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MAY I HAVE YOUR ATTENTION PLEASE

State of the Airlines has become Aviation Views

Yes, yes, all 5 of you readers. I have finally gone and done it…I got a domain name and with the help of my friend Brian I am up and running. Blogger had treated me well but “other” issues were preventing me from posting when I wanted to…so its off to Aviation Views. Much has happened with both airlines and aviation in general so I am looking forward to getting back into the groove.

An Ominous Start to Vacation?

Well it took all of about two seconds to have our first vacation miscue courtesy of Orbitz. See I used Orbitz to book the tickets and did my seat selections via Orbitz as well, seats 5A through 5D...perfect. WRONG!

I attempted to use Frontier's website to get boarding passes to no avail. So I called...turns out Frontier does not release rows 1-7 and exit rows for seat selection until the day of departure. Thus my row 5 seat selections via Orbitz were rejected. Did Orbitz let me know this...nnnnnnnnooooooo. LOSER!...MOVE ON!

Get your crap together Orbitz, if your going to offer seat selection it should play by the rules the airlines have in place. If it fails you should notify the person who just dropped a chunk of change via you website. If you simply cant make it work accurately then don't offer it. Seat selection is kind of a big deal to those of us travelling with kids.

For Frontier's part I got the impression early on in my conversation with the representative that she annoyed that I had the nerve to mention Orbitz. "I'm sorry sir, I have no idea how Orbitz works" "You could try to call back later to see if you can get your seat selections". I know that doesn't read too bad but trust me...it was delivered with some snap.

I've sent an email to Orbitz, I'll report back on their response.

Vacation is Calling and I am Answering

New posts will be sparse for the next 8 days because me and the whole fam-dam-ily are on vacation. I'll be back with trip reports and other stuff as appropriate soon. I am sure all 8 of you will find something else to read in the interim.

Boeing 757's are Still Sexy

God help me but airplanes are cool. I freely admit that there are certain aircraft that I classify as "good looking" and the Boeing 757 is one of them. I don't know what it is...maybe the combination of a long sleek hull with big engines hanging off the wings...but its one cool flying machine made even cooler when Northwest put winglets on them.

Northwest has big plans for these putting the 757 into a not so traditional role, international flying. The Cranky Flier has a good update on this as does IAG here. Photo credit goes to IAG as well. Nice!

Politics Complicate the Future at Airbus

Its clear now that politics are going to play a huge role in any corrective action taken by Airbus. As the French and Germans prepare to meet today its plainer than ever. Rumors have surfaced that Germany, yes...the country, is considering buying a stake in Airbus parent EADS in an attempt to guarantee a hand in the decisions regarding Airbus. This comes in the face of other rumors that five German based Airbus facilities could be sold off. Meanwhile, the new head honcho at Airbus, Louis Gallois, is trying to assure everyone that everything will be handled fairly in terms of national interest. Finally EADS tells us to not expect any decisions on restructuring at Airbus for the next few months. That which puts us into 2007 before we'll hear how Airbus plans to pull out of this A380 induced nose-dive. Sounds like great politics but poor business strategy to me. Airbus needs to start making decisions now now now.
The press is drawing comparisons between Airbus' current dilemma and the problems that faced Boeing in the mid to late 90's. Its a fair comparison. The difference is that Boeing was and is a business first and a major national manufacturer a distant second. Boeing was able to enact its recovery plans without far less worry for which countries were involved (though political interests and alliance did work in the background). The unprecedented level of multi-national outsourcing on the 777 and the upcoming 787 are evidence of that. Generally speaking, governments are not good at being successful businesses. The government interests in EADS and Airbus need to quit meddling and let Airbus be a business.

Virgin America Introduces Jefferson Airplane

Virgin America's attempts to gain approval to operate in the US may still be in a holding pattern but they are working the campaign trail. The airline unveiled its first aircraft, an A320, at San Francisco International (SFO) on Wednesday duly name "Jefferson Airplane" in honor of its San Francisco roots. Virgin America even managed to get Grace Slick to come out for the presentation of the aircraft.

Controversy still swirls regarding ownership of the airline despite the fact that they can clearly show that Virgin brands kingpin, Richard Branson's share is 25%, the maximum foreign ownership allowed under US law. It seems that the US Dept of Tranportation is taking its sweet time in the approval process. One reason for that is that several US airlines are bending the ear of the DOT and every Congressman that will listen and these airlines do carry some clout in Washington DC. One only needs to look as far as the recent Wright Amendment compromise to see that clout in action. Its a fair bet that they would all like to see Virgin America either fade away or have Virgin's start up delayed as long as possible while they shore up their defenses. Terrific post here. But Virgin does not appear to be going anywhere as they are poised to launch the most heavily captilized start up airline in US history. I think the investors backing the airline realize Virgin's name and their ability to generate a lot of swagger and PR make sticking with the process a good bet. Certainly high risk but high reward if it works. Will Virgin America be a west coast version of JetBlue?

PS. Hey, when's the last time you heard "Grace Slick" and "virgin" in the same sentence...yeah...that's what I thought.

How the Dots Connected at Helios

Investigations into the August 2005 crash of a Helios 737-300 have been completed and finding revealed (ATW). Once again we find that is was not single large fatal error but a collection of small things that led to a tragedy, the dots have once again been connected.

Boeing: "ineffectiveness of measures taken by the manufacturer in response to previous pressurization incidents in the particular type of aircraft."

Helios, now Ajet Airways: found to have "deficiencies in...quality management and safety culture."

Helios Maintenance: "Maintenance workers were at fault for failing to return the pressurization mode selector to the "auto" position after performing nonscheduled maintenance.

Helios Pilots: "not recognizing the cabin pressurization switch's incorrect setting before takeoff

Helios Pilots: ""nonidentification" of warnings once the plane was airborne"

Dot to dot to dot...the crew passes out from hypoxia due to the lack of pressurization on the aircraft and after 90 minutes on auto pilot, fuel exhausted, the engines flamed out. The aircraft descended rapidly and crashed into hilly terrain just 33 km from Athens Airport killing all 121 people on board.
So there they are, the dots connected and the accident happens. According to the report new policy and procedures in place but it sounds like a corporate culture needs to change too. It bears repeating: the little things matter.

Airbus CEO Resigns...Really...I'm Serious This Time

EADS has finally announced that Airbus Chief Exec Christian Streiff has well and truly resigned and that his resignation has been accepted by EADS and that his replacement will indeed be ex-Aerospatiale and current EADS co-chief exec Louis Gallois. In other words, everything that EADS and Airbus tried to refute over the last few days has turned out to be true. Everything...seems like a lot of wasted effort. Speaking of wasted efforts Streiff's departure after a mere 100 days should be viewed as an alarm that grows louder everyday. Consider Streiff's parting shots given to France's Le Figaro newspaper:

"I hope that (my resignation) will provide a salutary shock that forces a rethink about how Airbus is governed,"

"The organization and governance of EADS have as major objectives the preservation of a delicate balance between men, power and positions," Streiff told French daily Le Figaro on Tuesday. "This formula can work in normal times, but it is not appropriate for a firm that is going through a serious crisis."

the "governance of Airbus" would not allow his cost-cutting plan to succeed. "It is not a problem of men," he said, explaining that he personally had no issues with Gallois or EADS co-CEO Tom Enders. Instead, Airbus suffers from "a problem of structure," he said, asserting that EADS needs to give the manufacturer more autonomy to make decisions and carry out initiatives. He added that Airbus's production facility in Hamburg, where A380 assembly is centered, has "problems" and is the company's "weak link."

Normally I stay away from "industry" sources but they were all dead on regarding this situation so I will offer up this commentary:

An industry source who closely watches EADS said Streiff's position had become untenable after he exposed deep flaws in Airbus's industrial methods and raised the prospect of sensitive job cuts without adequate political cover.

And therein lies the rub. Streiff apparently made the mistake of offering his honest assessment when he called the Hamburg Airbus plant as "the weakest link" in the A380 production process. A smart business assessment, perhaps. A political bomb, absolutely.

My read on Streiff's departure is that the mix of business and politics at Airbus/EADS made the recovery of the A380 program impossible to achieve in the timeframe being demanded. Faced with an inability in enact the plans he felt necessary to bring about the needed changes Streiff seems to have seen the writing on the wall.

The funny thing is that time may bear out Streiff's assessment. New Airbus head Gallois has wasted no time in stating that their will be job cuts, its his first day on the job folks. He also states that cost-cutting will be evenly distributed between French and German operations. Take careful note, Gallois did not say that job cuts will be evenly distributed, he said cost cutting measures...the two are not necessarily equivalent. People...Streiff is the third CEO to depart Airbus since May 2005...maybe he's not the first to recognize the deep issues at Airbus.

UPDATE 5 - September Airline Results Extravaganza

Here's a quick summary on all the airline results that I have seen so far:

AirTran
Sept RPM=950 Million (+11.6%) Load Factor=61.8 % (-9.4) ASM=1.5 Billion (+28.6%)
YTD RPM=10.4 Billion (+24.7%) Load Factor=74.1 % (-.2) ASM=14.0 Billion (+25.0%)

Alaska
Sept RPM=1.4 Billion (+5.9%) Load Factor=73.6% (+1.2) ASM=1.9 Billion (+4.2%)
YTD RPM=13.6 Billion (+6.0%) Load Factor=77.5% (+.9) ASM=17.5 Billion (+4.7%)

American (without American Eagle)
Sept RPM=10.6 Billion (-1.4%) Load Factor=75.5% (-.7) ASM=14.0 Billion (-.5%)
YTD RPM=106.2 Billion (+1.1%) Load Factor=80.5% (+1.8) ASM=131.8 Billion (-1.1%)

ATA (Scheduled Service)
Sept RPM=299.0 Million (-37.6%) Load Factor=74.5 % (+3.6) ASM=400.0 Million (-40.6%)
YTD RPM=3.1 Billion (-43.4%) Load Factor=80.0 % (+10.2) ASM=3.8 Billion (-50.6%)

Continental (Mainline and Regional)
Sept RPM=6.9 Billion (+11.5%) Load Factor=78.6% (+1.2) ASM=8.8 Billion (+9.9%)
YTD RPM=67.7 Billion (12.6%) Load Factor=81.0% (+1.7) ASM=83.6 Billion (+10.2%)

Delta
Sept RPM=9.1 Billion (-3.4%) Load Factor=74.6% (+1.5) ASM=12.2 Billion (-5.4%)
YTD RPM=88.2 Billion (-4.5%) Load Factor=78.8% (+1.5) ASM=112.0 Billion (-6.2%)

Frontier
Sept RPM=616.5 Million (+11.3%) Load Factor=67.6% (-3.4) ASM=911.6 Million (+17.0%)
YTD RPM=6.4 Billion (+17.7%) Load Factor=77.8% (+1.4) ASM=8.2 Billion (+15.7%)

Hawaiian
Sept RPM=548.8 Million (-4.0%) Load Factor=83.1% (-6.0) ASM=660.3 Million (+2.9%)
YTD RPM=5.1 Billion (+2.1%) Load Factor=86.8% (+0.1) ASM=5.9 Billion (+2.0%)

JetBlue
Sept RPM=1.6 Billion (+8.2%) Load Factor=72.6% (-5.1) ASM=2.3 Billion (+15.8%)
YTD RPM=17.5 Billion (+16.5%) Load Factor=78.8% (+1.5) ASM=21.3 Billion (+22.9%)

Northwest
Sept RPM=6.2 Billion (-5.5%) Load Factor=81.3% (+1.3) ASM=7.6 Billion (-7.1%)
YTD RPM=59.1 Billion (-6.5%) Load Factor=84.7% (+3.0) ASM=69.8 Billion (-9.8%)

Republic
Sept RPM=534,827(+49.0%) Load Factor=66.9% (+1.9) ASM=799,018(+44.7%)
YTD RPM=1.8 Million (+56.8%) Load Factor=72.9% (+4.7) ASM=2.5 Million (+46.5%)

Spirit
Sept RPM=299.0 Million (+15.0%) Load Factor=70.0% (-2.4) ASM=427.0 Million (+18.8%)
YTD RPM=3.4 Billion (-4.0%) Load Factor=72.4% (-1.0) ASM=4.3 Billion (-2.7%)

Southwest (System)
Sept RPM=5.2 Billion (+9.8%) Load Factor=67.2%(-.2) ASM=7.7 Billion (+10.1%)
YTD RPM=50.9 Billion (+12.9%) Load Factor=74.0% (+2.9) ASM=68.7 Billion (+8.4%)

United (System)
Sept RPM=9.3 Billion (+1.3%) Load Factor=79.5%(-.7) ASM=11.6 Billion (+2.3%)
YTD RPM=89.0 Billion (+3.5%) Load Factor=82.8% (+.9) ASM=107.6 Billion (+2.3%)

US Airways (Combined US Airways, America West and Regional)
Sept RPM=4.8 Billion (-4.8%) Load Factor=72.2 % (-.5) ASM=6.6 Billion (-4.2%)
YTD RPM=48.1 Billion (-6.8%) Load Factor=78.8 % (+2.1) ASM=61.1 Billion (-9.3%)

Update 1 - Added JetBlue
Update 2 - Added Frontier and Spirit
Update 3 - Added Southwest and alphabetized
Update 4 - Added Northwest
Update 5 - Added Hawaiian

Northwest and Mechanics Have Tentative Agreement

Northwest Airlines and its mechanics represented by AMFA have finally reached a tentative contract agreement (Yahoo!). The agreement could provide monetary relief to striking mechanics in one of two ways. First, they can accept layoff status and pull in layoff pay, one week per year employed up to 5 weeks total. Doing so also makes them eligible for furloughed status for up to two years. Or they can choose termination and receive one week per year employed up to 10 weeks total. Nothing changes regarding the mechanics now working for Northwest though mechanics accepting the layoff option are eligible to apply for open positions. Finally, Northwest would agree to halt the appeals process on a recent ruling that allowed striking mechanics to claim unemployment benefits.
Despite the possibility of monetary relief for the mechanics most of this agreement is really a final victory for Northwest. Look at the way the terms skew the payouts. It sweetens the pot for senior mechanics take the "I quit" option. You can bet that this offer is going to cost Northwest less than it would to continue unemployment benefit payouts while racking up legal fees trying to appeal the ruling of the courts on that matter. The agreement doesn't do anything to change current contract terms for pay scale or benefits and doesn't bring any jobs for striking mechanics. Moving on...nothing more to see here.

US Airways Showing Their Pilots Tough Love

I've posted that the pilots union at US Airways needs to be careful with the negotiation tactics. The airline has shown some slim profits but overall US Airways is still trying to bring their merger and their recovery to full fruition. In that post I cautioned that any demands for increased pay need to be balanced with some give backs on benefits and work rules.
So it shouldn't be a shock that US Airways just handed the union a laundry list of concessions they would like from their pilots. US Airways CEO, Doug Parker "...has repeatedly said the company cannot afford to increase its overall labor costs,...". The airline will take a tough stand in order to be a viable airline. But the pilots union is plenty mad about it saying US Airways "tossed the most onerous sick-leave policy in the industry across the table." Furthemore, the union is accusing the airline of backing out of a tentative agreement on sick leave and other benefits.
So where's the truth. As with most negotiations its somewhere in the middle. The whole thing is complicated by the fact that US Airways must find a way to unify the two pilot unions...pilot unions with very disparant contracts. Its going to be a long road.

Emirates Buys Some Big Boeings

Emirates Airlines announced a firm order for of ten Boeing 747-8 freighters and options for an additional ten aircraft. This is a $5.6 billion warning shot across the bow of Airbus who are struggling to deliver the A380 as promised to Emirates. The airline's plan to expand their cargo opration hangs in the balance so they are supporting those plans up with the new 747-8. And the warning shot is two fold as Emirates also needs a new mid-range aircraft, i.e. the A350 XWB or the Boeing 787. Airbus has cautioned that the A350 XWB could be heavily delayed, Boeing's 787 is going to beat it out the door by 2-3 years at the current date. Airbus is in a very tough position.

Airbus Head Has Has Not Resigned

The difficulties in running a multi-nationally controlled company like Airbus came to the forefront late last week as we watched rumors flying about Airbus head Christian Streiff. Things kicked off with reports that Streiff has offered his resignation followed by denials from Airbus and EADS that his resignation had been accepted. It appears that Streiff is making a statement. To me that statement is to let him run the company and take the actions he deems necessary or accept his resignation. Because the job he has to do is going to be unpleasant and is going to stir up a lot of nationalism and politics. Airbus needs to cut costs to blunt the effect of the money being poured into the A380. There are talks of outsourcing and re-organizing Airbus divisions. Airbus partners Germany and Spain are already trying to assure workers at plants in their countries that all things will be considered before making decisions. Officials from the French and German government will be meeting so now things will get very sticky. Mixing business and politics is tough and often slow. Streiff needs to act fast to stem the bleeding at Airbus. Good Reuters article here.