Aviation

International passenger demand drops

The International Air Transport Association (IATA) unveiled international scheduled traffic results for January showing a deepening year-on-year demand slump.

International passenger demand fell by 5.6 per cent in January 2009 compared to the corresponding month in 2008. It is also a full percentage point worse than the 4.6 per cent year-on-year drop recorded in December. The January fall in demand is the fifth consecutive month of contraction.

The 5.6 per cent drop in passenger demand outpaced capacity cuts of 2.0 per cent driving the load factor to 72.8 per cent - 2.8 per cent below what was recorded in January 2008.

The alarming collapse in cargo markets in December (-22.6 per cent) worsened in January 2009 with a 23.2 per cent year-on-year demand drop. This is the eighth consecutive month of contraction for freight traffic.

“Alarm bells are ringing everywhere. Every region’s carriers are reporting big drops in cargo. Apart from the Middle East carriers, passenger demand is falling in all regions. The industry is in a global crisis and we have not yet seen the bottom,” said IATA’s Director General and CEO Giovanni Bisignani.

Asian carriers led the decline in passenger demand with an 8.4 per cent year-on-year drop in January. While this is slightly better than the 9.7 per cent contraction in December, this is positively skewed by the Chinese New Year which fell at the end of January 2009 (and which was in February the year before).

Capacity in the region contracted 4.3 per cent. With Japan, the region’s largest market for air travel, expected to see its economy contract by an unprecedented 5 per cent in 2009, the prospects for traffic in the region remain dismal. North American carriers posted the second largest passenger decline at 6.2 per cent led by a decline in Trans-Pacific travel. In response, carriers withdrew 2.6 per cent of their international capacity, clawing back some of the expansion of 2008.

European carriers offset a 5.7 per cent decline in demand with a 3.6 per cent decrease in capacity. Demand decreased sharply from the 2.7 per cent fall in December as European economies move into deep recession.

Latin American carriers saw a modest decline of 1.4 per cent. Even against a 0.5 per cent increase in capacity, the region turned in the highest load factors at 74.9 per cent.

African carriers saw the demand decline slow from an average 4.0 per cent in 2008 to 2.6 per cent in January.

The Middle East was the only region with a positive traffic growth of 3.1 per cent. This is far below both the double-digit traffic growth in 2008 and the 10.8 per cent expansion in capacity.

SIA profit down 43% to $337m

The SIA Group earned a net profit attributable to equity holders of $337 million for the third quarter (October-December 2008) of financial year 2008-09, a drop of 42.8% or $253 million from the same period a year ago.

According to Group’s unauditied financial results revenue declined 2.6% to $4,164 million on weaker passenger and cargo carriage, while Group expenditure rose 5.7% to $3,807 million.

The price of jet fuel corrected from its peak of USD171/BBL recorded in July 2008, averaging USD99/BBL in the third quarter. While lower fuel prices reduced expenditure on fuel by $125 million, losses in hedging amounted to $341 million. Other cost items were well contained. Excluding fuel, Group expenditure was $125 million (-5.5%) lower compared to the same period last year.

Foreign exchange rate movements lowered operating profit by $144 million, as major revenue generating currencies, particularly the Australian Dollar, the UK Pound and the Euro, weakened against the Singapore Dollar, even as the Japanese Yen and the US Dollar strengthened.

Group operating profit was $357 million for the third quarter, $318 million (-47.1%) lower than the year before. Operating profit for the Parent Airline Company at $314 million was $199 million (-38.7%) lower year-on-year.

For the nine months to December 2008, the Group posted a net profit attributable to equity holders of $1,020 million, compared to $1,522 million for the corresponding period last year, a decline of $502 million (-33.0%).

Group revenue grew $810 million (+6.8%) to $12,675 million while expenditure was up by a higher amount to $11,743 million (+$1,535 million or +15.0%) principally on account of higher expenditure on fuel.

All monetary figures are in Singapore Dollars.

Emirates rings 100,000th passenger in-flight

Emirates in-flight mobile telephone service has clocked up its 100,000th user confirming a dramatic increase in calls this year. Thirty-one Emirates passenger aircraft are now installed with the AeroMobile service, the largest of any commercial airline.

The milestone was passed when a Singaporean passenger made a call from 36,000 feet during Emirates flight EK404 from Dubai to Singapore.

Thousands of passengers on 31 AeroMobile-equipped Emirates aircraft depart daily from Dubai to destinations across its global network. Over 350 Emirates short and long haul flights operate weekly with AeroMobile covering services to 49 countries.

The AeroMobile in-flight system allows passengers the choice of safely using their own mobile phones to make and receive phone calls and text messages from Emirates aircraft, with charges in line with international roaming rates. The fast-growing popularity of the service sees typically more than 30 per cent of passengers on each flight taking advantage of the award-winning system.

With the first 50,000 users in the first nine months since the system’s launch, the second 50,000 have been clocked up in less than two months. Emirates’ Vice President, Passenger Communications and Visual Services, Patrick Branelly said, “The AeroMobile facility is growing in popularity day by day.

The feedback has been excellent, and our passengers are clearly using the system to stay in touch, as we saw with big increases in the number of calls and SMS messages over special occasions such as the New Year period. We even saw a surge at the time of the result of the US presidential election.

“For many of our passengers, making a call on their own mobile phone during a flight has become as natural as watching their in-flight TV screens, which offer a choice of up to 1200 channels of entertainment.”

The AeroMobile service can only be used at cruise altitude and allows passengers to send and receive text messages and make and receive calls, just as they do when roaming abroad.

Following a successful launch with Emirates in March 2008 - a world first - AeroMobile-equipped aircraft have seen over 370,000 flight hours of operation. Emirates Engineering is now rapidly rolling the system out across the remainder of the Airbus and Boeing fleets. AeroMobile is presently operating on Emirates A340, A330 and B777 aircraft.

AeroMobile chief executive Bjorn-Taale Sandberg said, “As the service availability has broadened, the number of users has shot up from 10,000 a month at the end of 2008 to 25,000 a month so far this year - and it’s rising rapidly as each day goes by.

“The sharp increase is not due only to the wider availability as our system is rolled out across the Emirates fleet, but the acceptance from passengers of what a valuable and stable service it is.”

Sir Richard Branson takes Virgin around the world in eight days

President of Virgin Atlantic, Sir Richard Branson, has set off an on epic eight-day journey around the world to coincide with the launch of V. Australia, the newest airline in the Virgin stable.

Sir Richard is travelling Londin-Hong Kong-Sydney-Los Angles-London in eight days, a far cry from the days of Phileas Fogg who went around the world in 80 days in a balloon. Along the journey, Sir Richard will meet local entrepreneurs and listen to their experiences of coping during the recession.

V Australia, which was launched on Friday will initially fly between Sydney and Los Angeles, with services also planned between Brisbane and Los Angeles and Melbourne and Los Angeles.

Its launch means that passengers can book to travel on individual Virgin airlines on an around-the-world routing.

V. Australia joins the family of Virgin airlines which includes Virgin Atlantic, Virgin Blue. Virgin America and Virgin Nigeria.

Sir Richard said, “Travelling around the world in eight days is going to be a pretty tough quest but we’ll certainly be doing it faster than Phileas Fogg did in his balloon

The launch of V. Australia joins up Sydney and LA, destinations currently served by Virgin Atlantic from London and it means consumers can travel on Virgin globally for the first time.

It’s a unique moment in Virgin’s history.”

Sir Richard will also be on the search for the best Richard look-a-like, as part of a global competition to celebrate Virgin Atlantic’s 25th birthday.

Cathay offers ‘Buy 1 - Get 1 Free’

Cathay Pacific has laid out an irresistible ‘Buy 1 - Get 1 Free’ offer appealing to travellers flying business class to a range of exotic destinations including Bangkok, Singapore, Hong Kong, Seoul, Japan, USA and Canada.

The airfare bonanza offers business class passengers the fantastic opportunity to take a companion along for free and the offer is open for travel right now up to end June. Ticketing ends on 31 May. Both passengers must fly out together.

The amazing fares are especially attractive for passengers flying to USA, Canada and Japan on selected flights because they can experience Cathay’s new flat bed comfort on the award winning business class and service that comes “straight from the heart.” More importantly, passengers flying to USA and Canada have the advantage of earning nearly 25,000 Asia Miles as well.

Sales and Marketing Manager for Cathay Pacific Airways Colombo Ruhan Abbas, was enthusiastic about the attractive fares and the fabulous offer that benefit those poised to visit a wide choice of countries. “This attractive offer is a boon to passengers flying on business class whether it is for business or pleasure because the companion flies free of charge.