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ANALYSIS: Wright Amendment Expiration Highlights Battle Between American and Southwest – Part 2

by Vinay Bhaskara / Published October 17th, 2014

Editor’s note: In part 1 of our analysis, we offered a history of the Wright Amendment, and took a look at Southwest Airlines’ prospects now that it has been lifted at Dallas Love Field after 43 long years of fighting.  Today we look at competitor American Airlines’ competitive response at Dallas-Fort Worth International Airport.

Competitive Impact on American Will Be Mixed

There is no question that the end of the Wright Amendment will have an adverse impact on American’s O&D market and revenue share in the markets affected. O&D passengers are more profitable than connecting ones, and insofar as American’s absolute O&D figures on these routes is set to decline, this will generate a hit on the profitability of American’s largest hub at DFW. Southwest Airlines is the leader or even with American in terms of O&D market share in the 16 markets it currently serves, and while American generates a fare premium in those markets, for the 14 city pairs where Southwest is adding service, American currently generates 60% O&D market share and 70% O&D revenue share. From here on out, it will trade those figures for something like 45% and 60%.

American Airlines Airbus A319 at DFW

American Airlines Airbus A319 at DFW

American’s stranglehold on business travel in the region should continues, as it will offer superior frequency in every single market save Oakland, which it does not compete directly in (while offering a combined 16 daily flights to San Francisco and San Jose in the Bay Area). Business customers have a well established preference for higher frequency, and when combined with the massive global reach of American’s DFW hub including rapidly growing links to Asia, corporate contracts centered on the region will continue to (heavily) favor American. This is not to say that Southwest will not be able to capture a substantial share of business traffic. It already does so in existing markets from Dallas Love Field, but that market share (driven disproportionately by Austin, Houston, New Orleans, and San Antonio) is generated in part because Southwest is at parity with American in terms of frequency on those routes.

In the near term, the impact of Southwest’s entry will likely be O&D revenue and share declines, and likely a modest hit on margins. However, in the long run, American has a couple of factors weighing in its favor.

Banking on Connectivity

American is counting on its re-banking initiative to boost connectivity at DFW, with a commensurate jump in revenue. The plan is driven by the experience of pre-merger US Airways, who rode banked hubs at Philadelphia and especially Charlotte to high profitability despite limited O&D markets.

Relative to the rolling hub structure that American currently uses at DFW with flights spaced (relatively) evenly throughout the day, the new banked hub will feature far more volatility. In a banked hub structure (the most common type around the world), flights depart and arrive in alternating waves, and at a hub of DFW’s size, these waves might number 50 or 60 cities at a time. Banked hubs offer more connectivity than rolling ones, which raises revenue potential, but they also cause challenges in terms of asset utilization and cascading delays at certain airports. However, American is rolling out banking projects at DFW, Chicago O’Hare, and Miami, seeking to boost revenue as the merger changes traffic flows.

Specifically with regards to the Wright Amendment, American will lose some traffic that migrates to Southwest’s new services. Love Field is extremely convenient for Dallas based leisure travelers (though DFW is quite convenient in its own right), and overall, the airline will win passengers away. But American will be able to offset that traffic decline by filling its planes with connections. And thanks to the ever-increasing pricing power of U.S. airlines, American should be able to maintain margins and absolute profitability in the market with high-fare connecting passengers.

Economics and Demographics Favor American

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

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

The Dallas-Fort Worth metropolitan area is one of the fastest growing in the United States. Cheap housing and a booming economy are drawing residents to the region, while businesses lured by Texas’ business-friendly tax policies and regulatory environment have generated well-paying jobs. These demographic and economic trends have boosted air travel demand, both leisure and business, substantially over the past 25 years and are expected to do so for at least another 15.

Clearly this is beneficial for both carriers, which will see fuller planes and rising demand. But American is better positioned than Southwest to take advantage of the growth of the region, and the reason has to do with the compromise allowing Southwest to begin nationwide service in the first place. Thanks to the 20-gate cap, of which Southwest is unlikely to control more than the 16 it does today, Southwest is effectively stuck at 153 or 155 flights per day as the natural limit for daily utilization of its gates. Now there are ways for it to grow its operation at Love Field as we will outline below, but those methods have drawbacks and once again have a natural limiting factor.

Meanwhile American basically has no restrictions at DFW. It has plenty of terminal space to expand into today, and the airport has ample room for additional terminals as necessary. As O&D demand rises in the Metroplex, American will be able to soak up a larger share of the growth than Southwest (because of both frequency and network – it will always serve more destinations), and it would not be surprising to see American holding 50- to 70-percent O&D splits even in markets where it competes head-to-head with Southwest a decade from now.

Southwest Is Not As Much of A Threat as it Used To Be

Fifteen years ago, the prospect of a Southwest freed from the shackles of the Wright Amendment would have rightly terrified American, who would have been undercut at every turn by a nimble, low-cost carrier and see fares plummet. Today? Southwest isn’t really a low-cost carrier and it needs similar fares to those required by American for profitability. The cost gap between the two airlines has narrowed substantially, and while Southwest remains a formidable competitor, it is a different kind of competitor.

Moreover, American also has an advantage in its new management team, composed primarily of pre-merger US Airways executives. No legacy airline did a better job of fighting off Southwest than US Airways (who had no choice given its revenue shortfalls). While Las Vegas was sacrificed to Southwest and Allegiant, US Airways more than held its own in Phoenix and most notably, drove Southwest out of Philadelphia with its tail between its legs after Southwest attempted to build a secondary Northeast connecting complex with close to 75 daily departures. If you could pick one management team to face off with Southwest in a post-Wright Amendment world, it would be Doug Parker, Scott Kirby, and company.

Southwest’s Growth Opportunities are Limited

Circling back to Southwest for a moment, its growth prospects at Love Field are not great. The natural cap for its daily departures is around 155 unless it can get its hand on more gates. That being said, in terms of pure capacity, Southwest does have some room for growth on the basis of aircraft mix. For the January day in question, Southwest will split its 153 daily departures across all four aircraft types in its fleet, including 24 daily 737-300s, 30 daily 737-500s, 87 daily 737-700s, and 12 daily 737-800s. That works out to 21,633 outbound seats, a substantial increase over pre-repeal capacity. But just 12 of the 153 flights use the 737-800, which seats 175 passengers versus 143 for the 737-300 and 737-700 and 122 for the 737-500. Replacing smaller 737s with the 737-800, of which Southwest has an additional 43 on order, or (later) the 737 MAX 8 or 737 MAX 9, could be its best strategy for capacity.

If Southwest were to convert all of its daily flights (up to 155) to the 737-800 or eventually the 737 MAX 8, it could offer 27,125 daily outbound seats. If it upgauged even further to the 737 MAX 9 as has been heavily rumored, and assuming a 200-seat MAX 9, it could offer up to 31,000 daily outbound seats. Using annualized comparisons (which are imperfect given that this analysis uses peak-day departures), that’s the equivalent of adding more than 4 million or 6.5 million annual seats (bi-directional) respectively.

Compositionally, Southwest does not have a ton of room to grow with additional destinations. That being said, in a scenario where it up-gauges to the 737-800, it could conceivably free up frequencies for new destinations. Consolidating the Houston Hobby service to an hourly shuttle would free up six daily flights, while consolidating Austin and San Antonio to eight daily flights apiece would add four to the tally. Albuquerque, Lubbock, and Midland could be brought down to three daily departures apiece, as could Amarillo and El Paso, adding eight additional frequencies. Finally, Kansas City, New Orleans and St. Louis could each drop down to six daily flights, giving Southwest a total of 22 additional frequencies to work with.

There’s also the chance that Southwest entirely eliminates Wichita and Birmingham from the network – two relatively recent additions with small O&D markets for another five daily flights. And if it has enough profitable opportunities, Southwest could eliminate Amarillo, Lubbock, and Midland entirely, giving it a grand total of roughly 36 additional frequencies to work with. In Southwest’s hands, that could generate anywhere from six to 18 new destinations (likely somewhere in the middle).

Of course paring frequency in existing markets will reduce Southwest’s O&D market and revenue shares in those markets, some of which could conceivably bounce back to American. Yet another reason why the competitive dynamics in the market are hardly dire for American.

Hardly #NonstopLove

With its heady marketing taglines and a well-timed sale launched just a day after the expiration, Southwest has certainly scored points and set the expectation that it will drive down fares. But Dallas consumers should not expect a sudden decline in ticket prices thanks to Southwest’s entry. In fact for many, ticket prices will actually increase. 

As we mentioned before, Southwest Airlines is no longer a purely low-lost carrier, but rather a hybrid network carrier with a complex business model and variegated product offering. The Southwest Effect above and beyond standard new entrant impact is dead, and the days of Southwest offering genuinely cheap fares is gone. In the Metroplex, that role will continue to fall to ultra-low cost carrier Spirit Airlines.

Southwest needs fares at roughly the same level as American to generate profits, and accordingly the pricing in most markets shouldn’t decline more than 5-7%. Moreover, there are many customers, who had previously traveled outside the perimeter from Love Field, for whom fares are actually going to increase.  After 2006, Southwest began selling “through” tickets at Love Field – direct, one-stop flights to beyond perimeter cities via an allowed airport. These one-stop flights helped Southwest fill its planes as traditional demand patterns tailed off, but they also were extremely low yielding. In many of the markets where it is adding nonstop service, Southwest was the lowest fare carrier in Q3 of 2013. Southwest is going to want to charge a premium for new non-stop service and accordingly passengers will have far fewer dirt-cheap one-stop flights from Love Field. Anyone expecting fares in the Metrpolex to drop sharply as a result of repealment is in for a disappointing surprise.

Partying Like its 1996

Southwest’s festive celebration of the passing of the Wright Amendment gave the impression that the market had changed in a monumental manner, but realistically, the Metroplex has simply returned to its status quo for much of the post-deregulation era. For years, American was the dominant player at DFW, but it was held in check by Delta Air Lines, who had a large hub in its own right at DFW (though American still led the market).

Southwest Airlines was the cheap, no-frills carrier who offered limited service to myriad destinations. Today? American is a dominant player at DFW though it is held in check by Southwest, who has a large operation in its own right at Love Field (and bears close resemblance to legacy carriers today). Spirit Airlines is the cheap, no-frills carrier that offers limited service to myriad destinations. Southwest Airlines may be overjoyed at the elimination of the Wright Amendment. But for many customers in the Dallas – Fort Worth metro area, their emotions today might be more aptly described as a muted sense of deja vu.

Related Stories
ANALYSIS: Wright Amendment Expiration Highlights Battle Between American and Southwest – Part 1

Southwest Trumpets End of Wright Amendment Restrictions at Dallas Love Field

Virgin America Makes Move to Dallas Love Field


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ANALYSIS: Wright Amendment Expiration Highlights Battle Between American and Southwest – Part 1

by Vinay Bhaskara / Published October 16th, 2014

At 12:01 am Monday, Southwest Airlines’ personal Berlin Wall came down, as the Dallas-based airline was allowed to begin non-stop service from Dallas Love Field to destinations across the contiguous United States, resolving a 43-year fight by the carrier to add service from its home base. The move, along with expansion by other airlines into the newly freed environs of Love Field, has created an unprecedented state of competition for origin and destination (O&D) in the Dallas-Fort Worth metropolitan area, challenging the hegemony of current market leader American Airlines.

A Protracted Battle

Written in 1979, the Wright Amendment was a federal law that governed air traffic at Love Field. Aimed at protecting massive government investment into the new Dallas-Fort Worth International Airport (DFW), the Wright Amendment prevented airlines from using aircraft larger than 56 seats at Love Field to serve destinations outside of the states of Texas, New Mexico, Louisiana, Arkansas, and Oklahoma. Flights between Love Field and airports in those states could be operated by aircraft of any size. While in theory, this law allowed for airlines flying small jets and turboprops to serve the entire nation, in practice (as the case of Legend Airlines illustrated) American Airlines was quick to quash any full-service competition at Love Field. As a low-cost carrier (LCC) with a single type fleet of Boeing 737, Southwest Airlines, one of few tenants who refused to leave Love Field for DFW, couldn’t take advantage of the 56-seat exception and was hemmed in by the restrictions of the Wright Amendment.

Defenders of the Wright Amendment claimed that it was necessary to protect the metro area’s investment into its green field airport, rightly pointing to examples such as Montreal’s Mirabel International Airport or Osaka’s Kansai International Airport of cities allowing traffic to be split across two different airports and losing traffic and airline hubs accordingly. Meanwhile, opponents of the law claimed that it was anti-competitive and a violation of free market principles, as well as needlessly restrictive. Both arguments held merit. Especially when DFW was opened, it was unclear whether the metropolitan area would have enough air traffic to justify two competing airports. Allowing two airports to fight over a limited pool of traffic often is a mistake, and strategically, the decision was justifiable at the time.

But the new connecting complexes built by American Airlines and Delta Air Lines meant that traffic at DFW boomed beyond anyone’s expectations and by the mid-1990s, DFW was over capacity, and it was clear that Love Field could be opened to new flying without damaging its prospects. While the airport and the city of Fort Worth managed to limit a 1997 repealment push to add Kansas, Alabama, and Mississippi, Missouri was added to the list of approved states with a 2005 amendment, and in 2006, another major push towards repealment that began in 2004 generated the compromise you see today.

The Specifics

Under the terms of the compromise ending the Wright Amendment in 2006, airlines are now free to begin service across the contiguous United States from Love Field, but the number of gates available to airlines will be capped at 20.  Of the 20 gates, Southwest will control 16 while United and Virgin America will control two apiece. Combined, the airlines will use these 20 gates to offer 178 flights per day by Thursday, January 15th, 2015, including 153 by Southwest, 13 by Virgin America, and 12 by United. Additionally, Delta Air Lines operates five flights per day to Atlanta, but those flights are in danger after Delta lost its lease on American’s gates (which were divested to Virgin America as part of the approval process for the American-US Airways merger).

Non Southwest Love Field Service

Delta is currently working with the city and other airlines (temporarily gaining accommodation at one of Southwest’s gates) on a deal to continue service but will otherwise be kicked out of the airport on January 5, 2015. The table to the right summarize peak-day frequency for the three airlines at Love Field (assuming Delta retains service) in January 2015. Virgin America will clearly be the second-largest airline at the airport, but United and Virgin America will operate just 25 daily departures (including 12 ERJ-145s with very quick turnaround times) across four gates for an average of 6.25 departures per gate, against Southwest’s 153 departures from 16 gates (9.6 departures per gate). Unless both airlines plan to expand operations, each could assist and/or be forced (in the case of a lawsuit) to accommodate Delta’s operations.

Southwest’s Operation

Southwest’s new non-stop service from Love Field will roll out in three phases to 17 new destinations, boosting the airline’s service offering at the airport from 116 daily departures to 153 by January 15, 2015, the peak day chosen for this analysis.


On Monday October 13, 2014,  Southwest launched service to the following destinations:

  • Denver
  • Chicago (Midway)
  • Baltimore/Washington
  • Washington, D.C. (Reagan National)
  • Las Vegas
  • Los Angeles (LAX)
  • Orlando

The following eight routes will begin November 2, 2014.

  • Phoenix
  • Orange County/Santa Ana
  • San Diego
  • Tampa Bay
  • Ft. Lauderdale
  • New York City (LaGuardia)
  • Atlanta
  • Nashville

And service to the final two destinations in Southwest’s initial round of expansion will begin on January 6, 2015.

  • San Francisco
  • Oakland

Southwest Love Field FrequenciesAll told, Southwest will operate 153 peak-day departures to 33 destinations. Frequencies for the 16 pre-repeal destinations on January 15, 2015 are shown to the right, with total frequency chopped down from 116 daily departures to 100. This reduction in frequency mostly happened to out of state destinations which had seen boosted frequencies due to Southwest’s ability to sell one-stop direct tickets to destinations outside the Wright Amendment “perimeter” via an intermediate stop within the perimeter. Since 2006, this has been the lifeblood of the Love Field operation, according to CEO Gary Kelly.

Meanwhile the chart below displays frequency to the new destinations for Southwest, along with a summary of American’s frequency (daily departures) for the same day of January 15, 2015. The fourth through seventh columns present a summary of key origin and destination (O&D) market data for the third quarter of 2013, representing the peak travel season for the DFW market. PDEW measures the O&D traffic demand for the market per day in each direction, fare and yield are self-explanatory, and the final column states whether American is the leader in O&D passengers or notes which competitor has the O&D lead otherwiseSouthwest vs. American at Love Field

Southwest is flying to 17 new destinations from Love Field, but only 14 new city pairs. The competitive dynamics with American are interesting, but what is key to note is that unlike some of the in-state quasi-shuttle routes, frequency to these new destinations is relatively low, with only New York La Guardia, Washington Reagan, and Chicago Midway surpassing five daily departures.

In part two of this story, Bhaskara covers American Airlines’ competitive response and the future of Southwest Airlines at Dallas Love Field.

Image Courtesy of Jack Harty

Related Stories
Southwest Trumpets End of Wright Amendment Restrictions at Dallas Love Field
Southwest Airlines Unveils New Livery and Brand
Southwest CCO Robert Jordan On Business Traveling, Rising Fares
Has “The Spirit Effect” Replaced ” The Southwest Effect?”


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China Airlines Takes Aesthetically Innovative First Boeing 777-300ER

China Airlines new 777-300ER sits at the Everett Delivery Center.

China Airlines new 777-300ER sits at the Everett Delivery Center.

By Brandon Farris / Published Sunday October 5th, 2014

On a sunny Friday afternoon in Everett, WA China Airlines was celebrating the delivery of the carrier’s first of ten all new Boeing 777-300ER aircraft, which will be the new flagship for the Taiwan based carrier. With an aesthetically unique cabin, this aircraft fits the old adage “It’s what’s on the inside is what counts.”

“China Airlines has been a valued Boeing customer for over 50-years and we are honored to celebrate the milestone delivery of their first 777-300ER,” said Ray Conner, president and CEO of Boeing Commercial Airplanes. “The airline’s new 777-300ER represents the beginning of a new era for China Airlines and the people of Taiwan. As the many Boeing models before it, we are confident that the 777-300ER will continue to help China Airlines open up new markets and expand its horizons, as they continue to achieve tremendous success.”

The last produced passenger 747-400 departs from LAX. Photo by Brandon Farris

The last produced passenger 747-400 departs from LAX. Photo by Brandon Farris

This is the first new Boeing wide body for China Airlines since they took delivery of the last ever produced passenger 747-400 nine years ago back in April 2005. Coincidentally the 777-300ER’s are going to be used to replace the 747s from China Airlines fleet.

The new aircraft will enter service on October 10th when it departs at 07:25am local time from Taipei as Dynasty 601 operating to Hong Kong and arrive at 09:15am local time where it will spend about an hour on the ground before it turns around to head back to Taipei.

After China Airlines takes delivery of its second 777-300ER in October, the third will come in November.  After that they will begin operations twice a day to Los Angeles starting December 1st. It will replace both the carrier’s 747 flights. In 2015, China Airlines plans to upgrade its flights to San Francisco, New York City and Frankfurt.

“The introduction of the Boeing 777-300ER fleet is an important milestone for China Airlines,” said China Airlines Chairman Huang-Hsiang Sun but indeed the cabin has taken center stage. “Over the past two years, China Airlines has taken a broad new approach and philosophy to cabin design. In addition to enhancing safety and fuel efficiency, China Airlines is making a pioneering move in the airline industry to incorporate Taiwan’s cultural creativity into its cabin interior. I am confident that this will leave a lasting impression on passengers and enhance our competitiveness.”

Chinese New Year theme.

Chinese New Year theme.

China Airlines will introduce a new, state-of-the-art cabin interior onboard its 777-300ER designed by award winning Taiwanese architect Ray Chen. China Airlines’ new aircraft has a capacity of 358 seats. Business Class (J) boasts 40 seats in across two cabins and in a 1-2-1 direct aisle configuration giving passengers full flat pitch of 78”. The Premium Economy Class (Y+) has 62 seats configured in a 2-4-2 abreast configuration giving passengers a 39” pitch. Economy’s 256 (Y) seats are in the rapidly emerging 77W industry standard 3-4-3 configuration with 32″ seat pitch.

Where the aircraft really stands out is in the unique cabin interior led by Chen. The liberal use of bamboo and wood accents, and even paintings in the lavatories make a strong brand statement for the airline and its home nation. The LED lighting is put to good effect with multi- hued programmable color combinations in the J cabin depending on what holiday it is. For example, if it is Chinese New Year, the cabin sidewalls will be projected with deep red tones while the ceiling will be bathed in gold light. The moon festival would see a blue sidewall and gold ceiling theme and finally for Christmas, a red sidewalls and white ceiling.

Up front, The B/E Aerospace Super Diamond seats feature 180 degree full-flat beds that have ergonomic memory foam cushions. Their reverse herringbone configuration allows for direct aisle access and suite like privacy.

The tea and literature area of the Sky Lounge.

The tea and literature area of the Sky Lounge.

The defining feature of China Airlines 777-300ER aircraft lies in its poetic beauty, inspired by Lu You. The industry’s first high-ceiling Sky Lounge in Premium Business Class thoughtfully integrates Eastern and Western culture. It serves as a relaxing space for passengers and a platform for showcasing Taiwanese culture. The elaborately designed lounge is where teas and coffees of Taiwan are offered along with many tasty desserts. It will feature Lishan Oolong tea along with coffee from Dongshan. They area also has a has a bookshelf with a diverse reading collection of materials to stimulate the mind and enrich life.

The premium economy class seating is in a fixed back shell and front sliding recline so that passengers don’t infringe with those who are sitting behind them. With the extra 6″ of pitch, It also features a expanded personal storage space and a three-position foot rest. Each seat is equipped with a power outlet and USB port.

A set up Skycouch shows how it would work.

A set up Skycouch shows how it would work.

Unusually much of the innovation is saved for the tight 3-4-3 abreast economy cabin. China AIrlines will be the first in Asia to introduce the Skycouch, which first debuted on Air New Zealand a few years ago. China Airlines licensed the Air New Zealand patented product though they revised it to cater to small families rather then couples. Initially, it will only be available for ten rows between 41 and 51 on the right side of the aircraft.

The IFE is standard top end fare for the 777-300ER. The entire aircraft is equipped with the Panasonic eX3 inflight entertainment system in all three classes with 18″ screen in J, 12.1″ screen in Y+, and Y getting an 11.1″ screen at every seat. Wi-Fi will also be equipped onboard the aircraft with rates starting at $11.95 for one hour, $16.95 for three hours and $21.95 for 24 hours.

Our verdict from a tour is that the overall aesthetic is positively unique. In a sea of rather generic cabins, China Airlines’ product couldn’t be confused with a carrier outside Asia. The idea is to welcome the airlines guests to Taiwan the minute they board and regardless of class, the cabin seems to have done its job.

But all this aesthetic and materials innovation could come at a cost. According to a China Airlines official who asked to remain anonymous, there is concern the aircraft has increased weight which would increase fuel burn. Once the carrier begins its New York route, it may have to make a fuel stop on the way back similar to what Eva Air does on its Taipei-New York route. It currently stops in Anchorage for fuel.

For additional information and photography, our colleagues at Airline Reporter also covered the handover event. 

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Air China Takes Delivery of Its First 747-8 Intercontinental

By Brandon Farris / Published September 30th, 2014


Air China  took delivery of its first Boeing 747-8 Intercontinental Monday, becoming the second operator in the world of the passenger variant of the Boeing 747-8.

“Air China has been operating 747s since the 1980s,” said Song Zhiyong, president of Air China, “This iconic airplane has played an important role in Air China’s international development and has also witnessed many milestones of the reform and opening-up of China. We are very proud to introduce the new 747-8 into our fleet to continue its tradition into the future.”

Mr. Zhiyong, a certified 747 pilot, will fly the carrier’s new flagship aircraft home with one of his pilots. Coincidentally, the 747-8 will fly to China on the same day that the first 747 rolled out back in 1968.

With seven additional 747-8 aircraft on order, Air China will initially use the aircraft domestically in October for training purpose, before expanding internationally with service to Frankfurt, Los Angeles, and New York as they take delivery of more 747-8is. Service to Frankfurt will begin in January 2015, but exact dates for the latter routes have not been officially disclosed.

“We are extremely honored to partner with Air China to introduce the first 747-8 Intercontinental into Asia,” said Boeing Commercial Airplanes President and CEO Ray Conner, “The 747-8 Intercontinental will deliver improved operating economics, efficiency and environmental performance in support of Air China’s growing long-haul fleet. This historic delivery demonstrates the continuity of our long and enduring partnership with Air China.”

Air China has configured its 747-8i with 365 seats in a four-class configuration ( 12F / 54J / 66y+ / 233Y ). The premium economy cabin will feature 38 inches of seat pitch while the economy class will feature a 33 inches of pitch. Additionally, the first class suite will actually be located behind the flatbed business class seats as Air China feared the suites would be constrained by the narrow nose. The plane was not open for media tours and no photos were available from the carrier at the time of publish.

Sales of the 747-8i have been extremely disheartening for Boeing, causing the airframer to reduce production to 1.5 aircraft per month. However, Boeing executives are upbeat that  the type will win new orders soon. Korean Air will be the next airline to receive the Boeing 747-8i.

See below for additional photographs from the Air China event

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Wireless Streaming Entertainment Comes of Age at APEX And On Your Flight

By John Walton / Published September 29th, 2014


Wireless streaming has been billed as the Next Big Thing in inflight entertainment for years. But last week at the APEX Expo, the big entertainment-focused trade show, a series of developments means airlines will stream more and more — both on their own devices and to your tablet, phone and laptop.

In the US, carriers including American, Delta, United and Southwest offer what’s called BYOD streaming, where they have a server on the plane with entertainment (think a mini Netflix box on board, rather than streaming to the ground). You connect to their Wi-Fi as normal, though you don’t need to use the Internet - just stream from their onboard library.

JetBlue, meanwhile, is taking another track and making the most of its superfast FlyFi Ka-band network, provided by ViaSat’s Exede. Rather than being a content provider itself, JetBlue has the capacity to let you stream Netflix, Hulu, YouTube or whatever you prefer from the ground. That saves the airline a fair bit on royalties, and on having to staff up in order to negotiate getting you those movies.

US airlines who adopted inflight Internet early have a streaming advantage: it’s quick and easy to add streaming to existing installations. If the Wi-Fi is there for the Internet, the Wi-Fi is there for wireless streaming. Internationally, fewer airlines have Wi-Fi, due to compounding factors including a lack of ATG provision outside North America, a dearth of faster satellite capacity in the Ku and Ka bands, and increased scrutiny of satellite radome birdstrike survivability by the FAA and other regulators over the last couple of years. IntelliCabin_4

Tablets are the obvious way to watch streaming content, not least because few economy seats are pitched far enough apart to use a laptop.

That explains why a huge focus of this year’s APEX Expo was the frustration airlines feel about the excessive paranoia by entertainment studios in terms of early-window content (just out of the movie theatres, before the DVD release) being pirated from tablets on the plane. Let’s be clear, content piracy is a bad thing. But it’s highly unlikely that even the most DRM-free tablets would be a significant source of piracy, not least because everything anybody would want to pirate has already been pirated by the time that the early window opens.

A potential solution for airlines to the early window problem is to leverage the eternally increasing size of SSD storage and offer a huge catalog of cult TV and classics. Think of it as a combination of Netflix and Nick at Nite.

The backend tech options also give airlines a significant amount of choice. Some airlines decide to install streaming permanently, while others have a quite literally hot-swappable option. Lufthansa subsidiary LSG Sky Chefs is offering a fully plug-and-play system that slots into a galley oven and creates a plug-and-play option for airlines to provide on some routes. Add the wide reach and supply chain of a global catering business — and perhaps a galley cart full of rental tablets to use with the system — and LSG may be on to a winner. RECARO_CL3710_Concept_13-inch_monitor

Yet seatback screens aren’t going away anytime soon. A quiet focus of this year’s APEX expo was on the options for airlines to maximize advertising revenues from inflight entertainment.

Clearly, the captive audience factor of a seatback screen is a bonus here — and not just on long-haul aircraft where holding a tablet for 14 hours would be a pain. Delta has retrofitted a significant proportion of its domestic narrowbody fleet with seatback IFE, and American is opting for it on many of its newest domestic aircraft as well. It’s a rare international aircraft that doesn’t come with full on-demand seatback IFE these days, with Philippine Airlines’ OnAir streaming an exception.

PAL wireless streaming entertainment

A hybrid solution is embedding tablets in the seatback, pushed particularly by Lufthansa Systems and, in a last-ditch attempt to remain relevant in an iPad world, digEcor, the company that made the pre-iPad digEplayer device. BAe Systems is also offering a Samsung Galaxy Tab-based system that feels very similar to tablets that passengers will already own. Embedding the tablet allows airlines to reduce the time-to-market of seatback entertainment in the fast-paced world where anything appearing on a brand-new seat today is essentially two-year-old technology.

The problem to overcome for embedded systems is safety. One of the reasons that seatback systems take so long to develop is that regulators must be satisfied that they are HIC (head injury criterion) compliant. Options to pass HIC include a protective film (similar in concept, though not materials, to the films many smartphone users use on their screens), a slide-up safety plastic protector that can be raised during the critical phases of flight like takeoff and landing, or a recessed placement to take the screen out of the “arc” of a pivoting passenger’s head.

A complicating factor: current HIC testing is essentially done with an automotive dummy, which measures 5’10”. By extension, passengers whose heights diverge from that standard may well raise questions about their own safety. After speaking with a dozen interiors manufacturers at APEX and elsewhere, the generally secretive interiors industry is quietly expecting a re-examination of the HIC standards and a requirement to use different sizes of safety dummies to ensure that all sizes of passenger are protected to the same standard.) Lumexis-Second-Screen

But the real killer application will be letting passengers use their own devices for dual-screening with a seatback option, whether embedded tablet or traditional screen. IFE systems can do more than ever before, including interactive moving maps, duty-free shopping, ordering food, destination content, connecting flight details, and airport gate info, but nobody wants to stop their movie or TV show to do it.

Making the most of the reduced attention spans of today’s — and tomorrow’s — passenger, and making more ancillary revenue while doing it, is truly the future of IFE.


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Analysis: Airbus A320neo First Flight Is a Triumph of Incrementalism

By Vinay Bhaskara / Published September 25th, 2014

The Airbus A320neo takes off for the first time from Toulouse, France. Image courtesy Airbus.

The Airbus A320neo takes off for the first time from Toulouse, France. Image courtesy Airbus.

The Airbus A320neo flew for the first time Thursday in Toulouse, marking the most important step towards entry into service for Airbus’ re-engined airline since the program was launched in December 2010. The first flight took off at just after 12:00 pm local time for a flight of 2 hours and 22 minutes, and was operated by an A320neo registered as F-WNEO (MSN6101)

The A320neo’s first flight occurred on schedule despite rumors that problems with the Pratt & Whitney PW1100G, whose smaller cousin, the PW1500G delayed flight testing for Bombardier’s competing CSeries program earlier this year, would push back the planned date. However, according to Airways News sources at the Tolouse-based airframer, testing of the A320neo’s second engine, the CFM International LEAP-1A is running behind schedule. The LEAP-1A has been chosen by a slight plurality of A320neo customers over the PW1100G (35% to 31%) despite the latter engine’s potential for better fuel burn and maintenance cost performance, though nearly 34% of firm orders for the A320neo have not yet been assigned an engine. CFM is the sole supplier of engines for rival Boeing’s competing 737 MAX with its LEAP–1B engine, and according to sources familiar with the respective programs, has been prioritizing resources and investment into the LEAP–1B.

Operating Economics Boosted

Alongside the first flight, Airbus has stepped up its effort in the war of words with rival Boeing, along with an update to the A320neo’s cost savings reflecting the increase in the maximum seating capacity of the A320neo to 189 seats thanks to the Space Flex design that rearranges the galley area. At the ISTAT Europe conference earlier this week, Airbus Chief Operating Officer, Customers John Leahy, presented updated performance estimates for the A320neo, which Airbus projects will burn 20% less fuel per seat versus the current A320ceo thanks to the aforementioned capacity increase and a performance improvement package (PiP) from Pratt & Whitney. The comparable figures for the A319neo and A321neo are 19% and 23% respectively, taking advantage of increases from 156 to 160 seats and 220 to 240 seats respectively.

However, it is well known that the A320neo’s operating economics will lag behind those of the 737 MAX 8, mirroring the present day gap between the A320ceo and the Boeing 737-800. The performance of the 200-seat 737 MAX 8, dubbed the 737 MAX 200, is also expected to be 20% better than the present-day 737-800, preserving the advantage held by Boeing. At the ISTAT Conference, in an interview with Leeham News and Comment, Kiran Rao, Executive Vice President, Sales & Marketing for Airbus, took aim at the higher capacity MAX 200. “At 200 seats the vast majority of [the 737 MAX’s] seats are at 28 inch pitch. Even at 194 the seat pitch is 28, as the lost seats are replaced with galley,” he says. “For the A320 at 189 seats, the majority of seats between Door 1 and mid cabin exit are at 30 in pitch. Behind the mid- cabin we are also at 28 in pitch.”

Despite Mr. Rao’s commentary, Airways News projects that the 737 MAX 8 (or MAX 200 for low cost carriers [LCCs]) will continue to hold an economic advantage over the A320neo. The A320neo currently has more firm orders than the 737 MAX 8 by a ratio of 2,484 to 1,952 but the latter aircraft has outsold the A320neo since it was launched, and Airways News eventually projects that the 737 MAX 8 will outsell the A320neo.

Family Success

However, despite Boeing’s edge in what the Chicago-based airframer has described as “the heart of the [narrowbody] market,” the Airbus A320neo family will likely outsell the 737 MAX over the long run, eventually stabilizing at a market share of 55-57%. The rationale comes from the dominant superiority of the A321neo versus the 737 MAX 9, which it has outsold by a ratio of 724 to 212. The 737 MAX 7 and A319neo have sold 55 and 49 copies respectively and are effectively irrelevant to the long run future of either program. But the A321neo represents a real advantage for Airbus, to such a degree that Boeing will likely be forced to launch a 757 successor.

Airways News is less confident than Boeing that the narrowbody market will be centered on the 737-800/A320 sized aircraft over the next 20 years. The trend in commercial aviation since the 1960s is a near continual increase in the size of the average mainline narrowbody aircraft; ranging from the Douglas DC-9-10/20 to the, Boeing 737-300 and McDonnell Douglas MD-81/82, to the A320 and 737-800 in the present day. The world’s aviation infrastructure is finite and increasingly embroiled in regulatory snafus (the Middle East excepted), and Asian markets in particular will need to up-gauge service in several markets in order to capture the growth in that continent’s middle class. It’s not unforeseeable that Airbus sells 2,500 copies of the A321neo over the next 15 years while Boeing trails with 1,250 737 MAX 9s and however many 757 replacement aircraft it can sell in the last four or five years of that window.

Airbus’ Greatest Triumph

Airbus’ control of the largest narrowbody segment underscores the remarkable success of the entire A320neo family of aircraft. Indeed, the A320neo, not the A350 or the troubled A380, is the greatest achievement for Airbus in the last 26 years (since the launch of the A320ceo) or perhaps even the 47-year history of the company. The A350 and A330neo were responses to the success of the Boeing 787 and the A380 was a prestigious project to be sure, but was plagued by delays and received tepid response from the market. But with the A320neo, Airbus finally seized control of the strategic dynamics of the large commercial aircraft, and it is poised to maintain substantial leadership in the narrowbody sector for at least one development cycle.

Setting aside the sales dominance of the A320neo, its more powerful achievement lies in what it represents strategically. After the initial success of the A320ceo, which Boeing more than countered with the more profitable 737 Next Generation, Boeing held the upper hand in the strategic balance between the two companies. Between the success of the 777 and the 787 Dreamliner, Boeing seized the upper hand in the more lucrative widebody segment of the market, while the tepid response to the A350 (really A330neo) Mark I sent Airbus scrambling back to the drawing board, and it couldn’t come up with a successful response (in the form of an A330neo) until Boeing was sold out for so many years that availability of mid-sized widebodies became a real challenge for several airlines. But with the A320neo, Airbus forced Boeing out of its complacent shell and plans to launch a clean-sheet 737 replacement in the early 2020s. But the success of the A320neo forced Boeing’s hand into a re-engining project that it didn’t want to undertake. The remarkable customer response to the A320neo, shifted the upper hand to Airbus, whose platform offers the opportunity for more savings in the long run due to its dual source engines and larger fan size (the A320neo’s wings are higher off the ground than those of the 737 MAX). Boeing’s initial belief that it could weather the storm by upgrading the 737NG was proved wishful thinking by American Airlines’ landmark order for 130 A320neos in July 2011, and Boeing was forced to scramble for an answer.

The Age of Incrementalism 

While the launch of the A320neo is certainly a joyous occasion for Airbus on its own, its impact on the aviation world is far more deleterious. The Airbus A320neo, by virtue of its success, has ushered in what we call an “Age of Incrementalism,” in which the major original equipment manufacturers (OEMs) avoid the massive investment and risk involved in developing clean sheet airplanes for the safe harbor of re-engined aircraft. Once the A320neo made it clear that airlines would accept a re-engined airplane so long as it delivered substantial improvements in operating economics (driven primarily by new engine technology), OEMs around the world began tailoring development towards re-engined projects like the Embraer E2, Boeing 777X, 737 MAX, and A330neo.

Bombardier’s CSeries, the 787, and the A350 all pre-date the A320neo, so none of the big four manufacturers is likely to build a new clean-sheet airplanes for ten years. Those ten years will see massive innovation in fields as disparate as automobiles and cloud computing, but the commercial airliner business will not participate. Aviation needs more of the 787 and A350, and less neo and MAX. For all of the faults of the 787, it represented genuine innovation in its body composition of carbon fiber reinforced plastic and in its passenger comfort advances. But the Boeing-Airbus duopoly (and Embraer-Bombardier beneath them) has gotten too comfortable. And the world of commercial aerospace suffers accordingly.

Eurasia to the Rescue?

Perhaps the best hope for restarting innovation in the commercial aerospace sector comes from the developing world; namely Russia, China, and East Asia. China is probably 30 years away from building a viable competitor to Boeing and Airbus aircraft (and we actually believe that a consortium involving some or all of Korea, Japan, India, Vietnam, and Taiwan might be the first Asian competitor for Airbus and Boeing). But Russia is a more interesting case. Recent geopolitical events and sanctions placed on the Russian economy have led the Russian government to increase investment in its domestic programs such as the Irkut MS-21. Russian technology and (more importantly) reliability is catching up with that of Western aircraft as evidenced by the improving performance of the Sukhoi Superjet. And its not inconceivable that at some point over the next decade, the Russians will launch an aircraft program that upsets the Airbus-Boeing duopoly, and in much the same manner as the A320neo, force the hand of executives in Tolouse and Chicago.


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Airways News to Take Flight with Benét J. Wilson as Co-Editor-In-Chief

By Chris Sloan / Published September 22nd, 2014

BenetWilson-3In less than two years, AirwaysNews has transformed from a blog and historical website (as, into a topical, credible and widely read news and analysis resource for stakeholders in the commercial aviation industry. The past year and half has brought several substantial changes, and most recently, we entered into a strategic alliance with Airways Magazine, relaunching and rebranding the site as The feedback and results have encouraged us to take the next step that we couldn’t be more excited to announce today.

After a competitive and exhaustive nationwide search, nationally known and respected aviation journalist Benét J. Wilson is taking the left seat as co-editor-in-chief of AirwaysNews. For the many who have read Benét’s work and those that have worked with her, you know what a coup this is for our reader-base and us. Benet has worked on both sides of the fence: for airlines (Delta Air Lines & Mesa Airlines Group) , manufacturers (Rolls Royce North America), and trade organizations (Regional Airline Association) and the aviation press (Aviation Week, APEX, Airports International). Additionally, Benét is a widely followed blogger and social media maven, penning articles under the name AvQueen Benet. We are thrilled she is bringing all of her firepower to us beginning October 6th. Benét is brimming with boundless ideas and passion that you will see in the weeks and months to come as we head into a very busy season for the industry. Find more on this announcement in our press release below.

I personally want to take the time to thank our team who haven’t missed a beat during this
transition, particularly our Senior Business Analyst Vinay Bhaskara who has filled in as our interim co E-I-C. Given Vinay’s aversion to titles and praise, I will just say thank you. Vinay will continue in an even more significant role to be announced at a later date. Additionally, we would like to thank Ian Petchenik who has also been invaluable to during the transition period. We’re glad to have him continue working with us in the coming months.



Industry Luminary Joins Newly Rebranded Aviation News Site on October 6

Miami, Florida – September 23, 2014 – Airways News ( is preparing to take flight with a new co-editor-in-chief in the cockpit. Aviation industry luminary Benét J. Wilson will join Airways News editor-in-chief Chris Sloan on October 6, officially relaunching the aviation news site under its new brand, which is a strategic alliance of and Airways Magazine.

“I couldn’t be more pleased to welcome Benét to the Airways News staff,” said Sloan in making the announcement. “With her background, vision and unmatched connection to all-things aviation, she clearly has what it takes to help Airways News reach even greater heights as we target industry professionals, frequent travelers and those who follow this ever-changing business closely.”

A veteran aviation journalist, Benét J. Wilson is the Air Travel Expert for and has penned her own blog,, covering the industry and travel topics for many years. She has been published by numerous publications and blogs, such as Cranky Flier, ACI-NA Centerlines, Aviation International News, Airport World and the Airline Passenger Experience magazine. Wilson served as an editor at Aviation Week, where she covered airports/security, business/general aviation, launched the company’s first blog and led the team’s social media efforts. She also wrote newsletters on regional airlines, airports and air cargo for Access Intelligence (formerly PBI Media).

Most recently, Wilson was the eNewsletters/social media editor for the Aircraft Owners and Pilots Association. She has also served in senior communications positions at the Regional Airline Association, Mesa Air Group, Rolls-Royce North America and Delta Air Lines. A self-proclaimed Air Force brat, Wilson lives in Baltimore, Maryland, where she is working on her private pilot’s certificate.

“I am delighted to join Airways. I look forward to working with Chris Sloan and the rest of the Airways team to take the website to the next level,” said Wilson. “We will all work hard to ensure that the site becomes the go-to place for the best in aviation news and analysis.”

Airways News, with Wilson as co-editor-in-chief, will continue to share content, contributors and promotion efforts in its strategic alliance Airways Magazine, going beyond the aviation enthusiast audience to reach aviation stakeholders, employees and frequent travelers.

Founded by Sloan in 2003 as, Airways News is a continuously updated, forward leaning source of news, features, and information for the vibrant and every changing aviation industry. Airways News content—featured regularly by Forbes, CNET, Business Insider and USA Today, among others—includes top-quality editorial coverage across a breadth of subjects: Breaking News, Aircraft & Technology, Airports, Aviation Safety, Business Financials and Analysis, Commemorative Events such as First Flights and Inaugurals, Historical Features, Passenger Experience in-the-air and on-the-ground, Trip Reports, Route News, and Special Features, such as #TGIF and Weekend Rewind.


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When is a Rebranding not a Rebranding? Parsing the New Southwest Identity

By Ian Petchenik / Published September 2014

Ask any executive at Southwest about the graphic identity changes the company unveiled in Dallas yesterday and they are quick to point out that it is not a rebranding. But if it’s not a rebranding, then what exactly is it and why do it at all?

After Monday’s announcement, Southwest’s marketing and brand executives sat down to discuss why they chose to leave the canyon blue behind and what it means for Southwest moving forward.


Kevin Krone, Southwest’s Chief Marketing Officer, speaking on the brand panel at Media Days. Image Credit – Ian Petchenik / Airways News

Southwest’s announcement of a new livery and company-wide visual identity comes at time when the airline is preparing to change in a number of important ways. The merger with AirTran is scheduled for completion by the end of 2014, the Wright Amendment is set for repeal in October, and new international destinations are on the horizon. Southwest was also contending with a varied and cluttered internal brand identity.

As Kevin Krone, Vice-President and Chief Marketing Officer, explained, “We needed a new consistent look. We had the heart, the plane icon, Business Select, Pets, Rapid Rewards,” and a number of other identity pieces. Anne Murray, Senior Director of Marketing Communications was a bit more blunt when she said the new logo meant “no more logo soup.”


Slide from Southwest brand presentation describing multitude of logos. Courtesy of Southwest Airlines.



Southwest’s new “Heart” logo. Courtesy of Southwest Airlines.

Southwest’s goal with the new visual identity is a “simple, keen expression of who Southwest Airlines is,” according to Krone. For this simple, keen expression, Southwest turned to long-time partner GSD&M and Lippincott & Co., a global brand identity consultancy. Lippincott’s previous airline clients include United, Delta, and Avianca. The result of over a year of work is the new Southwest “Heart” motif with a stylized red, yellow, and blue heart squarely at the center of Southwest’s brand identity. Robert Jordan, Southwest’s Chief Commercial Officer, sees the new heart as integral to Southwest’s identity, “It’s our symbol like the Apple logo or the Target logo. It’s what makes us different and drives us.”

Part of the idea behind the brand refresh and rollout is priming travelers who don’t already fly Southwest with an image of a modern airline. Southwest wants the chance to make a new introduction to markets that have consistently viewed the airline as a leisure airline, particularly in New York and Washington D.C., and feels the brand refresh provides that opportunity.

Southwest will also be using the brand refresh to update the interiors of their aircraft. Jordan said, “Change in the cabin is coming, specifically new seats. We have found the Evolve seat has had an issue with durability of the seat bottom.” The new seat bottoms will take about a year to get into aircraft due to testing and certification requirements. The rest of the seat will remain physically unchanged save for the updated color scheme. Passengers can expect a bluer look on the inside of the aircraft, along with the heart logo featured prominently.

Krone also discussed Southwest’s much vaunted “Bags Fly Free.” On the question of that possibly changing, he said, “Free bags are a part of the airline’s DNA. People have a right to take stuff with them on vacation. We don’t see this going away.” He also doesn’t see a place for premium economy style seating in the near term, though Southwest isn’t ruling it out. Krone, however, specifically excluded the addition of in-seat power on Southwest aircraft anytime soon, citing the cost and weight of such systems. While he promised additional passenger experience improvements coming later this fall, he did not specify what those were.


One of Southwest’s new television ads, “Attitude”. Image Credit – Ian Petchenik / Airways News

But the new identity isn’t just for customers. In fact, much of it isn’t directly for anyone outside the company at all. Nearly all of the accompanying marketing materials feature employees and embrace Southwest’s culture. For an airline that believes its culture is what separates it from its competitors, it’s only natural to rely heavily on that image as the face of the brand. In talking with various Southwest executives it became clear that one of the main drivers behind the new branding was leveraging existing brand equity to project an updated image of an airline that cares about its employees.

It remains to be seen if the new branding will have any effect on Southwest’s culture, employees, and—perhaps most importantly—profits, as Southwest wrestles with rising costs and issues with labor contracts. But one thing is clear: Southwest is going to wear its heart on its belly.


Southwest’s new livery featuring the “Heart” on the belly of the aircraft. Courtesy of Southwest Airlines.

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Mexico City to Receive New International Airport

By Benjamin Bearup / Published September 8th, 2014

Mexico City's new international airport: Image Credit - Foster + Partners

Mexico City’s new international airport: Image Credit – Foster + Partners

Mexico City is set to receive a new state-of-the-art-airport on a site adjacent to the current Benito Juarez International Airport. The $9.2 billion project will be constructed by a consortium of firms anchored by Sir Norman Foster’s Foster + Partners. The first phase of the new airport will be completed in early 2018 or late 2019, including three runways and a single terminal with capacity of 60 million passengers per year, more than double that of the current airport. In its final stages, the airport will have six runways and a capacity of 120 million passengers per year.

The project is expected to create up to 160,000 jobs for the local economy during construction and will maintain tens of thousands of new jobs long term. The projected economic impact of the new airport on tourism in Mexico is roughly $19.6 billion, doubling the current figure in line with traffic expansion.

The terminal building will cover an area of roughly 555,000 square meters, making the new airport one of the largest in the world by size. In addition to Foster + Partners, the consortium selected to design and construct the airport includes FR-EE (Fernando Romero Enterprise) and NACO (Netherlands Airport Consultants). The main terminal building will be designed by Lord Foster, who also designed London’s Stansted Airport, and Terminal 3 at Beijing International Airport, the world’s largest airport terminal when it was constructed.

The proposed initial design is for a single terminal building, similar to Beijing’s Terminal 3. It will house 95 gates including 12 dedicated to widebody aircraft. A large dedicated cargo facility is also shown in renders of the airport, with the capacity to handle more than 20 cargo aircraft simultaneously.

A rendering of the new Mexico City International Airport terminal: Image Credit - Foster + Partners

A rendering of the new Mexico City International Airport terminal: Image Credit – Foster + Partners

The main terminal building will have a span of between 100 and 170 meters, making it close to than three times wider than most modern airport terminals. One of the most recognizable architectural highlights of the main terminal is the light-weight glass and steel roof. The entire terminal will be enclosed within a continuous lightweight grid-shell that will feature “embracing walls and roof in a single, flowing form, evocative of flight.” The roof is specially designed for Mexico City’s poor soil conditions.

An interior rendering of the new airport: Image Credit - Foster + Partners

An interior rendering of the new airport: Image Credit – Foster + Partners

The new airport incorporates sustainable design, with features such as LEED Platinum which provides cool and comfortable conditions inside the terminals using minimal energy. LEED Platinum works by using air displacement ventilation principles to constantly pump fresh cool air into the terminal, using almost 100% outside air while adding little to no additional heating or cooling.

Mexican cultural influences will be prevalent throughout the airport, featuring art from local artists and creative design elements with major influences from Latin American culture. One of the largest show pieces inside the new terminal will be a full scale Olmec colossal head. However, the Olmec head will very likely be artificial due to the rarity of these heads (only 18 have been discovered. Other large cultural show pieces include carved stone support pillars shaped as Toltec warriors from Mesoamerica.

The current Benito Juarez Airport is at capacity, with no direct space for expansion available. Traffic at the airport reached 33.1 million passengers in 2013, and has averaged 9.2% per year in rebounding from a low of 24.1 million in 2010. Lack of spare capacity has prevented several interested airlines, including Middle Eastern carriers Turkish Airlines and Emirates, from launching new long haul services to the airport.

Mexico City’s economy grew sharply in 2013, even as growth in the overall economy tapered off to 1.1%. Rising affluence in the capital and the growth of low fare carriers have driven demand growth, and with the new international airport, Mexican aviation has its talisman for the next several decades.


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Southwest Airlines Unveils New Livery and Brand

By Vinay Bhaskara / Published September 8th, 2014

Southwest Airlines Boeing 737-800 ("Heart Two" / N8645A) in the new livery: Image Credit - Ian Petchenik / Airways News

Southwest Airlines Boeing 737-800 (“Heart Two” / N8645A) in the new livery: Image Credit – Ian Petchenik / Airways News

Southwest Airlines unveiled a new brand and livery Monday, marking its first brand refresh since introducing its present logo and canyon blue livery in January 2001. In an event dedicated to Southwest employees at its maintenance headquarters, the Dallas-based airline unveiled a new aircraft livery (named Heart), airport experience and logo. The new brand enhancement—which has been in the works for about a year—and a new take on Southwest’s famed “ding” mnemonic were developed in collaboration with advertising and branding partners GSD&M, Lippincott, VML, and Razorfish and Camelot Communications.

The new brand image appears to have been prompted by several substantial changes in the Southwest Airlines business model, including major expansions at Northeast airports New York La Guardia and Washington Reagan, the end of the Wright Amendment in October of this year, the first international flights in the company’s 47-year history, and the completed integration with AirTran Airways later this year. At the event, Southwest CEO Gary Kelly highlighted these developments, also crediting the inspiration for the heart motif to Southwest’s team of 46,000 employees:

Gary Kelly on stage at Southwest's announcement. Image credit: Chris Sloan / AirwaysNews

Gary Kelly on stage at Southwest’s announcement. Image credit – Chris Sloan / Airways News

“2014 is a big year and today puts an exclamation point on it, especially with the Berlin Wall of the Wright Amendment coming down in 1 month,” said Mr. Kelly. “The world has changed and we have had to evolve. The heart has stayed the same… and you are the heart. We have a record 2014 and it’s all because of you… Southwest Airlines is built on love by our people and for our people. Our heart is strong and healthier than ever.”


The first plane on display at the event was a newly delivered Boeing 737-800 (registered as N8642E) and dubbed “Heart One,” following the naming convention for all of Southwest’s new and special liveries. A second Boeing 737-800, christened as “Heart Two,” performed a flyby at the event.

Southwest's new branding at Dallas Love Field. Image credit: Ian Petchenik / AirwaysNews

Southwest’s new branding at Dallas Love Field. Image credit – Ian Petchenik / Airways News

Overnight, Southwest also unveiled a new branding concept for airports at its home base at Dallas Love Field. Implementation of the new airport branding will be spread over the next two and a half years through the end of 2016, and integrated into existing and upcoming airport improvement projects so as to remain cost-neutral. Three airports are expected to be converted by the end of 2014. Southwest’s employee uniforms, aircraft interiors, and customer facing brand elements will also be updated to match the new brand image. New service items will be introduced later this fall, while the divisive Evolve seats will begin to be replaced as early as next year. The carrier’s Spirit inflight magazine will be renamed Southwest, and a new edition featuring the new brand will be released on September 15,

Southwest's new airport branding, which was unveiled today at Dallas Love Field: Image Credit - Southwest Airlines

Southwest’s new airport branding, which was unveiled today at Dallas Love Field: Image Credit – Southwest Airlines

Repainting of aircraft is expected to take place over seven years, slower than rivals such as Atlanta-based Delta Air Lines or Chicago-based United Airlines. Southwest operates a fleet of 637 Boeing 737 aircraft, including 136 classic 737-300s and 737-500s, 427 737-700s, and 74 737-800s. It also has 285 737s on order (40 737-700s, 45 737-800s, and 200 re-engined 737 MAXs) with purchase options for a further 227. Given the extended timeline of repainting, it is unclear whether the 737-300s and 737-500s earmarked for retirement will be repainted. However, Southwest’s special liveries such as “Arizona One” will be repainted to incorporate the new Heart paint scheme.

A Southwest Airlines Boeing 737-200 in the 1971-2001 livery: Image Credit - Chris Sloan / Airways News

A Southwest Airlines Boeing 737-200 in the 1971-2001 livery: Image Credit – Chris Sloan / Airways News

Founded in 1967, Southwest has had just three brand identities in its lifetime. Until 2001, its primarily livery was Desert Gold, red, and orange, with the word Southwest written along the upper edge of the tail, as shown in the photograph at right.

Current Southwest Airlines Livery on a Boeing 737-300: Image Credit – Jeremy Dwyer-Lindgren / Airways News

In 2001, Southwest introduced the “Spirit” livery that graces most of its airplanes today, retaining the red and orange stripes on the fuselage and tail but replacing Desert Gold with Canyon Blue. The “Southwest” title remained on the tail, and the aircraft’s belly remained red. The “Spirit” livery is shown at left.

The new livery unveiled today features Bold (not Canyon) Blue, Warm Red, Sunrise Yellow, and Summit Silver. While the two tail colors are similar to the present tail, their order has been inverted, with the lighter Sunrise Yellow placed higher than Warm Red on the tail forward of it on the fuselage. The Southwest title has been removed from the tail and moved to the fuselage; a first for the carrier. Another major change occurs along the belly of the fuselage, where the red line extending the length of the fuselage (and covering the belly) has been eliminated in favor of a simple heart, dedicated to Southwest’s employees.

Southwest's snack options in the new branding.

Southwest’s snack options in the new branding. Image credit – Chris Sloan / Airways News

Southwest’s cabins will also see an update in color and style, but Chief Marketing Officer Kevin Krone stated there are no imminent changes to Southwest’s passenger experience. “Free bags are a part of the airline’s DNA,” he said, “People have a right to take stuff with them on vacation. We don’t see this going away.” He also doesn’t see a place for premium economy style seating in the near term.

The branding in the cabin will get a refresh, including Southwest’s snacks, as seen here. The cabin will include more blue with silver accents and feature Southwest’s heart prominently.


As part of Southwest’s changes, new advertising focusing on Southwest’s employees premiered during Monday Night Football. Other ads, including “More than a Machine,” seen here, will show in markets around the country.


Image Credit -  Stephen M. Keller / Southwest Airlines

Image Credit – Stephen M. Keller / Southwest Airlines

At a panel conducted after the unveiling event Monday, Southwest Chief Commercial Officer Robert Jordan stated that the airline wanted to avoid the “white” and bland liveries that so many other airlines have opted for and retain its “bold” color scheme. Additionally, Mr. Jordan noted that Southwest has several different logos and branding elements in airports, onboard its airplanes, and in advertising. Reducing brand confusion was thus a key impetus behind the redesign. “No other airline can put a heart on a plane and have it look authentic,” said Mr. Jordan, “The heart is now our symbol at Southwest Airlines.”


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Ian Petchenik and Chris Sloan in Dallas also contributed to this report

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Ryanair Launches the Boeing 737 MAX 200

By Luis Linares & Vinay Bhaskara / Published September 8, 2014

A rendering of the Ryanair Boeing 737 MAX 200

A rendering of the Ryanair Boeing 737 MAX 200

Low-cost Irish carrier Ryanair launched the Boeing 737 MAX 200, with a firm order for 100 aircraft valued at $10 billion. The deal also includes purchase options for a further 100 aircraft, with deliveries beginning in 2019 and lasting through 2023.

Europe’s largest ultra low cost carrier (ULCC) already operates a fleet of 300 Boeing 737-800 aircraft, with a further 180 copies on order. It will become the first operator of the larger 200-seat variant worldwide, though it will only configure the aircraft with 197 passengers. The additional aircraft will allow Ryanair to boost its fleet size to 520 aircraft by fiscal year 2024, driving growth to 150 million passengers per annum. Based on current growth projections for European air travel, Ryanair’s goal is to control roughly one sixth of the European air travel market within a decade.

Boeing had announced the increase in the 737 MAX 8′s seating capacity from the 189 offered on the 737-800 to 200 at July’s Farnborough Airshow. The increase will be achieved by incorporating a mid-exit door and raising the aircraft’s exit limit accordingly. The 5.8% increase in seat capacity will allow the 737 MAX 200 to achieve unit costs at least 5% lower than those of the 737 MAX 8, which already projected to be 13-14% cheaper to operate than the present day 737-800. Thus Boeing expects the aircraft to gain wide acceptance from airlines, especially ULCCs, around the world.

The order is a boost for Boeing, who has won more than 2,373 orders and commitments for the re-engined MAX since its launch in 2011. However, even with Ryanair’s order, sales of the 737 MAX continue to lag those of rival Airbus’ A320neo, which has won 3,288 firm orders and commitments since launch.

Despite its large 737 fleet, Ryanair has often had tense relations with the Chicago-based airframer. The airline was launched with used aircraft, but placed its first order for 45 737-800s in 1998. The airline followed that order with additional orders for 155 737-800s in 2001 and a further 100 in 2003. Because it had ordered in bulk, Boeing had granted Ryanair substantial discounts. However when 737 Next Generation (NG) family valuations rose sharply in the past half-decade, it became clear that Ryanair had gotten a steal. Due to Ryanair’s policy of selling aircraft before their first heavy maintenance check (which can happen anywhere between six and eight years after entry into service [EIS]), Boeing is also worried about the effect of undervalued Ryanair aircraft on after-market values. Eager to avoid the same fate, Boeing held firm in negotiations for an order for 200 airframes in 2009. Talks collapsed, and Ryanair didn’t place its order for 175 737-800s until March of last year. This time around, negotiations appear to have gone more smoothly. And despite the rhetoric of Ryanair head Michael O’Leary, who has threatened at times to defect to Airbus’ A320 or even upstart COMAC’s C919, the Dublin-based giant has once again returned to the fold.


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CSeries to Resume Flight Testing in September

By Vinay Bhaskara / Published September 5th, 2014

CSeries FTV: Image Credit - Howard Slutsken / Airways News

CSeries FTV: Image Credit – Howard Slutsken / Airways News

The modified engines for Bombardier’s CSeries flight test vehicles have successfully completed the testing required for a return to flight tests. The first set of engines have been re-installed, and after engine runs and other pre-requisite steps, CSeries flight testing is set to resume sometime this month using flight test vehicle FTV2.

The CSeries flight test program has been grounded since late May due to a sudden loss of power and un-contained failure of one of the flight test aircraft’s Pratt & Whitney PW1500G engines on May 29, 2014. Pratt & Whitney and Bombardier have finalized a solution to the problem that has been incorporated into the engine’s oil lubrication system, and Pratt has completed the first set of modified engines with full flight clearance approval from relevant authorities such as Transport Canada.

Despite the flight testing pause, Bombardier remans confident that the CSeries entry-into-service (EIS) will occur in the second half of 2015. This is in part due to other program work that was accelerated during the flight test pause, such as additional ground tests, configuration and software upgrades, and telemetry and system analysis for data collected thus far. All of these activities were included in the initial schedule for CSeries testing, but were moved ahead of the flight test program due to circumstances.

While no firm date has been announced for its return to the air, our sources indicate that FTV2 could fly as soon as this Sunday.


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Delta To Make Cuts in Pacific and Retire 25% of Its 747 Fleet This Year

By Jack Harty / Published July 31, 2014

6800002537_2dd598b172_z2Delta Air Lines will retire four of its 16 Boeing 747-400s by the end of 2014, further announcing that it will make some cuts and changes to its Pacific route network.

The carrier presently has 16 747-400s in its fleet, which were inherited when it merged with Northwest. The decision means twenty-five percent of its 747 aircraft (4) will be retired by the end of the year. Delta says it is speeding up the retirement of the 747s due to “a re-evaluation of options to improve our international performance.” Three are slated to be retired by the end of September.

Some are slightly surprised by Delta’s decision to speed up the retirement as all 16 aircraft recently went through a major cabin refresh.

Pacific Network Changes

Delta says it will cancel its flights between Tokyo Narita and Hong Kong as well as flights between Nagoya and Manila effective October 26, 2014.

With four of the 747s departing the fleet by the end of the year, the carrier will have to redeploy its aircraft on some of the existing 747 routes. The carrier will begin operating a 777-200 between Atlanta and Tokyo as well as between Los Angeles and Tokyo starting on September 30. On October 26, it will downgrade its flights between Detroit and Nagoya to an Airbus A330-200 from a 747.

The A330s, 767-300s, and 777s are all being redeployed in the Atlantic and Pacific networks since there were some other service reductions.

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ANA, Airbus and Boeing Finalize Major Aircraft Orders

By Jack Harty / Published July 31, 2014

20140731-004409-2649147.jpgBoeing and All Nippon Airways (ANA) finalized an order for 40 wide-body airplanes on Thursday.

The order is split between 20 777-9Xs, 14 787-9 Dreamliners and six 777-300ERs (Extended Range), part of the airline’s strategic long-haul fleet renewal plan. The order is valued at approximately $13 billion at list prices, and it was originally announced as a commitment in March 2014.

“The aircraft we have selected will enable us to modernize and expand our fleet further as we seek to become one of the world’s leading airline groups,” said Shinichiro Ito, president and CEO, ANA Holdings. “These new aircraft will give us maximum flexibility and improved fuel efficiency, and will allow us to meet the growth in demand, both internationally and in our domestic Japanese market.”

“This order from ANA demonstrates the strength of our 50-year partnership and we are proud to make history with ANA once again,” said Boeing Commercial Airplanes President and CEO Ray Conner. “We are honored that ANA has decided to continue operating an all-Boeing widebody fleet that consists of 767s, 787s, 777s and now the new 777X family of airplanes.”

In March, ANA announced that it would place firm orders for 70 new Airbus and Boeing aircraft. Airbus won the narrow-body battle as the carrier ordered seven A320neo and 23 A321neo single aisle aircraft. However, Boeing took home the wide-body order.

The new Boeing aircraft will be used predominantly on international routes.

The carrier chose the 777-9X in part because it boasts a 15% larger seating capacity when compared to the current generation 777-300. Since the -X program is not scheduled to gain full traction until late in the decade, the carrier bought a handful of current generation 777-300ERs.

ANA says the “introduction of these new aircraft will help it respond to the needs of the increasing number of passengers expected to arrive in Japan in the run-up to the 2020 Tokyo Olympics, and will support the Japanese government’s plans to boost the annual total of foreign visitors to Japan to 20 million.”

To date, this order is the biggest in the airline’s history, and Boeing still continues to dominate the carrier’s long haul fleet. The carrier was the launch customer of the 787, and it plans to have a fleet of approximately 80 787s once all of its orders have been delivered.

RELATED: Analysis: ANA Goes Shopping

RELATED: Boeing Launches the 777X with the Gulf Big Three

RELATED: JAL places historic order for Airbus A350 XWB

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ANA To Fly Its First Scheduled 787-9 Flight August 7

By Jack Harty / Published July 30, 2014

KBFI-4_9_14-9ANA will begin flying scheduled domestic Boeing 787-9 Dreamliner flights on August 7. It will introduce the 395 seat aircraft on routes between Tokyo’s Haneda Airport and Fukuoka, Osaka (Itami) and Matsuyama.

ANA will take delivery of two more 787-9s before the end of the fiscal year ending March 2015, and the carrier plans to start 787-9 international flights around these times. The carrier plans to use these aircraft on long haul routes to Europe, North America, and other key destinations. In the mean time, the aircraft will help with maximizing passenger numbers and lower operations costs on domestic flights.

Although the first aircraft have 395 seats, the aircraft will be converted before international 787-9 flights begin next year. There will be 215 seats which is 46 more than its 787-8s have.

Here is the flight schedule the airline has set:

Flight No. Departure Arrival Flight No. Departure Arrival
NH241 Tokyo (Haneda) 7:25 Fukuoka9:15 NH248 Fukuoka10:05 Tokyo (Haneda) 11:50
NH25 Tokyo (Haneda) 13:00 Osaka(Itami) 14:05 NH30 Osaka(Itami) 15:00 Tokyo (Haneda) 16:15
NH595 Tokyo (Haneda) 17:15 Matsuyama 18:40 NH598 Matsuyama 19:30 Tokyo (Haneda) 21:00

In the press release, ANA says it will become the first airline in the world to operate a scheduled flight with the 787-9. However, Air New Zealand was the launch customer, and via Twitter, it said that it will fly the first scheduled flight. The carrier says it will begin flying the 787-9 between Aukland and Sydney on August 9, but when asked which flight, it said that not all of the details have been worked out.


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WestJet Reports Record Earnings and Announces It Will Begin Flying 767s

By Jack Harty / Published July 29, 2014

While WestJet Airlines Ltd. reported record profits this morning, the westjetcarrier announced that it will begin flying four Boeing 767-300ER aircraft for flights between Alberta and Hawaii beginning during the late winter in 2015.

The airline announced a second quarter profit of $51.8 million or 40 cents per share which is up from $44.7 million or 34 cents per share a year ago. The profits beat analysts expectations as it was estimated that the carrier would earn a profit of 28 cents per share.

Despite costs growing (excluding fuel) by 1.9%, the company saw a revenue increase of 10.3% to $930.3 million which is up from 843.7 million year over year.

Growth Is In The Future

Last month, the carrier launched its first flights to Europe when it began flying between St. John’s, N.L., and Dublin. More growth in overseas markets is expected starting in the 2016 summer.

“We continue to execute on our growth plans, including new service to Dublin, Ireland, success with our fare bundles initiative, and the expansion of WestJet Encore,” WestJet’s president and CEO, Gregg Saretsky, said in a statement.

The carrier announced that it will begin flying the Boeing 767-300ER aircraft in late 2015 for flights between Alberta and Hawaii. The carrier plans to have four 767s in its fleet which have a range of 6,000 nautical miles, and they will be replacing  the two Boeing 757-200s operated by Thomas Cook that operate these flights.

Additionally, the carrier says it will use its option to purchase five more Bombardier Q400 turboprops as its regional service, WestJet Encore, continues to expand.

Related: WestJet to Introduce Wide Body Aircraft in 2015


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Airbus Terminates Skymark A380 Order

By Jack Harty / Published July 29, 2014

On April 8, 2014, Skymark Airlines’ first A380 successfully A380 MSN162 SKYMARK TRANSFER TO  STATION 30made its maiden flight, and the aircraft was scheduled to get painted and its cabin installed in Hamburg, Germany shortly after.

However, Airbus has terminated the $1.7 billion order.

Skymark has had some financial troubles during the last year due to a weaker yen and tough competition, and the carrier says it has been in talks with Airbus to cancel the order. The carrier says Airbus had requested that it become an affiliate with a larger airline as a condition for altering the contract and that they asked for a cancellation fee after the carrier rejected the request.

According to the Wall Street Journal, “Airbus terminated the contract when Skymark made it clear that it was not going to perform its contractual obligations,” an Airbus spokesperson said in an email.

“We cannot accept a demand that would shake management independence,” Skymark said in a statement.

Even though Skymark Airlines only ordered six aircraft, the order was big for Airbus as it struggled to sell its A380s in Japan.

Unfortunately, this is the latest blow in the Airbus A380 program. The manufacturer has not been able to attract new customers in the last two years, and just recently, Qatar Airways has rejected delivery of its first three A380s.


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New and Free IFE Options Coming to a Delta Flight Near You August 1

By Jack Harty / Published July 28, 2014

On August 1, new and free inflight entertainment options are coming to more than 1,000 Delta mainline and regional aircraft near you with the “Delta Studio.”

Welcome to “Delta Studio”

Delta’s customers will have access to movies, television shows, music, and games through seat-back entertainment systems or on demand video streaming onboard Delta’s Wi-Fi-equipped aircraft, regardless of what class they are seated in. However, the Delta Studio will only available on flights longer than one and a half hours.

In a press release, Delta calls its move “the most far-reaching effort by an airline to provide hit movies, popular television shows, music and video games for free.”

“Through the introduction of Delta Studio our customers have yet another reason to choose Delta and a different travel experience,” said Tim Mapes, senior vice president – Marketing. “Delta continues to be driven by customer feedback which has consistently placed the desire to be entertained at the top of the list of ways to improve our customers’ time in the air.”

New IFE Options on International Flights

Delta customers seated in BusinessElite, First Class and Economy Comfort will have free, unrestricted access to in-flight entertainment on all international flights worldwide. Customers traveling in economy on all international flights will also have access to free content. Delta completed installation of seat-back entertainment systems on its international fleet in 2013.

New IFE Options On Domestic Flights

Customers traveling on domestic flights in BusinessElite, First Class and Economy Comfort will have free access to all in-flight entertainment. Domestic economy customers will have access to free content which includes all of Delta’s live satellite TV channels, music selections and game options through seat-back entertainment systems as well as movie or TV selections such as ‘The Hunger Games: Catching Fire’ or ‘Frozen’ on seat-back systems in August as well as streaming content through in-flight Wi-Fi.

Want More Content?

Additional premium content will be available for purchase in economy including the latest movie titles such as ‘Need for Speed’ or ‘Rio 2,’ HBO and SHOWTIME programming as well as on-demand TV shows like ‘About a Boy’ or ‘The Middle.’ Delta’s full entertainment line-up for the month of August is available in Sky magazine.

How does it work if you don’t have seat-back entertainment options?

Delta explains that “customers traveling on any domestic Delta or Delta Connection aircraft equipped with Wi-Fi will be able to stream free movies and TV options directly to their mobile devices while in flight by using Gogo’s video player app. The Fly Delta app will include an integrated player for iOS devices. Customers who have downloaded the app before their flight can easily access streamed content from Delta aircraft for playback while in-flight.”

Delta’s Current IFE

Delta currently offers 18 channels of live satellite TV and up to 250 movies, hundreds of TV shows, 2,300 songs and a selection of games on aircraft with seat-back entertainment systems on select aircraft.

There are 140 domestic aircraft with seat-back entertainment systems installed, and the carrier will be adding seat-back entertainment to 56 Boeing 757-200, 43 Boeing 737-800s and 57 Airbus A319 aircraft through 2016. Additionally, more than 100 new Airbus and Boeing aircraft are already scheduled to be delivered with seat-back entertainment through 2018.

More than 900 domestic and international aircraft are equipped with in-flight Wi-Fi, and all of its Boeing 777, 767, 747, Airbus A330 and transoceanic Boeing 757 aircraft are scheduled to receive Wi-Fi by the end of 2015.


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