04.30.2008 | 10:07 am | Flight Comparison
It seems that each new government budget around the world and each new review of the industry all arrive at the same conclusion – air travel costs must rise to offset the damage to the environment and stub the growth in air travel. But how high will air travel costs have to rise before we change our habits?
The bottom line is that air travel is a growth market and there is very little that governments around the world can do to change this. Under the guise of eco-friendly policies we have seen literally billions of pounds of extra tax squeezed from the airline industry with the consumer left to foot the bill at the end of the day. How much of that extra tax income has been spent on the environment?
People need to travel for work, they need to travel for holidays and they want to travel to other places around the world, and no increase in taxes charges will change this attitude – it may well reduce the number of consumers able to afford the increased prices but it will not change attitudes. Perhaps if we saw more of the increased tax income going towards the causes which they are supposed to be supporting, we might be more understanding, but while governments use the airline industry as a “sugar daddy” when they need money, how can the consumer be expected to appreciate this?
There is also a growing ground swell of support for the view that governments encouraged growth in the industry over the last decade to assist with economic growth and tax income. However, while they increase the costs to the airlines in the name of “Green Issues” it is in effect a form of indirect taxation for the consumer – but they would never call it that.
04.29.2008 | 9:54 am | Flight Comparison
Reports have hit the press today which claim that Don Langford, a senior executive with American Airlines and in charge of the group’s European division, has publically stated that Heathrow is the worst airport in Europe and terminal 3 is “a bit of a dump”. So is he correct or just playing politics?
Many people will have a wry smile when they see the quote attributed to Mr Langford, especially when you consider the shocking punctuality record which many US airports have, even compared to Heathrow in its current state. JFK Airport was recently carpeted by the regulators after a period which saw a massive increase in the number of cancelled and delayed flights. We also have the ongoing inspection of US airlines by the FAA who have questioned a number of the safety tests which the US airlines have been carrying out for years – note there has been no UK or European equivalent as yet.
While there is no doubting that the current situation at Heathrow is “disappointing” to say the least, this has not always been the case at the busiest airport in the world. This is an airport which the Americans have had their eyes on for many years, as well as the lucrative landing slots which British Airways dominate. Quite how they managed to miss the auction for BAA when it was sold to Spanish giant Ferrovial is a mystery.
Those in the industry believe that today’s attack on Heathrow is nothing more than a diversionary tactic to deflect attention from the ongoing problems in the US. However, it has to be said that unless BAA are able to get their “house” into order as soon as possible then this crticism may not be the last one we hear from across the pond.
04.28.2008 | 9:35 am | Flight Comparison
In a move which is more of a delaying tactic than an attempt to put together a rescue package, US business class airline EOS has filed for bankruptcy protection in the US after an attempt to raise vital funding fell of deaf ears. This is the latest in a long line of smaller airlines which have hit the buffers of late and it surely will not be the last.
EOS Airlines was something of a phenomenon in the industry, affording passengers extensive leg room on their flights and top class services. In theory their luxury planes could have coped with up to 200 passengers, but they were renovated so that their 48 “guests” would fly in luxury. It seems that a mixture of higher fuel costs, a slowing of the business market and the credit crunch have assigned another chapter in the airline industry to the record books. So what next?
While there were few airlines as generous with space and luxury as EOS Airlines, market conditions have got the better of them. However, you can guarantee that they will not be last to be grounded forever with more and more small US airlines seriously considering bankruptcy protection as an option to give themselves breathing space.
However, while the bankruptcy laws of the US are there to protect companies and give them time to consider their options, there is little likelihood of any “white knights” appearing for the companies that have gone under and the ones currently struggling. Those airline companies with money are looking to shore up their own operations and venture capitalists have never been too keen on the airline industry where union interference and a dependence on the price of oil can often over shadow any spectacular business skills.
Even though the number of grounded airlines is growing by the week, we are nowhere near the bottom of the cycle and more bad news is sure to follow over the coming months.
04.25.2008 | 12:06 pm | Flight Comparison
As we approach the peak summer season the Home Office have announced plans to test face recognition software at a selection of airports throughout the UK. However, the trials are scheduled for the summer period, a time when you might have thought the authorities would be looking to attract as little attention and possible confusion as possible?
Initially the trial will take in holders of UK and EU biometric passports and will simply work by matching various facial features from a camera at the airport to the picture of the passport holder held on file. While the system has yet to be tested in the open market, there are hopes that it will eventually lead to a massive reduction in queuing times throughout the UK and hopefully Europe. However, is the system fool proof?
It would be foolish to claim that any system was fool proof, but it does seem that the computer systems used are able to spot a number of similarities between a stored picture and a real life picture. Using biometric surveillance methods they are able to track the distance between certain areas of the face and use these to compare against the picture held on file.
While it is hoped that the system will help to track down an array of criminals there will be times when innocent passengers are rejected by the system. A second screening process will then take over which will see members of the UK Border Agency formally interview the people who have been refused admission. Even though some are pushing for a totally automated system, there will be times when some faces may not “totally” match the picture stored on the system.
This is an interesting, if somewhat controversial decision, but surely the UK passenger will not be subjected to more delays with new systems this summer?
04.24.2008 | 9:42 am | Flight Comparison
We are now several weeks into the Heathrow Terminal 5 baggage debacle and there are rumoured to be 19,000 bags still waiting to be reunited with their owners. If things are this bad now, how will they be in the summer?
While many of the flights which were supposed to move over to T5 have been rerouted back via the old terminal there are real concerns that the general mayhem and lack of control which British Airways have shown of late will carry over into the busy summer period. So are we in for more of the same?
Even though British Airways are making every effort to reunite travellers with their lost baggage, they were forced to admit that not all baggage will be returned. Due to labels going missing and problems with the computer system, many bags may actually be lost forever. If this can happen during a relatively quiet period can more mayhem be avoided?
Despite calm words and positive moves from British Airways there are concerns that their staff are being stretched to the limit, their baggage handling systems are still not working properly and the problems keep mounting. While the press have gone fairly quiet about the situation, T5 is nowhere near full capacity and there are still problems being encountered.
As well as issues with British Airways flights, the delays and inconvenience have had a knock on affect to other international airlines. Heathrow is the busiest airport in the world and a central link for many flight paths around the globe. The T5 affair has caused major embarrassment to the UK airline industry as a whole, and unless everything is up and running by the summer we could be in for more of the same.
04.23.2008 | 9:19 am | Flight Comparison
While the airline industry struggles to cope with falling passenger numbers and a severe slowing of the business class market, we now see the price of oil touch $120 a barrel for the first time ever. So what does this mean for the industry?
The news that oil has now reached $120 a barrel is bad for the worldwide transport industry, not just the airlines. As costs continue to rise and demand continues to fall we are seeing more and more of the smaller airlines being placed under severe financial pressure. There are already a number of US mergers and acquisitions in the offing and this is set to increase in the short to medium term. But how will it all end?
A similar situation arose a few years ago when passenger numbers dropped off in the wake of high profile terrorist attacks, but the price of oil was not a problem at that stage. However, we did see companies as high profile as British Airways hit serious financial trouble, with many pessimists suggesting that they may have gone under. Thankfully this was not the case but it did focus the minds of many in the industry. If British Airways was being mentioned as a high profile casualty, who could really escape?
It would be wrong to say that the airline industry is no more robust now than it has been in the past, but the current state of affairs regading the rise in the oil price and reduction in passenger numbers has been ongoing for some time. In the past we have seen relatively short sharp shocks and then a return to near normality, but this does not seem to be the case this time around.
If this situation continues for much longer, we may see some of the big names come under increasing pressure.
04.22.2008 | 4:41 pm | Flight Comparison
In a move which many had forecast some time ago, the UK government are set to look into the running of UK airports and whether the fact that the sector is dominated by BAA is holding back improvement in services and further investment.
Transport Secretary Ruth Kelly is looking at ways to improve services to the consumer while doing so within the environmental framework of the UK. There are grave concerns that as BAA is by far the most dominant partner in the UK, they are been able to dictate to airlines and consumers, rather than taking on board a number of grievances which have been aired of late. Many will be aware that while owning the main airports in the prosperous South East of the UK, BAA also own Glasgow, Edinburgh and Aberdeen airports to name but a few.
This move is sure to infuriate Spanish group Ferrovial who took over BAA a couple of years ago in a massive multi billion pound deal. That deal was cleared by the competition and regulatory authorities at the time although now it seems that the government are looking at forcing the company to sell off some of the assets they acquired in the deal.
Heathrow, Gatwick and Stansted airports are the company’s main income earners in the UK and while they have invested substantial money into Terminal 5, things have not always gone to plan. While there are many calling for the breakup of BAA, quite how the government and the competition authorities can affectively scupper a takeover deal which was done some years ago, after initial clearance was given, remains to be seen.
While the investigation into the airport industry has just started, this is an issue which is set to rumble on for some time and attract an awful lot of controversy.
04.21.2008 | 11:23 am | Flight Comparison
As costs become ever more critical in the fight to control the skies and survive what is becoming an increasingly cut-throat industry, we are hearing reports of some planes running low on fuel, prompting a degree of concern from US Regulators. So what exactly is happening?
Continental Airlines have come in for particular criticism from the FAA after it was reported there had been a 5 fold jump in the number of “minimum fuel” declarations by pilots of the airline flying between the UK and US over the last 2 years. These situations arise when the planes which are waiting to land have just over 45 minutes of fuel left onboard – a drop to under 45 minutes worth of flying time leads to a “fuel emergency” when prompt action needs to be taken.
The concerns seem to centre on Continental’s fleet of Boeing 757-200 aircraft which have a range of 3,900 nautical miles against the 3,014 nautical mile average distance between London and New York. While this would seem a comfortable gap, there have been problems with weather conditions and the stacking systems at both London and New York airports as planes wait to land. While nobody is saying that there are any real risks of running short of fuel, the FAA are acutely aware of the 1990 crash at Kennedy Airport where a plane ran out of fuel and all onboard perished.
The comments by the FAA are more of a warning shot in the direction of Continental Airlines than anything more sinister, but it has alerted the flying public to issues which many would never have even considered. There are some who believe that the Boeing 757-200 aircraft used by Continental are not really suitable for transatlantic flights, but as the fight to keep costs as low as possible continues, safety margins have come under some pressure.
04.18.2008 | 11:18 am | Flight Comparison
While the EU regulators recently announced plans to allow mobile phone use in the skies, it seems that the US authorities are not so keen. If rumours from Congress are correct it seems that the US regulators are pushing for specific laws to outlaw the use of cell phones in the skies. So are they actually safe to use?
The subject of using your phone above 30,000 feet has been something of a thorny subject for some time with more pressure being exerted on the regulators to make a decision one way or the other. The EU regulators decided that it was safe to use phones on specially modified planes although it seems that the US has taken a totally different view of the situation.
Interestingly, we have seen the EU regulators come forward with a mass of research which shows that there are no dangers, while their US counterparts are basing their proposed law on the fact that the majority of people do not want phones on planes. If this so called dislike of phones on planes is as widespread as the US Congress indicates then surely this will be a self regulated market with no need for government interference?
While the US regulators talk of laws to ban mobile phone use in the skies they have hinted at concessions for internet use and other non-voice communication systems. Quite how they can differentiate between the legality and safety of voice or non-voice communication is bizarre to say the least, but is seems that we will have some kind of confrontation in the near future.
How will it work if a European airline flies to the US with phone use perfectly legal in Europe? Will passengers have to hang up their calls when reaching US air space?
This clash of views has the potential to cause yet more friction between the growing European air travel market and the US.
04.17.2008 | 11:35 am | Flight Comparison
People who fly regularly will no doubt have come across the term “bumped” on their travels, and a growing number of people will probably have experienced this unfortunate situation for themselves. The term is used to describe airlines’ process of routinely selling more tickets for their planes than there are seats, in order to ensure that they have the best chance of flying full. So what happens if you are the one who is “bumped”?
It is very feasible for you to turn up for your plane at the right time with the right documents and still be refused admission to the aircraft. Very often you will be left to wait for the next available flight, something which can literally takes hours in many cases. So what are your rights?
Under the old regulations which came into effect in 1978, the maximum compensation you could receive was anywhere up to $400 depending upon the time taken to find alternative travel, etc. Thankfully the regulators have now stepped in to double this compensation limit and address the terms and situations in which it may arise. From May 2008 all passengers who are “bumped” will be able to claim compensation up to $400 if they arrive at their destination within 2 hours of the original flight time, and up to $800 if the delay is any longer.
The compensation figures do not include additional refunds for unused tickets as they are designed to avoid a growing trend in “bumping” and possible problems this summer as the travelling season takes off. Quite how this will affect the actions of the airlines and their overall profitability remains to be seen but thankfully we are seeing more action on the side of the consumer - and not before time.
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