Southwest’s Kelly Calls Fuel Prices Aviation’s Greatest Threat
Gary C. Kelly, chairman, president and CEO of Southwest Airlines, said that the greatest and most serious challenge facing aviation is the cost of fuel. Speaking at the Wings Club in New York last month, he said that a look over the past decade shows the havoc soaring fuel prices wreak on aviation.
Kelly, who was just named vice chair of the Air Transport Association board, said that the ATA has three major goals: make a serious effort to develop alternative fuels, modernize air traffic control and develop the latest next generation aerospace technology. “Otherwise we see a continuing diminunization of air transport domestically,” he said. (Source: Kelly´s speech).
Air Traffic Growth Slows But Outlook Remains Positive
Air traffic growth slowed slightly in November, growing 8.2 percent year over year as opposed to the 10 percent increase reported in October, according to the International Air Transport Association.
Even with that decline, however, passenger and freight traffic are growing at an annualized rate of between five and six percent, which is in line with industry´s historical growth trends.
The level of air travel is now four percent above the pre-recession peak of 2008. North American carriers´ November passenger levels equal the pre-recession levels of early 2008. Giovanni Bisignani, IATA´s director general and CEO, said that a strong end to 2010 has boosted the year’s profit forecast to $15.1 billion. (Source: IATA press release).
U.S. Carriers See Continued Growth; Global Air Capacity is Up
U.S. airline revenue grew 14.5% in November, according to the Air Transport Association, which tracks a core group of carriers, including major network carriers, low-cost carriers and regional airlines.
It was the 11th consecutive month of revenue growth. The miles flown by paying passengers rose 6.5 percent, while the average price to fly a mile rose 7.5 percent. Passenger revenue improved 11 percent domestically and 23% in international markets.
Separately, OAG, which tracks air traffic, said that global air capacity grew 6% in December. Over the last ten years, the number of available seats worldwide has increased 40 percent, while the number of flights has increased 24%.
Capacity in the Americas and Europe are growing at a modest rate while Africa, Asia Pacific and the Middle East are increasing at much higher rates. The improving global economy is having a positive impact on passenger demand. (Source: OAG, ATA press releases).
Inflight WiFi Goes International
Lufthansa passengers traveling on long-haul flights can use inflight WiFi on intercontinental routes. The service, which initially will be provided on select North Atlantic routes, will be available on nearly the entire Lufthansa intercontinental network by the end of 2011. The service will be free this month. (Source: Lufthansa press release).
Delta Reinstates Codesharing With Aeromexico After FAA Upgrades Mexico to Category 1
The Federal Aviation Administration’s decision to upgrade Mexico´s federal civil aviation authority to Category 1 means that Delta Air Lines has been able to reinstate code sharing with AeroMexico, Delta´s SkyTeam partner. A Category 1 rating is required to allow U.S. carriers to code-share with an international airline. (Source: Delta press release).
Delta Air Lines
Delta is expanding the First Class cabin on more than 60% of its mainline domestic fleet, approximately 350 aircraft, as it responds to business customers´ requests for more premium cabin seating. The addition of First Class cabins to all Delta Connection regional jets with more than 60 seats, does not impact Delta´s previously announced capacity guidance.
Delta expanded its Asia Pacific network with new nonstop flights between Japan and Honolulu & the Pacific island of Palau. The new service to Palau brings the number of Asia-Pacific destinations offered by Delta to 17. The Nagoya-Honolulu route is a new competitive option for customers traveling between the two cities. Delta´s new service between its Tokyo-Narita hub and Palau operates 4 times weekly and is the only service that connects the two airports.