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Friday, 01 July 2011 00:00

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AirBaltic: It’s now over a year since AirBaltic began evaluating narrow bodies to renew its medium-haul fleet and replace its current fleet of eight 737-300s, six 737-500s and two 757-200s. However there is a need to strengthen its capital base before it can order the 20 or so new aircraft it believes are required. It is seeking to simplify and streamline its fleet to just two aircraft types, Dash 8-Q400s and 737NGs or A320s and this decision is becoming urgent owing to the high fuel prices. Already it began replacing its Fokker 50s with Dash 8-Q400s. It currently has eight but wants about 20 Q400s by 2014-15. At present, all 737s and 757s are on operating lease and in spite of the challenge in the financing of the new aircraft CEO Bertolt Flick stressed “We really need to make a decision this summer.” AirBaltic has also become the first airline in the world offering discounted tickets for passengers during the flight which will secure discounted future flights for loyal customers. Tickets purchased onboard can be used for the next flight, or given as a gift. The tickets will be on sale on all airBaltic flights with one-way fares starting at €30, including airport fees.

 

 

Air Berlin: Air Berlin is expanding its codeshare agreement with oneworld partners and having concluded codeshare agreements with American Airlines, Finnair and S7, contracts with Iberia and British Airways will follow shortly. Becoming a member of the oneworld global airline has been one of the most important business decisions since the company's public offering according to CEO Joachim Hunold.

 

American Airlines: Having resumed its Chicago-Dublin service on 5th April and indicating that it planed to maintain the service for winter 2011/12, American Airlines announced it has now downgraded it again to seasonal.

 


 

Blue air: Blue air which already operates from Bucharest and Bacau to Dublin is to add Cluj on Fridays and Sundays as an en route stop on the Bucharest service from 1st July to the end of October.

 

 

Cimber Sterling: According to the Danish newspaper Borsen, Ukrainian billionaire Ihor Kolomoisky is to buy Cimber Sterling. The paper quoting sources in the Danish government claiming he plans to merge Cimber Sterling with Swedish Skyways, which he bought in December. Neither airline was willing to confirm anything. “We are in negotiations with several investors… But we cannot disclose their names yet,” said Jacob Krogsgaard, CEO of Cimber Sterling. Kolomoisky already owns three carriers in Ukraine – Aerosvit, Dniproavia and Donbasaero and together they constitute 48.5% of the Ukrainian market. He is also believed to own another Ukrainian carrier, Windrose, which he denies!! Cimber Sterling held an Extraordinary General Meeting (EGM) on 8th June which agreed to elect Kåre Bo Stolt to the board of directors. It also agreed an investment proposal from GEM Global Yield Fund Limited based in New York. GEM is to provide a drawing facility of DKK 300 million (€40.22 million), and will subscribe to new shares in the airline. It will not be lending money to Cimber Sterling, but as and when Cimber Sterling draws on the facility, GEM will subscribe to the new shares in the company. The agreement will be in place for three years.

 

Germanwings: Germanwings which operates three times per week on the Dublin-Cologne route, has introduced a section of more comfortable seating on its aircraft with a more spacious seat-pitch, offering an extra three inches, in the first 10 seat rows on all its 30 A319 aircraft. This option can be booked at a premium of €15 compared to its regular seat selection which costs €8. The ‘Best Seat’ is included in their best tariff bundle which includes a seat reservation, snack and drink while flying and one item of luggage. This bundle can save passengers 35% if they book in advance, rather than booking each of these features separately once on the aircraft. Other Germanwings options include Flex-fare, which allows up to five pieces of baggage and change reservations within certain limits. Their ‘Private Seat’ product allows you to buy the seat next to you for the same price, or for the going rate if you choose this later than your reservation. All options can be booked on the airlines website or through their call centre.

 


Iberworld (Orbest Orizonia): Iberworld Airlines, a charter airline based in Palma de Mallorca, Spain, was re-branded and changed its name to Orbest Orizonia on 1st May. The airline was founded by Grupo Iberostar a tour operator owning Holiday resorts and hotels. In 2006 Grupo Iberostar decided to sell the airline and it became a part of the new Orizonia Group owned by the UK's Carlyle Group (55%), Spain's Vista Capital (36%), the ICG Equity Fund (5%) and ten of the company's managers (4%). The airline operates two Airbus A330-343Xs and six A320-214s, the latest of which EC-LLX was delivered from Finkenwerder to Norwich for painting on 7th June and has entered service in the new Orbest Orizonia colour scheme.

 

Lufthansa: Lufthansa is making every effort to bring its European network business back to profitability, according to its CEO Christoph Franz. He confirmed that Lufthansa had incurred a multi-million euro loss on its European routes in the first quarter. Measures have been taken such as reducing capacity by using smaller aircraft and 50-seat regional jets are now used on some European routes. Lufthansa has also announced a simplification of its baggage allowance policy with effect from 1st June. It is also applying the “piece concept” to their baggage policy rather than weight and it depends on class on travel. Economy passengers will be allowed one piece weighing up to 23 kg, business class will be allowed two bags with a combined weight of 64kg and first class can take up to three bags weighing 32kg each. Previously, economy passengers could only take 20kg of baggage, but there was no ‘one bag limit’.


 

Lufthansa Italia: Lufthansa Italia, which was launched in 2008, will cease operating at the end of the summer timetable and its eight Airbus A319 aircraft will be redeployed. It had announced weekend charters serving Dublin from Milan Malpensa as part of its extensive summer 2011 season leisure charters.

 

Norwegian Air Shuttle: Norwegian Air Shuttle has signed a letter of intent with Icelandair to acquire three Rolls-Royce Trent 1000-powered Boeing 787-8s that Icelandair currently has on order. Two of the aircraft are expected to be delivered during the first half of 2013 and the third in early 2015. Norwegian is leasing two 787-8s from ILFC in late 2012/early 2013.

 

Turkish Airlines (THY): Turkish Airlines has joined forces with Manchester United to launch a new inflight safety video featuring some of the club's players such as Wayne Rooney and Nani. It is aimed at making safety information more engaging for passengers. The video, which is being screened from June, follows Manchester United's involvement in the current Turkish Airlines television commercial and forms part of the airline's on-going sponsorship deal with the club. Meanwhile its chief executive, Temel Kotil, has called for Boeing to consider installing new engines on its 737 aircraft rather than waiting for a new aircraft design that won’t be ready until the end of the decade.

 

 

United Continental Holdings: United Continental Holdings, formed by the merger last October of United Airlines and Continental Airlines, is moving toward a single designation by the Federal Aviation Administration. The company's chief executive Jeff Smisek told shareholders that the integration of the two airlines is on track and should be completed by year's end. The company hopes to realise more than $1 billion (€695 million) in annual revenue benefits and cost savings by 2013 and a central focus of integration is combining workforce at the two carriers. Already there are rumblings of discontent and pilots picketed the company's annual shareholder meeting. Unionised United and Continental pilots challenged Smisek's assessment that integrating the two companies into a single Federal Aviation Administration (FAA) operating certificate is on track. The company is discussing pilots’ contracts and unions, which represent more than 12,000 pilots at the combined carrier, has said that "until an agreement is reached, this merger cannot be considered anything close to a success." Mr. Smisek told shareholders he wants a contract with pilots, but any deal must be “affordable and fair”. United Continental Holdings services to Ireland are operated under the Continental brand, although Aer Lingus and United Airlines operate a joint venture on the Madrid-Washington route. There is unlikely to be much change to the Irish routes except possibly from Belfast, although the joint venture could end following the merger. While the route is valuable to Aer Lingus, it is probably less valuable to United and losing a third code-share partner (after Delta and American) would be bad for Aer Lingus. When the route was launched United was short of suitable equipment and had no money. Continental however operates a Boeing 757-200 service to Madrid from Newark and this could provide a feed in their network at least as good as Washington. In addition the joint venture operation has been very sensitive to the unions who consider it as "outsourcing".

 


This article first appeared in the July 2011 Issue of FlyingInIreland Magazine


 


 
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