons SriLankan management, to retain 43.6% stake for the moment

Emirates has announced that it will not renew its existing ten-year contract for the management of SriLankan Airlines, the national carrier of Sri Lanka. The management contract expires at the end of Mar-08.

Tim Clark, President Emirates Airline and Managing Director Sri Lankan Airlines stated: "Emirates has notified the Government of Sri Lanka that it will not be renewing the Shareholder's Agreement which expires on 31st March 2008 and accordingly, with effect from 1st April 2008, management control of Sri Lankan Airlines will pass to the Government of Sri Lanka. Emirates will continue to manage the Company until 31st March 2008. Emirates will also retain its 43.6% equity in the Company for the time being, and continue to have a Board presence."

Revamped branding for airberlin

The airberlin group has revised it brand identity and launched a new advertising campaign. The repositioning of the airberlin group as a global business is associated with the group’s acquisitions, which is to be reflected in the airline’s image.

With immediate effect, the airberlin logo will be a combined mark, consisting of a figurative and a word element, and will be used internationally. The company name will be in lower case and written as one word. The colour HKS15 remains the same, but the font is now "Chalet airberlin". The new claim is: "airberlin. Genau deine Airline." (airberlin. Your kind of airline.)

The airberlin.com website has already been revised and features the new image. The first print advertisements will appear from 07-Jan-08. The outdoor advertising campaign will start on 11-Jan-08 in 21 German cities, as well as in Vienna and Zurich. The television commercials will run from 19-Jan-08. The first aircraft bearing the new livery will be rolled out in Jan-08, with the other aircraft being gradually updated throughout the year.

Joachim Hunold, airberlin’s CEO commented: "On account of our growth in recent years, passengers now benefit from a wider range of flights and a dense network within Germany, taking them to major cities throughout the world and to holiday destinations. Business travellers should feel just as comfortable on board as families, enjoying the same personal attention on longhaul and on short-haul flights. This makes airberlin the perfect airline for every passenger, meeting individual travel preferences and service expectations. The new branding emphasises this claim."

Monarch Airlines carries 3.7 million scheduled passengers in 2007

Monarch Airlines celebrated a record-breaking year carrying 3.7 million scheduled passengers during 2007, a 15.8% year-on-year increase.

The launch of eight new routes during the year helped passenger numbers surge with the introduction of Birmingham to Ibiza; London Gatwick to Ibiza and Murcia; London Luton to Almeria, Ibiza and Larnaca as well as Manchester to Ibiza and Jerez services.

Capacity increases on a number of popular routes and the launch of further new services in 2008 is expected to further stimulate growth for the airline in 2008. Following on from the successful launch of services from London Luton to Larnaca in Mar-07, the LCC will continue its expansion to the Eastern Mediterranean, as well as add a new service from Manchester to Murcia in Feb-08.

Passenger traffic for Dec-07 also improved 10.6% year-on-year to over 184,500 passengers.

ISLAND AVIATION GOES REGIONAL

Island Aviation has received operations permit from the Government of India to operate schedule flights to Trivandrum, India. Special ceremony was held on 07th January 2008 at Nasandhura Palace Hotel on 07th January 2008 to officiate the handing over of this permit to Island Aviation.

Executive Director at the Civil Aviation Department, Mr. Mahmood Razee handed over this permit to Island Aviation. Mr. Bandhu Ibrahim Saleem – Managing Director of Island Aviation received this on behalf of the company. Mr. Razee and Mr. Saleem made their statements at this ceremony. Mr. Mahmood Razee in his speech said, quote "IAS is an operating airline meeting the aeronautical requirements stipulated under the Maldivian Air Legislation. The choice of jet or turboprop for sector lengths of about 500km is fundamentally driven by economics. IAS by choosing to commence services with a turboprop airliner has also addressed some of the other elements of the business for this level of stage lengths” unquote.

Managing Director of Island Aviation, Mr. Bandhu Ibrahim Saleem stated in his remarks, quote “To realize our goal, we will continue to invest in our expansion this year as well” unquote.

The first flight from Male’ to Trivandrum will be operated on 25th January 2008. Dash8 aircraft will be used for this operation and daily flights will be operated between Male’ and Trivandrum. All the departures from Male’ will be at 1530 hrs everyday.

AIRPORT NEWS

Indian government seeks low airport fees

The Indian government has asked private companies developing new airports at Hyderabad and Bangalore not to make flying out of them prohibitively expensive for passengers.

Agreements currently in place allow an airport development fee of US$17 to US$23 to be charged per passenger, however the aviation ministry has requested that the GMR and Siemens Project Venture-led consortias wait until the delayed Indian Airport Economic Regulatory Authority (see: Regulator planned for India’s airports) is in place to decide on a more ‘reasonable’ amount.

With fuel and congestion surcharges and other fees plus rising fares, the cost of flying from these airports could potentially become too expensive for passengers. “As it is there are serious connectivity issues. With road networks still incomplete, the airports are nearly a two-hour drive away from the cities and are costlier to get to. If in addition, passengers have to pay up to US$25 (Rs 1,000) more for flying out, the reaction could be adverse,” says a senior official

Mumbai airport to be revamped by year-end

Right: The first phase of a facelift of Chhatrapati Shivaji International Airport should be complete by the end of this year

The Mumbai state Government has prioritised US$13.2 million for a facelift of Chhatrapati Shivaji International Airport.

The project will be undertaken by airport operator, Mumbai International Airport (MIAL), and will be carried out in two phases: Phase one will see the upgrade of Terminal 2A and phase two will renovate Terminals 2B and 2C. Phase one is scheduled for completion by the end of this year.

The programme also includes upgraded runways, 106 aircraft parking stands, 51 boarding bridges and 316 check-in counters.

Changi seeks stakes in overseas airports

Right: Changi International Airport is part of a network of airports owned by Changi Airports International

Changi Airports International, the overseas investment unit of Singapore’s main airport operator, plans to buy stakes in as many as 15 airfields, says chief executive officer Chow Kok Fong.

Chow says the company aims to manage US$700 million of airport assets within the next three years and that overseas revenue in five years may climb to as much as 20% of sales from less than 5% now.

The company wants to tap growth in the Middle East, China and India, where governments are upgrading airports as more people fly. Global passenger air traffic is projected to jump 29% by 2011, threatening to overwhelm airports, according to an October 2007 forecast by the International Air Transport Association.

The company secured its first direct investment in China last month, acquiring a 29% stake in the Nanjing Lukou International Airport for US$138 million. Funding for future purchases will mainly come from its parent, says Chow.

“We are looking at several deals, which we hope will crystallise over the next three years,” he adds. “A lot of the growth that we expect in China will come from the central and western region. So, we will be spending a lot of our efforts in that region.”

China Scurries To Contain Mice On United Flight

The United States, concerned about tainted imports from China, has exported its own batch of potentially harmful goods to Beijing in the form of mice on a flight from Washington, state media said on Tuesday.

Chinese inspectors found eight mice, dead and alive, on a United Airlines flight to Beijing after the airline reported the stowaways to local quarantine officials upon landing on Sunday afternoon, Xinhua news agency said.

The report prompted an "emergency team" to rush to the aircraft, Xinhua said, to "put rat poison and mouse traps at every possible corner on the aircraft, including the cockpit".

"Eight mice, dead and (alive), were found at last... hidden in pillows," the agency said.

The surviving mice were sent to labs for testing, it said.

The incident was reported in most newspapers on Tuesday, citing experts warning of dozens of fatal viruses that the mice could spread, and the risk of deadly accidents from them chewing through the plane's wiring and circuits.

"We are taking this matter seriously and have begun a full investigation with the authorities to determine how this happened and ensure it is resolved," United Airlines said in a statement.

"It would be inappropriate for us to comment further at this stage as the investigation is currently under way."

China has been rocked by a number of quality scandals involving food, toys and drugs in recent months, but has repeatedly accused foreign media of biased reporting, while making a point of naming foreign companies it claims have sub-standard product problems. (Reuters)

China Eastern Shareholders Sink Singapore Air Deal

China Eastern Airlines shareholders rejected a deal to sell a 24 percent stake to Singapore Airlines for USD$920 million, opening the door for bigger rival Air China to make a play for the country's third-largest carrier.

Analysts say loss-making China Eastern, squeezed by record fuel prices, would return to the negotiating table with Singapore Air and its parent Temasek to try and get a better deal.

A less favored option would be to submit to the Air China group's advances.

Singapore Airlines, the world's most profitable airline, which had hoped to gain access through the acquisition to China's fast-growing air travel industry, said in a statement it was disappointed but would continue to build a relationship with China Eastern.

The collapse of a deal two years in the making and blessed by the Beijing government highlights the unpredictability of a Chinese corporate scene that usually bows to politics.

Cathay Pacific, which already has an alliance with Air China, has bolstered the airline's case by saying it would seriously consider teaming up on a joint investment in China Eastern.

"There's not much difference between domestic airlines in terms of management expertise and branding," China Eastern Chairman Li Fenghua told reporters after minority shareholders torpedoed the Singapore Air deal.

"In this case, one and one would not equal more than two."

Air China's parent, China National Aviation Corporation (CNAC), has said it will submit a rival offer for China Eastern within two weeks.

The battle over an airline that has made losses in three of the past five years underscores the lure of an industry dominated by three players but which is growing at more than 16 percent a year ahead of this summer's Beijing Olympic Games.

"Air China seems committed to making a higher bid. But Singapore would have brought a lot of international management expertise to China Eastern," said Kelvin Lau, analyst at Daiwa Institute of Research.

CNAC, which owns 3.9 percent of China Eastern but which has more than 12 percent of its Hong Kong stock, had argued for weeks that the sale to Singapore was being done on the cheap -- a perennial worry among domestic investors fearing a fire-sale of Chinese assets to foreign firms.

Shares in China Eastern and Singapore Airlines were suspended on Tuesday, pending the vote. Air China ended the day down 3 percent as investors cashed out of its recent rally.

Days ahead of the vote, CNAC had signaled it would try to derail the agreed HKD$3.80 per share sale to Singapore Air, saying it would offer at least HKD$5 a share. Singapore Air and China Eastern insisted their deal was fair at six times the airline's end-2006 book value.

Analysts say Air China feared the creation of a strong competitor based in the commercial hub of Shanghai -- where Air China is traditionally weak.

Some said investors may now favor a tie-up between China Eastern and Air China, the world's most valuable airline by market capitalization, especially if Cathay gets on board.

Others said Singapore Airlines and Temasek could be persuaded to return to the table with a sweetened bid.

"With the deal vetoed, SIA's out of the picture for the time being. Obviously, that's a positive for both Cathay Pacific and Air China -- less competition," said CLSA analyst Adrian Lowe.

"My sense is they'll probably give up, given how things have played out, (but) some minority shareholders from China Eastern are hoping for a bidding war." (Reuters)

AirAsia launches direct flights to Yogyakarta

Beginning 30 January 2007, AirAsia will commence direct flights to Yogyakarta, Indonesia from Kuala Lumpur, documenting its entry into its 13th destinations in Indonesia. The Airline of the Year 2007 has the most extensive service into Indonesia sprawling across cities such as Bali, Balikpapan, Banda Aceh, Bandung, Batam, Jakarta, Medan, Padang, Palembang, Pekan Baru, Solo, Surabaya and now Yogyakarta.

AirAsia will begin with four (4) flights per week to Yogyakarta departing from LCC Terminal, Kuala Lumpur on Monday, Wednesday, Thursday and Saturday. The airline’s new 180-seater Airbus A320 will be deployed for the route.

Yogyajarta is a city with outstanding historical and cultural heritage. Renowned for being the centre of classical Javanese fine art and culture, Yogyakarta is also known as one of Indonesia’s most important centres for higher education. A visit to Kraton, the Royal Palace of the Sultan, will have one mesmerized with Gamelan, the beautiful Javanese traditional music and Ramayana ballet.

Tony Fernandes, Group Chief Executive Officer of AirAsia, said, “Yogyakarta has long been on our list of destinations that we want to fly to and it certainly adds value to our route network. The new service into Yogyakarta augurs well for both countries in promoting the exchange of tourist, labour, and small and medium enterprise traffic. In addition, year 2008 marks an exciting year for Indonesia as it is Visit Indonesia Year and we are excited to be able to play a key role in promoting the beautiful city and people of Yogyakarta to the rest of the world.”

“By means of AirAsia’s extensive route network in ASEAN, amazing low fares and high safety standards, we are optimistic in boosting tourism economy for all the countries we fly to, and specifically in this case, we are also looking forward to strengthening our domestic routes in Indonesia via our hub in Jakarta.”

easyJet to maintain one bag rule

The Government recently announced that on 7 January 2008, the restriction of one piece of hand luggage will be lifted at 22 of the UK’s airports. This will leave 40 key commercial airports with the one bag rule still in place, including easyJet bases at Belfast, Bristol, East Midlands, Liverpool and Luton. In addition, some of the BAA airports, notably Gatwick, have applied to the CAA for a price increase.

easyJet has decided to maintain its policy of allowing each UK departing passenger to carry one piece of hand baggage (dimensions up to 55x40x20cm with an unlimited weight allowance). Passengers are advised to check this website for more information on baggage allowances, but can be assured that by following this simple policy, they can continue with their journey as normal.

Andy Harrison, easyJet’s Chief Executive, commented: “There is massive scope for customer confusion in an environment where UK airports are adopting different policies. The only way to maintain a simple and standard policy is to maintain our one bag policy.”

“Also some of the major BAA airports are using the relaxation of the one bag rule as a pretext to further increase passenger charges. They increased charges when the restriction was introduced and now they want to increase charges again to remove it! easyJet will continue to resist such attempts and calls on the CAA for its full support”

Singapore Airlines starts operations at Changi Terminal 3

On 9 January 2008, Singapore Airlines will be the first carrier to operate from Changi Airport Terminal 3. Operations will start close to noon, with SQ 001 being the first flight scheduled to arrive at the new terminal at approximately 1150 hours.

SQ 318, bound for London, will be the first flight to depart from Terminal 3 at 1250 hours. Terminal 3 check-In counters will be operational from 0900 hours. All passengers departing Singapore for the UK will leave from Terminal 3.

With effect from 9 January, Singapore Airlines will operate from both Terminals 2 and 3, and the commencement of services from the new terminal marks an expansion of Singapore Airlines operations at Changi Airport.

“The addition of Terminal 3 is another jewel in the crown for Changi as it cements its position as a leading international hub. Singapore Airlines is excited to be part of its growth, and we are confident that the new terminal will complement our operations at Terminal 2,” said Singapore Airlines Senior Vice President Product and Services, Yap Kim Wah.

“Customers will now enjoy the benefits of having access to two world-class terminals – state-of-the-art facilities, modern design, thoughtful service and of course, more choice.

Needless to say, we are extremely honoured to be the first airline to start using Terminal 3, and we’re sure our customers are equally looking forward to being the first to enjoy such a world-class facility,” said Mr Yap.

With the expansion of services, customers departing from Changi Airport will check-in at Terminal 2 or 3 for their flights, depending on their destination.

Flights may arrive at either Terminal 2 or 3, and information on the arrival terminal will be available at least 2 hours prior to the estimated arrival time.

Jet Airways launches new direct flights to Muscat and Doha

Jet Airways announced the launch of its daily direct flights to Muscat from Kochi and Kozhikode (Calicut) and Doha from Mumbai and Kozhikode. With the introduction of these flights, Jet Airways will expand its Gulf route network, effective January 23, 2008.

Jet Airways will introduce its service on the advanced Boeing 737-800 aircraft on these sectors. With the induction of these new flights Kozhikode will be the second city in Kerala to be connected by Jet Airways’ international services to the Middle East.

Announcing the launch of these new flights, Mr. Sudheer Raghavan, Executive Vice President - Commercial, Jet Airways said, “The introduction of Jet Airways’ operations to Muscat and Doha is part of a well planned strategy of the airline to expand its international operations in the Gulf region.”