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.”
China Eastern Airlines is working on the possibility of adding at least two weekly flights between China and Spain from next year. The Shanghai-based company is one of the largest Chinese airlines operating international, domestic and regional flights.
This was confirmed by the Minister of Industry, Energy and Tourism, José Manuel Soria, who said that the current eight operations per week "are very limited" compared to other European countries.
At present, Spain has two routes to Beijing, operated by Air China, from the airports of Madrid-Barajas with five weekly frequencies and Barcelona-El Prat, with three flights a week, in this case, with a stopover in Vienna. Meanwhile, Germany has 50 weekly flights, France 60, and the UK up to 80 weekly frequencies, consolidating the hubs of Frankfurt, Paris Charles de Gaulle and London Heathrow.
China Eastern Spain is considering operating two flights per week from 2016
The CEOs of Europe’s five largest airline groups hosted a press briefing in Brussels earlier today (June 17) to outline their shared vision for a new EU Aviation Strategy.
The group outlined four main measures for the aviation industry to support the EU, agreeing that a common strategy and comprehensive plan was well overdue.
Several key principles included a commitment to safety, support for pro-competition policy and regulation within the EU, and an opposition to state-aid.
Carsten Spohr, Lufthansa CEO, highlighted the impact the aviation industry has on the EU as a whole: “Our industry doesn’t just create jobs in our own industry, but has a huge multiplying effect on any country we are representing. It is crucial for the economic strength of Europe to improve our aviation strategy,” she said.
The cost of EU airports is one of the greatest problems within Europe, and is one of the main issues which need to be addressed, according to the panel. Lowering the cost of the EU’s airports will be possible by ensuring the monopoly airports are effectively regulated, ensuring that passengers receive the full benefit of the commercial revenues which they create at airports.
According to Alexandre de Juniac, Chairman and CEO of Air France-KLM, regulations on monopoly airports would safe consumers 1.5 billion euros.
“We need to introduce one-stop security. There is an inadequate control on security costs in Europe which need to be put under a clear cap,” he said.
The CEOs highlighted the issue surrounding air traffic control in the EU, including the number of strikes which affect EU airspace. With over 3,000 flights cancelled so far in 2015 due to air strikes, Michael O’Leary, CEO of Ryanair spoke about the inefficient airspace provision.
“The EU needs to ensure that ATC strikes do not cause disruption for passengers by making use of the new technology tools available. We need to allow airlines to overfly countries where there are air traffic control strikes,”
“Only half of the planned efficiency gains from Single European Sky will be achieved by 2020,” he added.
With a better, more efficient use of EU funding, the CEOs are calling for action on flights, and a reform of legislation on the Single European Sky policy.
The group moved onto the issues of taxes on aviation within the EU, stating that several European countries continue to impose unreasonable taxes on aviation.
“There is clear evidence from independent research that passenger tax is counterproductive, it reduces economic output and therefore government revenue,” said Willie Walsh, CEO of International Airlines Group (IAG), parent of British Airways, Iberia and low-cost carrier, Vueling.
The IAG CEO also highlighted that experience from countries such as the Netherlands and Ireland show that when such taxes are removed, aviation and economic activity significantly increases.
According to the group, the EU needs to act to ensure that these taxes are lifted – leading to more travel, more investment, more trade and ultimately increased jobs and growth.
“Aviation is an enabler of European growth, we should support the industry to support growth,” added Walsh.
Concluding, Carolyn McCall confirmed the group’s support for several key principles: “We will take our proposed measures to the Commission – to increase competition, encourage efficiency and reduce costs in other parts of our industry,” she said.
Airlines have continuously delivered lower fares for consumers over the last two decades – now is the time to ensure these reductions are matched by other parts of the industry, noted McCall.
“We will continue to work together to promote the interests of our passengers. Our strategy will be open to all airlines in Europe, we need to work together closely, and more seriously,” she said.
Abu Dhabi-based Etihad Airways reported a net profit of $73 million for 2014, up 52.1% from the $48 million reported for 2013.
The UAE airline said the results were its fourth consecutive year of profit and its “strongest to date,” largely attributable to a 26.7% increase in total revenue driven by strong passenger and freight demand. Revenue for the year reached $7.6 billion, with growth in passenger traffic outstripping capacity increases.
Etihad president and CEO James Hogan said: “Our shareholder has set a clear commercial mandate for this business and we continue to deliver against that mandate. Our focus is on sustainable profitability and our fourth year of net profits, at a time when we continue to invest in the new routes, new aircraft, new product and new infrastructure needed to compete effectively, shows we are serious about that goal.”
Passenger numbers in 2014 increased 22.3% year-over-year to 14.8 million, with RPKs up 23.6% to 68.6 billion. ASKs were up 21.8% to 86.6 billion, and load factor up 1.2 percentage points to 79.2%. Cargo revenue was up 19.2% to $1.1 billion, with freight and mail volumes rising from 487,000 to 569,000 tonnes.
Hogan said that a key driver of Etihad’s growth in 2014 was its partnership strategy, including minority equity investments in strategically important airlines, which generated revenues of $1.1 billion in 2014, an increase of 37.7% year-on-year, accounting for 24% of Etihad’s total passenger revenues. The airline has equity stakes in Air Serbia, Alitalia, airberlin, Air Seychelles, Aer Lingus, Jet Airways, Virgin Australia, and Swiss-based Etihad Regional, operated by Darwin Airline.
Hogan said that, “although our growth continued strictly to plan in 2014, we are currently faced with unprecedented external challenges. Of particular concern has been the rise in aggressive protectionist sentiment in Europe and the US, where both Etihad Airways and its partner airlines are being targeted. These attempts to limit competition are detrimental to consumer choice. They threaten to damage the significant progress that our airline has made in offering improved travel connections, product and service standards, and value for money.”
A report just published by global consultancy Oxford Economics suggested that Etihad will contribute $2.9 billion to the US economy and support 23,400 American jobs in 2015. Commissioned by the airline, the report—“The economic impact of Etihad Airways on the US economy—projects that by 2020, Etihad’s operating expenditure and capital investments in the US will almost double, to support 46,200 American jobs and deliver $6.2 billion a year.
It says that, since 2004, Etihad has introduced or ordered almost 120 Boeing aircraft at a current list price of $36.5 billion, and has also chosen US suppliers for equipment ranging from cabin interiors to inflight entertainment systems.
The report also pointed out that, in 2014, Etihad delivered 182,000 connecting passengers onto US airlines, a figure that is forecast to increase 65% to reach approximately 300,000 this year.
Etihad VP-international and public affairs Vijay Poonoosamy said: “Put into perspective, that’s equivalent to five full Boeing 737-800 flights every day of the year.”
Oxford Economics valued the economic benefits of connectivity between the US and destinations in the Etihad network at $410 million this year, rising to an expected $850 million by 2020.
The proposal of the owner of Blue amounts to 354 million euros, minimum amount may increase depending on the activity of the company for 2015 and the addition to the fleet of 53 new aircraft adds.
El propietario de la aerolínea brasileña Azul, David Neeleman, ha ganado el concurso de privatización lanzado por el estado portugués para desprenderse de la compañía TAP, en el que competía con el magnate colombiano-brasileño Germán Efromovich. The owner of the Brazilian airline Azul, David Neeleman, won the privatization tender launched by the Portuguese government to divest the company TAP, which competed with the Colombian-Brazilian tycoon German Efromovich.
El gobierno portugués informó de esta decisión después de la reunión del consejo de ministros, que entregará el control al consorcio liderado por Neeleman en el que también participa el empresario luso Humberto Pedrosa, dueño de la firma de transportes Barraqueiro. The Portuguese government announced this decision after the meeting of the council of ministers, which will give control to the consortium led by Neeleman which also involved the Portuguese entrepreneur Humberto Pedrosa, owner of the transport firm Barraqueiro.
La propuesta del dueño de Azul asciende a 354 millones de euros, cantidad mínima que puede aumentar en función de la actividad de la compañía durante 2015 ya la que se suma la incorporación a la flota de 53 nuevos aviones. The proposal of the owner of Blue amounts to 354 million euros, minimum amount may increase depending on the activity of the company for 2015 and the addition to the fleet of 53 new aircraft adds.
La operación necesita, no obstante, del visto bueno de la Comisión Europea, ya que las reglas comunitarias impiden que compañías aéreas con sede en la UE sean controladas en más de un 50 por ciento por un propietario no europeo. The operation requires, however, the approval of the European Commission, as the Community rules prevent airlines based in the EU are controlled by more than 50 percent for non-European owner.
Precisamente por este motivo Neeleman se alió con Pedrosa para crear un consorcio en el que el empresario portugués representa el 50,1 %, con la intención de respetar la normativa de Bruselas, que ahora deberá pronunciarse. Precisely for this reason Neeleman allied with Pedrosa to create a consortium in which the Portuguese businessman represents 50.1%, with the intention of respecting the rules of Brussels, which now must decide.
La oferta perdedora -presentada por Germán Efromovich, dueño de la aerolínea Avianca- a priori no planteaba dudas en este sentido, debido a que el magnate tiene pasaporte polaco. The losing bid-presented by German Efromovich, owner of Avianca airline priori not raise doubts in this regard, because the tycoon has Polish passport.
De ser confirmada la compra, Neeleman adquirirá el 66 % de las acciones del grupo TAP, aunque un 5 % de este porcentaje está reservado a los trabajadores. If confirmed the purchase, Neeleman will acquire the 66% stake of the TAP group, but 5% of this percentage is reserved for workers.
Además de la aerolínea, TAP incluye una empresa especializada en manutención e ingeniería en Brasil y la firma de gestión de carga y equipajes Groundforce. In addition to the airline, TAP include specializing in maintenance and engineering company in Brazil and the management firm Groundforce cargo and baggage.
Según la información facilitada por el Ejecutivo portugués en el pliego de condiciones original, el Estado mantendrá en su poder el 34 % de los títulos del grupo, aunque podrá venderlo al mismo comprador “durante los dos años siguientes” a la firma del contrato, siempre que el ganador del concurso cumpla todas las condiciones… According to information provided by the Portuguese government in the original specification, the State remain in power for 34% of the shares of the group, but may sell to the same purchaser "for the next two years," the signing of the contract, provided that the winner meets all the conditions ...
This year 48 Spanish companies are attending the BIO International Convention, held in Philadelphia from 15 to 18 June, invited by ICEX.
BIO International Convention is the largest global event for the biotechnology industry. It takes place annually, with rotating headquarters. This year it will be held between 15th and 18th June in the city of Philadelphia, Pennsylvania, in the United States.
ICEX Spain Export and Investment is organising Spanish participation for the 12th time, this time made up of 48 companies, a number that has been experiencing a significant increase since 2004, when the Spanish pavilion was composed of nine exhibitors.
This evolution demonstrates both the strong commitment of ICEX to improving the country's image among American players in the industry, and the interest of Spanish companies in the largest biopharmaceutical market in the world and source of much of the biotech milestones of the past 30 years.
Exhibitors are physically divided into four areas: three of them representing the bioregions of Andalusia, Catalonia – more than half of the companies come from Barcelona – and the
Basque Country; and the fourth, called SpainBio, holds firms from other areas, as well as state-level institutions.
One of the keys to the success of this event lies in the unique opportunity afforded to companies by the partnering system that takes place during the fair, which enables contact with potential partners or customers through one to one meetings.
A small but highly specialized market
The Spanish industry is perceived in the US as a small market (compared to its own), but
with very high quality research, mainly in the areas of oncology, neurodegenerative and inflammatory, and rare, diseases both in basic and in applied research and in clinical diagnosis.
Spanish biotechnology is growing at above average rate in the EU, such that Spain has become the fifth country in the EU-15 in scientific production in biotechnology behind the United Kingdom, Germany, France and Italy, despite the fact that the sector is deficient in the development of products and technologies, and in its application in business (public research represents about 70% of the total).
Over recent years, Spanish biotechnology has gained confidence to develop commercial and research activities in the US, when in the past its natural market was essentially the European Union (Germany, the UK, France and Italy).
Interaction between Spanish and American companies is growing. Large companies from the United States (Amgen, Genentech Inc., Monsanto and Syngenta AG) recognise the value of small Spanish biotech companies, which are generally more specialised. This fact creates a favourable climate for the establishment of technological or commercial agreements, or even for financing cooperation projects. For Spanish biotechnology companies developing products with high added value – as in the case of drugs – and which require prior approval from the Food & Drug Administration (FDA), association with a US company can help to develop new products, and to receive both financial and structural support to take all the necessary steps to achieve this approval.
Spanish participation in BIO will be enhanced with the third edition of the Spain Kicks off BIO day, to be held at the Independence Visitor Center of the city of Philadelphia on the morning of June 15.
This activity, organised from the Economic and Commercial Office of Spain in Chicago, is entitled "Winning Strategies to Move Forward" and will focus primarily on licensing, technology transfer, and access to external sources of financing.