The Port of Barcelona will host the Annual Conference of the European Shortsea Network (ESN) next year, for the first time in Spain. The objective of this event, which will be organised by the Spanish Association for the Promotion of Short Sea Shipping (SPC-Spain) with the support of the Catalan enclave, as well as other partners (Grimaldi, GNV, Flota Suardíaz and Neptune Lines), will offer the opportunity to update and share developments and new trends in short sea shipping (SSS), as well as to contact counterparts and various sector agents. In addition to this, the European School of Short Sea Shipping is celebrating its tenth anniversary in 2016, which will be an additional incentive, as highlighted from SPC-Spain.
The 2015 edition took place in Copenhagen, where the most topical issues were dealt with, such as SSS market outlook, Motorways of the Sea, public-private financing, environmental impact, and safety in transport. Further, the options offered by the new CEF financial instrument for the Trans-European Transport Network (TEN-T), as well as some of the projects being developed under the TEN-T program, were explained in detail.
Barcelona El Prat Airport's shuttle train line connecting T1 and T2 with the city will enter the construction phase by the end of Jul-2015, according to Spain's Secretary of State for Infrastructure, Transport and Housing Julio Gómez Pomar (elperiodico.com/europapress.es, 06-Jul-2016). The project is reportedly drawing an investment of more than EUR200 million with between seven and nine million passengers p/a expected to use the service.
The second largest bank in the world has included Barcelona in its expansion plans, setting up its Spanish headquarters here.
The China Construction Bank (CCB) will inaugurate its first headquarters in Barcelona on July 1st, adding to offices in cities such as Paris, Milan and Amsterdam in the entity's expansion strategy
easyJet's recent announcement that it plans to open a new base at Barcelona El Prat Airport from Feb-2016 provides an opportunity to examine the recent traffic history of Europe's leading LCC airport. Barcelona is home to IAG subsidiary Vueling, the biggest operator at the airport and Europe's third largest LCC. Vueling's nearest competitors here are Ryanair and easyJet, ranked first and second among European LCCs.
The narrative at Barcelona remains substantially about short and medium haul and the main protagonists continue to be Europe's leading LCCs. However, there is an emerging sub-plot, albeit one that remains in the background for now. This concerns the global super-connectors, who aim to turn Barcelona's paucity of long haul destinations to their advantage.
Traffic growth at Barcelona was strong before the global financial crisis, but slumped in 2008 and 2009. It bounced back quickly in 2010 and 2011, before the demise of Spanair interrupted the resumption of rapid growth. After various twists and turns in the traffic growth path of the three leading airlines at Barcelona, all three now look ready to battle hard, particularly for business passengers.
The International Air Cargo Association (TIACA) announced new leadership, effective 21 May when current Chairman Oliver Evans and Vice Chairman Enno Osinga retire.
Sanjiv Edward, Head of Cargo Business at Delhi International Airport has been named as the next Chairman of TIACA, with Sebastiaan Scholte, CEO of Jan de Rijk Logistics named Vice Chairman. TIACA provided the following biographical notes:
* Sanjiv Edward has worked in the aviation industry for over 18 years, including more than a decade with British Airways. He completed his Executive Management Studies from the Oxford Brookes University and also served as a member of the high level Working Group constituted by the Ministry of Civil Aviation, India to formulate the Air Cargo Policy for India. He is one of the founding members of the Air Cargo Forum India and heads its Innovation Group.
* Sebastiaan Scholte has worked in the air freight industry for over 18 years, including with Aeromexico where he was VP Sales. He held senior management roles with Cargolux for eight years from 2002, and took over as CEO at Jan de Rijk Logistics in 2010. He holds a Global Executive MBA from the IESE Business School and is also Chairman of the Cool Chain Association.
TIACA is governed by its Trustee members who elect the Board of Directors to manage the Association’s affairs and establish its policy. The Chairman and Vice Chairman are elected by the Board for two year terms. What is interesting about the current appointments is that neither Mr Edward nor Mr Scholte works for an airline. Both have executive experience with airlines, but Sanjiv Edward now works for an airport and Sebastiaan Scholte for a road freight company. Historically, TIACA was primarily focused on the air freight business from the perspective of airlines, but recent years have seen a welcome (and neccessary) change toward representing all players in the air freight game — including airlines, airports, handlers, truckers, forwarders, and manufacturers. Outgoing Vice Chairman Enno Osinga, for example, was the head of cargo at Amsterdam’s Schiphol Airport.
Auckland, New Zealand is set to become the first destination when Hong Kong-based Cathay Pacific Airways launches the long-haul operation of its Airbus A350-900 in May 2016, following the first delivery of the game-changing aircraft next February, according to people familiar with the oneworld carrier’s preliminary plan. The initial year of A350 operation at Asia’s biggest international carrier will also see the aircraft being used to right-size its European route network, launch new long-haul thin routes whilst providing incremental growth opportunities for its constrained Australian operation.
The commencement of long-haul A350 operation follows roughly 3 months of regional deployment for crew familiarisation and the build-up of engineering station support readiness that will see Manila, Taipei Taoyuan International Airport, Singapore, Osaka Kansai, Bangkok and Ho Chi Minh City in Vietnam amongst the first cities receiving the carbonfibre composite jet.
The preliminary plan, still subject to change, also calls for the “selective replacement of a few B777 routes to current European destinations”, Aspire Aviation‘s multiple sources at Cathay Pacific said. The airline launched a 4 times weekly service to Manchester on December 8th last year and is slated to begin a 4 times weekly flight to Dusseldorf, Germany on September 1st. Replacing the 3-class 340-seat and 4-class 275-seat Boeing 777-300ER on these two routes with a 280-seat 3-class A350-900, for instance, provides the airline flexibility to either boost the flight frequency that business travellers prefer and generally carries a higher yield, or return on airfares measured in revenue per revenue passenger kilometre (RPK) while keeping a lid on the overall weekly capacity; or hasten the maturation process of these new routes by temporarily slashing short-term capacity in order to improve both load factors and yield. Should the airline ultimately decide to do so on such routes, the A350 will enable it to better optimise its product offerings to match market demand.
Meanwhile, Australia is on the radar for A350-900 deployment, with “some upsizing of some A330 services to one or two Australian ports is also being considered” towards the end of 2016, the same sources say. This makes much sense as Cathay Pacific’s number of weekly frequencies to the 4 Australian “capital cities” of Sydney, Melbourne, Brisbane and Perth is currently capped at 70 under the bilateral air services agreement (ASA) between Australia and Hong Kong, with the conversion of all Cairns and Adelaide flights to non-stop earlier this year lifting the weekly total to 74, thus leaving up-gauging the only viable growth option unless the cap is abolished. The airline has already moved one of its 4 daily Hong Kong-Sydney flights, CX138/139, to a 3-class 777-300ER and will be introducing a second 777-300ER flight on CX100/101 beginning 1st October, thus bringing the total capacity increase on the route to 18% for 2015.
Furthermore, not only will the A350 provide incremental growth opportunities for the Australian operation which is celebrating the 45th anniversary of serving Perth this year after the 40th anniversary of continuous non-stop Sydney service in 2014, the 280-seat A350-900 is arguably very fitting to the price elasticity of demand of the market, whose growth in traffic is predominantly driven by back-end economy class passengers. The A350-900, configured with 38 New Business Class, 28 New Premium Economy Class and 214 New Economy Class seats, has a 12.04% bigger Economy cabin than a 251-seat A330-300 with 39 Business, 21 Premium Economy and 191 Economy seats, thus hiking the economy ratio by over 6 percentage points to 82.3% from 76.1% (“Cathay Pacific begins the next chapter of growth“, Apr 8th, 15). The 251-seat A330-300, dubbed “33K”, itself saw the removal of 7 premium economy class seats and the addition of 16 economy seats from the 247-seat A330-300 “33G” configuration.
Given the unclear potential ramifications on the bilateral air traffic rights negotiation between Australia and Hong Kong after the decision of the Air Transport Licensing Authority (ATLA) to reject Jetstar Hong Kong’s application for a local air transport licence, in which the regulator used English and US persuasive precedents and applied the “nerve centre test” in determining Jetstar Hong Kong’s “principal place of business”, growing in Australia with the A350 from late-2016 onwards appears to carry the least risk and is independent of the negotiation outcome.
“The nerve centre has to be in Hong Kong. By nerve centre, the Panel looks at where and by whom the decisions regarding the key operations of an airline are made. Decisions are not those of the day-to-day operations only but also those which are relevant and crucial to the business of the airline. Its activities must not be subject to the control of senior management, shareholders or related parties located elsewhere,” the ATLA wrote.
Intriguingly, it is likely that there will be some months before Cathay Pacific announces the next round of network expansion with the A350, as the operational lead times of 6 months of building up engineering station support capability and gaining regulatory approvals, coupled with the delivery profile of 12 A350s in 2016, plus the aforementioned 777-300ER substitution plan and a possible Australian deployment, mean the launch of “a couple of new destinations” under consideration will be more progressive. Some of the frontrunners are understood to include Seattle, USA and Barcelona, the latter of which has 43.9% of Spain’s total origin and destination (O&D) traffic from Asia/Pacific and yet is significantly underserved with 94.2% of passengers originating from region being indirect in 2014, according to the Barcelona Air Traffic Intelligence Unit. Spain is targeting 1 million Chinese tourists by 2020 with a 20-25% annual growth, with Global Blue, a global duty-free retailer, estimating that a Chinese tourist spends €2,040 on a tour package plus €167 per day on fashion items on average, doubling the average Chinese tourist spend in Germany (“The quiet rebirth of Iberia“, 12th Feb, 15).
That said, the current focus at the airline is the induction of the A350-900 into its fleet, whose first full flight simulator (FFS) has been installed at the Flight Training Centre in the last week of May and the fuselage sections of its first example, MSN029, arrived at Airbus’s final assembly line (FAL) in Toulouse on 29th May.
Cathay Pacific will receive the remaining 10 A350-900s on order in 2017, which will feature the FB2+ New Business Class seats with customisation by Germany’s Porsche Design Group, improved table and personal television positions; in-flight Wi-Fi; and a new Economy tray service, before deliveries of 26 A350-1000s begin in 2018.
easyJet announced plans to open a new base at Barcelona El Prat Airport in Feb-2016 with three based aircraft. easyJet stated: "Barcelona has always been a key network point for easyJet and the base opening consolidates easyJet’s strong position at Barcelona carrying almost three million passengers a year to and from 14 airports across Europe. With aircraft based at the airport business travellers will be able to benefit from earlier departures as well as an increased number of flights on existing routes connecting to primary airports in Europe such as London, Paris, Geneva and Milan.
Vueling launched (21-Jun-2015) seasonal twice weekly Barcelona-Tallinn service on 19-Jun-2015, using A320 equipment. Service will be suspended on 11-Sep-2015. The carrier is the route's only operator, according to OAG
Gulf carrier Etihad Airways has welcomed the European Commission (EC) review of aviation policy as a chance to embrace “bold reforms” that put competition and passengers’ interests in the spotlight.
In its submission to the EC’s Strategic Aviation Package Etihad said its involvement in Europe—it has stakes of varying size in five European carriers—gives it a “unique perspective” on what is required to drive the industry forward.
The Strategic Aviation Package has a number of aims, including policies that will lay down Europe’s 10- to 15-year air transport strategy, give new powers to the European Aviation Safety Agency (EASA) and establish rules for drone use.
“The Strategic Aviation Package … represents a significant ‘window of opportunity’ to strengthen the European air transport sector as an economic and social enabler, and a key driver of growth,” the airline said in a statement.
Among its suggestions are to put competition and consumers at the forefront of policy development; to think globally, not locally; to ensure connectivity is at the heart of EU aviation and transport policy; and to support innovation in business models, not artificially constrain them.
The airline supported its submission with research from three consultancies, Oxford Economics, Edgeworth Economics and The Risk Advisory Group.
Among this research, the Risk Advisory Group prepared an analysis of the state support received by European flag carriers prior to and following their privatization. Etihad said that while it did not challenge the European system, it sought to demonstrate it had created a distorted playing field for new entrants.
“Aviation in 2015 is global, not local,” Etihad president and CEO James Hogan said of the European review. “By taking a strategic and holistic approach to aviation policymaking, the European Commission can deliver meaningful change, not just for Europe, but also for the benefit of air travelers and the airline industry worldwide, just as the US did with its visionary Open Skies Policy.
“The European Commission has declared that it wants to revive Europe as an economic powerhouse, and a hub for jobs, for growth and for investment. Air transport is essential for such a promising agenda and for international trade.
“Etihad recognizes the enormous growth achieved by liberalization of intra-European airline operations, and urges the European Commission to now be the catalyst for global air transport reforms by easing restrictions on non-European airline access to member states and global investment in airlines domiciled within the EU.”