Business Aviation

Targets fulfilled before 2008:

SriLankan CEO predicts US$ 15 m profit

He calls himself an “aviation man”. Yet the “60-something” Peter Hill co-owned and ran a pub, The Constitution, for two years in Camden Town, UK. In 1996, after 11 years with the Emirates as its commercial manager-he was one of the airline’s founding members-he felt burnt out and went home to the UK.

Till Emirates beckoned with an offer to run SriLankan Airlines as its CEO. “Running a pub is not the same as running an airline. It was too good an offer to refuse.” And as advice: “Never burn your boats. It’s always good to leave your employer on great terms.” It could also be that he got too used to being an expatriate executive. “I’ve spent only 10 per cent of my working life in the UK.”

The remaining has been in the Caribbean, Uganda, Bahrain, Dubai and Sri Lanka, all in aviation. So on April 1, 1998, Hill started off at Colombo, seconded by Emirates to the government-owned (51 per cent stake) SriLankan. Emirates has a 43 per cent stake in the airline and management rights through a contract that will come up for renewal in 2008.

Today, Hill feels good about turning SriLankan Airlines around. It no longer needs government handouts, having become profitable, though profit levels are dependent on the socio-political conditions in Sri Lanka. In a good year, such as 2004-05, SriLankan made $60 million profit, says Hill. In other years, profit has ranged between $6-12 million.

“Hopefully, we will close March 31, 2008, with profits exceeding $15 million.” Two important challenges have been the employees and the government. “We inherited a good bunch of people but they lacked direction.”

Also, the airline was used to seeing the management change every time the government changed. “Employees were grossly underpaid; we overhauled the pay conditions. You need to give everyone a feeling of worth and then ask for performance.”

Good performance measurements, a performance reward system, decision-making empowerment, encouragement of poor performers, were quickly effected. “Passing the buck stopped; people started taking ownership of issues and working as a team. Sri Lankans aspire for jobs with us today.”

Proud achievements also include SriLankan’s run in India. “Four-and-a-half years ago, I was in Delhi for a convention. We were doing 37 flights a week in India and when I said that by 2008, we were targeting 100 flights a week, I faced disbelief. Today, we are doing 100 flights to 11 destinations in India.”

Hill cites his most difficult and time-consuming challenge as the one of managing a balance between Government expectations and running a commercially viable operation. So what’s next? He plans to move on when he turns 65: “It’s a young people’s business”. Back to running a pub? No, no, he protests: “I’d be happy to sit back and help, maybe as a consultant.” Always leave an employer on good terms and all that. So not another airline, right? Quips Hill: “Never say never!”

Hindustan Times

Passenger demand remains robust

The International Air Transport Association (IATA) released traffic results for October 2007 which shows that the International passenger traffic for October increased 7.7 per cent over the same month in 2006. This is down slightly from the 8.2 per cent growth recorded in September.

Average international passenger load factors were 76.5 per cent in October, down from the record levels in the summer but 1.2 percentage points higher than in October 2006.

Passenger traffic growth for airlines in the Middle East (20.9 per cent) continued its 3-year trend of double-digit growth. In Latin America (19 per cent) demand continued to expand following the impact of industry restructuring in 2006.

African airlines (10.8 per cent) also enjoyed solid growth as they grabbed a larger share of rising demand in the region.

For the first 10 months of the year, passenger traffic grew 7.3 per cent indicating that consumer demand for air travel remains robust in most regions even as some parts of the global economy, notably the US, slow. Importantly, the credit crunch has yet to dampen demand. Economic volatility is having a more immediate effect on international air freight demand.

It grew 3.6 per cent in October compared to the same month in 2006. But this is down from the 5.0 per cent year-on-year growth recorded in September, and partly reverses the strong pick up of freight growth seen in mid-2007.

Emirates enjoys lone-star welcome for first non-stop Connection to Houston

Emirates, the Dubai-based, award-winning international airline, touched down on December 3 at Houston’s George Bush Intercontinental Airport, marking the beginning of a long-anticipated service.

The flight, carrying 266 passengers on Emirates’ new, state-of-the art Boeing 777-200LR, was met on arrival by Emirates’ Chairman and Chief Executive, Sheikh Ahmed bin Saeed Al-Maktoum and Richard Vacar, Director of Aviation of the Houston Airport System.

Representing Emirates’ second U.S. gateway, the new route will offer business and leisure travellers the fastest link between Texas and the UAE with a 15 hour flight from Houston to Dubai and a return of approximately 17 hours.

The route follows on the success of Emirates’ first destination in the United States, New York which has been operating since 2004 and grown to become a three-flights-a-day service.

The Houston service will operate three times a week, increasing to daily on 1st February 2008. The new Boeing 777-200LR features eight luxurious private suites in First Class, 42 of its latest lie-flat seats in Business and generous space for 216 in Economy. Additionally, the aircraft offers shippers up to 12 tonnes of cargo capacity.

The launch to Houston falls on the heels of Emirates historic aircraft order announcement made on November 11 at the Dubai Air Show when it signed contracts for a 120 Airbus A350s, 11 A380s, and 12 Boeing 777-300ERs, worth an estimated US$34.9 billion in list prices.

“Emirates has looked forward to bringing business and tourism traffic to America’s south and southwest and specifically to Houston and the state of Texas. With the growing demand, particularly from discerning business travellers, we are confident that the new service will prove to be very popular and we look forward to serving the region with our growing fleet,” said Sheikh Ahmed.

SriLankan Airlines presents ‘Christmas on Wings 2007’

SriLankan Airlines is starting its festive season with its annual carol service ‘Christmas on Wings’ at the Bishop’s College Auditorium on Saturday, 15th December at 6 p.m.

The 1 1/2 hrs programme will feature a large number of Christmas Melodies and Hymns by the fabulous SriLankan Airlines Choir, in English, Sinhala, and Tamil. There will also be solo numbers and duets. This year’s theme for Christmas on Wings is ‘Peace’.

This is the 24th year that it is being held. As on previous occasions, this year’s programme will include several short plays and entertaining dance acts, all by members of the staff and their immediate family members of the national carrier, adorned in colourful costumes. These too are original items choreographed to the theme of peace.

An important aspect of the cast and members of the choir is that they come from all of Sri Lanka’s four religions, and the event is certainly not one for Christians alone.

SriLankan Airlines invites all who wish to add to their enjoyment of the festive season, to join them for Christmas on Wings.

IATA against move to limit credit facility

The International Airline Travel Agents Association in Sri Lanka (IATA) is up in arms against move by the airlines to limit their credit facility to one week.

President IATA, Sri Lanka, Riza Ahamat said that presently they enjoy longer credit periods. “However if this time frame is lowered the industry cannot survive and several travel agents would have to shut down,” he said. Ahamat said even the cortorates take to pay back as its the usual practice in many countries.

“What we are saying, that Sri Lanka is not geared to do this at this point of time. Give us one year and then we can look into the one week credit facility”, he said. (SS)

Hemtours launches Lanka’s first-ever leisure booking engine

Hemtours, the in-bound travel arm of the Hemas Group blazed a trail in Sri Lanka’s travel and tourism industry by launching - ‘www.holidasia.com’ - the country’s first-ever leisure booking engine.

Mrs. Jane Chilcott, wife of the British High Commissioner in Sri Lanka Dominick Chilcott made the first booking in the presence of Director Hemas Holdings Abbas Esufally and Managing Director Hemtours Harith Perera, at the launch.