Airlines News Updates Feb 2009

Airfares Show Some Decreases
Domestic airfares are starting to dip. The average domestic fare fell to $428.29 in December from $525.63 in November according to airfare tracking company Topaz International’s national database. And the average fare for the fourth quarter was $497.69, down from 526.18 for the third quarter.

Airfares have been climbing steadily throughout the year, hitting a high of $633.44 in June and trending downward subsequently.(Source: Topaz International Monthly Airfare Index).

IATA Figures Show Air Travel Continues Decline The International Air Transport

Association (IATA) reported that international traffic dropped 4.6 percent in December from December 2007, but that the 4.6 percent decline was far less dramatic than cargo’s 22.6 drop from the previous December.

Year-end leisure travel booked in advance kept passenger numbers from falling as dramatically as cargo. Still, a 1.5 percent cutback in supply could not keep pace with falling demand. That meant planes weren’t quite as full. “Airlines are struggling to match capacity with fast-falling demand.

Until this comes into balance, even the sharp fall in fuel prices cannot save the industry from drowning in red ink,” said Giovanni Bisignani, IATA’s general director. He pointed out that premium travel—the profitable front of the plane–declined 11.5 percent in November. (Source: IATA press release).

Air France-KLM Invest in Alitalia
Air France-KLM is taking a 25 percent minority stake in Alitalia. The partnership will be based on a multi-hub strategy, adding Rome Fiumicino and Milan Malpensa to Paris Charles-de-Gaulle and Amsterdam Schiphol.

The airline said Alitalia’s acquisition for Air One has strengthened its position in the domestic market; the carriers say they will plan to create synergies using network optimization and revenue management. (Source: Air France-KLM press
release).

United, British Airways Keep Passengers Connected in the Air
Both United Airlines and British Airways are keeping their passengers connected in-flight on certain routes. United Airlines will begin offering in-flight internet service to customers on board its p.s. transcontinental service between New York and California starting in the second half of this year.

The service will be available in all classes for a flat $12.95 fee on all 13 of the Boeing 757s United flies between JFK and Los Angeles and San Francisco.

British Airways will launch text and mobile services on its all-business class service between London City Airport and JFK later this year.

Customers will be able to access the internet and send emails from laptops with GSM data cards as well as their mobile phones and PDAs. Voice service may be offered in the future, depending on customer demand and feedback. (Source: BA, United press releases).

California Fare Wares Mean Cheaper Flights
Southwest is expanding its California service, adding five new nonstops between San Francisco International Airport and John Wayne International Airport starting May 1 and kicking off the service with a $69 fare.

That followed Virgin America’s announcement that it was starting service between San Francisco and John Wayne International April 30 with a $59 introductory fare.

The airfare monitoring website FareCompare.com reported that American Airlines and United Airlines responded with $59 fares April 30 through June 10 and said that a year ago, the two were charging $125 for one-way fights. (Source: Southwest and Virgin America press releases, FareCompare.com blog).

JetBlue to Start Service Out of LAX to New York and Boston
JetBlue Airways will begin service out of Los Angeles International June 18. It is JetBlue’s third Los Angeles airport. It will offer two daily nonstops to New York’s JFK and two daily flights to Boston’s Logan International. (Source: Jet Blue press release).

Airlines News February 2007

Third Quarter Air Travel Index Hits 11 Year High:
The Air Travel Price Index (ATPI) for the third quarter of 2006 reached the highest third-quarter level recorded in 11 years, 7.5 percent higher than the previous third quarter high in 2005, according to the U.S. Department of Transportation’s Bureau of Transportation Statistics.

The fare index rose 7.5 percent in the third quarter of 2006 from the third quarter of 2005, the biggest year-to-year rise since third quarter 2000.

While reaching a third-quarter high, the ATPI declined 2.6% from the record high set in the second quarter of 2006. Quarter-to-quarter changes may be affected by seasonal factors. (Source: Bureau of Transportation Statistics press release).

FAA Reports Third Annual Drop in Air Traffic Control Staff:
Air traffic controller staffing levels have dropped for the third straight year, to a new low of 14,206, according to the most recent Federal Aviation Administration “Administrator’s Fact Book.”

The fact book reports that the overall total number of controllers working in its 300- plus facilities dropped from 14,227 at the end of fiscal year 2005 to 14,206 in fiscal year 2006. The figures are listed as being current as of October 31, 2006, taking into account hiring and attrition statistics a full month into the current fiscal year.

Controller staffing totals reached as high as 15,386 as recently as September 2003. But a year later, in October, 2004, the FAA reported that total had fallen to 14,736 as the long-expected controller retirement wave began to increase in size. (Source: National Air Traffic Controllers Association press release).

BA, Air France to Launch Clear at JFK:
Air France is sponsoring the Clear Registered Traveler program at John F. Kennedy International’s Terminal 1. This means all airlines from Terminal 1, and their passengers, can take advantage of the Clear program.

The program allows business traveler and other frequent fliers to pay an annual fee of $99.95 and provide background information about themselves to the Transportation Security Administration for pre-screening.

If approved, they get a biometric ID card that gives them expedited access through airport security checkpoints. Last month, British Airways opened its Clear Lane at JFKs Terminal 7. (Source: Air France press release).

Air Canada Relocates U.S. Transborder Flights to Pearson Terminal 1:
Air Canada has relocated all of its U.S. transborder Toronto flight to Terminal 1 at Pearson International Airport. This means all of Air Canada’s U.S. operations out of Toronto have been consolidated with its current domestic and international operations in the terminal.

Air Canada will no longer operate from Terminal 2. Air Canada expects this to dramatically improve the customer experience, reducing distances between gates and making connections much easier. (Source: Air Canada press release).

Virgin Atlantic Brings To Chicago an Antidote to Transatlantic Travel:
Virgin Atlantic announced their newest route from Chicago O’Hare to London Heathrow, aptly named The High Riser, to honor those pioneers who envisioned a city that could touch the sky, and for today’s jetsetters who elevate business to new heights. Daily service commences April 23, 2007.

Increased Air Passenger Duty Levied By The UK Government:
From February 1, 2007, the UK Government has increased Air Passenger Duty (APD) from £20 to £40 per passenger for Economy passengers, and £40 to £80 per passenger for Premium Economy and Upper Class passengers. The tax applies to every passenger (excluding infants and some transit passengers) leaving on a flight from any UK airport. APD is a government tax which has been paid by passengers since it was introduced 13 years ago.

The government says the extra APD raised will be targeted at helping our environment and tackling climate change.