Canada-Singapore open skies

Canada and Singapore have signed an open skies agreement thus effectively removing all restrictions imposed upon SQ which impeded its expansion plans for YVR & YYZ for over a decade.

No announcement has been yet being made by SQ as to when YVR would go daily but insiders feel that by Winter 2008 that should open.

Kingfisher Airlines

Kingfisher Airlines through its affiliate Deccan Aviation aka Air Deccan, has applied to the U.S. DOT for permission to operate service to USA from April 2008, and also requested to place Kingfisher's "IT" code on its flight. Kingfisher will dry-lease their A 340-500 and other long-haul aircraft to Deccan. In 2008, Kingfisher will add 10 long-haul planes, i.e. two A 345s + 8 A 332s, intended for non-stop flights to the US, Far East, JNB & Europe.

The first international flight is planned to start between BLR & SFO by April, followed by BLR-JFK nonstop in June-July. This is likely to be followed by flights between Mumbai, New Delhi and London Heathrow using the A 332s.

In other news, Kingfisher has formally informed the Indian Government of its wish list of international routes that it wants to launch from 2008 onwards. The main highlights are as follows :

DEL-YYZ : nonstop daily using an A 345

DEL-YVR : nonstop daily using an A 345

DEL-GVA : nonstop using an A 332 (market for a daily flight doesn't exist)

DEL-KWI : nonstop daily using an A 321 / A 332

DEL-DXB : nonstop daily using an A 332

DEL-PEK : nonstop daily using an A 332

DEL-KTM : nonstop daily using an A 320 / A 321

DEL-CAN : nonstop using an A 332 (massive cargo potential here)

DEL-BKK : nonstop daily using an A 321 / A 332

DEL-KUL : nonstop daily using an A 321 / A 332

BLR-JFK : nonstop daily using an A 345
BLR-SFO : nonstop daily using an A 345

BLR-LHR : daily nonstop using an A 332

BLR-DXB : daily nonstop using an A 321

BLR-CMB : daily nonstop using an A 320

BLR-BKK : daily nonstop using an A 321 / A 332

BLR-KUL : daily nonstop using an A 321 / A 332

BOM-JFK : nonstop daily using an A 345

BOM-LHR : daily nonstop using an A 332

BOM-DUS : nonstop using an A 332 (does a market for this route exist?)

BOM-HKG : daily nonstop using an A 332

BOM-PVG : daily nonstop using an A 332

BOM-ZRH : daily nonstop using an A 332

BOM-JNB : daily nonstop using an A 332

BOM-DXB : daily nonstop using an A 321 / A 332

BOM-BKK : daily nonstop using an A 321 / A 332

BOM-KUL : daily nonstop using an A 321 / A 332

BOM-SYD : daily nonstop using an A 332

BOM-BAH/DOH/MCT : each city to beserved daily nonstop using an A 320 / A 321

MAA-DXB : nonstop daily using an A 321 / A 332

MAA-CMB : nonstop daily using an A 320 / A 321

MAA-BAH : nonstop daily using an A 321

MAA-KUL : nonstop daily using an A 321 / A 332

MAA-BKK : nonstop daily using an A 321 / A 332

ATQ-DXB : nonstop daily using an A 321ATQ-SHJ : nonstop daily using an A 320

HYD-KUL/DXB/SHJ : each city to be served daily nonstop using an A 320 / A 321

TRV-SHJ/MCT/BAH : each city to be served daily nonstop using an A 320 / A 321

COK-BAH/DXB/MCT : each city to be served daily nonstop using an A 320 / A 321

Analysis :

From the looks of it, Kingfisher's wish list especially for Europe makes it out to seem that it is positioning itself to be a "cosmopolitan airline" flying to exotic destinations nonstop from India not explored before by its competitors such as GVA & DUS. It is very pleasing to see that BLR-LHR nonstop with the A 332 is being seriously considered as someone needs to make BA sweat it out on this profitable route which KF has the potential to do so due to its excellent on board product and brand name recognition in BLR and in the NRI community residing in the UK.

There are rumors floating around that the Spanish Government is very eager in wanting to make MAD or BCN a "scissors hub" for KF just like BRU is for 9W as Spain lacks nonstop connectivity to many key U.S . cities. However, KF's business strategy for North America is to fly nonstop from India's premium markets and not copy AI & 9W's one stop model which is fine. Most of its wish list routes are viable ones except for DEL-GVA & BOM-DUS as a size able O&D market segment doesn't exist for these routes to even warrant a 4 times weekly nonstop flight using an A 332!

Sources for new routes :

http://www.livemint.com/2007/11/02235607/46667D16-7B12-44AF-9BEA-FA92103A646CArtVPF.pdf

and

http://www.livemint.com/2007/11/02235607/46B10455-6E1F-44FC-845E-B05B251BBBBBArtVPF.pdf

Air India

Air India has tentatively chosen Munich (MUC), Germany as its EU "scissors hub" airport along the same line as to how Brussels (BRU) functions for Jet Airways (9W). MUC airport has also confirmed that it has for the time being given AI two pairs of early morning slots for its DEL-JFK and BOM-ORD bound flights. AI in return has informed MUC that BOM-MUC-ORD would be flown daily by a B 744 where as DEL-MUC-JFK would be flown using a B 773ER. The two EU airports that were in contention for AI's business were VIE & MUC.

Slot timings given to AI for ORD & JFK flights via MUC are as follows :

Arr from BOM - 0630 a.m. Dep MUC 0820 a.m. - ORD operated by B 744 Arr from ORD - 0640 a.m. Dep MUC 0830 a.m. - BOM operated by B 744

Arr from DEL - 0645 a.m. Dep MUC 0820 a.m. - JFK operated by B 773 Arr from JFK - 0715 a.m. Dep MUC 0835 a.m. - DEL operated by B 773

Analysis :

It is interesting to note that MUC is now a serious contender to become AI's primary hub in Europe for North America bound flights, a concept that has some pros but more cons attached to it. On the positive side, MUC is a huge Star Alliance hub airport in EU which is useful for AI as it will be joining this airline group shortly. From MUC, AI can get feeder traffic from LH & OS's EU network bound for USA which shall prove to be useful especially in the low season. However, when an airline creates an intermediate hub, it is made with the forecast that there is a fair amount of O&D + 5th freedom traffic available on the entire route that is created to be flown via that hub + the 5th freedom route that the airline hopes to fly on sees little or no competition on it (such as ET's DEL-PEK route, DL's DKR-NBO/JNB route, 9W's future BRU-LAX, PVG-SFO routes etc). This is why QF's & NW's hubs in SIN & NRT respectively work because from their home market, there is decent O&D to SIN/NRT + onward traffic originating from their respective home markets & the intermediate hub bound for the final destination.

After examining the points above, none of this holds true for MUC as the O&D demand between India and MUC is minimal to say the least and on the trans-atlantic 5th freedom routes that AI hopes to fly out of MUC i.e. to JFK, ORD & LAX/SFO/IAD/IAH in the future, UAL & LH already offer daily nonstop flights on all of these routes except IAH. Therefore, one fails to see what AI hopes to extract by making MUC its biggest hub airport outside of India!

It is more feasible for Air India & Star Alliance to push for a new niche market segment to tap such as my last week's suggestion of making Manchester, UK (MAN) its intermediate hub for USA/Canada bound flights from India. From BOM, DEL & AMD, there is high O&D demand bound for Manchester + a smaller amount from HYD/MAA/BLR/CCU. From MAN, no airline flies to India nonstop + no airline flies nonstop to IAD, LAX, SFO & IAH from MAN thus providing Air India with an unique advantage of having a monopoly position on both India-MAN + MAN-North America flights.

Flights via MAN could be routed in the following manner :

BOM-MAN-ORD : daily B 744

DEL-MAN-JFK : daily B 773ER

AMD-MAN-IAH : daily B 773ER

HYD-MAN-LAX : daily B 772ER

BLR-MAN-SFO : daily B 773ER

MAA-MAN-IAD : daily B 773ER

Etihad Airways

Etihad Airways has announced that it will be launching new 4 weekly flights to Beijing, China from February 25th 2008 nonstop from its AUH hub using an Airbus A 330-200. The flight timings are as follows :

Days : MON / WED /FRI / SUN

Dep AUH 2225 Arr PEK 1005+1
Dep PEK 1750 Arr AUH 2320

Cathay Pacific

According to HKG Airport Authorities, Cathay Pacific has officially informed them that it is upgrading capacity on its Toronto bound flights from December 1st 2007. This upgrade will be carried out in stages which are as follows :

a) From Dec 1st onwards, CX will fly 3 times a week (Wed, Fri, Sun) nonstop HKG-YYZ-HKG flights using an Airbus A 340-600 with new flight numbers i.e. CX 826/827 where as 4 weekly A 343 operated HKG-ANC-YYZ flights remain on other days of the week.

b) From January 1st 2008, all YYZ bound flights will be numbered CX 826/27 and be flown nonstop daily with an A 346.

c) From Feb 1st 2008, a further capacity increase will take place with 3 weekly flights being flown by the Boeing 777-300ER nonstop + 4 weekly A 346s. B 773ERs will operate CX 826/27 on Tue/Thu/Sat.

d) From March 30th 2008, all HKG-YYZ flights will become permament daily nonstops flown by the Boeing 777-300ER.

Lufthansa-Air Canada

Lufthansa & Air Canada have officially announced a major Canadian expansion which will start in Summer 2008. The main highlights are as follows :

YYC - new nonstop daily flights by LH flights start on April 14th using a three class A 333 from FRA.

Flight timings are as follows :
LH 494 FRA 1110 - 1250 YYC
LH 495 YYC 1445 - 0755+1 FRA

YOW - new nonstop daily flights by AC to FRA start from June using a B 763ER.

Flight timings are as follows :
AC 838 YOW 1935 - 0855+1 FRA
AC 839 FRA 1415 - 1645 YOW

YUL - upgrade in capacity for the seasonal LH operated flights from MUC. Previously, an A 343 was being used for this route, but from next summer it will be an A 346.

In addition, other new long haul routes for Summer 2008 were also announced by LH.

SEA - new daily nonstop flights to Seattle, USA from March 30th 2008 using a 3 class A 333. Flight timings are as follows :

LH 490 FRA 1005 - 1120 SEA
LH 491 SEA 1430 - 0925+1 FRA

SIN - new 5 weekly nonstop flights from Munich using an A 343 from 8th June 2008.

Analysis :

This is a brilliant move by LH to launch YYC & SEA as both markets offer immense high yielding traffic potential in the premium cabin as YYC has the oil/energy market to exploit where as SEA has the IT/Software industry to tap into. LH have purposely timed their YYC flights to connect with their key oil markets in Africa and the Middle East as these type of pax are the highest yielding ones flying full fare F & J class & most of all they can obtain AEROPLAN points. From YYC, their main threat is BA who offers a superior F & J class product on board its B 777-200ERs but lacks the variety of connections that LH can offer via FRA across its network.

As far as AC's YOW-FRA route goes, off line carriers such as GF/QR/KU/EK/UL/MEA stand to benefit with AC's new YOW-FRA flight as it provides them a new nonstop EU gateway from the YOW market to extract passengers from. It has been mentioned before that AC's YOW-LHR flight is its most profitable trans-atlantic service.

Kuwait Airways

Kuwait Airways has announced further expansion for its India bound flights during the current winter season. The main highlights are as follows :

HYD - to be increased to 4 weekly flights with a Sunday flight being added from Jan 6th using an A 310-300.

COK - will get a 5th weekly flight effective Jan 4th...3 weekly AB6s + 2 weekly A 310-300s.

Emirates

According to Air Cosmos magazine, there has been a further twist to Emirates's upcoming mega order announcement at this weekend's Dubai Airshow. The article states that EK will sign a LOI (Letter of Intent) for 50 Airbus A 350s (mixture of -900s and -1000 models) plus lease 30 Airbus A 330-300s which shall be used as a "capacity bridging aircraft" until the A 350s are delivered. The A 333s are expected to replace in due course EK's oldest B 772As & A 343s.

In other EK related news, its Toronto bound flights had one of its most successful inaugural launches ever as the first 3 flights recorded a 93% overall load factor. On the first flight, 305 passengers flew inbound and 330 outbound.

KLM

KLM has announced that it will launch a new daily nonstop service between AMS and Detroit (DTW) using an Airbus A 330-200 effective Summer 2008.

Thus, the AMS-DTW route will see 5 daily NWA flights along with this KLM one.

Korean Air

Korean Air has indicated that it will be upgrading capacity on its ICN-Moscow (SVO) bound flight by replacing the Airbus A 330-300 with the Boeing 777-200ER due to increased seasonal demand. The flight is flown 3 times a week nonstop.

Lan Chile

Lan Chile has officially confirmed its large order with Boeing for 32 Boeing 787s out of which 6 B 789s are to be leased from ILFC where as the remainder will be bought directly from Boeing itself.

In addition, the Chilean airline has also confirmed its order for 4 Boeing 777-200LR freighters.

Air India

According to Newkerala.com, Air India will be launching daily nonstop service between Delhi and New York JFK effective February 2008. This flight will be flown using a Boeing 777-300ER. It will be the airline's second ultra long haul route flown nonstop from India in addition to its heavily loss making BOM-JFK flight operated by the Boeing 777-200LR.

Analysis :

One fails to understand the fixation that not only Air India has but also other North American carriers too have with the NYC-India market. There is no need what so ever for AI to fly DEL-JFK nonstop as it will lose a lot of money on this route which is evident with its new BOM-JFK flights which are losing heaps load of $$$ every time they are flown. Currently, AI fly triple daily to NYC i.e. daily to EWR from BOM + daily to JFK from DEL via LHR + daily nonstop BOM-JFK. Hence, by adding a 4th daily flight, it serves no purpose as there is enough capacity serving this market segment which also includes CO's and DL's daily EWR/JFK-India bound flights.

An idea for Air India :

By joining Star Alliance, the logical step would be to fly nonstop from DEL to a Star Alliance hub airport in USA which is ORD or IAD. Since ORD already sees a daily flight from India flown by AA & AI each respectively, why not use the B 773ER to launch new flights to IAD from DEL and code share with United Airlines. It will give AI a monopoly position on this "niche market" route as no other airline flies it nonstop plus from IAD, its Star Alliance partner; United Airlines would provide value able feeder traffic obtained from Florida, ATL, BOS, PHL, CLT, PHX and Texas which are densely populated with immigrant Indians.

As far as AI's choice of an EU hub goes, it currently has flights from FRA to ORD & LAX and according to people who work in their BOM HQ, future flights to SFO & IAH are planned to be routed via FRA. However, AI should look into making Manchester, UK (MAN) its hub for onward flights to USA as it will get good O&D loads on its MAN-India-MAN bound flights + have a monopoly position on many MAN-USA nonstop routes if launched such as MAN -SFO, MAN- LAX, MAN-IAH etc. Take into account that Manchester and its surrounding areas have a huge Indian/Sikh population and currently lacks nonstop flights to India. If AI want to take the initiative here, the MAN market is ready for them to exploit.

Kuwait Airways

Kuwait Airways has officially confirmed that it will be launching 3 weekly nonstop flights on Tues/Thu/Sat from KWI to Hyderabad (HYD), India using an Airbus A 300-600R (AB6). KU's AB6's seat 235 pax in a 2 class configuration (J + Y). The new HYD flight timings are as follows :

KU 371 Dep KWI 2235 Arr HYD 0605+1
KU 372 Dep HYD 0715 Arr KWI 0940

In addition, KU has announced other major capacity upgrades across its network for Winter 2007-08 :

CDG - capacity increased to 2 weekly A 343s + 2 weekly AB6s

AMD - increased from 3 to 5 weekly A 320s.

BOM - capacity increased to 2 weekly B 772s + 5 weekly A 343s.

TRV & COK - both cities to receive 4 weekly AB6s.

Analysis :

This a good move by KU to launch HYD as that market has good potential to offer. It's pleasing to see that KU are using the AB6 for this new route as the extra revenue generated from the cargo side (8 tons) per flight will come in handy big time. However, if one carefully analyzes their return flight timings from HYD to KWI, it doesn't connect with any of its JFK bound flights which is sad as from NYC, KU can get decent feeder traffic bound for HYD. Its also unfortunate that KU no longer flies to ORD as from there lies probably the biggest HYD bound market from North America.

To enable JFK to be connected conveniently in both directions with HYD, KU must re-time their KWI-HYD-KWI flights in the following manner :

KU 371 Dep KWI 2105 Arr HYD 0435+1
KU 372 Dep HYD 0545 Arr KWI 0810

This will enable a 3-5 hour connection on the outbound sector in KWI and a 90 minute connection inbound from HYD via KWI. Lastly, its nice to see AMD get upgraded to 5 weekly flights as that route desperately needed it. One reckons that the next 12 months for KU in AMD will be crucial as its flights now compete against EK's 6 weekly B 777s/A 332s + QRs daily A 320s.

Out of the 3, EK offers the superior in-flight product on this route as well the ability to carry on cargo. In order to maintain a hold on its market share in AMD, KU needs to seriously consider upgrading these flights to A 310s (if spare aircraft are available).

Jet Airways

Jet Airways of India has confirmed that it will be launching new flights to San Francisco, USA from Mumbai via Shanghai from February 2008 onwards. The flight will be flown daily using a Boeing 777-300ER and will be allowed to carry lucurative 5th freedom traffic on the PVG-SFO-PVG trans-pacific sector.

In addition to this, 9W is expected to launch daily AMD-BRU-ORD flights from April 2008 as well as daily BLR-BRU-LAX flights in 2008. ORD flights are confirmed to be operated with the A 330-200 where as LAX is still undecided on whether a B 773ER will be used or an A 332.

Cathay Pacific

Cathay Pacific has announced that it will be increasing capacity to JFK this December onwards by putting the Boeing 777-300ER on 3 out of 7 flights operated currently by the A 340-600. This refers to CX 830/831.

Thus the airline's 21 weekly JFK flights will be flown using a B 744 seven times a week (via YVR with full 5th freedom rights) + 10 times a week B 773ERs + 4 times a week an A 346.

As far as Canada is concerned, a local travel magazine i.e. Travel Courier has mentioned that CX will be using the B 773ER on YYZ & YVR flights from mid 2008 onwards.

UAE -Spain open skies

UAE and Spain have signed an open skies agreement over the weekend which includes 5th freedom rights beyond Spain to the Americas for UAE based airlines. The designated airlines of both countries will be able to operate unlimited weekly passenger frequencies and capacity in each direction with any type of aircraft, as well as operate all cargo services.

Analysis :

For many months prior to this agreement being signed, EK was conducting a feasibility study on launching new DXB-BCN nonstop flights as well as future flights to Mexico City which would be routed via Spain as UAE too has an open skies agreement in place with Mexico. This became more serious in the summer when EK was conducting negotiations with few upscale Barcelona hotels for its cabin crew to stay in as well as for the EK Holidays division. With the open skies treaty being signed between UAE & Spain now, all options are available on the table for EK to pursue.

Currently QR only fly to Spain (Madrid) nonstop from the GCC and according to many, their flights are doing pretty ok. In Spain, MAD is the higher yielding market than BCN as its the political and financial capital of Spain hence there exists a bigger J & F class sized market segment here than in BCN. In Barcelona, the cargo potential for EK is huge as the city has a huge manufacturing and services industry which are booming.

In both Spanish cities, the main target market for EK would be transit traffic bound for the Far East (BKK/KUL/SIN), China, Japan, Australia and India. In the summer months, it shall definitely see high volume & high yielding traffic consisting of rich Arab families visiting their mansions on the Spanish peninsula.

Transaero Russia

Transaero Airlines of Russia has officially released details of its Winter 2007-08 timetable for its medium/long haul routes. The main highlights are as follows :

BKK - daily B 742 from DME + 2 weekly B 762ERs from St Petersburg.

HKT - 3 weekly B 742s from DME

ATQ - 3 weekly TU 204s from DME

GOI - 3 weekly B 742s from DME

SIN/DPS - capacity increased from 2 weekly B 762ERs to 2 weekly B 742s from January 08.

MLE - new twice weekly flights to start with B 767s.

The airline's management board has also revealed its wish list for routes to start in Summer 2008. They include DME-HKG-SYD with a B 742 + DME-LAX nonstop + DME-MIA nonstop and DME-JNB-MRU.

Malev Hungarian

Malev Hungarian Airlines is to suspend all of its trans-atlantic flights for the upcoming winter season as part of a large cost cutting initiative currently being undertaken by the airline. Malev's trans-atlantic operations consist of flights to Toronto and New York only. Both cities are flown by Boeing 767s.

As a result, one B 767 will be wet leased out and another will be used to upgrade Bangkok from a B 762ER to a B 763ER.

Source: http://www.malev.hu/BP/ENG/I_NEWS_ENG/2007-1029-1551-07PGDK.asp

Qatar Airways

Qatar Airways has confirmed that it has asked Airbus to delay delivery of its Airbus A 380s by two years from 2010 to 2012. The reason provided by QR's CEO is that it needs more time to move into Doha's new international airport as well build up its passenger numbers to allow it to properly fill up its A 380 operated flights.

Lufthansa

Lufthansa will launch 6 times a week service from Dusseldorf to Miami effective October 26th 2008 using an Airbus A 340-300.

This move is seen by many as a direct challenge to its main rival i.e. Air Berlin/LTU who has many trans-atlantic flights from its DUS hub.