Category Archives: Airplanes and Airports

Could Perimeter Exceptions at Reagan National Foreshadow LaGuardia’s Future?

By Benét J. Wilson / Published February 26, 2015

Rush hour at LaGuardia Airport. Photo: AirwaysNews

Rush hour at LaGuardia Airport. Photo: AirwaysNews

As the Wall Street Journal reports on possible exemptions to the 1,500-mile perimeter cap out of LaGuardia Airport, AirwaysNews looks back at what happened when exceptions were put in place at Ronald Reagan National Airport, which has its own 1,250-mile perimeter rule. Exemptions out of LaGuardia could allow for direct flights to Los Angeles and San Francisco.

 

Since May 1966, a perimeter rule has been in place at Reagan National
restricting airlines from operating nonstop flights to airports beyond 650-mile perimeter, with an exception for seven cities between 650 and 1,000 miles away. The rule was originally put in place by the FAA, which cited jet noise concerns over Washington, D.C., and a potential conflict at the then-new Washington Dulles International Airport.

In 1986, Congress transferred authority over Reagan National and Dulles from the federal government to the Metropolitan Washington Airports Authority (MWAA). It also expanded the perimeter at 1,250 miles, which allowed nonstop flights to Houston and Dallas.

Ronald Reagan Washington National Airport. Photo: AirwaysNews

Ronald Reagan Washington National Airport. Photo: AirwaysNews

In 1999, thanks to the efforts of Sen. John McCain (R-Ariz), the FAA reauthorization bill included language that allocated 12 roundtrip slots for flights outside the 1,250-mile perimeter. The slots eventually benefitted McCain’s hometown airline, America West, which ended up offering three flights a day out of Reagan starting in 2004.

Six years later, in July 2005, McCain introduced a bill that would have gotten rid of perimeter restrictions at Reagan and prevented enforcement of the perimeter rule at LaGuardia. The bill failed, but McCain brought it back four years later, where it also failed.

Under the FAA Modernization and Reform Act of 2012, signed by President Obama on Feb. 14, 2012, eight daily slot exemptions (four roundtrips) at Reagan National were created for airlines with little or no service at the airport to serve cities farther than 1,250-mile perimeter.  from Washington. Since Congress first created slot exemptions at Reagan in 2000, DOT has added exemptions for 20 new roundtrip flights.

The Future of LaGuardia

Howard Mann, a vice president at Campbell-Hill Aviation Group, an air service consultancy in Alexandria, Virginia, sees the Port Authority of New York and New Jersey studying possible exceptions for flights to Los Angeles and San Francisco as natural. “The timing could be political to pave the way for a deal with airlines and other stakeholders,” he said. “But there certainly is interest in the proposal. And because the port manages all three New York area airports, they will have to analyze how what happens at LaGuardia will impact the other two facilities.”

Flights to Los Angeles and San Francisco are attractive because they are the largest source of O&D traffic for business and leisure travelers, said Mann. “But there are also other markets of interest out of LaGuardia, like Seattle, Las Vegas, San Diego and Phoenix,” he said. “A similar expansion happened at Reagan National under the perimeter rule. Any airline that is already at LaGuardia and maintains a national network would certainly be interested in service beyond the perimeter.”

The approach onto LaGuardia Airport Runway 13/31. Photo: AirwaysNews

The approach onto LaGuardia Airport Runway 13/31. Photo: AirwaysNews

Reports say that the port would do its study on longer-range flights out of LaGuardia in a fair and transparent manner, said Mann. “I think the Port Authority will always be required to do what it can to ensure the future of aviation in the largest O&D market in the country,” he said.

The port will look at everything from slots, to new facilities, to studying runway capacity, said Mann. “These are all things they should do, as the agency tasked with looking at the future of aviation in New York.” he said. “It needs to look at service to different communities and what airlines can expect in the short and long term.”

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By the Numbers: Airlines and the Winter Storms of 2015

By Benjamin Bearup / Published February 23, 2015

As U.S. carriers dig out from this weekend’s Winter Storm Pandora, AirwaysNews looks back at the thousands of cancelled flights across the country this winter and how the airlines managed operations during brutal conditions during what has shaped up to be a challenging storm season.

Two months into 2015 have brought several major winter storms. While severe winter storms, such as Marcus and Octavia in February, each caused major delays across the east coast of the United States, Winter Storms Linus and Juno each crippled much of the Eastern seaboard, causing tens of millions in economic impact on airlines.

Winter Storm Octavia brought snow and ice across the Midwest and into the Southeast. Major U.S. airports, including Memphis and Charlotte, were affected, with hundreds of flights cancelled. This storm took a more southern path and hit airports that are usually not accustomed to severe winter weather. For this reason, large delays and cancelled flights were forced as proper equipment for treating airfields and aircraft often was not available to meet demand.

Winter Storm Juno hit the Northeast hard in late January. This monster dropped more than two feet of snow in Boston and forced the cancellation of more than 8,900 flights,. In turn, the storm affected more than 700,00 passengers, costing them upwards of $350 million.

Chart: Courtesy of masFlight

Chart: Courtesy of masFlight

According to data and analytics firm masFlight, in 2015 alone, U.S. airlines have cancelled more than 28,800 flights due to severe winter weather. The flying public has lost an estimated $1 billion in out-of-pocket expenses and lost productivity as a result of cancelled flights. So far, two million passengers across the country have had their travel plans disrupted due to winter storms.

“So far, the cancellation impact of the 2015 winter season is trending slightly higher than what we are used to seeing during this time of year,” according to Edmund Otubuah, managing director at masFlight.  “I think this really highlights how brutal the 2014 winter season was to airline operations, where the U.S. airlines cancelled over 42,300 flights during the same period.”

A JetBlue Airbus A320 at JFK Airport. Photo: Benet J. Wilson / AirwaysNews

A JetBlue Airbus A320 at JFK Airport. Photo: Benet J. Wilson / AirwaysNews

The Northeast has been the hardest-hit region in 2015. Major airports such as New York LaGuardia, New York JFK, Newark, Boston and Philadelphia have all seen major flight cancellations and delays.

Jetblue Airways, which operates its only hub at New York JFK and its largest focus city at Boston Logan, has been the heaviest-hit airline this winter. The cancellation rate during this time reached an astounding 11.5 percent. American Airlines/US Airways, with hubs in Philadelphia and New York JFK, had a cancelation rate of 6.9 percent. United Airlines, with its large Newark hub, rounded out the top three with a 6.3 percent cancellation rate.

Airlines across the country helped the more than two million travelers by waiving change fees on impacted routes during a short time frame. Nearly all domestic U.S. carriers operating in the Northeast region offered impacted passengers support in varying degrees.

One such carrier is Southwest Airlines who allowed impacted customers a one-time change in their itinerary and no fee. This only applied as long as passengers flew within 14 days of their original flight and to the same city pairs. “Safety is our number one priority. If it’s not safe to fly, we won’t fly. We are working with Customers to reaccommodate them on different flights,” said spokesman Dan Landson. “We are also keeping everyone updated with a travel advisory that’s being updated as needed at Southwest.com. We encourage customers to visit the travel advisory for details and reaccommodation policies.”

With more than two million passengers impacted and nearly 30,000 flights cancelled so far, the winter of 2015 continues to challenge airlines and passengers across the country.

Cover Image: Courtesy of BWI Airport

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JetBlue Will Land in Daytona Beach In 2016

By Jack Harty / Published February 13, 2015

Photo: AirwaysNews

Photo: AirwaysNews

DAYTONA BEACH, Florida: JetBlue Airways will launch daily flights between Daytona Beach, Florida, and New York JFK Airport with an Airbus A320 starting in February 2016. Daytona will become JetBlue’s eighth destination in Florida and the city’s only nonstop service to New York.

JetBlue’s announcement is a big sigh of relief and a celebration for Volusia County, which has been trying to recruit the carrier for several years. There have been dozens of face-to-face visits between airline officials, airport staff and local business leaders, and 30 local business have pledged guarantees of $250,000 in pre-paid airline tickets for the first year of service in a travel bank managed by the Daytona Regional Chamber of Commerce.

The airport is offering an incentive of $400,000 in advertising, with the costs shared by the airport, the Daytona Beach Convention and Visitors Bureau, the Southeast Volusia Advertising Authority and the West Volusia Advertising Authority.

Other New York City Attempts

Although this will be Daytona’s only nonstop service to New York City, it will not be the first time that an airline has attempted to serve the market. Continental Airlines offered daily nonstop flights between Daytona Beach and Newark for close to 18 years, but the airline cut the flights when the 2008 recession occurred.  AirTran AIrways launched daily service to New York JFK AIrport in March 2008, but eventually ended it.

Delta Air Lines attempted to fly Saturday-only seasonal flights between New York LaGuardia and Daytona Beach with an Embraer E170/175 when it was first known that the airport and JetBlue entered talks about possibly starting flights. Unfortunately for Delta and the airport, it was difficult to make the flights work, and the service was subsequently cancelled.

A Sigh of Relief

“This is great news for this community and our airport. This is the result of the community’s support that County Council has received to recruit JetBlue as an important new business partner at Daytona Beach International Airport,” said Jim Dinneen, Volusia’s county manager in a press release.

Image: Courtesy JDL Multimedia

Image: Courtesy JDL Multimedia

“We couldn’t be more excited to launch yet another route that shows our deep commitment to Central Florida,” said Scott Laurence, JetBlue’s senior vice president of airline planning in the release. “We also have a long-standing relationship with Embry-Riddle Aeronautical University and are pleased to give the academic community there a new option for travel.”

The new service to Daytona Beach will create a direct link between JetBlue’s hub in New York and Embry-Riddle Aeronautical University. In 2007, JetBlue partnered with Embry-Riddle to launch the University Gateway Program, a unique opportunity that creates a path to a career with the airline for aspiring aviators.

“This new route will provide a much needed service for our growing community and strengthen an already great relationship between Embry-Riddle and JetBlue,” said Dr. John P. Johnson, president of Embry-Riddle in a statement.

The airport is currently served by Delta and US Airways/American Airlines. Will JetBlue be able to survive on the route? Many are optimistic. Plus, JetBlue will inaugurate flights just before the Daytona 500 and the spring break season.

Cover image: Courtesy of JDL Multimedia

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Contact the author at Jack.Harty@AirwaysNews.com

Contact the editor at Benet.Wison@AirwaysNews.com

JetBlue Airways (NASDAQ: JBLU), New York’s Hometown Airline™, will launch a new route to Florida’s Daytona Beach International Airport (DAB) in February 2016. The airline will offer daily service from its home at John F. Kennedy International Airport’s (JFK) Terminal 5 — providing the Daytona Beach area with its only nonstop service to New York City. Daytona Beach will be JetBlue’s eighth in the Sunshine State. Tickets will be available for sale closer to launch date.

“This is great news for this community and our airport. This is the result of the community’s support that County Council has received to recruit JetBlue as an important new business partner at Daytona Beach International Airport,” said Jim Dinneen, Volusia County Manager.

“We couldn’t be more excited to launch yet another route that shows our deep commitment to Central Florida,” said Scott Laurence, JetBlue’s Senior Vice President of Airline Planning. “We also have a long-standing relationship with Embry-Riddle Aeronautical University and are pleased to give the academic community there a new option for travel.”

The new service to Daytona Beach will create a direct link between JetBlue’s main base of operations in New York and Embry-Riddle Aeronautical University, the world’s largest, fully accredited university specializing in aviation and aerospace. In 2007, JetBlue partnered with Embry-Riddle to launch the University Gateway Program, a unique opportunity that creates a path to a career with the airline for aspiring aviators.

“This new route will provide a much needed service for our growing community and strengthen an already great relationship between Embry-Riddle and JetBlue,” said Dr. John P. Johnson, President of Embry-Riddle.

JetBlue’s flights to Daytona Beach will be operated on a 150-seat Airbus A320 — the largest aircraft to serve the airport on a regular basis — and will offer the airline’s award-winning service featuring assigned and comfortable seating; complimentary and unlimited name-brand snacks; more than 100 channels of free SIRIUSXM® radio programming and 36 channels of free, live DIRECTV® programming on personal seatback televisions; and the most legroom in coach. (a)

Customers traveling between Daytona Beach and New York can enjoy onward connections to several cities in the Northeast with JetBlue as well as cities across the globe through JetBlue’s three-dozen international airline partners.

- See more at: http://otp.investis.com/clients/us/jetblue_airways/usn/usnews-story.aspx?cid=981&newsid=28632#sthash.JIecwbd6.dpuf

JetBlue Airways (NASDAQ: JBLU), New York’s Hometown Airline™, will launch a new route to Florida’s Daytona Beach International Airport (DAB) in February 2016. The airline will offer daily service from its home at John F. Kennedy International Airport’s (JFK) Terminal 5 — providing the Daytona Beach area with its only nonstop service to New York City. Daytona Beach will be JetBlue’s eighth in the Sunshine State. Tickets will be available for sale closer to launch date.

“This is great news for this community and our airport. This is the result of the community’s support that County Council has received to recruit JetBlue as an important new business partner at Daytona Beach International Airport,” said Jim Dinneen, Volusia County Manager.

“We couldn’t be more excited to launch yet another route that shows our deep commitment to Central Florida,” said Scott Laurence, JetBlue’s Senior Vice President of Airline Planning. “We also have a long-standing relationship with Embry-Riddle Aeronautical University and are pleased to give the academic community there a new option for travel.”

The new service to Daytona Beach will create a direct link between JetBlue’s main base of operations in New York and Embry-Riddle Aeronautical University, the world’s largest, fully accredited university specializing in aviation and aerospace. In 2007, JetBlue partnered with Embry-Riddle to launch the University Gateway Program, a unique opportunity that creates a path to a career with the airline for aspiring aviators.

“This new route will provide a much needed service for our growing community and strengthen an already great relationship between Embry-Riddle and JetBlue,” said Dr. John P. Johnson, President of Embry-Riddle.

JetBlue’s flights to Daytona Beach will be operated on a 150-seat Airbus A320 — the largest aircraft to serve the airport on a regular basis — and will offer the airline’s award-winning service featuring assigned and comfortable seating; complimentary and unlimited name-brand snacks; more than 100 channels of free SIRIUSXM® radio programming and 36 channels of free, live DIRECTV® programming on personal seatback televisions; and the most legroom in coach. (a)

Customers traveling between Daytona Beach and New York can enjoy onward connections to several cities in the Northeast with JetBlue as well as cities across the globe through JetBlue’s three-dozen international airline partners.

- See more at: http://otp.investis.com/clients/us/jetblue_airways/usn/usnews-story.aspx?cid=981&newsid=28632#sthash.JIecwbd6.dpuf

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Industry Leaders Share Passenger Experience Trends for 2015

By Benét J. Wilson / Published January 28, 2015

The passenger experience was a hot topic in 2014 as airlines and airports worked to make the travel process better. But despite these efforts, industry observers interviewed by AirwaysNews feel there is still more work to be done and offered up trends they expect to see in 2015 and beyond.

EXTRA: AirwaysNews High Flyer Interview: Luke Hawes of Priestmangoode

Craig Stark is AirGate Solutions’ managing partner and Robert Cook is a co-founder and member of the advisory board of AirGate Solutions. Stark said he and Cook got together to look at strategies in vertical industries like travel. “We saw a need for data analytics and data in support of the passenger experience,” he said.

The main cabin of American Airlines' Airbus A321. Photo: Chris Sloan / AirwaysNews

The main cabin of American Airlines’ Airbus A321. Photo: Chris Sloan / AirwaysNews

One trend is passengers are still being herded despite initiatives like IATA’s Fast Travel to simplify passenger travel, said Cook. “The primary focus is to get to the gate in the least amount of time, but there’s been no change on how to facilitate the process and make it easier for passengers,” he said. “There’s a disconnect between airlines and airports, because airlines don’t give enough information to airports to help passengers to the gate. I hope they will cooperate eventually.”

EXTRA: Use of Beacons to Improve the Passenger Experience Grows

Another trend noticed by Cook is that airline loyalty program are becoming less valuable and less positive. “You see people having trouble redeeming travel awards, you see points being devalued and airlines moving toward how much you spend rather than how much you travel,” he said. “And there will be an increased focus on the top five percent of travelers, who will continue to get perks like early boarding and free checked bags.”

But the industry can improve the passenger experience by helping those in the back of the aircraft, said Cook. “There’s a huge opportunity for airports, like operating lounges because airlines only focus on the five percent,” he said. “We already see airports starting to do this with products like Priority Pass.”

A Transportation Security Administration checkpoint at BWI Airport. Photo: Benet J. Wilson

A Transportation Security Administration checkpoint at BWI Airport. Photo: Benet J. Wilson

A big pain point for travelers is airport security checkpoints. “I see an expanded trusted traveler program that will speed up checkpoints, which are a major choke point in the travel process,” said Cook. “Programs like PreCheck and Global Entry are a welcome change. If more countries agree to have similar processes, we’d see a much better passenger experience.”

Having healthy food available in airports is another trend. “We did a project in Canada on restaurants attempting to steer people to nutritional labeling so they can be aware of what they’re eating,” said Stark. “We spoke with officials at Toronto-Pearson International Airport as part of that research. They noted that they worked hard to have a balance of 40 to 50 percent of airport restaurants offering healthier food, and we see more airports doing that.”

EXTRA: Alaska Airlines Introduces New Inflight Entertainment System and Other Small Upgrades

Jeff Klee, the CEO of CheapAir.com, feels that the network airlines are looking at the passenger experience because they finally don’t want to be seen as just commodities. “When you look at United, Delta and American, they have been more profitable and are investing that money back into their products,” he said. “The large airlines are trying hard to create a differentiated experience, while low-cost carriers are taking a different approach by not adding bells and whistles.”

The network carriers have really been focusing on premium cabins, said Klee. “In first and business class, they have invested in things like lie-flat beds and upgraded food. It’s much better than its ever been,” he said.  “And even in economy, inflight entertainment has been a big focus. We see things like carriers streaming movies and television to smartphones and tablets, adding personal video monitors with live TV and adding more WiFi access.”

EXTRA: American Airlines to Spend $2 Billion on Passenger Upgrades

The IFE system on JetBlue. Image: Courtesy of JetBlue

The IFE system on JetBlue. Image: Courtesy of JetBlue

With airports, there has been a big focus on improving food options, said Klee. “Options are much better, but there’s no pressure to offer free and better Wi-Fi,” he said. “Everything on the ground is getting better, which is good news, because passengers need it to get better.”

The airline industry will continue to split into two tiers — full-service and ultra-low-cost carriers, said Klee. “It used to be that passengers chose airlines based on who had the lowest fares, and the products and service available were pretty consistent,” he said. “But the rise of LCCs like Spirit Airlines and Frontier Airlines are giving passengers a lower fare never seen before without offering any extras, but with the ability to pay for an upgraded experience.”

Image: Courtesy Spirit Airlines.

Image: Courtesy Spirit Airlines.

EXTRA: Delta Unveils New Inflight Cabin Family of Products

Jason Rabinowitz, an AirwaysNews contributor, is the data research manager for travel data company Routehappy. “I think we’re finally at the tipping point with airlines, which have been making gradual changes over a number of years,” he said. “Enough passengers have experienced those changes first hand so they can offer an impression of the passenger experience and how it impacts them. They are finally aware of how these changes can help them find a better flight.”

A lot of the changes airlines have made have been on the technology side, said Rabinowitz. “For example, airports are finally offering free Wi-Fi that actually works,” he said. “We’re seeing airlines and airports investing in their terminals like what United is doing at Newark and what Delta has done at LaGuardia, with things like iPads, power outlets and USB chargers. There are even little things like Southwest putting cushy seats in its gate areas.”

EXTRA: JetBlue Touts Benefits of New Airline Seats Despite Less Pitch

With the airlines, passengers are seeing things like streaming Wi-Fi and internet connectivity that wasn’t possible two years ago, said Rabinowitz. “United has announced that its regional jets will be Wi-Fi capable, offering entertainment,” he said.

Jon Glick, director of transportation and logistics for Pricewaterousecooper, said the way to think about this is how travel is becoming increasingly stressful. “So some of the airlines feel if they can improve the passenger experience, it may translate into more loyalty and a willingness for a repeat purchase,” he said. “The idea is that if we can ease travelers’ stress, we’ll be able to gain more market share.”

Virgin America is especially known for its cutting edge innovation in inflight-entertainment systems. While other carriers are just now introducing advanced seat-back IFE’s on domestic U.S. Flights, every Virgin America seat has had this since the airline’s 2007 launch. Their system, known as RED leaped frogged jetBlue’s pioneering LiveTV system which is only now in the midst of its first upgrade since the airline’s 2000 launch. On May 21, 2009, Virgin America became the first U.S. airline to offer Wi-Fi access via Gogo Inflight Internet on every flight. VX’s Panasonic Avionics' IFE’s are already being updated to their 3rd version in 2013. Image courtesy: Virgin America

Virgin America’s RED IFE system. Image: Courtesy of Virgin America

If travel is stressful, airlines can differentiate their product to alleviate that pain, said Glick. “Looking inflight, inflight entertainment is something that can distract from their discomfort onboard. Customers live in an always connected world, and they are tied to their devices,” he said. “Business travelers are willing to pay to deliver that experience, but airlines are challenged to improve the quality of it. They are competing with terrestrial experiences, like streaming a movie.”

EXTRA: United Highlights Changes Coming to Newark Airport’s Terminal C

A restaurant that will open in United Airlines' Newark Airport terminal. Image: Courtesy of United

A restaurant that will open in United Airlines’ Newark Airport terminal. Image: Courtesy of United

From an airport perspective, some people want to minimize their time in terminals, said Glick. “But others don’t want to feel rushed. If airports and airlines work together to help maximize the experience that a passenger has while in the airport, it’s a great opportunity to take the stress of travel away,” he said. “Whether that’s things like traditional airport lounges, separate lounges for families or shopping and food concessions, these amenities help travelers enjoy the airport.”

Looking ahead, Pricecooperwaterhouse’s Glick says he sees more airlines moving toward self-bag tagging and self-boarding. “Putting some of the tasks that have been traditionally done by airline and airport employees now puts it in the hands of customers,” he said. “It will help eliminate long lines and put passengers in control of their time.”

Onboard flights, airlines will continue to experiment with inflight entertainment and Wi-Fi connectivity  products, said Glick. “They will begin to really answer whether these items are enhancers or revenue generators,” he said. “I think airlines will finally get the right balance.”

Looking at the past 20 years, the airlines have been a mess, said Klee. “But after bankruptcies and the basic struggle to survive, they now have a model that works. Fares are higher, capacity is lower and they’re making money,” he said. “Travelers prefer to see this returned in lower fares, but the airlines will continue to invest in their product.”

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Best of Airways Magazine – Good Jets Gone Bad

By Michael Zoeller / Published January 28, 2015

This article was originally published in Airways magazine in August 2012

International airports in the sixties and early in the seventies were home to arrays of gleaming Boeing 707s and 720s operated by the likes of Pan Am, TWA, Lufthansa and United Airlines. By the mid-seventies many of these aircraft had migrated to secondary carriers, cargo or charter outfits, perhaps no longer working out of a major airport but still plying the skies and making (or trying to make) a profit for their owners.

Former JAT 707-321 N723PA (msn 17601/ln 76, ex YU-AGA) parked on the south side of London-Heathrow by the Pan Am hangar on a gloomy day in November 1974. Oddly, the registration is painted on the nose. A close inspection revealed ‘Afric...’ titles under the white paint. All Images Courtesy of

Former JAT 707-321 N723PA (msn 17601/ln 76, ex YU-AGA) parked
on the south side of London-Heathrow by the Pan Am hangar on a
gloomy day in November 1974. Oddly, the registration is painted
on the nose. A close inspection revealed ‘Afric…’ titles under the
white paint. All Images Courtesy of Michael Zoeller

Toward the latter part of the seventies newer types were introduced, fuel prices had increased, and the once-proud first-generation jetliners were retired from frontline service and offered for sale. Some soldiered on, carrying passengers and cargo on a regular basis until time, literally, ran out. A handful of others ended their days flying for less-than-respectable owners to locations where ordinarily no questions would be asked as to the reason for the aircraft’s visit, its payload, maintenance history, or for whom it was flying.

Pan Am started phasing out its non-turbofan 707s in 1970 when the value of the aircraft would have been around $1.5 million (equivalent to $8.7 million today). Many were sold in the United Kingdom, Turkey, the Philippines, Yugoslavia, and of course the USA. Ten years later one could be acquired for less than $500,000 (now $1.4 million).

One such aircraft was Pan Am’s former Jet Clipper Aurora, 707-300 N725PA. It saw service with THY-Turkish Airlines, followed by a two-year stint with UK-based leasing company Tempair (Templewood Aviation). When the latter firm was liquidated at the end of 1976, the 707 was parked at Ostend, Belgium.

In December 1977 Lieutenant General Maurice F. Casey, trading as Burbank International, acquired the aircraft. At one stage during payment negotiations in Miami, a gun appeared on the table and the buyers tried to pay with Australian black opals. On February 17, 1978, wearing its new registration N725CA, the airplane was ferried from Ostend to Luton, England, for checks. Casey’s intention was to operate livestock flights between Miami and Venezuela, which was always going to be problematic because the aircraft was not equipped with a main cabin cargo door.

A special certificate was issued to ferry the aircraft from Luton to Miami via Gander, and the flight took place on March 8. Freelance navigator Dave Welch (Airways, January 2012, May 2011, July 2003, May 2002 & June 2001), who was on the flight, described the 707 as “a flying heap of sh*t.” Before its departure on March 8, N725CA carried out a test flight from Luton, during which a hydraulic cable broke loose, dumping a load of fluid over new cars parked at the nearby Vauxhall plant. This prompted the national press to refer to the aircraft as ‘The Luton Carwash Bomber’.

Welch adds: “We just managed to get the 707 airborne [on March 8] before a bailiff arrived at Monarch Engineering’s operations intending to slap a writ on it for all the damage. Vauxhall made a million pounds [£4.5 million/$6.8 million] insurance claim against Templewood, plus a large number of the population of Luton claimed that their cars were ruined too. On the way to Gander it developed the worst Dutch roll I ever experienced—twice at least. One problem was that one of the outer engines wasn’t giving full power.”

The aircraft never moved from Miami, although more than $73,000 (worth $220,000 today) of repair work, mainly to wing corrosion, was carried out during most of 1979. Three liens were placed on the 707 between March 1979 and October 1981, and at one stage it came close to being sold to a company in Wyoming. Finally the aircraft was bought by General Air Services in 1981, and broken up at Miami between September 1983 and January 1984.

‘The Bristol Cowboy’: the long-suffering 707-321, wearing the marks 9Q-CRY, at Lasham in August 1979, shortly before its departure for Bristol.

‘The Bristol Cowboy’: the long-suffering 707-321, wearing the marks 9Q-CRY, at Lasham in
August 1979, shortly before its departure for Bristol.

Meanwhile, the twilight years of sistership N723PA Jet Clipper Viking were anything but restful, and like Clipper Aurora, it gained national press coverage in the UK. After serving with JAT (Jugoslovenski Aerotransport) it was sold, via brokers, to United Trade International (UTI) and registered N711UT by the end of 1975. The president of UTI was Shirley Adams Soghanalian, wife of Lebanese-Armenian ‘merchant of death’ arms dealer Sarkis G. Soghanalian, and mother of Garabet Soghanalian, who ran Pan Aviation, an outfit that was at the center of a Federal Bureau of Investigation/Drug Enforcement Agency probe in the eighties on suspicion of drug running.

The 707 made an appearance at Stansted early in 1976 wearing an anonymous color scheme; it was in cargo configuration and reportedly had been operating out of Swaziland in 1974 for a company called Air Union, which might have been owned by Soghanalian too.

The airplane was seen at various locations between 1976 and 1979—Miami, San José (Costa Rica), Lisbon, Prague, Budapest, Sofia, and Athens—whence cargo flights to the Middle East were being operated. During this same period Sarkis Soghanalian was known to be selling arms to the Lebanese Christian Phalangist militia, and various factions in Ecuador, Mauritania,  and Nicaragua. But a blind eye was turned to much of this activity, such is the way of international politics.

A contemporary U.S. government report stated that the USA supplied a 707 plus crew to enable Christian forces in Lebanon to be equipped with arms. During one nocturnal delivery flight from Warsaw to Beirut without a flight plan, the aircraft refueled in Athens. When the 707 was ready to resume its journey, Athens Tower called and asked the crew to pull the airplane aside because two Greek customs officials wanted to inspect the cargo. Soghanalian asked the pilot if they could ignore the request and take off, but it was pointed out to him that the Greeks had an adjacent air force base and could deploy fighters.

The front section of the 707 had seating with the rear cargo area curtained off, where Soghanalian entertained the customs officials with Scotch and attempted to bribe them. But when they proved incorruptible, Soghanalian and the crew pulled guns on the Greeks, locked them in the airplane’s toilet, and took off.

Former TWA 707-331 N762TW (msn 17675/ln 74) in Air Tanzania colors, named Ngorongoro Crater, at London-Gatwick in May 1980. This replaced an ex-United 720-022 N62215 (msn 18080/ln 284).

Former TWA 707-331 N762TW (msn 17675/ln 74) in Air Tanzania colors, named
Ngorongoro Crater, at London-Gatwick in May 1980. This replaced an ex-United 720-022
N62215 (msn 18080/ln 284).

Upon arrival at Beirut the officials were released with the help of the Greek ambassador and sent home the next day on a commercial flight. Apparently the officials were not even missed in Athens. Luck ran out for this 707 when it was impounded in Helsinki in February 1979. However the airplane’s fraudulent activities were far from over, and it was about to take seat-of-your-pants flying to new levels. In the summer of 1979 the aircraft was released by the Finnish authorities to Air Union and ferried to Lasham, UK, for checks and a change of registration to 9Q-CRY (a fictitious one)—reportedly with its Yugoslavian registration YU-AGA still visible under a wing—while being readied for operations by ‘Khan Air’, flying livestock between the Arabian Gulf and India. Money for the maintenance work was not forthcoming, and the aircraft departed from Lasham for Bristol-Lulsgate with many defects still unrectified; for example, both compasses were unserviceable as were both HF (high frequency) radio sets.

The 707’s exit from Bristol for Kuwait on October 11 was spectacular, and even raised questions in the British Parliament. Using every inch of the runway upon rotation, it took out two 10ft (3m)-tall marker poles along with a portion of the airport boundary hedge. The crew consisted of a qualified British flight engineer, but the captain and first officer were a father and son team, Richard Khan Sr. and Jr., both with questionable 707 experience.

When the airplane subsequently received a 10-hour inspection in Kuwait with the help of Kuwait Airways, problems were discovered in the pressurization system, and metal bars were found hanging from the fuselage, wings, and landing gear, while gear locks were damaged, mainly by vegetation and undergrowth. Nevertheless it left Kuwait for Bombay (now Mumbai) in non-airworthy condition to complete a livestock charter.

For several months the aircraft operated cattle charters around the Arabian Gulf with the undercarriage locked down. On one occasion, despite being surrounded on the ramp at Sharjah to attempt to stop it from leaving, it managed to evade all of the ground vehicles and took off.

Destination was Luxembourg, but by the time the 707 was over Erzurum, Turkey, an emergency was declared as two engines had been shut down. The ailing airplane arrived at Ankara on January 25, 1980, and was hastily abandoned by the crew, who were unsure as to the true ownership of the aircraft or what to do with it. Eventually, the Turkish ministry of transport scrapped the 707 in 1984. As for the Khans, they were never heard of again.

TWA took longer than most other major carriers to phase out its 707s. Initially, some of the Dash 100 models were sold to Israel in 1971, but the later 707-300s did not leave the carrier until 1979 when they were almost at the end of their useful lives. One such aircraft was N762TW.

In March 1980 it was sold to Caledonian Airlines of Pennsylvania and flown to Miami for repainting in Air Tanzania colors before lease. Strangely, no color drawings of Air Tanzania’s complicated livery were available, so photos of one of the airline’s 737s were used for reference. The aircraft was delivered to Air Tanzania the following May.

No relation to the British airline with a similar name, this Caledonian was owned by George Hallak (aka George Khallaq), who also had an office in Beirut. Hallak was infamous among international law enforcement agencies for issuing illegal airline tickets and forged travel documents. As is well documented in a report by the U.S. Congressional Task Force on Terrorism and Unconventional Warfare, Hallak had helped the Palestine Liberation Organization form Caledonian Airlines and was involved in the PLO’s ‘investment strategy’ (he also facilitated the PLO’s purchase of part-equity in Transportes Aéreos da Guiné-Bissau). The former TWA 707-300 was seized by the Tanzanian authorities in July 1981 after Caledonian had defaulted on its contract with Air Tanzania; at the time it was the highest-time 707, with a total of 66,681 hours.

Air Tanzania’s earlier experience with Caledonian had also not been a happy one. A former United 720, N62215, was leased from December 21, 1979, arriving the following day in Dar es Salaam. Immediately upon arrival in ‘Dar’ it was pressed into service—not on the London-Gatwick route as the US flight crew expected, but flying troops from Mtwara, a Tanzanian coastal city, to Beira and Maputo in Mozambique, in connection with the transition of Rhodesia to Zimbabwe. When ‘conventional’ passenger services finally started, it became apparent that operating out of Kilimanjaro destined for Gatwick the 720 could carry only 29 passengers because of hot-and-high conditions at the Tanzanian departure point; an operational technicality that Caledonian had failed to mention to Air Tanzania. Consequently, the 720 operated only a handful of services before being replaced by the 707-300. Like the 707, the 720 ended its days rotting away in the African sun.

Although United started to dispose of its fleet of 29 ‘straight-pipe’ 720s in 1973, the majority served for many more years. One such aircraft was N7216U Jet Mainliner George R. Mann, which was sold to Aero Specialties in August 1973. The seats were removed, so ostensibly it became a freighter, but little happened in the way of flying until late in 1975, when it was sold to Dolphin Aviation of Sarasota, Florida, and was seen operating around the Arabian Gulf with ‘Pionair’ titles, the trading name of a small Ghanaian outfit called Pioneer Air Transport. The aircraft was returned to Dolphin at Bombay in March 1976 and was soon sold, via an agent, to Dick Wellman/Airmania, who operated ad hoc freight flights around the Middle East with two Douglas DC-7s, mainly for Air India. The agent took the money ($250,000, equivalent to $1 million today) and disappeared, never paying Dolphin.

But an agreement was somehow struck between Dolphin and Wellman, and although the 720 continued to fly in the region, it never returned to the USA. From 1976 onward the aircraft was seen at Abu Dhabi, Bombay, Dhahran, and Bangkok in a constantly deteriorating condition. But in April 1979 the Federal Aviation Administration, having inspected the 720 at Hong Kong, issued an emergency suspension of airworthiness because of its poor state. Since leaving the care of United, it had received only minimal attention. The 720 ended its days at Hong Kong-Kai Tak, with the question as to who the legal owner was remaining unanswered while the airframe’s value depreciated daily; it was finally broken up in April 1981.

During summer 1976, Lufthansa retired its Rolls-Royce Conway-powered 707-400s. Of the five the airline owned, four went on to work either directly or indirectly with infamous Biafra war mercenary pilot, Henry (Hank) Warton (aka Wharton). Born Heinrich Wartski in Germany in 1916, Warton emigrated to the USA in 1937. Postwar, he flew for or ran numerous freight airlines throughout Europe and beyond. During the Biafran conflict he operated a fleet of elderly and illegally registered Lockheed Constellations. Early in the seventies, he operated DC-7C freighters under the names North American Aircraft Trading and ARCO (Bermuda); the latter maintained bases at São Tomé and Príncipe, Basle, and Stockholm. Warton used his connections at Lufthansa to acquire, in association with M Marshall Landy, four of the former Lufthansa aircraft between September 1976 and August 1977 at scrap value prices.

The first was D-ABOG Bonn, which became N9985F. It had probably the most colorful career of all the ex-Lufthansa 707-400s. Upon delivery to Miami the 707 was converted to cargo configuration—or at least it was divested of its seats. Soon afterward Landy’s and Warton’s Air-Trans (a Bahamian corporation) leased the aircraft to International Aircraft Leases, which in turn subleased it to livestock specialists J D Smith Inter-Ocean of New York, which organized cattle charters to Central and Latin America, mainly out of Newburgh, New York. Occasionally the 707 flew for Lanica (Nicaragua). Some trans-Atlantic services were also operated to Ireland and France.

In August 1977 the aircraft was seized at Newburgh by the FAA for violations of Federal Aviation Regulations through poor maintenance procedures and inadequate safety equipment (with many safety placards still in German). But equally seriously in the view of the FAA, despite contracts stipulating that the aircraft would be operated under Part 121 rules, it was barely meeting Part 91 requirements. A hefty fine was paid by Landy, Warton, and J D Smith Inter-Ocean, and by the end of September Warton had the aircraft flown to Miami. (The FAA subsequently brought an action against Landy, IAL, Air-Trans, and the freight forwarder for operating without a certificate.)

By this time one of the other Lufthansa 707s had been written off. D-ABOB Hamburg had become 9Q-CRT and leased by Air-Trans to Pearl Air (Grenada), for which it carried out livestock flights around the Middle East (although there was speculation that other loads of dubious provenance were carried) until a hard landing at Sana’a, Yemen in August 1977 ended its flying days.

Meanwhile, Hank Warton had recruited a number of crews for a ‘secret’ arms flying operation out of central Europe to the Middle East and East Africa. A deal was struck for the US to clandestinely supply Soviet ammunition and guns to Somalia for its fight against the Ethiopians, with the USA’s aim of acquiring a bit of strategic real estate in the Straits of Hormuz. At the time Somalia had Soviet weapons but only US ammunition, while Ethiopia had US weapons with East Bloc ammunition. One of the recruits was John Lear, son of Learjet creator Bill Lear. He arrived at Frankfurt on October 22, 1977, and flew his first trip in N9985F on October 25, routing Budapest–Mogadishu; this was repeated three days later.

Flights to and from Budapest used the name ‘Fragtflug’, a defunct Icelandic operator owned by Loftur Jóhannesson, a billionaire arms dealer and friend of Hank Warton who had provided aircraft during the Biafran conflict. Over Yugoslavia, Air-Trans Miami became the operator. Flying over the Mediterranean the 707’s registration became the call-sign, and on contact with Jeddah, Saudi Arabia, Lear was instructed to use a Somali Airlines call-sign. The final leg from Jeddah to Mogadishu was flown under radio silence. If the crewmembers were questioned, they had been told to explain that were carrying ‘agricultural materials’ from Budapest to Jeddah.

Some 580 tonnes of arms were flown from Budapest to Somalia, and there is anecdotal evidence that N711UT was also involved in this operation. In October 1977, N64739, the former D-ABOC Berlin, which had been ‘converted’ to a freighter in a similar way to N9985F, joined the operation and was a regular visitor to Mogadishu for a month until November 4, when Lear flew it from Budapest to Stansted via Salzburg.

Evidently about this time the Somali operation ceased, as Lear collected another 707-400 at Stansted a few days later. It was 9G-ACK (formerly D-ABOF München), which was registered to Geminair in Ghana but flying mainly for Nigeria Airways with crews supplied by Air-Trans. From Stansted, Lear flew the 707 to Heathrow for a regular Nigeria Airways passenger service to Lagos.

Of all the ex-Lufthansa 707s, 9G-ACK was the most ‘above board’. Operating for established carrier Geminair it flew numerous leases and charters for DETA Mozambique, Sabena, Dan-Air, Monarch Airlines, British Airtours, and Britannia Airways between 1977 and 1980.

However, it was often called upon to operate for Warton during this period too, and for most of 1980 it flew on behalf of Nefertiti Aviation, a company heavily reliant upon Warton for aircraft and crews.

By July 1981, 9G-ACK had been returned to Air-Trans (if indeed it had ever really left in the first place) and was wearing the illegal registration N90498, earlier allocated to N64739, by then semi-derelict at Tripoli, Libya. Air-Trans applied for a special permit to ferry ‘N90498’ from Manston to Miami, but after leaving Manston the 707 never reached its purported destination; instead, it flew to Kano in Nigeria and was painted as ‘3C-ABH’ on one side and ‘3C-ABI’ on the other, under the control of another Warton company, Bata International Airways of Equatorial Guinea (a country familiar to Warton during his flights to and from Biafra).

John Lear returned to work with Air-Trans in October 1981 and flew this 707 Athens–Johannesburg–Cairo during the month, carrying arms and ammunition, and later Khartoum–Sana’a with cattle. Finally, as EL-AJC, the aircraft arrived at Bournemouth from Cairo in July 1983 in an anonymous all-white scheme, and was broken up at its final destination shortly afterward.

Meanwhile, N9985F had spent much of 1978 and 1979 one step ahead of the law, visiting Bucharest, Lisbon, Angola, and Ireland, all locations well known to Warton and in which he had contacts. Maintenance, such as it was, was carried out at Manston by Invicta Aircraft Engineering, whose Michael Harradine was the agent for Equatorial Guinea’s ‘flag of convenience’ register. Finally, the FAA caught up with the 707 at Manston in October 1979, when an inspection revealed numerous points of corrosion, including at the over-wing exits, a vertical stabilizer leading edge strip loose, and neither airworthiness certificate nor FAA-approved operating manual in sight. Unsurprisingly, the airframe was declared non-airworthy. Somehow the 707-400 was able to fly away from Manston and was noted early in 1980 flying cargo at Sana’a for Warton’s Anderson.

In August 1980 N9985F returned to Manston, where Anderson Aviation notified the FAA that the aircraft was being sold to Bata International—as 3C-ABH. From December 1980 the aircraft was painted in the same markings and registration as the other ‘3C-ABH’, even wearing two different registrations. The aircraft’s activities in its final days are difficult to trace, but what is known is that livestock flights were flown around the Middle East in 1982, and that by 1984 it was withdrawn from use at Tel Aviv in poor condition. By 1989 the remains were being used as a training aid by the Ben Gurion Airport fire service.

So, what of N64739, which had returned to the USA in November 1977 after its stint as a gun runner? It was registered in Ireland in August 1978 as EI-BFN with Intercon Air of Dublin, which already owned a Bristol Britannia and intended to use the 707 on long-haul livestock and general charters (N9985F had Intercon Air titles applied but never entered service); however, there were certification difficulties, and the aircraft returned to the US register with Landy at Manston as N90498 in January 1979.

That April it left Manson for Tripoli as 5A-CVA with STAC (Société de Transports Aériens Centrafricain), a company formed by Emperor Jean-Bédel Bokassa of the Central African Republic, to carry ivory for resale abroad.

Bokassa was overthrown in a September 1979 coup, and the aircraft was nominally transferred to United African Airlines, successor to STAC. The aircraft officially reverted to N90498 with Anderson Aviation in January 1980, but never left Tripoli, where it was broken up in 1988.

All these events took place three decades ago. After September 11, 2001, security around the aviation world was increased dramatically, but flights of a similar nature and dubious character are likely still taking place on a regular basis in less-regulated countries of the world.

Cover Image Courtesy of Michael Zoeller

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ANALYSIS: Fuel Buys Time for Alaska Air Group

by Vinay Bhaskara / Published January 27, 2015

An Alaska Airlines Boeing 737. Photo: Courtesy of JDL Multimedia

An Alaska Airlines Boeing 737. Photo: Courtesy of JDL Multimedia

Alaska Air Group reported a $148 million net profit for the fourth quarter of 2014 on January 22, delivering yet another quarter of record financial performance despite heightened competition. Excluding a $6 million fuel hedging gain and other special items, its net profit for the quarter (Q4) was still a record $125 million dollars.

For calendar 2014, Alaska reported another record net profit of $571 million excluding special items, up 49.1 percent YOY. Including a net $15 million mark to market fuel hedging gain and other special items, net profit for the year was also a record $605 million.

EXTRA: Lower Fuel Prices Help Alaska Air Double Its 4Q Profit

Quietly, as its larger peers underwent more aggressive and widely covered restructuring, Alaska has very quietly turned itself into a high-quality industrial company. Operating margins for 2014 expanded YOY to 17.9 percent on an operating profit of $962 million. Furthermore, Full year pretax margin came in at 17.2 percent (up 4.8 percentage points), while ROIC for the trailing 12 months totaled 18.6 percent. Admittedly, much of the gains were driven by fuel prices, but even without that headwind, the numerical improvement was substantial YOY.

For the full year, on an adjusted basis, lower fuel prices contributed $49 million, or 8.3 percent to Alaska’s bottom line on a decline in adjusted fuel price per gallon from $3.28 to $3.03. However in Q4, Alaska paid an adjusted fuel price of $2.58 per gallon, suggesting that Alaska has several million dollars worth of YOY expense reduction coming throughout 2014 if current prices persist (the IATA spot fuel price average for North America is $1.58 per gallon).

Photo: Chris Sloan / AirwaysNews

Photo: Chris Sloan / AirwaysNews

Alaska Airlines is still very much in a growth phase. Passengers carried rose 6.8 percent YOY, capacity as measured by available seat miles (ASMs) rose 7.1 percent YOY, and Alaska added more than two dozen new routes. In a normal environment, this would be margin dilutive due to its adverse impact on revenues, and you did see some of that with consolidated PRASM declining 2.4 percent YOY in Q4 (which cannot be fully explained by the after-Thanksgiving shift and increasing stage length). Furthermore, the strength of the local economy on the West Coast and especially in the Pacific Northwest helped buoy demand. But the massive reduction in fuel costs was the primary driver behind the scope of the expansion in Alaska’s margins.

Since Q2 of 2014, I’ve characterized Alaska’s network re-organization as a necessary project in diversifying its revenue base in the face of heavy competition from Delta at its highest margin hub. My reasoning was that while Alaska’s growth might dilute overall margins to some extent in the short run, the long run benefits of doing so would outweigh the short run travails, especially given the strong macroeconomic conditions in the U.S. But fuel prices will buy Alaska more time. Now, its new routes will have an extra year or so to mature in a low pressure environment, likely resulting in another yearly cycle of record profits.

There were several interesting items that came out of Alaska’s earnings call, and without diving too deeply into the details, here are a few that I found notable.

  • 2014 Free Cash Flow was $344 million, while operating cash flow was $1 billion.
  • On time performance was 86 percent, completion factor as 99.5%, and Alaska recorded a blended satisfaction score of 84 percent, a record.
  • Competitive capacity rose 7 percent in Alaska markets, 8 percent in Q4.
  • Alaska launched 16 new North American markets in Seattle (up to 79 total versus 26 for Delta). Seattle market share is 55 percent.
  • The seat retrofitting program on 737-800s and 737-900s has been completed, generating incremental benefit of $50 million annually.
  • Mileage Plan frequent flyer members were up 11.4 percent YOY.
  • Q1 2015 capacity growth projected at 11 percent, with 4 percentage points due to aircraft up-gauging. Calendar 2015 capacity growth is expected at 8 percent.
  • Paid first class traffic up 7 percentage pints in Q4 on roll out of discounted first class to 50 percent of markets by YE 2014.
  • Preferred seating product in Q2 for exit rows and bulkheads expected to add $15 million to the bottom line.
  • Revenue is management system being updated in Q1.
  • Profit sharing and incentive pay totaled $116 million, $14 million for operational performance rewards.
  • A large portion of the Q400 fleet is entering an engine overhaul cycle.
  • All 27 737-400s will be replaced by 737-900ERs by the end of 2017.
  • Mileage Plan growth has been highest in Salt Lake City and San Diego, new markets with a small base.
  • Oil prices have not had a major impact on volatility in State of Alaska demand. Alaska views the key oil towns as Anchorage and Prudhoe Bay on the North Slope, and it views North Slope projects as stable in the long run.
  • The 737-900ERs enable reasonably cost-neutral expansion in Hawaii.
  • Reduction in oil prices may hurt local consumer demand in Alaska.
  • Alaska wants to move up into the S&P 500.
  • Alaska’s fuel hedges versus those of Delta are not expected to affect competition in Seattle.
  • E175s expected to drive strength on long and thin routes.
  • Competitive capacity growth tails off over the course of 2015.
  • Business travel represents 30-35 percent of Alaska’s revenue.
  • Alaska is planning for the future as if fuel prices will be $2.90 per gallon.

Without diving too deeply into the specifics, the regional growth Alaska is pursuing is very interesting. Unlike the legacy airlines, Alaska is actually growing its regional business (3.6 percent YOY in 2014), and the recent decision to add yet more incremental Q400s and grow the E175 subfleet is interesting.

An Image Courtesy of JDL Multimedia

A Horizon Air Bombardier Q400 turboprop. Image: Courtesy of JDL Multimedia

The Q400s at least make some sense in that even if fuel rises, the fact that they are turboprops means that operating margins won’t suffer to deeply. The E175s on the other hand, while useful in a legacy sized network, might be difficult for Alaska to utilize during cyclical downturns. Remember, Alaska operated a subfleet of Bombardier CRJ700s on similar routes up until the global financial crisis, before largely abandoning those aircraft in favor of the Q400s. The structural conditions of the airline industry are infinitely better now than in 2009, but even so, this decision may prove unwise in the long run.

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Contact the author at vinay.bhaskara@airwaysnews.com

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Flashback Friday: Airbus A380 Planespotting

By Luis Linares / Published January 23, 2014 / Photos by author

DLH A380 FRA - LFL

Lufthansa Airbus A380 at Frankfurt International Airport

Our week-long commemoration of the 10th anniversary of the rollout of the Airbus A380 included the airplane’s history, statistics, and a unique passenger experience aboard the first A380 commercial flight.  As the number of A380 aircraft in service increases, so do the sightings.

I split my time between Miami and Washington, D.C., during a typical week.  I’m very new to the A380 world since I have never flown it and seldom see it.  However, over the last year I spotted the A380 at Miami International Airport (MIA) and Washington-Dulles International Airport (IAD) during my travels.  I also had the privilege of covering the inaugural A380 service to MIA.  On this Flashback Friday, I share some pictures and the stories behind them.

The first time I saw an A380 was at night as my Europe-bound aircraft took off from New York’s JFK International Airport in 2008.  It was an Emirates example, and to this day, the airline still flies it there from Dubai.  Fast forward to June 2014, when, after landing at Frankfurt International Airport, I saw a couple of Lufthansa A380s from my window seat and I had my camera ready.  Fortunately, 2014 gave me other opportunities to see more of the A380.

My current residence in Northern Virginia is located near the downwind flight path for many flights when they have to land to the north on either runway 1R or 1L at IAD.  It is very common for traffic coming from Europe to follow this arrival procedure when winds are out of the north.  I like to have my camera handy, especially on clear days, and this usually makes for some great spotting opportunities.

One clear evening, I was lucky enough to capture the daily Air France A380 flight as it turned from downwind to base before landing on runway 1R.  As a nice bonus, I caught it as the landing gear dropped.  One of the characteristics of the A380 that will immediately capture the attention of spotters and passengers alike is the very quiet engines.

AFR A380 IAD 1 - LFL AFR A380 IAD 2 - LFL AFR A380 IAD 3 - LFL AFR A380 IAD 4 - LFL   Air France Airbus A380 lowering landing gear as it turns from downwind to base before touching-down on runway 1R at Washington-Dulles International Airport.

Another A380 frequency to IAD is that of British Airways from London’s Heathrow International Airport.  I have been able to photograph this flight landing on runways 19L from IAD’s long-term parking lot on the northeast side of the airfield.  This is a good location in general for spotting landings when the winds are out of the south.

EXTRA: British Airways Launches A380 Service at Washington Dulles

BAW A380 IAD 1 - LFL British Airways Airbus A380 on final to runway 19L at Washington-Dulles International Airport

An even better treat at IAD is not just visiting the fantastic Smithsonian National Air and Space Museum annex, also known as the Steven F. Udvar-Hazy Center, but also going up to its observation deck, especially when flights are landing to the north.  On one of those very cold, but beautiful winter days, I shot the British Airways A380 during its final approach and touchdown on runway 1R.  The museum’s observation deck is on the southeast corner of IAD and offers a clear view of the entire airfield.  In addition, a live feed of ATC can be heard over the loudspeaker.

BAW A380 IAD 3 - LFL BAW A380 IAD 4 - LFL BAW A380 IAD 5 - LFL BAW A380 IAD 6 - LFLBritish Airways Airbus A380 seen from Steven F. Udvar-Hazy Center (Smithsonian National Air and Space Museum Annex) as it lands on runway 1R at Washington-Dulles International Airport.

Another unique experience at IAD is a ride on the vintage “moving lounges” that connect the main terminal to the two mid-field terminals.  Despite the opening of an underground train, these lounges still operate.  I had a couple of hours to spare on a recent trip from IAD to MIA, so I hopped on one of the lounges to photograph the British Airways A380 as it prepared for its return to Heathrow.  The two jet bridges to the lower deck and the one to the upper deck were clearly visible, as well as the service trucks designed to serve either of the decks.

BAW A380 IAD 2 - LFL        British Airways Airbus A380 parked at Washington-Dulles International Airport

I usually spend most of my work week in Miami and seldom miss a chance to do some planespotting at MIA.  The prime location has to be where NW 72nd Avenue dead-ends next to the holding point of runway 9.  Air France and Lufthansa currently provide A380 service to MIA and both use gate J17.  The Lufthansa flight typically departs about 90 minutes before the Air France flight arrives.  However, one evening the Lufthansa flight had a delay of over an hour, which I suppose was great for us AvGeeks, but an inconvenience for the passengers.  As a result of the delay, I enjoyed getting to photograph the Air France A380 as it landed, while the Lufthansa A380 was approaching the holding point of runway 9.

BAW A380 IAD 2 - LFL        Air France and Lufthansa Airbus A380s at Miami International Airport

The A380 will progressively become more and more of a common sight at some of the major U.S. international airports, as well as others around the world.  As part of this future increase in A380 sightings, the next A380 that will come to MIA will be operated by British Airways later this year.

Gate D10 in the North Terminal will be modified with the jet bridges necessary for the lower and upper decks.  As far as the A380 program itself, what remains to be seen is whether or not Airbus will upgrade the A380 with a new engine option (neo) and a stretch that will be known as the A380-900.  Based on comments from Airbus and interest from Emirates, the largest A380 operator, this will more than likely be the case.  The sole variant right now is the A380-800, since the freighter version never came to fruition after UPS cancelled its order.  In the meantime, we wish the A380 a very happy 10th birthday!

Editor’s note: Our readers now have access to our weekly eNewsletter, which includes a recap of our top stories of the week, along with the subscriber-only exclusive Weekend Reads column and Photo of the Week from our extensive archives. The newsletter comes out every Friday night. Stay in the know; click here to subscribe today!

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Contact the author at luis.linares@airwaysnews.com

Contact the editor at benet.wilson@airwaysnews.com

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Rewind: Dallas/Fort Worth International Airport Celebrates 40 Years

By Jeremy Dwyer-Lindgren

This article was originally published on January 13, 2014

Forty years ago, Dallas Ft. Worth International Airport received the first commercial air flight, starting off a long history for one of the world’s larger airports. The airport maintains a laundry list of superlatives, maintaining one of the largest people mover systems in the world, four workings runways at 13,000 feet, and its own postal code.

The airport celebrated this morning as DFW and American Airlines celebrated the arrival of flight 1461 from Little Rock, Arkansas. Yellow Texas roses were presented to each passenger as they deplaned, along with a slice of cake, mirroring the very first to arrive at the airfield in 1974. As the airport celebrates its birthday, we take a quick look back at the history of this remarkable airport.

DFW2 dfw4 dfw3
Photos courtesy of American Airlines

The idea for DFW first came to be in September, 1964. At the time the cities of Dallas and Ft. Worth both had their own separate airports: Love Field for Dallas, and Greater Southwest International Airport for Ft. Worth. The two cities maintained a rivalry between their two fields for years as both fought for passengers. As Dallas grew to overshadow its neighbor, so too did Love Field. By 1965 the airport hosted 49% of Texas air traffic, while Ft. Worth had declined to under one percent.

EXTRA: Dallas / Ft. Worth International Airport Photos

Seeing the writing on the wall a few years earlier, the FAA (named CAA at the time), in 1964, refused to continue financially support both fields going forward. It also ruled that both would be insufficient to meet future demand, and thus ordered the two cities to set aside their differences and create a joint airport.

The original plan for DFW. Quite ambitious. Photo courtesy Noah Jeppson Creative Commons / Flickr

The original plan for DFW. Quite ambitious.
Photo courtesy Noah Jeppson Creative Commons / Flickr

A site was chosen between the three towns of Euless, Irving, and Grapevine Texas, and ground was broken on the airport on December 11, 1968. The construction, which lasted five years, produced a truly monumental feat. The original four terminals enclosed nearly one million square feet of floor space, and each could handle up to eighteen 747s, the largest plane at the time. It is said that enough concrete was used to build the runways, taxiways, and aprons to build a four lane highway between Dallas and Oklahoma City (205.7 miles).

The completed airport was unveiled to the public in a lavish ceremony on September 20, 1973. More than 200,000 turned out for the dedication. But the big draw was the first visit of Concorde to the US. The  British Airways jet made a DFW its pit stop while en route from Caracas to Paris. It was accompanied on the apron by Braniff’s famous and first Boeing 747 “Big Orange”.

The field officially opened several months later on January 13, 1974, as American Airlines flight 315 from Little Rock touched down on the fresh runway. At the time Dallas-Ft. Worth Regional airport had only four terminals (it now has five, though was built to accommodate up to thirteen). Every airline that had been serving the bustling Love Field moved over practically immediately to DFW, except for budget carrier Southwest which chose to stay behind.

DFW-First-Arrival-image003 DFW_AA87-275-4-35_SF1
AA pilots talk to the press following the first flight (L).  The inside of the C terminal, not long after opening, in 1974. Photos courtesy C.R. Smith Museum – Ft. Worth, TX.

As Southwest grew, however, the city of Ft. Worth resented the carrier, the airport, and the cities continued success. Ft. Worth’s congressional representative, Jim Wright, wound up creating the now infamous Wright Amendment, which severely limited Southwest’s operating capabilities from the airport. The law has provided DFW significant protection from competition since it went into effect in 1980. After decades of protest from Southwest, the arcane law is set to expire in the fall of 2014.

One of American Airlines DFW Hub Terminals seen in the late 1980s.

One of American Airlines DFW Hub Terminals seen in the late 1980s.

Meanwhile, DFW continued to hum along.  Braniff, which had hubbed at Dallas Love prior to the move, was DFW’s first airline to hub in the city. It began the airport’s first European route in March of 1978, operating to London Gatwick, and added service to Asia in 1979. Braniff also brought DFW regular Concorde service in the late 1970s and very early 1980s, giving Dallas/Ft. Worth a distinction only a handful of US airports can claim. The carrier borrowed the iconic airplane from both Air France and British Airways, touting one-stop Concorde service Dallas to London and Paris.
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American followed suit in the same year, choosing Ft. Worth as its corporate headquarters in 1978. It doubled down a few years later, making DFW an official hub in 1981, and adding international flights to London in 1982. It went on to add service to Tokyo in 1987.

Bad day for Braniff. Photo from Airchive Archives.

Bad day for Braniff. Photo from Airchive Archives.

The airport’s first big shake up took place on May 12th, 1982 when Braniff abruptly ended service and filed for bankruptcy. At the time Braniff was by far the airport’s largest carrier. The scene created a chaotic nightmare in the hub, as passengers already on airplanes were forced to leave the aircraft. Passengers were simply told that Braniff no longer existed.

The airport eventually went on to assume its present name, Dallas Fort Worth International Airport, in 1985. The same year also saw the first major disaster, Delta 191. The flight, operated by a Lockheed L-1011 Tristar, crashed while trying to land in a thunderstorm.  Twenty-seven of the 152 on board survived. Three years later a Delta 727 crashed on takeoff in 1988, killing 14 of the 108 on board.

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DFW today. Photo by Chris Sloan / Airchive

DFW attempted to expand in 1989, wishing to add two additional runways and terminals. The surrounding cities, all of which share land with the massive neighbor, all objected and sued to stop the growth. The case meandered its way to the very top of the justice system, the Supreme Court. The court ultimately sided with the airport, paving the way for the airports seventh runway being complete in 1996. Existing primary runways were also all extended the first batch in 1996, the latter batch by 2005.

Like all airports, DFW struggled after 9/11. Delta dehubbed the airport in 2005, leaving American as the uncontested ruler of DFW. It wound up recovering nicely.

The International Terminal D and the present Skylink train system were both completed in 2005, providing a fresh and modern alternative to the now aging A, B, C, and E terminals. American, which had gone bankrupt in 2011, also began the process of renovating sections of terminal, starting with A in 2012. The renovations are expected to continue for several years, especially following the successful merger of American with US Airways.

Recently the airport has seen a heavy and long overdue rash of international expansion in the past year. American announced new routes to Hong Kong and Shanghai in October 2013, the airport’s first service to China. Qatar plans service to Doha, and Etihad to Abu Dhabi. Rumors have also been flying that the airport will start construction of Terminal F some time this decade. If so, DFW will come one step closer to those thirteen terminals originally envisioned.

Today, AA and DFW will mark the occasion by giving each arriving passenger from a Little Rock flight a commemorative yellow rose like they did 40 years ago when the airport first opened. We hope to have photos of the event.

PHOTOS: Historical ads, sales brochures, and timetables for American Airlines and Braniff International.

Editor’s note: What are the benefits of subscribing to our weekly newsletter? You’ll get a summary of our top stories of the week, along with our exclusive Weekend Reads column and a Photo of the Week from the extensive AirwaysNews archives. The newsletter comes out every Friday afternoon. Click here to subscribe today!

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Contact the editor at benet.wilson@airwaysnews.com

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Delta Unveils Latest Expansion to JFK Airport Terminal 4

By Seth Miller / Published January 13, 2015

The ribbon-cutting ceremony at the Terminal 4 expansion. Image Courtesy of Seth Miller / AirwaysNews

The ribbon-cutting ceremony at the Terminal 4 expansion. Image Courtesy of Seth Miller / AirwaysNews

Delta Air Lines unveiled the latest expansion to its hub operations at New York’s JFK airport this morning, adding 75,000 square feet of additional terminal space and 11 new gates dedicated to regional jet operations. The expanded space sits at the far end of Terminal 4 at JFK and augments the expansion for mainline operations,  inaugurated in late 2013.

EXTRA: A Fond Farewell and Happy Hello at JFK: The WorldPort Terminal 3 Closes and Delta’s Expanded Terminal 4 Opens

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The new gate space replaces the regional jet facility Delta was operating in Terminal 2 and provides significant improvements for passengers on these flights. All planes will now be served by jet bridges rather than requiring walking outside, for example, an experience which can be particularly challenging with the range of weather New York has.

A Delta Connection regional jet parked at a JFK T4 gate. Image Courtesy of Seth Miller / AirwaysNews

A Delta Connection regional jet parked at a JFK T4 gate. Image Courtesy of Seth Miller / AirwaysNews

Extra: Additional WorldPort history and preview of Terminal 4 in Soho

Gail Grimmett, Delta’s senior vice president for New York, noted that 65 percent of Delta Connection passengers are connecting through JFK to another flight. Moving these flights into the T4 concourse will make those connections far easier for thousands of passengers each day.

EXTRA: Delta Wows With Their New JFK Terminal 4 and SkyClub

A Delta jet parked at JFK T4. Image Courtesy of Seth Miller

A Delta jet parked at JFK T4. Image Courtesy of Seth Miller

The new space is the latest in a series of investments Delta has made in building out a hub in New York City. The carrier has a significant presence at both JFK and LaGuardia airports and has made a number of improvements in its operations. And the company is not done yet.

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An escalator down to Deltas’s expansion of Terminal 4. Image Courtesy of Seth Miller

Grimmett noted that a further $65 million investment is slated for LaGuardia this year, while more moving walkways and other improvements are coming to JFK. “You’re going to see changes product-wise on the airplanes as well as further investment in the terminals.”

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Contact the editor at benet.wilson@airwaysnews.com

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BrewTown: Inside Milwaukee General Mitchell Airport

By Benjamin Bearup / Published January 12, 2015

Milwaukee’s General Mitchell International Airport is often an afterthought to the American flying public. For years, the airport took a back seat to the much-larger airports in Chicago, about 90 miles down the road. To help get the truth about this airport, Southwest Airlines and Mitchell Airport flew AirwaysNews to Milwaukee to take a behind-the-scenes tour of the facility’s operations.

General Billy Mitchell. Image Courtesy of Benjamin Bearup

General Billy Mitchell. Image Courtesy of Benjamin Bearup

History

Hamilton Airport, as it was called then, began handling passenger traffic in July 1927, when the first terminal, named the Hirschbuehl Farmhouse, opened. Within days, Northwest Airlines began regularly scheduled service to Chicago and Minneapolis. In July 1940, the airport welcomed a new multi-story terminal building to help meet Milwaukee’s demand for air travel.

In 1941, Hamilton Airport was renamed General Mitchell Field, after the famed Brigadier General and Milwaukee resident William “Billy” Mitchell. After World War II and into the early 1950’s, Milwaukee saw a boom in air travel. This growth not only meant more passengers, but also “growth in the number of flight operations, including the large propeller-driven StratoCruisers and Constellations.” July 1955 brought the opening of a new $3.2 million terminal that featured three concourses and 23 additional gates.

General Mitchell Airport Terminal. Image Courtesy of Benjamin Bearup

General Mitchell Airport Terminal. Image Courtesy of Benjamin Bearup

The 1940s and 1950s brought the addition of the military to Mitchell Airport. In the late 1940s, Mitchell Airport began to be used as a prisoner-of-war camp. In 1947, the 128th wing of the Wisconsin National Guard made Mitchell Airport its home. Today the wing is an Air Refueling Wing and operates on the east ramp of the airport. From the 1950s to 2008, 440th Airlift Wing of the Air Force Reserve was stationed at Mitchell Airport.

With a new age of aviation upon them and an increasingly larger flying public, Mitchell Airport renovated and greatly expanded the terminal, to the tune of $44 million dollars in the late 1970s. The renovations welcomed many new shops and expanded ticketing and baggage claim areas. October 1989 brought the opening of a new cargo operations center and maintenance center. In 1990, Concourse D expanded by 16 gates to help modernize the facility. In 2007, Mitchell Airport added eight gates to Concourse C.

Mitchell Airport Tour

Upon entering General Mitchell Airport, the first stop we made was the Mitchell Gallery of Flight. This small flight museum offers viewers a peek at the history of Mitchell Airport and highlights many great accomplishments in aviation history. Without spoiling the visit too much, one can see the history of Billy Mitchell, the role of Midwest Airlines and AirTran at the airport, and view an outstanding collection of World War II aircraft models. The Mitchell Gallery of Flight is located pre-security in the main terminal.

EXTRA: Mitchell Gallery of Flight Museum Images

Mitchell Gallery of Flight. Image Courtesy of Benjamin Bearup

Mitchell Gallery of Flight. Image Courtesy of Benjamin Bearup

Displays at Mitchell Museum. Image Courtesy of Benjamin Bearup

Displays at Mitchell Museum. Image Courtesy of Benjamin Bearup

From the Gallery of Flight, we drove to the snow management hangar. With an average snowfall of around 47 inches annually, Mitchell Airport needs a large fleet of snow removal vehicles to keep runways clear and flights on time.

A fleet of 12 snow combos quickly and efficiently clean up a runway in under 30 minutes. The crews work in two shifts of 12 men, with six snow combos on each side. Each group of snow combos is accompanied by what is called a snow thrower. This mega machine is capable of rotating at around 2,400 rpm and can throw thousands of pounds of snow over 300 feet. This machine pushes snow away from the runways and off of the runway lights. A chemical truck often also joined the combos out on the runway to remove ice from the surface.

A staff of 65 men and additional seasonal employees work to keep aircraft clean and safe during the treacherous winter months. To finish off the mega machines are two massive snow melters. Each snow melter is capable of melting tens of thousands of pounds of snow an hour. These machines are used to reduce snow piles along the airfield.

Snow combos at Mitchell Airport. Image Courtesy of Benjamin Bearup

Snow combos at Mitchell Airport. Image Courtesy of Benjamin Bearup

The snow management fleet utilizes a massive former C-130 hangar at the former home of the 440th Airlift Wing. The hanger fits the needs of the snow management fleet perfectly with the long snow combos nicely sliding in.

After the snow management hangar, we toured the Emergency Operations Center. This room serves as a nerve center in the event of a crisis. One large table seats eight airport officials, each designated to a department. Seats at this table include airport operations, emergency responders such as police and fire, public relations, and others. Hundreds of cameras are connected in a network and can be broadcasted real time in the Emergency Operations Center. Maps and airport diagrams are displayed on the walls for emergency management while each department is designated a personal monitor and telephone.

Emergency Operations Center at Mitchell Airport. Image Courtesy of Benjamin Bearup

Emergency Operations Center at Mitchell Airport. Image Courtesy of Benjamin Bearup

Next door to the Emergency Operations Center is the Airport Operations Center. The Airport Operations Center is a highly complex room that controls much of the airport. A team operates the room 24/7 and 365 days a year to make sure the airport is running smoothly. From aircraft emergencies to a leaking faucet, the room controls everything.

Inside the Airport Operations Center are several small stations reserved for unique roles such as fire protection, monitoring every door in the airport and runway light conditions. During our brief visit to the center, five automated alarms rang from the central computer, alerting the workers of an abnormality. Luckily the instances were just false alarms such as an jammed or unclosed door. The workers said that hundreds of automated alarms go off daily with the overwhelming majority of them being false alarms. Either way all alarms are treated equally with a quick and professional response.

Airport Ops Center main station. Image Courtesy of Benjamin Bearup

Airport Ops Center main station. Image Courtesy of Benjamin Bearup

On another computer screen a large airport map can be seen. This interactive map shows areas of needed maintenance and other abnormalities along the airfield. During our visit, a small private aircraft blew a tire during taxi and needed assistance. On the screen a large red circle appeared showing the position of the aircraft on the taxiway. Within a minute, the team alerted airport operations ground personnel to assist the disabled aircraft. All passengers onboard the aircraft were safe, but a Green Bay Packers game that night would ultimately be missed.

Disabled aircraft on taxiway at Mitchell Airport. Image Courtesy of Benjamin Bearup

Disabled aircraft on taxiway at Mitchell Airport. Image Courtesy of Benjamin Bearup

A fire control system gave the control center team complete management of the hundreds of fire alarms, smoke detectors, and sprinkler systems within the airport. Any potential fire would be instantly located and proper personnel would be dispatched to the scene.

As in the Emergency Operations Center, the Airport Operations Center had full control of the hundreds of cameras in and around the airport campus. With the touch of a button, the main cargo delivery gate could be monitored while Gate C14 was being watched. The room also had direct access the the air traffic control tower.

After the Airport Operations Center, we watched the baggage screening process. The baggage room featured a state-of-the-art system where computers track where each bag is located at all times. Rapid-moving conveyor belts and trap doors moved to get the bags where they needed to be. In a separate room, the Transportation Security Administration (TSA) physically searched bags. To avoid lifting heavy bags, each bag was lifted from a conveyor belt to the TSA officer by a vacuum suction arm. This straight-out-of-a-sci-fi movie technology greatly reduced TSA liability and work related injuries. Unfortunately, due to federal regulations, we were not allowed to photograph this process.

From there we walked onto the Southwest Airlines ramp at Concourse C, Gate 22. We were getting ready to view an aircraft turnaround from the ramp. As aircraft N7708E, a 737-700, pulled into the gate, we were delighted to see that the aircraft was in the new Southwest Airlines livery. In fact, the aircraft was former AirTran bird N175AT delivered in October 2005 and refurbished for Southwest in October 2014.

Southwest Airlines Boeing 737. Image Courtesy of Benjamin Bearup

Southwest Airlines Boeing 737. Image Courtesy of Benjamin Bearup

The Southwest employees at Milwaukee happily welcomed us onto the ramp. We were given a complete walk-around of the aircraft and saw how the ground crews work. We even got to go underneath the plane and took a picture of the Southwest Heart featured on the bottom of their new livery planes.

Southwest Heart logo. Image Courtesy of Benjamin Bearup

Southwest Heart logo. Image Courtesy of Benjamin Bearup

The turnaround and departure of N7708E marked the end of our tour at Milwaukee’s General Mitchell Airport. I came to the airport and city with no true predictions of what it would be like. After a day full of great adventures touring the airport and the city I left knowing what Milwaukee Airport truly is about. It is a city that often doesn’t get the attention that it deserves and is often seen as the “little brother” of Chicago. In reality Milwaukee is its own unique city that far surpasses its reputation.

EXTRA: Milwaukee General Mitchell Airport Photo Gallery

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Contact the editor at benet.wilson@airwaysnews.com

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US Airlines Won’t Lose Capacity Discipline Because of Oil

by Vinay Bhaskara / Published December 30, 2014

Few changes in macroeconomic conditions have been more impactful for the global airline industry than the precipitous drop in oil prices from June 2014 to the present. From a peak of $115.49 per barrel, the price of global-benchmark Brent Crude oil fell to $57.88 Monday, near a five-year low.

The fall in oil prices will have a mixed impact on the world’s airlines, but will be primarily positive for US airlines, who operate in an economy not dependent on high oil prices and generally have diversified networks not highly reliant on oil industry business travel. Lower oil prices mean lower fuel costs, and as the largest expense for US airlines, the reduction in oil prices more than offsets adverse demand effects in select markets. But despite the prospective boost to US airline earnings, the fall in oil prices has also been accompanied by a small but growing undercurrent of naysayers, who fret that lower oil prices will drive airline management to engage in fare and capacity wars in an attempt to boost market share (see here and here). Most notable of these worriers is Hunter Keay, the airlines analyst at investment firm Wolfe Research.

Respectfully, (as Mr. Keay is one of the best in the business), I fundamentally disagree with his assessment. I do not believe that lower oil prices will cause airlines to sacrifice hard-won capacity discipline and I will go on record stating that I believe that 2015 will be yet another year of record profitability for US airlines (and that lower fuel prices will be a net positive contributor to higher pre-tax earnings). The idea that US airlines would, once again, devolve into a war for market share is founded on a misunderstanding of the new structure of US airlines, and a misdiagnosis of localized conflicts between airlines in certain markets as indicative of a broader trend towards increased competition.

Starting with the present structure of the US airline industry, the first thing to keep in mind is that years of consolidation, increased regulation from the FAA, have fundamentally altered the dynamics in the US airline market. We are unquestionably living with an air travel oligopoly, though I am not unsympathetic to arguments that the present oligoply is a net positive as a reimbursement to the stakeholders (airline employees and shareholders) who effectively subsidized lower-than-cost air travel for the general public for years (employees through wage and benefit cuts, shareholders through investment losses [and eventually Chapter 11 Bankruptcy]).

However, no oligopoly can hold without strategic convergence. And that is where capacity discipline amongst airlines comes into play. The early 2000s were a period of giddy catch-up growth in the US airline industry post 9/11, but after the late 2000s recessions, new airline management pivoted sharply towards capacity discipline. Even today, total system capacity for US airlines, as measured by available seat miles (ASMs) is 3.1% below its 2007 peak, with domestic ASMs down 8.0% and international ASMs up 6.8%. But ASMs alone don’t give a complete picture. Total available seats (both domestic and international) in the US airline industry are still a whopping 7.9% below levels in 2007, even as total enplaned passengers have largely recovered.

This kind of en-masse capacity reduction does not happen without across-the-board discipline at every major US carrier. Sure there was a deep recession, the deepest since the Great Depression, but judging by the pattern of recovery from every other recession, if US airlines were being managed the way they were in the late 80s, 90s, and early 2000s, capacity would already be 10-15% ahead of its 2007 levels, even adjusting for the severity of the recession. This is a different breed of airline management.

Post-2009, airline managers have ridden capacity discipline to boost revenues and profits. In fact, by almost any financial metric, the current crop of airline management is the most successful in the US since deregulation. They have little incentive to act like previous generations of airline management, their compensation is largely tied to ROIC and shareholder returns, and shareholders are not in the mood to reward airlines for growth (revenue/market share), instead preferring profitability.

There have certainly been myriad examples of US airline management squandering positive exogenous shocks (fuel prices, GDP growth in the early 2000s), but what in the behavior of current airline management leads anyone to believe that this group of managers will repeat those mistakes? Remember, this is the same management group that (instead of allowing passengers to reap a modest reduction in fares) responded to the FAA’s inability to collect taxes in mid 2011, by gleefully raising base fares to where total out of pocket costs were exactly the same (earning a windfall of $28.5 million per day). This is the same management group that has closed redundant hub after hub, that has retired 50-seat regional jets at remarkable rates, that has implemented revenue-based frequent flyer programs (which have certainly driven away incremental passenger traffic). Heck, this is the same management group that has shied away from competing directly with Spirit Airlines on fares, allowing Spirit to gain a foothold in many legacy airline hubs. To reiterate, Spirit presented US majors with a clear opportunity to defend market share… And they responded by largely ignoring the ultra-low cost carrier (ULCC). This is a different breed of airline management.

Now the obvious counterpoint is to look at Seattle, the Dallas-Fort Worth Metroplex, and Los Angeles, currently the hottest battlegrounds amongst major US airlines. Starting with Seattle, this is certainly an area of competitive concern, particularly for Alaska who has already begun to see some softness in Seattle margins in the wake of Delta’s domestic expansion. But at the end of the day, Seattle is still Delta adding a bunch of RJ flights to key west coast destinations, with a handful of narrowbodies likely to eventually ply routes to key non-hub business markets in the rest of the country. I’m not going to argue that Delta’s growth in Seattle isn’t going to affect Alaska somewhat, but in Delta’s overall network, it’s a drop in the bucket. Lower oil prices aren’t going to magically make Delta add dozens of new daily flights in the market. If anything, they’ll help the two airlines co-exist, by improving margins for both.

Los Angeles might be more worrying, with both Delta and American adding capacity at a dizzying pace. However, I see United as likely to blink soon (and reduce frequency and capacity in the market). Moreover, any serious expansion (large enough to put a meaningful dent in the overall industry’s fare levels) is impossible given the facility constraints at the airport. Dallas Fort Worth has recently been thrown into a new fit of competitive fare pressures thanks to the expiration of the Wright Amendment and Spirit’s continued growth in the market. Certainly the market dynamics have been altered somewhat, but the potential for further capacity additions and fare wars in the Metroplex is still limited. Southwest is boxed in by facility restrictions at Love Field and while American’s new management has been aggressive competing against Southwest in the past, they are also smart enough to realize that unlike Philadelphia, Southwest are here to stay in the Metroplex. The long run interplay between the two carriers is much more likely to resemble that in Phoenix (another shared hub), where the competition is far more amicable (though American will hold far more market power in the former). As far as Spirit, they will certainly continue to fly the routes that they already do, but I see them as unlikely to add a lot of further capacity. Spirit CEO Ben Baldanza has famously said that the carrier has 750 markets in the domestic US identified and ready to go that meet Spirit’s margin criteria. At the same time, Spirit has specifically called out Dallas Fort Worth as a market where it is experiencing significant fare weakness. Why would Spirit add more capacity in a three-way battle in the Metroplex when there are plenty of viable routes around the country in far less competitive environments?

In addition to Spirit, fellow ULCCs Allegiant and Frontier would hypothetically be good candidates to drive capacity growth and fare wars in the industry given their high levels of proposed growth. However, there are two key issues with this thesis. First, the major airlines by and large don’t seem interested in combatting Spirit and the ULCCs. ULCCs today mostly cater to a previously unserved segment in the market, a segment that the US majors abandoned in the wake of consolidation and the last recession. A fare war requires some sort of competitive response to low fares, and a broad-based competitive response to the ULCCs doesn’t appear imminent. Second, Spirit and Frontier are largely locked in to their present levels of growth, which the industry has already planned for and taken into account for 2015. The way that Spirit and Frontier would drag the overall industry down is by growing much faster than they have previously indicated. But unlike US majors, Spirit and Frontier don’t have slack in their fleet. Their aircraft are (mostly) highly utilized and with a relatively set number of new aircraft deliveries for the year, they cannot wholesale add 10 percentage points to their capacity growth plans, they simply lack the spare and newly arriving capacity to do so.

So let me end with a question to you the readers. Will airlines squander the windfall from oil in 2015 as they chase market share? Or will a new brand of profit-focused managers act in a responsible manner, using lower fuel prices to boost margins and profits even further? I’m betting on the latter, and I’m willing to put my money where my mouth is, as my disclosures below the fold should indicate.

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Disclosure: The Author is Long AAL, LUV, UAL, SAVE, and DAL.

Contact the author at vinay.bhaskara@airwaysnews.com

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Final AirTran 717 Ferry Flights

By Jack Harty / Published December 28, 2014

ATLANTA, GA - When Southwest Airlines announced that it would acquire AirTran Airways, many wondered what Southwest would do with the 717s AirTran had. It seemed unlikely that Southwest would operate two aircraft types because it has been an exclusive 737 operator since birth, with the exception of a few leased 727s from Braniff in the late 1970s. B59iXaRIAAAO8-l

In 2012, Southwest was able to make a deal with Delta Air Lines to lease them through 2024. This deal was perfect for Delta because they would provide a great replacement to the older DC-9-50 aircraft it planned to retire. The first 717 entered service with Delta Air Lines in the Fall of 2013, and it will continue to add more to its fleet through next year.

EXTRA: Delta Inaugurates 717 Flights

In May, Southwest published the final AirTran schedule. On the final day of operations, AirTran would operate approximately 90 flights with only 717s.

Many were surprised to see that several 717s would end the day in outstations including Chicago and Houston, and many hoped there would be a few more flights added to Atlanta on December 29 for one final flight.

Unfortunately, this would not be the case. They are wasting no time in getting them stored temporarily or to locations like Miami to be converted.

Extra: Onboard AirTran’s Final Flights

N717JL, the 717 that flew AirTran's final flight departs Tampa Monday December 29, 2014 bound for Goodyear, AZ and its conversion for lease customer Delta.

N717JL, the 717 that flew AirTran’s final flight departs Tampa Monday December 29, 2014 bound for Goodyear, AZ and its conversion for lease customer Delta.

Aircraft by Aircraft

The flights below are scheduled to operate tomorrow. Some aircraft are headed to Goodyear Airport for storage, until they can be converted into the Delta configuration. The aircraft that are headed to VQQ (Cecil Airport) will begin the process of getting configured.

Aircraft Number Departs at:  Origin  Destination
764 800 ATL  GYR
737 800 ATL  GYR
768 800 ATL  GYR
724 1300 ATL  GYR
705 1300 ATL  GYR
730 700 ATL  VQQ
785 700 ATL  VQQ
704 740 MKE  GYR
711 710 MSY  GYR
710 715 STL  GYR
702 1025 MCI   GYR
709 750 RDU  GYR
739 850 HOU  GYR

Earlier today, aircraft 765 ferried to VQQ. It quietly pushed back from gate C7 to not much fanfare other than a few ground crew workers shaking hands as it pulled away.

Please note that the schedule above is subject to change.

N717JL, the 717 that flew AirTran's final flight departs Tampa Monday December 29, 2014 bound for Goodyear, AZ and its conversion for lease customer Delta.

N717JL, the 717 that flew AirTran’s final flight departs Tampa Monday December 29, 2014 bound for Goodyear, AZ and its conversion for lease customer Delta.

Extra: A History of Air Tran

Extra: Employees say farewell to AirTran

Extra: Onboard the final flights of AirTran

Extra: Vintage AirTran and ValuJet Timetables and Schedules

 

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Contact the author at Jack.Harty@AirwaysNews.com

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Program Analysis: Airbus Likely to Launch A350-1100

by Vinay Bhaskara / Published December 22, 2014

Qatar Airways took delivery of the first Airbus A350-900 yesterday, marking the entry into service (EIS) for Airbus’ first new-build aircraft since the A380 was launched by Singapore Airlines in October 2007.IMG_7504

EXTRA: Qatar Airways Takes Delivery of World’s First Airbus A350 XWB

EXTRA: On-Board Qatar’s A350 XWB Media Flight

Given the momentous occasion, we thought the time ripe to provide a comprehensive analysis of the A350 program.

Project Execution Exceeds That of 787 But Specifications Weakened

Airbus had an advantage over Boeing in executing on the A350 project given that it could incorporate lessons learned from its own struggles with the A380 as well as from Boeing’s problems with the 787 Dreamliner. We spoke with program head Didier Evrard at the Farnborough Airshow this past July, and he noted that Airbus had taken an extremely cautious approach with the A350′s development.

Yes, we have learned a lot from the previous programs, particularly from the A380. We’ve defined a very clear process for improvement, which was about program management, customization, which was about stability of the design, focusing on maturity, meeting maturity gates in a straight manner. And sometimes, we had to take hits at the early stage of the program to protect the back end of the program. And it’s clear that since two years, we have had a very stable plan for development, but this did not come just by chance. It came because we had really adhered to these principles. For instance we had a new block of design tools, [and] we had invested massively in these design tools that we shared with our worldwide suppliers. We developed new customization policies and we have built our [development] principles on a very rich platform, which reduces a number of issues that we have to deal with. And this platform is able to accommodate a large variety of layouts for our customers without changing its foundations. So this enables us today to be rather confident at the start of the production… and at the start of the customization… [It’s] not just the number of aircraft, which is great, but also the number of different customers that we are addressing. Plus we have our customer definition center in Hamburg, which helps a lot from that point of view. So it’s about lessons learned, it’s about maturity, not cutting corners, and trying to provide strategy. But it’s also a lot of work – we’ve had a very stable team from the very beginning of the program and a strong management as well as our regime of partners.

As a project, the A350 was less risky than the 787 by design. Airbus incorporated far fewer new and unproven technologies, and where it did use the same technology as the 787, Airbus’ implementation was frequently more conservative. For example, the A350 has twice as many lithium-ion batteries as the 787, but more conservative power and energy levels. This is not to discount the similarities between the two aircraft. The 787 and A350 share several design solutions, including a carbon fiber reinforced plastic (CFRP) – based structure, a wing designed with high lift arrangement, and similar avionics system. But where Boeing ran into trouble with its electrical systems architecture for delivering power to the 787′s various system, Airbus found success with a conventional system passed on from the A380.

All of this resulted in an unusually smooth systems testing period for the A350, which has enjoyed a trouble-free flight test period. Whereas Boeing had to work on perfecting its systems on the 787 during testing, Airbus could instead focus on delivering systems and aircraft maturity at EIS, having long before perfected most elements of the systems.

Airbus’ conservatism and “Stop and Fix” mentality have taken their toll however, with the result an 18-month delay from the initial planned EIS of early 2013 to the present. Like Boeing, Airbus ran into difficulties with manufacturing its CFRP fuselage for the A350 as well as with other new technologies implemented in the aircraft, and accordingly, the timeline of the A350 slipped and slipped, three to six months at a time.

Even more troubling was the steady creep in weight as the program matured, with operating empty weight (OEW) 6-7% higher than planned at launch. This is still below the 9% at present for the 787 and certainly below the 12% weight increase the 787 had at launch, but substantial nonetheless. The effect of this can be seen in the 350 nautical mile reduction in the A350-900′s published range earlier this year despite a shift to a lighter passenger configuration and an increase in maximum take off weight (MTOW) from 268 to 275 tons. All told, the A350-900′s effective range was reduced by roughly one hour, and while the A350-900 will still be able to perform 95-97% of advertised missions, this range reduction played a substantial role in Emirates’ cancellation of an order for 70 A350 aircraft earlier this year. While any such weight challenges have not yet become apparent publicly on the A350-1000, our sources at Airbus and its suppliers indicate that the A350-1000 will be overweight by at least 7-8% as it heads towards EIS in 2017.

We also spoke with sources at Rolls Royce, who revealed that the Rolls Royce Trent XWB has met most of its performance targets through flight testing, with specific fuel consumption (sfc) within 0.5 percentage points of revised targets from 2013. However, the A350-900 will likely EIS with higher fuel burn than advertised due to the weight challenges noted above.

Airbus has already ramped up well on the A350′s production in advance of EIS. Additional aircraft for Qatar Airways and the first A350s for Vietnam Airlines and Finnair are already on the final assembly line (FAL) in Toulouse as Airbus has progressed at a rate of two aircraft started per month. In the new year, Airbus will increase to three new aircraft started per month, steadily ramping up thereafter until it reaches a production rate of 10 aircraft per month in 2018, four years after EIS. However, we believe that Airbus will move to push A350 production rates higher to boost cash flow in the latter half of this decade, and speed up the break even target date (currently 2020). We think Airbus will eventually target rates of 11 or even 12 aircraft per month, however the recent decline in fuel prices, especially if persists through 2015, could alter the timing of those rate increases based on cash-strapped airlines delaying long haul fleet replacement.

Airbus Ends 2014 with Order Momentum

From a backlog perspective, 2014 was certainly not a strong year for the A350, due primarily to the cancellation of an order for 70 aircraft by Emirates. However, Emirates was not the only airline to eliminate an A350 order during 2014, as Hawaiian Airlines also cancelled its order for 6 A350-800s, and the Alitalia/Air One order for 12 A350-800s was removed from the books as well. Thus through the first 11 months of 2014, the A350 looked to be in for a rough year, only winning orders for 20 A350-900s (10 from Kuwait Airways, 8 from Iberia [announced in 2013], and 2 from Libyan Airlines).

But the last two months of the year brought a flurry of activity, with Airbus winning an order for 4 A350-900s from Air Mauritius, a top-up order for 8 additional A350-900s from Finnair, and notably, 25 A350-900s from Delta. With the additional orders, Airbus ended the year with a net decline of 31 orders for the A350, still leaving the program with 786 firm orders (and 288 purchase options) at EIS.

The A350-900 order from Delta was a big win, as it represented the most recent head-to-head competition between the A350-900 and the 787-9, which Boeing claims has met or exceeded performance targets. Both aircraft are of course excellent, with Boeing largely shedding the issues that plagued the 787-8, but as our analysis showed, the A350-900 more than holds its own in a head-to-head comparison.

Even as Emirates cancelled its order (dealing the A350-1000 a more substantial blow), reports emerged that the airline would re-consider the A350 in a new sales competition next year, presumably searching for a medium haul widebody to complement its two pronged fleet of A380s and Boeing 777-300ERs/777Xs. While Emirates is certain to reconsider the A350-900 in particular (the A350-1000 makes little sense given the large numbers of 777-8X and 777-9X aircraft Emirates has on order), our view is that the 787-10 should be favored in any competition for a regional and mid haul widebody aircraft, given its superior operating economics on routes that it can fly. The A330-900neo could also play such a role effectively as Delta’s recent order indicates, and it would also require a smaller cash outlay on the part of Emirates.

Despite Emirates’ cancellation, year-end sales and the good feelings surrounding the EIS should soften the blow to the overall program. Moreover, given Airbus’ famed “Fifth Quarter” where lead salesman John Leahy announces a slew of orders at the airframers annual press conference in mid-January, we cannot count out the the possibility of additional A350 order announcements in the coming weeks, perhaps filling the slots vacated by Emirates from 2019 onwards.

A350-800′s Demise Offset by the A330neo

The A350-800 is dead, killed off by the A330neo. Technically, there are still 26 outstanding orders for the type (10 from Yemenia, and 8 apiece from Asiana and Aeroflot), but both Aeroflot and Asiana have up-gauged a portion of their A350-800 orders to the A350-900 in the past and could likely be easily persuaded to do so. Yemenia is in financial shambles, and will likely convert or cancel its order outright.

Recent history and basic aeronautical science show that aircraft shrunk from the base variant (whether the 737 MAX 7, A319neo, or earlier the 737-600 and A318) tend to suffer from poor operating economics relative to the base model. Even the 787, for which the 787-8 was technically the base model, is likely to gain most of its sales from the 787-9 and 787-10 moving forward. 75% of what Airbus wanted to achieve with the A350-800 from a strategic perspective can be met by a mix of the A350-900 and the two A330neo models. While customers will have to sacrifice some range and or take on increased capacity with either alternative, few routes need the A350-800′s excess range over the A330-800neo, let alone over the A350-900. Moreover, by eliminating the A350-800, Airbus will improve its future financial performance (especially cash flow) through two mechanisms.

First, it will avoid a substantial cash outlay (perhaps as much as $1.5 – 2 billion) that it would have spent on developing the A350-800 and retooling its production to ramp up production of the type. Additionally, the A330-800neo and A330-900neo have already had their production line development largely written off and are relatively cheap to develop ($2.5 – 3 billion). For that reason, the A330neo is likely to be a positive contributor to cash flow in a way that the A350-800 would not have been. Until 2020, each A330neo sold in place of an A350-800 generates millions of dollars of net excess cash flow.

The A350-900 is a Powerhouse 

While Airbus may face challenges on the smallest and largest members of the family, the base variant of the XWB is in fantastic shape. With 585 firm orders (plus 16 likely conversions), the A350-900 represents 74.4% (76.5%) of the overall backlog. For its core mission of replacing the Boeing 777-200ER and A340-300, it is clear that the A350-900 has been a resounding success. Amongst its largest customers, the A350-900 will (at least partly) be replacing 777-200ERs and LRs at Singapore Airlines, Japan Airlines, Air France-KLM, Asiana, Vietnam Airlines, and Thai Airways. Meanwhile, amongst A340-300 customers, the A350-900 will play a replacement role at Air France – KLM, Lufthansa, Cathay Pacific, Finnair, China Airlines, TAP Portugal, Kuwait Airways, SAS, Iberia, Air Mauritius, and Sri Lankan Airlines.

Admittedly, the A350-900 shares this replacement market with the 787-9, but there is no doubt that it has been a resounding success. We believe that Airbus will eventually easily surpass 1,000 sales for the A350-900 and perhaps even approach 1,500 sales in an upside case scenario. This is a far cry from the tepid market response to the A350 Mark I, though some concepts from that offering have been resuscitated by the A330neo.

In terms of its cost competitiveness, our most recent estimates regarding the A350-900′s operating costs based on our proprietary model were released in our analysis of the Delta widebody order. You can find the summary table here, and the assumptions used can be found in the main body of the article. While the recent drop in fuel prices affects some of the specific numbers in the table, we believe that our broader conclusions are still applicable. The table illustrates the competitive parity between the 787-9 and A350-900, and the A350-900s abilities as a 777-200ER/LR replacement.

Furthermore, an operating cost analysis does not even take into account the A350-900′s superior revenue generation potential versus the 787-9. The A350-900 will seat anywhere from 5-15 additional passenger (315 in a two class configuration) versus the 787-9 depending on configuration, as well as superior cargo capacity. The A350-900 is the most capable aircraft in its class, to the point that it can even function as a viable 747-400 replacement for certain airlines looking to down-gauge on certain routes or boost frequency. For example, Delta will use the A350-900 to ply many of the same missions currently run by 747-400s inherited in its merger with Northwest Airlines.

The A350-1000 is a Viable Aircraft but Has Been Outflanked by the 777X

The largest A350 variant has come into its own since boosting the aircraft’s specifications back in 2011. While it was struggling at the time, subsequent orders have boosted the aircraft’s viability. At present, Airbus has 169 firm orders for the A350-1000, including 37 from Qatar Airways, 35 from United (converted from A350-900s), 26 from Cathay Pacific, 22 from Etihad, 18 from British Airways, 13 from Japan Airlines, 10 from Asiana, 5 from Air Lease Corporation, and 3 from Air Caraibes.

169 orders by itself is a firm foundation for a program that many speculated was destined for cancellation as recently as 2012, but unfortunately, the A350-1000 cannot escape the competitive glare of Boeing’s 777X. The 777-8X is the same size as the A350-1000 (and similar to the present-day 777-300ER), though it offers an additional 1,200 – 1,500 nautical miles worth of range. However, the A350-1000 holds a substantial edge in operating economics (our most recent estimates, not publicly released, place the figures at a 6-7% cost per available seat mile [CASM] delta including capital costs), even after taking into account the fuel burn improvements offered by the new General Electric GE9X engines. The 777-8X is likely to be a niche aircraft for the few operators that require an ultra long haul (ULH) aircraft, and to date, only 43 777-8Xs have been ordered (35 by Emirates, 8 by Etihad).

The core 777-9X presents a far more interesting competitive comparison, with a stretch that offers anywhere from 40-50 additional seats versus the A350-1000. To date, Boeing has sold 243 777-9Xs (115 to Emirates, 50 to Qatar Airways, 21 to Cathay Pacific, 20 to Lufthansa, 20 to ANA, and 17 to Etihad), outselling by itself the A350-1000. Moreover, since it was launched, the 777-9X has effectively won three of five head to head order competitions with the A350-1000 (ANA, Lufthansa, and Emirates [in a manner of speaking] while Airbus won the smaller Japan Airlines and British Airways contests). Moreover, Boeing won roughly an equal split with the A350-1000 amongst Middle East customers Qatar Airways and Eithad, as well as at Cathay Pacific. And we do see British Airways as likely to eventually order the 777-9X given space constraints at its London Heathrow home base.

Our most recent analyses of the 777-9X’s operating costs versus those of the A350-1000 were released in March and April, corresponding respectively to the ANA order and an initial consideration of the Delta widebody RFP. While these analyses were conducted assuming a higher price of fuel than at present, the broader conclusion of a small but statistically significant CASM advantage for the 777-9X still holds, especially given that lower fuel prices will narrow the trip cost gap with the A350-1000.

Both aircraft hold their merits, but from an airline fleet planner’s perspective, the 777-9X may hold a slight edge, if the extra space can be filled. The 777-9X does have higher trip costs, but that is offset by the lower CASM and extra revenue potential (both from additional passengers and from larger cargo capacity), assuming that an airline can take advantage of that potential. For example, Japan Airlines, operating from a capacity constrained hub no less, decided that given Japan’s economic and demographic trends, that the 777-9X was too much airplane for the market demand in its network.

So there are clearly airlines for whom the A350-1000 makes more sense, but from a long run perspective, we think that Boeing will be able to outsell the A350-1000 with both 777X models by a 55-45 or even 60-40 ratio given present conditions. That being said, the next couple of years may be slow for 777X and A350-1000 sales given Boeing’s desperation to fill its 777 production gap by selling 777-300ERs at cost, and the reduction in fuel prices causing airlines to delay fleet replacement plans. Even allowing for the fact that Airbus can theoretically bracket the 777-9X with the A380 on the (extremely) high end, Boeing appears to have seized the upper hand in this segment.

Enter the A350-1100?

While Boeing today holds the upper hand, Airbus could counter with a stretched A350-1100, which would close the capacity gap with the 777-9 while restoring the overall economic advantage for the A350 program over the 777X. Airbus needs a 400-seat A350 variant, but achieving that with the current Trent XWB engines is complex. Without improvements in specific fuel consumption (beyond the usual 1-3% from performance improvement packages), the A350-1100 would have to sacrifice range like the 787-10. Alternatively, Airbus could increase MTOW to maintain, which would be prohibitively expensive given that it would require a stronger wing and higher thrust engines.

One alternative could be to use Rolls Royce’s new Advance engine, which we believe will be used to power the A380neo. Using the Advance, which would offer a 5% fuel burn improvement over the present day Trent XWB, allowing Airbus to offer an aircraft cost-competitive with the 777-9X with a similar range. Even with Boeing’s ability to offer superior pricing on the 77X, with a 2021 or 2022 EIS, such an A350-1100 would bring Airbus to parity in the segment. We believe that Airbus will in fact launch both an A380neo and an A350-1100, both powered by the Rolls Royce Advance and targeted for EIS in the early 2020s.

EXTRA: Photos from the Delivery Event

EXTRA: The Airbus A350 Program Timeline

EXTRA: The Airbus A350 XWB: Being There At The Maiden Flight

EXTRA: Qatar Airways Takes Delivery of World’s First Airbus A350 XWB

———————-

Contact the author at vinay.bhaskara@airwaysnews.com

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ANALYSIS: Boeing Cuts 747-8 Production Amidst VLA Weakness

by Vinay Bhaskara / Published December 12th, 2014

Lufthansa receives its first 747-8 in a handover ceremony. Image Courtesy of AirwaysNews

Lufthansa receives its first 747-8 in a handover ceremony. Image Courtesy of AirwaysNews

Boeing announced yet another cut in the 747-8′s production earlier this week, with production to drop to 1.3 aircraft per month beginning in September 15. The 747-8 is currently produced at a rate of 1.5 aircraft per month (18 aircraft per year), but has a backlog of just 39 aircraft out of 119 total firm orders. Under program accounting block rules, Boeing will soon be required to take a substantial one-time charge, which would hamper financial results in 2015. Boeing’s announcement mirrored recent commentary from Airbus, which has signaled its own struggles in the very large aircraft (VLA) market.

EXTRA: Boeing’s 747 Celebrates 1,500th Delivery as Future Remains Uncertain

Sales Dry Up

The 747-8′s sales record has been poor and future prospects are grim. Its current backlog of 39 aircraft is composed of 26 passenger 747-8 Intercontinentals (747-8i – including one VIP aircraft), and 13 freighters. Boeing had previously cut production in 2013 from two aircraft per month to 1.75 and then 1.5 aircraft per month, where it settled until the announcement of the latest cut. And despite Boeing’s protestations, its unclear where additional orders will come from, especially on the passenger side.

The original Boeing 747 rollout in 1969. Image courtesy of Boeing

The original Boeing 747 rollout in 1969. Image courtesy of Boeing

EXTRA: Korean Air Lines Orders Five Boeing 747-8i Jumbo Jets, Program Hangs On

Our sources indicate that Boeing has a major sales push in place for six VIP 747-8is in the Middle East, but beyond that, there is nothing on the radar. Many of the intended customers for the 747-8i have already opted for the A380, A350-1000, or Boeing’s own 777X, and the number of airlines that need a VLA or VLA sized aircraft (seating more than 400 passengers) without having already placed such an order is dwindling. There is (hypothetically) a potential order for five-10 VLA frames from Turkish Airlines, but we view Turkish Airlines as most likely to opt for the 777X as its interim VLA solution. Beyond that Boeing can maybe pitch El Al or Saudia amongst 747-400 operators without a direct replacement yet. And of course there is some potential for top-up orders from existing customers Korean Air, Transaero (rumored around the 787 cancellation), Lufthansa and Air China. But overall, Boeing cannot reasonably expect more than 20-30 further orders for the passenger variant without a major shift in airline strategy.

The Boeing 747-8 on the assembly line. Image Courtesy of Boeing

The Boeing 747-8 on the assembly line. Image Courtesy of Boeing

The VLA market is smaller than Airbus (and Boeing’s) projections

In their most recent current market projections for the period between 2014-2033, Airbus projected a VLA market of 1,228 passenger aircraft, whereas Boeing projected a market of 500 aircraft. Both of these numbers appear overly optimistic, given a combined backlog between the two programs of just 210 aircraft (a number which includes close to 50 A380 orders which we view as uncertain [and 30 that are outright doubtful]) extending over the next 10 years. Our view is that the market is smaller than Airbus’ projections and will settle at around 400-450 additional airframes (treating the 777X as outside the VLA sphere). Airbus is likely to soak up the majority of that demand with an A380neo if it chooses to launch the aircraft type, but otherwise it will be captured by the 777X and a hypothetical A350-1100 stretch.

EXTRA: Boeing Delivers 50th Boeing 747-8

Indeed the 777-9 may be the biggest culprit for the 747-8i’s sales weakness. Our economic analysis shows that the 777-9 at 10-abreast seating holds a substantial advantage over the 747-8 in terms of operating costs at today’s fuel prices, let alone at the $80-100 per barrel prices that persisted over much of the last five years. The 747-8 counters with added performance (especially at hot and high airport) and some extra revenue potential, but it’s not enough to compensate for the higher cost of operations.

No Help Is Coming From the Freighter Market

When Boeing launched the 747-8F, a significant portion of the business case rested on the new-build freighter market, which Boeing projected to boom in line with generally bullish projections about the air cargo market as a whole and expectations of high fuel prices. The last five years have instead been extremely choppy for the air freight market, with economic uncertainty and growth slowdowns in several emerging markets pressuring cargo space utilization and yields. Moreover, belly cargo is playing a larger and larger role in the long-haul freight market, as the passenger widebody fleet booms in size.

Photo Courtesy JDL Multimedia

Photo Courtesy JDL Multimedia

EXTRA: Air China Takes Delivery of Its First 747-8 Intercontinental

The 747-8F is the best and only new build freighter in its class. But there’s nobody left that has a true need for it. The shift to belly cargo has tamped down demand for medium and large widebody freighters, and amongst airlines that actually need or could use an aircraft of that size, there are still 263 Boeing 747-400 passenger aircraft available for passenger to freight (P2F) conversions available at a small fraction of the purchase price of new build 747-8Fs. At reasonable fuel prices, those 747-400s may approach similar operating costs (including the cost of capital) to the 747-8F, especially when the larger 747-8F is harder to fill. There may yet be top up orders from a few existing customers, but overall, we see Boeing selling no more than 15-20 additional 747-8 freighters in an optimistic scenario. Between the lack of additional passenger and freighter orders, we think Boeing will be forced to cut production even further, to one aircraft per month in 2016.

Holding Out for Air Force One

Recent rumblings in the defense industry indicate that the US Air Force (USAF) is fast tracking the acquisition of the next generation of Air Force One presidential transport aircraft. According to defense industry newsletter Inside Defense, the USAF has moved forward the timeline to acquire new aircraft in 2018, after previously indicating that a purchase would not occur before 2021. Under the new timeline, a request for proposals (RFP) for new-build aircraft to replace the 747-200 based VC-25s that currently service as presidential transport aircraft would be issued next year, with the purchase decision made in 2016 and delivery occurring two years later.

Air Force One at Miami International Airport. Image Courtesy of AirwaysNews

Air Force One at Miami International Airport. Image Courtesy of AirwaysNews

The Air Force One contract is a prestigious one for Boeing, which also supplied the 707 and 747-200 that made up the base for previous iterations, and Boeing can be expected to compete vigorously for the new contract. And while building Air Force One, with its secretive materials and interior on the same line as the commercially produced 747-8 may prove challenging, other defense aircraft are built on the same production lines as commercial ones, having the production line open is critical to enable Boeing to produce the new Air Force One, a public relations bonanza, at reasonable cost. And for that reason alone, we expect Boeing to try and hold out producing the 747-8 until 2018, when the Queen of the Skies will be allowed to die a dignified death.

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Contact the author at vinay.bhaskara@airwaysnews.com

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This Month in Airways Magazine: The Twilight of the MD-11

An all-new issue of Airways Magazine with an upgraded paper stock and spine is now available on newsstands!

Subscribe or buy yours today! Don’t miss a single issue.

PHOTO: TIM DE GROOT

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PHOTO: TIM DE GROOT

THE TWILIGHT OF THE MD-11

by ENRIQUE PERRELLA

On November 11, 2014, the world witnessed the end of an era in commercial aviation. Twenty-eight years had passed since McDonnell Douglas launched the MD-11 program. Originating in the United States in 1986, the adventure culminated with its last passenger commercial flight in the Netherlands in 2014. This event marked the end of the tri-jet wide-body passenger operation, just nine months after Biman Bangladesh (Airways, November 2014) retired the last passenger DC-10.


PHOTO: JETBLUE

THE DESIGN AIR — TOP-10 INTERNATIONAL FIRST CLASS CABINS

by JONNY CLARK

In our brand-new monthly section in the larger and improved Airways, we will bring a series of Top-10 lists curated by TheDesignAir. This month, we award the best International First Class Cabins.


PHOTO: QR

QATAR AIRWAYS IS REACHING FOR THE CUTTING EDGE 

by BENET WILSON & CHRIS 

Qatar Airways began flying in 1994 as a small carrier serving a handful of routes in the Gulf region, using Airbus A310s and Boeing 727s. In 1997, the airline re-launched with the mandate to become a leading global carrier with the highest standards of service and excellence.


SEA

PHOTO: SEA

SEATTLE-TACOMA AIRPORT REVIEW

by ALBERT RODRIGUEZ

To say that Seattle-Tacoma International Airport (SEA/KSEA) has grown by leaps and bounds is an understatement. Though it ranks a mere #15 among domestic airports for number of passengers served in 2013, it impressively ranked #40 last year for international travelers, with nearly 3.6 million people coming in from, or going out to, Dubai, Tokyo, Frankfurt, Paris, Seoul, London, Beijing, Reykjavik, Taipei and Shanghai, plus five Canadian cities and three Mexican resort areas.


PHOTO: ANDREAS ROHDE

AIRWAYS TRAVELER: FLYING TO/FROM MOSCOW THE RUSSIAN WAY // AEROFLOT VS. TRANSAERO

by ANDREAS ROHDE

“HAVING RECENTLY CELEBRATED ITS ninetieth birthday, Aeroflot is almost a mystic name in commercial aviation. Once the largest airline on the globe—incorporating everything that had been connected to civilian flying in the former Soviet Union— today’s Aeroflot is only a fraction of its former self.”


PHOTO: AUSTRIAN

AIRLINE REVIEW: AUSTRIAN AIRLINES

by JEFF KRIENDLER

Born 60 years ago in Puebla, Mexico, the grandson of Austrians on his maternal side, Jaan Albrecht would have never dreamed of returning to the “old world” to try to save the once-proud and highly-regarded national carrier, Austrian Airlines, from insolvency.



Mohawk DC-3-1 - Copy

MOHAWK AIRLINES, PART TWO

by DAVID H. STRINGER

“America’s Local Service Airlines were created for the purpose of bringing air transportation to small and medium-sized cities. Mohawk was born from one man’s effort to fill that need for his hometown.”


PHOTO: CX

AIRWAYS INTERVIEW: RUPERT HOGG – CATHAY AIRWAYS COO

by ANDREAS SPAETH

CATHAY’S NUMBER TWO TALKS TO Andreas Spaeth in Hong Kong about his carrier’s rôle in a vibrant market and how global its reach has become.


 

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Airways Literature: CREW REST

by CLAY TAYLOR

Left Seat Chronicles: AIR FORCE ONE AND HALF

by JOHN MARSHALL

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American Express Opens Centurion Lounge at San Francisco International Airport

By Benjamin Bearup / Published November 17th, 2014

All photos courtesy of American Express

All photos courtesy of American Express

San Francisco International Airport has become the latest home for a brand new American Express Centurion Lounge. The lounge, located in Terminal 3 near gate 74, becomes the fourth Centurion Lounge in the United States, with a fifth coming in early 2015.

A prime position airside and directly above the premium passenger security check within Terminal 3, home to United Airline’s domestic hub, offers passengers a perfect chance to relax before making connection onward to Asia or to recoup after a long-haul flight. The Centurion Lounge replaces the old Alaska Airlines Board Room at SFO, which closed on June 24, coinciding with the carrier moving from T3 to the International Terminal.

The new San Francisco Centurion Lounge is modeled after the Las Vegas lounge and features a “living wall” (live plants growing on wall) that greets visitors upon entering. For the casual passenger passing through, the Centurion Lounge offers multiple options for entertainment and relaxation.

A large complimentary bar run by mixologist Jim Meehan is sure to please the upbeat crowd, while a wine bar run by Centurion Wine Specialist and author Anthony Giglio will offer customers a sample of California’s famous wine country. The large food buffet, run by Executive Chef Christopher Kostow, will offer passengers a taste of locally inspired cuisine. Other amenities include shower suites and multiple spacious lounge areas throughout. Passengers traveling with family can use the special family room or pass the time watching one of the many flat-screen televisions within the lounge.

Screen Shot 2014-11-13 at 9.28.34 PM

For business passengers, the Centurion Lounge offers spacious workspaces with power outlets and a computer bar with fax, print and copy capabilities. High-speed WiFi is also available.

As with other Centurion Lounges in Dallas, Las Vegas, and New York LaGuardia, dark hardwoods and modern design techniques will be prevalent throughout the complex. The overall design appeals to the upbeat and tech-savvy crowd around the Bay Area and certainly will become to go to lounge within SFO.

American Express recently announced that it will open its fifth Centurion Lounge at Miami International Airport,  due to open in early 2015. It was originally scheduled to open in December 2014. Located in the North Terminal, the Miami Centurion Lounge is in a prime location to serve passengers flying oneworld alliance partners American Airlines, US Airways and Qatar Airways.

Lisa Durocher, senior vice president of benefits at American Express, sees the opportunities that this lounge brings saying “We’re thrilled to bring The Centurion Lounge experience to Miami International Airport, a critical hub for domestic travelers as well as the nation’s largest gateway to Latin America and the Caribbean.”

Access to Centurion Lounges is free for American Express customers with Platinum or Centurion cards and American Express customers with any valid credit or charge card can pay $50  for a one-day pass.

Editor’s note: Have you subscribed to our weekly newsletter yet? Click here to subscribe today for a summary of our best stories, along with exclusive subscribers-only content.

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Contact the editor at benet.wilson@airwaysnews.com

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Flashback Friday: Planespotting International Flights at JFK in 1992

By Luis Linares / Published November 7th, 2014

LOT B763 - JFK - LFL

LOT Polish Airlines Boeing 767-300ER at JFK in 1992

New York’s JFK International Airport has been and continues to be a plane spotter’s dream, given the variety of domestic and international carriers that fly there.  In a previous Friday Flashback, we looked at the changes that were taking place at JFK, such as the construction of a new ATC tower and Delta’s takeover of Pan Am’s operations more than 20 years ago.  Join us for another look at JFK in the early 1990s, this time focusing on international flights and some of their history, in some cases fateful.

Last month, the McDonnell Douglas MD-11 made its last commercial passenger flight on KLM Flight 672 from Montreal to Amsterdam.  When I visited JFK in 1992, the MD-11 was a new aircraft.  Many passenger MD-11s are getting a second lease on life by being converted to freighters.  American Airlines used the MD-11 for trans-Atlantic and South America operations.

AAL MD11 - JFK - LFL SWR MD11 - JFK - LFL
American Airlines and Swissair McDonnell Douglas MD-11s at JFK in 1992

Another carrier starting MD-11 service at the time was Swissair for flights to Geneva and Zurich.  Unfortunately, one of these flights would go down in history as the deadliest MD-11 accident, killing all 229 passengers and crew, when on September 2, 1998, Flight 111 from JFK to Geneva crashed five miles off the coast of Nova Scotia, Canada.  The official investigation concluded that an electrical fire and very flammable insulation material resulted in the crew losing control.  Eventually, Swissair would become a casualty of post 9/11 airline financial difficulties.

What would a good plane spotting experience two decades ago be without seeing some DC-10s?  The MD-11, designed to replace the DC-10, was just starting to roll out of Long Beach in the early 1990s.  Therefore, DC-10s were very common at major airports like JFK. When I visited, I spotted a couple of Lufthansa models, which flew the routes from Frankfurt and Munich.  At the time, they sported a classic blue cheat line in their fuselage.  Another DC-10 operator at JFK was Nigeria Airways, which ceased operations in 2003.  The carrier flew form Lagos at the time, and Nigerian company Arik Air serves this route today.

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Lufthansa and Nigeria Airways DC-10s at JFK in 1992

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United Airlines Boeing 747-400 at JFK in 1992

The Boeing 747-400, which started service 25 years ago, is slowly starting its farewell to passengers and is also undergoing conversions for an extended life in the cargo world.  At the time of my visit, this variant of the “Queen of the Skies” was brand new.  Although United Airlines today only flies to its Los Angeles and San Francisco hubs from JFK, in the early 1990s it had a more robust presence, which included trans-Atlantic flights and trans-Pacific flights.  The 747-400, decked in United’s “rainbow/tulip” livery, operated from JFK to Tokyo.

VRG B744 - JFK - LFL

Two generations of the Boeing 747 at JFK in 1992:  Varig 747-200 and Singapore Airlines 747-400

Speaking of the 747, the classic -200 series variant was a very common sight at JFK at the start of the 1990s, especially since its eventual -400 series replacements were still very young.  Some of the -200s I spotted included those flown by Aer Lingus from Dublin and Shannon; Alitalia from Milan and Rome; Pakistani International Airlines from Lahore; the infamous and defunct Tower Air mostly to Europe and Israel; and Brazil’s Varig, another failed but historic carrier, from Rio de Janeiro and São Paulo.

EIN B742 - JFK - LFL AZA B742 - JFK - LFL JPIA B742 - JFK - LFL TOW B742 - JFK - LFLBoeing 747-200s at JFK in 1992:  Aer Lingus, Alitalia, Pakistani International AIrlines, and Tower Air

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EgyptAir Boeing 767-300ER at JFK in 1992

EgyptAir operated the Boeing 767-300ER from Cairo to JFK with continuing service to Los Angeles in the early 1990s.  The airline continues JFK-Cairo service to this day using new 777-300ERs.  Like Swissair, EgyptAir also suffered a tragedy on a flight originating from JFK.  On October 31, 1999, Flight 990 crashed into the Atlantic Ocean 60 miles south of Nantucket, and all 203 people onboard perished.  Egypt’s Civil Aviation Authority lacked the resources for a complex accident investigation and thus turned to the NTSB for help.  However, the U.S. and Egypt failed to agree on the findings.  The NTSB determined deliberate intent by the relief first officer, while Egypt concluded elevator failure.

Another aviation icon at JFK was the Concorde.  Air France and British Airways took passengers from JFK to their respective Paris and London hubs in just over three hours.  Concorde service catered to the rich and famous, but that didn’t prevent us regular people from seeing and especially hearing this legendary aircraft.  I captured an image of an Air France Concorde during this visit.

While I do not want to focus too much on tragic accidents, it is important to note that JFK was the destination of the only fatal Concorde accident. On July 25, 2000, charter flight 4590 crashed shortly after takeoff from Paris, killing all 100 passengers and nine crew.  The cause was a metallic strip that fell from a Continental Airlines DC-10 that had just departed.  The fragment made a tire on the left main landing gear explode, which in turn punctured a fuel tank.  The pilots were unable to maintain control after the two left engines failed, while their wing was consumed by fire.

AFR B744 - JFK - LFL AFR Concorde - JFK - LFL
Regular and luxury flying options: Air France Boeing 747-400 and Aérospatiale-BAC Concorde at JFK in 1992

I will end on a more positive note by talking about two Chilean carriers flying to JFK during this time.  Ladeco and Lan Chlie were competing carriers in Chile and operated various domestic and international routes.  Ladeco flew a Boeing 757-200, which meant it could not provide non-stop service from Santiago since the 5,100 mile trip exceeded the 757’s range.  Lan Chile, on the other hand, operated a 767-300ER, which was capable of connecting Santiago and JFK without any stops.  A couple of years after this plane spotting visit, Lan Chile took over Ladeco.  Today, Lan Chile is known as LAN Airlines, featured in this month’s issue of Airways Magazine, and it is part of the larger LATAM Airlines Group.

LCO B752 - JFK - LFL LAN B763 - JFK - LFL
LAN Airlines predecessors:  Ladeco Boeing 757-200 and Lan Chile Boeing 767-300ER at JFK in 1992

EXTRA: AirwaysNews collection of JFK pictures

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Contact the author at luis.linares@airchive.com

Contact the editor at benet.wilson@airwaysnews.com

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Qantas Set to Open New First Class Lounge at LAX

By Benjamin Bearup / Published November 4th, 2014

All photos courtesy of Qantas

All photos courtesy of Qantas

Australian flag carrier Qantas is preparing to open a brand-new first class lounge at Los Angeles International Airport’s Tom Bradley International Terminal in January 2015. The 200-seat lounge, which is set to open around New Years Day 2015, will become Qantas’ flagship international first class lounge.

The lounge will be a greatly modernized recreation of Qantas’ Melbourne and Sydney international first class lounges, which underwent major overhauls in 2007. One of the greatest features of the first class lounge will be the first Neil Perry restaurant in the United States. Perry, the famed Australian chef and coordinator of Qantas flight catering, has been tapped to redesign and revolutionize the dining experience in the new first class lounge.

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Perry has given several hints about what to expect, such as a menu heavily centralized around vegetables native to North America. He has also hinted at offering a very diverse menu by introducing flavors from the culturally diverse Los Angeles culinary market.

Chef Neil Perry

Chef Neil Perry

Unlike its Sydney and Melbourne counterparts, the Los Angeles first class lounge will not feature the famous Aurora day spa, due to lack of space within the Bradley terminal.

Passengers flying first class or equivalent aboard Qantas OneWorld partners, Qantas Platinum or Platinum One passengers, or OneWorld Emerald passengers will be eligible to use the new international first lounge.

Business Lounge

In the ribbon-cutting ceremony for the new lounge, Qantas will also unveil a 200-seat extension to its existing business class lounge. The expanded business class lounge will hopefully alleviate peak time overcrowding at the current business class lounge. The expansion comes months after Qantas experienced an embarrassing and public problem regarding their LAX business class lounge where hundreds of passengers were denied access to the lounge due to overcrowding.

The business class lounge, which opened in June 2014, is available to passengers flying business onboard several OneWorld partners, including British Airways and Cathay Pacific along with several frequent flyer levels and OneWorld frequent flyer levels found here.

Qantas currently offers once daily service to Melbourne with the A380, once daily service to Brisbane with the 747, and twice daily service from Sydney with the A380 and 747, once daily 747 service to New York JFK.

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Contact the editor at benet.wilson@airwaysnews.com

 

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