The EU has just announced that it has deemed that the competition issue between these two behemoths deserves full investigation:
Origial Case Number 2007/c 190.
http://eur-lex.europa.eu/LexUriServ/site/en/oj/2007/c_190/c_19020070815en00090009.pdf
However in typical EC style you still have only until the 12th September to comment.
Any concentration of GDS type power even at this JV level is in our view likely to result in reduced competition. While we applaud the need for the market to have a better way of processing hotel transactions - we remain skeptical on the value of these two players providing it.
08 September 2007
04 September 2007
Airlines adjust after Summer of discontent
Great piece in the (still) independent WSJ. http://online.wsj.com/article/the_middle_seat.html?mod=djemseat
The airlines opine that they have been hit by a triple whammy: High Load factors (duh!!!) ATC delays (if all else fails blame the government), The weather (act of God). They can apparently handle 2 out of 3 but not all 3. Apparently Airlines cannot make bad decisions that contribute to the problem…
As a result they are going to operate differently and hold back seats (read this as still overbook just not as badly), use spare aircraft and add flex into the timing.
OK Chaps (Mr. and Mrs. Airline) - I have a suggestion for you. How about using less SMALLER aircraft and bite the bullet on capacity constraints. The overuse of RJs is the fundamental root cause of the increase in aircraft system resources without a corresponding increase in passenger capability or a pricing model that accommodates this significant upsurge in traffic without necessarily increasing the system capacity for passengers.
I have a further suggestion for the FAA. Guys is this a wakeup call for VLJs? If you were to reprice the usage of the scarce airport tarmac, and flight pathways - then this problem can be ameliorated BEFORE it hits us.
But perhaps its just better to blame the Government and the weather than actually doing the right thing.
One day Congress will wake up to the problem and boot in a quick fix.
The airlines opine that they have been hit by a triple whammy: High Load factors (duh!!!) ATC delays (if all else fails blame the government), The weather (act of God). They can apparently handle 2 out of 3 but not all 3. Apparently Airlines cannot make bad decisions that contribute to the problem…
As a result they are going to operate differently and hold back seats (read this as still overbook just not as badly), use spare aircraft and add flex into the timing.
OK Chaps (Mr. and Mrs. Airline) - I have a suggestion for you. How about using less SMALLER aircraft and bite the bullet on capacity constraints. The overuse of RJs is the fundamental root cause of the increase in aircraft system resources without a corresponding increase in passenger capability or a pricing model that accommodates this significant upsurge in traffic without necessarily increasing the system capacity for passengers.
I have a further suggestion for the FAA. Guys is this a wakeup call for VLJs? If you were to reprice the usage of the scarce airport tarmac, and flight pathways - then this problem can be ameliorated BEFORE it hits us.
But perhaps its just better to blame the Government and the weather than actually doing the right thing.
One day Congress will wake up to the problem and boot in a quick fix.
03 September 2007
Jim leaves DL - A job well done + NW/DL
The quiet half of the Jim and Gerry show at DL has finally announced his exit with a generous severance package. Entirely deserved in our opinion. While Gerry was very much the public face, Jim slaved away at the detail. Incoming CEO Richard Anderson has big shoes to fill. But its a clean break and whether or not the oft quoted NW/DL merger of champions comes about, at least it will be based on a clear and open state of play.
From our perspective we believe that a merger of DL and NW will not serve the 2 companies shareholders nor the market in general well. Both players are still reeling from several years in protection and have a difficult enough road to follow without the distraction of such a merger. CVG and MEM would be the immediate victims but while the stockmarket in general may applaud fortress hubs in MSP, DTW and SLC all of them including JFK and ATL are under attack from smaller more nimble players.
Hey Mr Anderson - just say no
From our perspective we believe that a merger of DL and NW will not serve the 2 companies shareholders nor the market in general well. Both players are still reeling from several years in protection and have a difficult enough road to follow without the distraction of such a merger. CVG and MEM would be the immediate victims but while the stockmarket in general may applaud fortress hubs in MSP, DTW and SLC all of them including JFK and ATL are under attack from smaller more nimble players.
Hey Mr Anderson - just say no
Brace yourselves - 787 delay story coming
Boeing is playing down rumours (now fact in our opinion) that the 787 program is running behind schedule.
With May delivery dates looking increasingly shaky, the Boeing spin machine is in full force. On Wednesday the scheduled 787 quarterly briefing should be an interesting affair.
While we doubt we shall see 787s parked in Everett with concrete blocks instead of engines (like the 747 early stage program) there is a now a clear likelihood that the first customers will not be getting their full complement of planes on time.
The culprit(s) the process of reinstalling fasteners for the prototype and yes our old friend software integration are probably the candidates for the delay. We personally believe that the 787 will fly in 2007 Q4 with deliveries coming in before the start of the second half of 2008. Even so that is a very aggressive schedule.
Boeing is not infallible and this goes on to just show that launching a new aircraft is no trivial exercise. Airbus is probably not going to be able to take advantage of this situation. But at least they can take some comfort that they are not the only player to suffer. (No comments please on Embraer's recent melt down of its supply chain).
Coming up - likely that Boeing will shortly formally announce the 787-10 to compete with the higher end A350XWB. Boeing is not shy in letting the new aircraft cannibalize the market for the older model 777-200s.
Stay tuned people. Spin at its finest coming your way.
With May delivery dates looking increasingly shaky, the Boeing spin machine is in full force. On Wednesday the scheduled 787 quarterly briefing should be an interesting affair.
While we doubt we shall see 787s parked in Everett with concrete blocks instead of engines (like the 747 early stage program) there is a now a clear likelihood that the first customers will not be getting their full complement of planes on time.
The culprit(s) the process of reinstalling fasteners for the prototype and yes our old friend software integration are probably the candidates for the delay. We personally believe that the 787 will fly in 2007 Q4 with deliveries coming in before the start of the second half of 2008. Even so that is a very aggressive schedule.
Boeing is not infallible and this goes on to just show that launching a new aircraft is no trivial exercise. Airbus is probably not going to be able to take advantage of this situation. But at least they can take some comfort that they are not the only player to suffer. (No comments please on Embraer's recent melt down of its supply chain).
Coming up - likely that Boeing will shortly formally announce the 787-10 to compete with the higher end A350XWB. Boeing is not shy in letting the new aircraft cannibalize the market for the older model 777-200s.
Stay tuned people. Spin at its finest coming your way.
Back from Holiday... lots to chat about
Sorry we have been quiet during August but the team decided to take some tme off. We will be back in full production later this week as we review the current trends and provide some of our usual milquetoast intensive analysis.
Cheers
Cheers
02 August 2007
Midwest and AirTran - all over bar the shouting?
The inevitable is almost here. AirTran subject to a last minute stumble will finally be able to gobble up the smaller MidWest Express.
The Little Airline that started out as the Kleenex Express will likely cease to exist and Air Tran will have a new mid western hub in MKE.
We are suckers for the little guy but the economics of the airline biz does not allow a premium domestic service to operate in this manner. So the brave experiment will likely end early next year if not before
Will AirTran allow fresh cookies on board. I doubt it. Joe Leonard is trying to lose weight
Cheers
Timothy
The Little Airline that started out as the Kleenex Express will likely cease to exist and Air Tran will have a new mid western hub in MKE.
We are suckers for the little guy but the economics of the airline biz does not allow a premium domestic service to operate in this manner. So the brave experiment will likely end early next year if not before
Will AirTran allow fresh cookies on board. I doubt it. Joe Leonard is trying to lose weight
Cheers
Timothy
Is Iberia worth it – or will the Spectre of Qantas still haunt?
Iberia is at the moment being poked and prodded like a contestant at a very ritzy beauty pageant. With only the Joint TPG/BA team allowed anywhere near the books – you can ask why anyone would want to pay for the company with one of the most bloated payrolls in Europe. Simple. 12 straight years of profit. Oh yes and add in the combined effect of the AF-KL deal as a model and you have an interesting cocktail that someone clearly thinks is worth it.
So what do we think?
Without touching the books and with only public reports to work with we feel it comes down to a certain amount of cojones and ego. BA is literally challenging or daring LH to come out and play. The latter has effectively grown by stealth through defusing competition and broadening its base while at the same time building a set of vassal states to feed its dual hubs in FRA and MUC.
Effectively we are neutral on it. We can’t see the large scale synergies emerging because the London Madrid Axis has been in place for many years. Unlike AF KL who were in different leagues and therefore could engage in joint value, BA and IB wont achieve anything like that. Sure BA will have a growth opportunity in LATAM (one of the bright growth spots in international inter-regional travel) but it is still a small base. IB won’t benefit because it is a mature market and there isn’t the value proposition to move to BA's core markets such as Africa and the orient. So the only other reason for doing it is defense. While there are some short term gains – long term value is far from assured.
Risk factors abound:
Open skies on the transatlantic
Premium niche carriers
LCCs especially Ryanair, Easyjet and Air Berlin
Etc
So we remain ambivalent to the deal. We think that it’s necessary but fundamentally we don’t like the match up.
Cheers
Timothy
So what do we think?
Without touching the books and with only public reports to work with we feel it comes down to a certain amount of cojones and ego. BA is literally challenging or daring LH to come out and play. The latter has effectively grown by stealth through defusing competition and broadening its base while at the same time building a set of vassal states to feed its dual hubs in FRA and MUC.
Effectively we are neutral on it. We can’t see the large scale synergies emerging because the London Madrid Axis has been in place for many years. Unlike AF KL who were in different leagues and therefore could engage in joint value, BA and IB wont achieve anything like that. Sure BA will have a growth opportunity in LATAM (one of the bright growth spots in international inter-regional travel) but it is still a small base. IB won’t benefit because it is a mature market and there isn’t the value proposition to move to BA's core markets such as Africa and the orient. So the only other reason for doing it is defense. While there are some short term gains – long term value is far from assured.
Risk factors abound:
Open skies on the transatlantic
Premium niche carriers
LCCs especially Ryanair, Easyjet and Air Berlin
Etc
So we remain ambivalent to the deal. We think that it’s necessary but fundamentally we don’t like the match up.
Cheers
Timothy
Battle lines drawn Big Airlines vs Big wigs Corporate Plane toys
Here at T2 we have been a big critic of the current "market" based system for allocating Air Space resources such as ATC.
The big airlines have launched into this using a somewhat lame metaphor. Welcome to the party boys! A new website has been launched http://www.smartskies.org/ which aims to put the blame for ATC gridlock at the door of Corporate Jet users.
Not so fast everyone. Surely Delta and others are just as conflicted. Since Delta's Elite service is actually part of the enemy of this community. http://www.airelite.com/ So is Delta speaking out of 2 sides of its mouth. You betcha. But lets not stop here. One of our other gripes with the US Airlines is their diversion of resources by using more smaller planes (IE less Air Space efficient) aircraft to service domestic points. We have a raft of studies that show the air traffic (measured in aircraft movements) is increasing much more rapidly vs total passengers (RPMs). Yes Delta - your mainline fleet reassignment has resulted in more planes in the air which are less efficient. I am just picking on Delta because they are being a particular hypocrite in this debate.
Moral of the story - let he that is innocent cast the first stone.
But the real urgent issue is a full and open debate on the true cost of the Air Space. For that I believe the smartskies.org website is a useful forum for the debate. So everyone - lets have a full and sane (that means rational) debate and come to a long term solution. The old devil worship of General Aviation should not be sacrificed at the alter of public opinion. The FAA needs to fix what is broken and to use a rational pricing mechanism that recognizes the true cost of the Air Space, the runway space and the bits in between.
Cheers
Timothy
The big airlines have launched into this using a somewhat lame metaphor. Welcome to the party boys! A new website has been launched http://www.smartskies.org/ which aims to put the blame for ATC gridlock at the door of Corporate Jet users.
Not so fast everyone. Surely Delta and others are just as conflicted. Since Delta's Elite service is actually part of the enemy of this community. http://www.airelite.com/ So is Delta speaking out of 2 sides of its mouth. You betcha. But lets not stop here. One of our other gripes with the US Airlines is their diversion of resources by using more smaller planes (IE less Air Space efficient) aircraft to service domestic points. We have a raft of studies that show the air traffic (measured in aircraft movements) is increasing much more rapidly vs total passengers (RPMs). Yes Delta - your mainline fleet reassignment has resulted in more planes in the air which are less efficient. I am just picking on Delta because they are being a particular hypocrite in this debate.
Moral of the story - let he that is innocent cast the first stone.
But the real urgent issue is a full and open debate on the true cost of the Air Space. For that I believe the smartskies.org website is a useful forum for the debate. So everyone - lets have a full and sane (that means rational) debate and come to a long term solution. The old devil worship of General Aviation should not be sacrificed at the alter of public opinion. The FAA needs to fix what is broken and to use a rational pricing mechanism that recognizes the true cost of the Air Space, the runway space and the bits in between.
Cheers
Timothy
30 July 2007
Watch out Europe - here comes Virgin
Great article today in WSJ on interview with Steve Ridgeway MD of Virgin Atlantic.
http://online.wsj.com/article/SB118575235393381736.html?mod=hps_us_editors_picks
One critical element is what VS will be doing to combat the loss of its oligopoly position at LHR. We believe that VS will be taking on weak carriers and uncompetitive premium product airlines. Watch out all of you EU carriers with a slightly inferior product (AZ you have been warned) because Virgin has you in their sights. Air France's legendary surly flight attendants better go to charm school now! Also watch out for additional markets with high premium traffic and low transatlantic lift. Specifically look at markets like DC, Seattle, Denver and Vancouver. As a clue look at the coming route map for Virgin America.
Worth the read - interesting battle. VS will be battling (like BA who is similarly affected) the peer and above crowd (Read BA and LH) and now the niche carriers such as L'Avion, Maxjet etc.
Competition is definitely out there. Long may it rear its pretty head
Cheers
http://online.wsj.com/article/SB118575235393381736.html?mod=hps_us_editors_picks
One critical element is what VS will be doing to combat the loss of its oligopoly position at LHR. We believe that VS will be taking on weak carriers and uncompetitive premium product airlines. Watch out all of you EU carriers with a slightly inferior product (AZ you have been warned) because Virgin has you in their sights. Air France's legendary surly flight attendants better go to charm school now! Also watch out for additional markets with high premium traffic and low transatlantic lift. Specifically look at markets like DC, Seattle, Denver and Vancouver. As a clue look at the coming route map for Virgin America.
Worth the read - interesting battle. VS will be battling (like BA who is similarly affected) the peer and above crowd (Read BA and LH) and now the niche carriers such as L'Avion, Maxjet etc.
Competition is definitely out there. Long may it rear its pretty head
Cheers
27 July 2007
BCD fights for rationality in Global Distribution
A well meaning paper written by the folks at BCD Travel is well worth the read. http://www.bcdtravel.com/aw/home/Corporate_Page/en-us/Content_5811652/Document_centre_5912426/~bmk/White_Papers/
The points it lays out are clearly expressed and mostly valid.
There are two points that we think should be added to the debate. So since we have the pulpit - we will exercise our rights:
1. Fragmentation of distribution actually benefits TMCs who can now show their value by being the real aggregator of content - rather than just the re-presenter of information.
2. The true cost of distribution has not fallen - either for the Airlines nor the users of travel.
We will continue to push these points in coming weeks and months as we believe that there is a sea change of distribution re-alignment occurring. One thing is for sure. Full Content deals were not the great seminal moment of change that the airlines thought it would be. Rather it has resulted in an increase in distribution costs as the GDSs unbundled their offerings while rejoicing in the the handcuffs they have placed on the airlines signing such deals.
The points it lays out are clearly expressed and mostly valid.
There are two points that we think should be added to the debate. So since we have the pulpit - we will exercise our rights:
1. Fragmentation of distribution actually benefits TMCs who can now show their value by being the real aggregator of content - rather than just the re-presenter of information.
2. The true cost of distribution has not fallen - either for the Airlines nor the users of travel.
We will continue to push these points in coming weeks and months as we believe that there is a sea change of distribution re-alignment occurring. One thing is for sure. Full Content deals were not the great seminal moment of change that the airlines thought it would be. Rather it has resulted in an increase in distribution costs as the GDSs unbundled their offerings while rejoicing in the the handcuffs they have placed on the airlines signing such deals.
24 July 2007
Wrath of Kahn - what is his legacy
The nice old man with the youthful grin is largely ignored whenever he travels. Yet he has had more impact on Airline Travel than anyone on the planet. Bar none.
In Tuesday's USA Today there is a lovely article on the father of de-regulation. http://www.usatoday.com/money/industries/travel/2007-07-23-alfred-kahn_N.htm?csp=34
There is a of course a huge debate by many people on the long term impact. Economically it was largely inevitable. De-regulation would happen. If not under the Carter administration then for sure under the Reagan one that followed.
However there are still some who are guilty of not making the sea change easier through the regulatory and economic framework. Inappropriate and just plain lame government action or inaction is the root cause of today's issues. Now is it fixable. Sure. But fixing things that are broken are always more difficult than preventing things.
There are no excuses. The numbers do not lie.
For those who think that this is a pure economic solution - then that is wrong. Sorry - I am a great believer in the free market but by definition there has to be a fair market. Thus far the market is badly organized by the market's managers. That needs fixing. There needs to be new rules for a true market with all stakeholders acknowledged. (See our blog from yesterday on the Air Space Control system).
For those who want a return to full regulation. Well that's just insane.
So there needs to be a rational approach. There is no rocket science to this. Just plain common sense. Do we have it?
Let’s hope so. Professor Kahn did. Let’s not waste his legacy. Let’s celebrate his achievements and our benefits but fixing the Air Traffic mess permanently
Cheers
In Tuesday's USA Today there is a lovely article on the father of de-regulation. http://www.usatoday.com/money/industries/travel/2007-07-23-alfred-kahn_N.htm?csp=34
There is a of course a huge debate by many people on the long term impact. Economically it was largely inevitable. De-regulation would happen. If not under the Carter administration then for sure under the Reagan one that followed.
However there are still some who are guilty of not making the sea change easier through the regulatory and economic framework. Inappropriate and just plain lame government action or inaction is the root cause of today's issues. Now is it fixable. Sure. But fixing things that are broken are always more difficult than preventing things.
There are no excuses. The numbers do not lie.
For those who think that this is a pure economic solution - then that is wrong. Sorry - I am a great believer in the free market but by definition there has to be a fair market. Thus far the market is badly organized by the market's managers. That needs fixing. There needs to be new rules for a true market with all stakeholders acknowledged. (See our blog from yesterday on the Air Space Control system).
For those who want a return to full regulation. Well that's just insane.
So there needs to be a rational approach. There is no rocket science to this. Just plain common sense. Do we have it?
Let’s hope so. Professor Kahn did. Let’s not waste his legacy. Let’s celebrate his achievements and our benefits but fixing the Air Traffic mess permanently
Cheers
23 July 2007
Pricing Power hits - er India?
The headline is not a mistake.
While there has been a lot of attention paid to the stellar growth of the Online Travel Sector in India and the spectacular explosion of LCC traffic - the hotel sector has been quietly suffering. There are essentially no hotel rooms in India. So anyone with any can charge a premium. Up till now the paucity of product has been tempered by the lack of available distribution channels. With all the Online players and even the airlines now able to offer hotel rooms in combination or seperately - the hotelliers can rightly flex their muscles. In a recent report in Travel Weekly OZ one tour operator described the situation as "out of control". Duh... wake up people. Just look at the US market and for a REALLY tight supply situation look no further than the world's most expensive city... Moscow
While there has been a lot of attention paid to the stellar growth of the Online Travel Sector in India and the spectacular explosion of LCC traffic - the hotel sector has been quietly suffering. There are essentially no hotel rooms in India. So anyone with any can charge a premium. Up till now the paucity of product has been tempered by the lack of available distribution channels. With all the Online players and even the airlines now able to offer hotel rooms in combination or seperately - the hotelliers can rightly flex their muscles. In a recent report in Travel Weekly OZ one tour operator described the situation as "out of control". Duh... wake up people. Just look at the US market and for a REALLY tight supply situation look no further than the world's most expensive city... Moscow
Expedia Trips... Stock drops
Big drop today!
We have written before that we think Diller may have lost some of his magic. The recent stock behavior of Expedia has been interesting. From the depths of last year’s catastrophic position to this year's all time high we can attribute this to many things. But is the stock still a darling?
Clearly not enough to capture the imagination of the large scale bond holders. They have derailed the massive $3.5 Billion Stock Buyback. WSJ blogs point the culprit at the bond vigilantes. http://blogs.wsj.com/deals/2007/07/23/bond-vigilantes-take-down-expedia/
Today Expedia (EXPE) was forced to scale back its second stock buyback program since its re-launch over 2 years ago. The powers that be are punishing Expedia for either being greedy or too opportunistic. Either way it took a big drop today - over 9%.
The company however remains fundamentally sound and Dara and Co can stay on a little longer. Growth however is not going to be as easy to come buy as in former years. With the US market (sssssshhhhhhhh) now at saturation point for online - it’s a game of share shift rather than market expansion. Internationally the second tier markets will not return big numbers (for example recent expansion into the Nordic Countries). So outperforming the market will be hard unless good old Barry can work some of his old black magic.
Our view is the overall market will be pretty stable. Today was also coincidentally the market debut of Orbitz Worldwide. (OWW) That finished just slightly down on the day. With both Sabre and Amadeus currently out of the market and in the hands of Private Equity firms - we don’t have as much market info to work with. But still Priceline (PCLN) (who seem to have done everything right to assure themselves a seat at the top table) are the current darlings.
Of course tomorrow it could all change.
Cheers
Timothy
We have written before that we think Diller may have lost some of his magic. The recent stock behavior of Expedia has been interesting. From the depths of last year’s catastrophic position to this year's all time high we can attribute this to many things. But is the stock still a darling?
Clearly not enough to capture the imagination of the large scale bond holders. They have derailed the massive $3.5 Billion Stock Buyback. WSJ blogs point the culprit at the bond vigilantes. http://blogs.wsj.com/deals/2007/07/23/bond-vigilantes-take-down-expedia/
Today Expedia (EXPE) was forced to scale back its second stock buyback program since its re-launch over 2 years ago. The powers that be are punishing Expedia for either being greedy or too opportunistic. Either way it took a big drop today - over 9%.
The company however remains fundamentally sound and Dara and Co can stay on a little longer. Growth however is not going to be as easy to come buy as in former years. With the US market (sssssshhhhhhhh) now at saturation point for online - it’s a game of share shift rather than market expansion. Internationally the second tier markets will not return big numbers (for example recent expansion into the Nordic Countries). So outperforming the market will be hard unless good old Barry can work some of his old black magic.
Our view is the overall market will be pretty stable. Today was also coincidentally the market debut of Orbitz Worldwide. (OWW) That finished just slightly down on the day. With both Sabre and Amadeus currently out of the market and in the hands of Private Equity firms - we don’t have as much market info to work with. But still Priceline (PCLN) (who seem to have done everything right to assure themselves a seat at the top table) are the current darlings.
Of course tomorrow it could all change.
Cheers
Timothy
Air Space Control Systems - A Manifesto for ATC.
For too long the ATC systems around the world have been looked on as unimportant and isolated parts of national government controlled infrastructure. This is no longer acceptable when the demand is soaring. To address this set of issues we are proposing a manifesto be adopted by ALL Stakeholders starting with the US ATC system and then using it as a model to work with other centralized systems.
Principals:
· Safety is paramount for users and impact footprint stakeholders alike.
· The air is not free
· A new unit of AS – Air Space - needs to be determined and defined for usage. Current definitions are not adequate now that air is a scarce resource
· The Air Space is part of a total infrastructure system from Gate to Taxiway to Runway to Air and back down again.
· The Air Space has multiple stakeholders all of whom are entitled to a share of the use.
· Citizens have a right to clean unpolluted and correctly oxygenated air without paying for it.
· Recognizing that there are multiple users of Air Space some of whom are interconnected – some of whom are not
· Stakeholders are anyone who consumes Air Space irrespective of their reasons for usage.
1. Military users must be brought into the systems
2. Transient users must be part of the system (above a certain height – through, in or via certain heights.
3. The Eco-system including Birds and passage of natural phenomena E.G. from Spores to Volcanoes must be acknowledged.
· The Air Space bounded by certain traditional jurisdictions is a part of the infrastructure of more than just nations. It is inextricably linked with other areas of air in the same manner that the sea is comprised of water that moves in and out of jurisdictions.
· Economic usage of the Air Space scarce resource demands fair premium pricing should be paid for inefficient usage.
· Ineffective and inefficient usage can be on the ground as much as in the air.
· Use of Air Space as a revenue source for non-air space uses should be discontinued
· Harmonized usage based pricing should be the norm.
· Inefficient use or knowing abuse of the system (e.g. over-scheduling or deliberate substitution of less priority aircraft) should result in fines paid by the offender and compensation provided to affected parties
· It is better to charge for the future environmental damage (Pollution and Global Warming) rather than post fact payment. (as is the case of tobacco litigation).
· Protection from litigation through the creation of a fund to cover non-specific stakeholder damages (such as environmental damages) must be funded by the Insurance and the User communities.
· Pollution can be chemical, biological, noise or light. Medical and Psychological effects must also be considered.
· Some grandfather scheme must be in place for existing inefficient facilities. However a goal of reducing the impact footprint must apply by no later than 2012 for Stage A and 2020 for all areas to be compliant to a Stage B criteria.
Based on these principals we believe that the ACS – Air Control Systems - needs to replace current outdated and inadequately conceptualized ATC systems which only cover certain parts of the Air Space.
Specifics:
Efficient use of air resource means that a full economic price should be charged for the use of the air – irrespective of user type. Thus a private plane using airspace must pay an economic rate for the use of the air space as much as a passenger carrying plane or a military jet fighter. Specifically inter air space user communities can specify if they wish to allow cross subsidy of certain categories of air space usage however this should not come at the expense of inefficient use or price gouging.
Global Standards of ASC need to be set and delivered. Monitoring of this should be an interagency responsibility with the right to fine backward or inefficient users or ASC authorities who allow such efforts.
Private Enterprise based management systems for Air Space should be encouraged but ultimate ownership should be acknowledged as a public right just as Land Space.
Examples of issues:
1. The use of inefficient aircraft such as smaller regional jets in place of larger aircraft should be discouraged through pricing mechanisms. Today we have a situation where air traffic has increased by 14% in summer of 2007 while domestic capacity of ASMs has only increased at 2-3%. Thus an inefficient model has emerged of the use of smaller and less efficient aircraft.
2. Full responsibility for traffic rights should be applied to the seller of each Air Space user. For example if an airline A sells a seat on a regional or code share airline – yet it offers a lesser priority for routes then the compensation must be made to the whole stakeholder community.
3. Air Space units must recognize distance as well as access. For example the access to the skies at particular FL (Flight Levels) should be recognized to prevent inefficient use by say high flying business jets operating at Commercial Airliner FL.
4. Carbon Trading Schemes should be encouraged but with limits to prevent abuse. Remember the issue is a “Global Problem” not a localized one.
A global stakeholder effort is required to address the overall issues
We believe that the effort to work on this starts now. We believe that the global expansion of aviation based system users needs to be thoroughly examined. Principals should then be enacted at the highest inter-government level and implemented by 2015 for Stage A. We believe we should use an accelerated adoption method similar to the recent global warming manifesto principals.
Time line:
We believe that a definitive timeline should be put in place for all countries to adopt the manifesto and enact appropriate legislation.
Development of principals and detailed white papers on Air usage and ACS in particular – Delivery 2008 End for ratification by the UN
Detailed local ratification by top 50 air using countries – Delivery end of 2010.
Detailed ratification by all countries of principals and enacted legislation 2012
Stage A achievement 2015 – carbon neutral and consolidated global coverage
Stage B achievement 2020 – carbon reduction 1-2% per year unified global services.
As a kick start to this effort T2Impact will deploy resources to any duly authorized entity who can facilitate the changes outlined here.
Sincerely
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
Read our Blog: http://t2impact.blogspot.com/
Principals:
· Safety is paramount for users and impact footprint stakeholders alike.
· The air is not free
· A new unit of AS – Air Space - needs to be determined and defined for usage. Current definitions are not adequate now that air is a scarce resource
· The Air Space is part of a total infrastructure system from Gate to Taxiway to Runway to Air and back down again.
· The Air Space has multiple stakeholders all of whom are entitled to a share of the use.
· Citizens have a right to clean unpolluted and correctly oxygenated air without paying for it.
· Recognizing that there are multiple users of Air Space some of whom are interconnected – some of whom are not
· Stakeholders are anyone who consumes Air Space irrespective of their reasons for usage.
1. Military users must be brought into the systems
2. Transient users must be part of the system (above a certain height – through, in or via certain heights.
3. The Eco-system including Birds and passage of natural phenomena E.G. from Spores to Volcanoes must be acknowledged.
· The Air Space bounded by certain traditional jurisdictions is a part of the infrastructure of more than just nations. It is inextricably linked with other areas of air in the same manner that the sea is comprised of water that moves in and out of jurisdictions.
· Economic usage of the Air Space scarce resource demands fair premium pricing should be paid for inefficient usage.
· Ineffective and inefficient usage can be on the ground as much as in the air.
· Use of Air Space as a revenue source for non-air space uses should be discontinued
· Harmonized usage based pricing should be the norm.
· Inefficient use or knowing abuse of the system (e.g. over-scheduling or deliberate substitution of less priority aircraft) should result in fines paid by the offender and compensation provided to affected parties
· It is better to charge for the future environmental damage (Pollution and Global Warming) rather than post fact payment. (as is the case of tobacco litigation).
· Protection from litigation through the creation of a fund to cover non-specific stakeholder damages (such as environmental damages) must be funded by the Insurance and the User communities.
· Pollution can be chemical, biological, noise or light. Medical and Psychological effects must also be considered.
· Some grandfather scheme must be in place for existing inefficient facilities. However a goal of reducing the impact footprint must apply by no later than 2012 for Stage A and 2020 for all areas to be compliant to a Stage B criteria.
Based on these principals we believe that the ACS – Air Control Systems - needs to replace current outdated and inadequately conceptualized ATC systems which only cover certain parts of the Air Space.
Specifics:
Efficient use of air resource means that a full economic price should be charged for the use of the air – irrespective of user type. Thus a private plane using airspace must pay an economic rate for the use of the air space as much as a passenger carrying plane or a military jet fighter. Specifically inter air space user communities can specify if they wish to allow cross subsidy of certain categories of air space usage however this should not come at the expense of inefficient use or price gouging.
Global Standards of ASC need to be set and delivered. Monitoring of this should be an interagency responsibility with the right to fine backward or inefficient users or ASC authorities who allow such efforts.
Private Enterprise based management systems for Air Space should be encouraged but ultimate ownership should be acknowledged as a public right just as Land Space.
Examples of issues:
1. The use of inefficient aircraft such as smaller regional jets in place of larger aircraft should be discouraged through pricing mechanisms. Today we have a situation where air traffic has increased by 14% in summer of 2007 while domestic capacity of ASMs has only increased at 2-3%. Thus an inefficient model has emerged of the use of smaller and less efficient aircraft.
2. Full responsibility for traffic rights should be applied to the seller of each Air Space user. For example if an airline A sells a seat on a regional or code share airline – yet it offers a lesser priority for routes then the compensation must be made to the whole stakeholder community.
3. Air Space units must recognize distance as well as access. For example the access to the skies at particular FL (Flight Levels) should be recognized to prevent inefficient use by say high flying business jets operating at Commercial Airliner FL.
4. Carbon Trading Schemes should be encouraged but with limits to prevent abuse. Remember the issue is a “Global Problem” not a localized one.
A global stakeholder effort is required to address the overall issues
We believe that the effort to work on this starts now. We believe that the global expansion of aviation based system users needs to be thoroughly examined. Principals should then be enacted at the highest inter-government level and implemented by 2015 for Stage A. We believe we should use an accelerated adoption method similar to the recent global warming manifesto principals.
Time line:
We believe that a definitive timeline should be put in place for all countries to adopt the manifesto and enact appropriate legislation.
Development of principals and detailed white papers on Air usage and ACS in particular – Delivery 2008 End for ratification by the UN
Detailed local ratification by top 50 air using countries – Delivery end of 2010.
Detailed ratification by all countries of principals and enacted legislation 2012
Stage A achievement 2015 – carbon neutral and consolidated global coverage
Stage B achievement 2020 – carbon reduction 1-2% per year unified global services.
As a kick start to this effort T2Impact will deploy resources to any duly authorized entity who can facilitate the changes outlined here.
Sincerely
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
Read our Blog: http://t2impact.blogspot.com/
22 July 2007
Concorde Gone... and now forgotton - The market for Premium Seats
While some of us bemoan the forced retirement of Concorde there is however a very vibrant market for premium traffic.
If we take the Londont to New York route in Concorde's heyday there were the following flights between London (LHR and LGW) and New York (EWR and JFK):
British Airways 5X - Newark 1, JFK 4 Plus 2 Concorde
American Airlines 4 JFK-LHR
Virgin Atlantic 5 various combos PLUS CO code share
United 3
Continental 2 plus VS code share
Air India 2
Total 21 Flights per day plus 2 Concordes.
Thats a healthy bit of competition.
Fast forward to this summer (using August 12th as the date) and we have even more flights 35 flights daily with premium seat share of the new entrants at a healthy 22% of all premium seats. For clarification a premium seat is a C/J/P/F class seat not premium economy.
With Virgin and BA poised to make an entry into the market we anticipate that the segment will continue to grow. This trend is likely to spread to other markets where already there is premium single plane service on many other sectors including flights offered by Air France, L'Avion, Lufthansa, Swiss International, KLM. We believe that certain other markets will see the introduction of premium service. Even Maxjet filed for one of the US-China frequencies this month.
If general traffic and therefore yields go soft next year as has been predicted (we are still pondering that question) will traffic in the premium plane business also soften? Will the premium traffic take a load of the depressed Coach yields?
Good questions all - stay tuned
Cheers
Note on sources - Source Material is OAG, SeatGuru, IATA and Airlines directly.
If we take the Londont to New York route in Concorde's heyday there were the following flights between London (LHR and LGW) and New York (EWR and JFK):
British Airways 5X - Newark 1, JFK 4 Plus 2 Concorde
American Airlines 4 JFK-LHR
Virgin Atlantic 5 various combos PLUS CO code share
United 3
Continental 2 plus VS code share
Air India 2
Total 21 Flights per day plus 2 Concordes.
Thats a healthy bit of competition.
Fast forward to this summer (using August 12th as the date) and we have even more flights 35 flights daily with premium seat share of the new entrants at a healthy 22% of all premium seats. For clarification a premium seat is a C/J/P/F class seat not premium economy.
With Virgin and BA poised to make an entry into the market we anticipate that the segment will continue to grow. This trend is likely to spread to other markets where already there is premium single plane service on many other sectors including flights offered by Air France, L'Avion, Lufthansa, Swiss International, KLM. We believe that certain other markets will see the introduction of premium service. Even Maxjet filed for one of the US-China frequencies this month.
If general traffic and therefore yields go soft next year as has been predicted (we are still pondering that question) will traffic in the premium plane business also soften? Will the premium traffic take a load of the depressed Coach yields?
Good questions all - stay tuned
Cheers
Note on sources - Source Material is OAG, SeatGuru, IATA and Airlines directly.
21 July 2007
Scaled Composites Succumbs - Big Defense Takes Over
One of the sad footnotes to the Space Face is that the big guys are likely to win. With EADS already announcing its Astrium's Division project for a CTOL (Conventional Take Off and Landing) based Space Plane for Space Tourism, it wasn’t long before one of the big 3 US Contractors decided that this was something they wanted into.
Northrop Grumman Corp agreed July 5th and announced July 20th the agreed purchase of the remaining shares it didn’t own. According to news reports the share holding rose from 20% to 100% with (subject to US government approval) final effect from August 2007. Quietly the other players have been evaluating the market. It is well known that Boeing has been cooperating with the Russians in this area for some time. Lockheed Martin is keeping Mum on the subject. I believe that we will see a small further number of these projects seeing the light of day. Who is to say that Textron (owner of Cessna Aircraft) will not be entering the race. Not to mention Bombardier (Owner of Canadair and Learjet). Indeed the latter's Learjet 25 is the basis for a low cost entry by Rocketplane Ltd based in Oklahoma State.
The obvious impact is that competition will drive down the pricing to reasonable levels from the current astronomical $30-$40 million (For Space Adventures trips to the ISS) to $180,000 for a flight on SpaceShip 2 with reservations maxed out for approximately the first 5 years of service. Most of these reservations are backed by 100% prepayment. The first time there is an accident of course people will be heading for the hills, but in the mean time this is the equivalent of the Concorde Travel experience.
I might just sign up
Cheers
Timothy
Northrop Grumman Corp agreed July 5th and announced July 20th the agreed purchase of the remaining shares it didn’t own. According to news reports the share holding rose from 20% to 100% with (subject to US government approval) final effect from August 2007. Quietly the other players have been evaluating the market. It is well known that Boeing has been cooperating with the Russians in this area for some time. Lockheed Martin is keeping Mum on the subject. I believe that we will see a small further number of these projects seeing the light of day. Who is to say that Textron (owner of Cessna Aircraft) will not be entering the race. Not to mention Bombardier (Owner of Canadair and Learjet). Indeed the latter's Learjet 25 is the basis for a low cost entry by Rocketplane Ltd based in Oklahoma State.
The obvious impact is that competition will drive down the pricing to reasonable levels from the current astronomical $30-$40 million (For Space Adventures trips to the ISS) to $180,000 for a flight on SpaceShip 2 with reservations maxed out for approximately the first 5 years of service. Most of these reservations are backed by 100% prepayment. The first time there is an accident of course people will be heading for the hills, but in the mean time this is the equivalent of the Concorde Travel experience.
I might just sign up
Cheers
Timothy
20 July 2007
Is the EC trying some wizardry to appease Amadeus?
On the eve of the release of the Harry Potter final installment - perhaps we are seeing some signs and clues as to how the EC will define its long awaited changes to the GDS regulations. Up until now we have all assumed that the focus would be on the relaxation of the rules along the lines of the US deregulation of the GDS marketplace. But no - it would appear the bureaucrats in Brussels have other plans in store for us. The final chapter in this saga looks like it is going to have a few interesting plot twists and in the end The GDS/Harry character may not be killed off.
The issue it seems in the somewhat single tasking mode of the EC is that they are responding to some obvious pressure from the Amadeus lobbying efforts. They are now opening the door to the definition of "Parent" carrier. The origins of the "Parent" carrier term come from the 1980s when the battle was initially between the "Have" airlines - i.e. those who owned a part of a GDS vs. the "Have Not" carriers. Since this was clear at the time no one needed to have much definition. All EU based major airlines were all by definition "Parent" carriers by dint of the ownership stakes in either Galileo or Amadeus.
Fast forward to today and with the major airlines in the Galileo group all now non "Parent" carriers and even SAS is not an owner - then in Euro speak the definition is moot.
But I offer two other thoughts for consideration. The definitions of "Control" and "Distribution" should also be on the table for interpretation. Why?
Let’s start with "Distribution" the lines are now clearly drawn differently as we have fragmented distribution. With Amadeus focus now on airline IT it is not hard to see that actually distribution control can be effectively managed through the Airlines' PSS (Passenger Sales and Service aka internal Res Systems). So PSS systems are today doing much of what the GDS did before. If PSS systems were added into the loose definition of GDS in a redefined term of Distribution Platform then Amadeus would fail in my opinion the test of dominant control. Specifically we believe at T2 that the System User agreement should be examined in the same context as the "neutral" GDS agreements.
Now let’s consider the term "Control". The 3 participating owner carriers (and I choose my words carefully hear) are indeed much stronger than they were in the late 1980s and 1990s when the regulations were drawn up. Further the US share of the Transatlantic market has fallen significantly in actual passenger counts. The concentration of control among the 3 is pretty compelling.
However take both terms together - Control AND Distribution - and add ALL system users, CTP (Star Alliance - Common Technology Platform) users, all ALTEA users in the EU together and there is clearly a dominance and concentration of market power the likes of which we have NEVER seen before.
It was our hope that the EC would enact the new legislation for the protection of the consumer and the smaller EC airlines to prevent abuse of the monopolistic power concentration that can occur in situations such as these. Unlike the US market - the EC has the power of judge jury and executioner. They can both write and implement legislation. There is no check of the legislature at this level. Appeal to the judiciary is such a laborious process that it is effectively mute in all but the most high profile of cases. AND it takes many years of significant expense to challenge.
The story is not yet over and there will be many more plot twists. The EC has been known for using some of the Black Arts to conjure up dark forces cloaked in respectability. Let’s hope that
Olivier Onidi doesn’t turn out to be the real Voldermort.
For further reading we recommend going to the EC's Transportation section, Air Transport Portal: http://ec.europa.eu/transport/air_portal/index_en.htm.%20Specifically look a the comments on "Possible revision of Regulation 2299/89 on a Code of Conduct for computerized reservation systems (CRS)" http://ec.europa.eu/transport/air_portal/consultation/2007_04_27_en.htm
Note that the EC uses the older term CRS Computer Reservation System - rather than the more common GDS, Global Distribution System. Perhaps this different wording has an impact on the actual spells used.
OK so I carried the Harry Potter metaphor a bit far but my comments are valid. You have been warned. I have experienced first hand the power of the EC in this regard and how they listen to the "home team" of Amadeus lobbyists.
Other resources I suggest are to go to the BTC's website. http://businesstravelcoalition.com/
Cheers
Timothy
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
The issue it seems in the somewhat single tasking mode of the EC is that they are responding to some obvious pressure from the Amadeus lobbying efforts. They are now opening the door to the definition of "Parent" carrier. The origins of the "Parent" carrier term come from the 1980s when the battle was initially between the "Have" airlines - i.e. those who owned a part of a GDS vs. the "Have Not" carriers. Since this was clear at the time no one needed to have much definition. All EU based major airlines were all by definition "Parent" carriers by dint of the ownership stakes in either Galileo or Amadeus.
Fast forward to today and with the major airlines in the Galileo group all now non "Parent" carriers and even SAS is not an owner - then in Euro speak the definition is moot.
But I offer two other thoughts for consideration. The definitions of "Control" and "Distribution" should also be on the table for interpretation. Why?
Let’s start with "Distribution" the lines are now clearly drawn differently as we have fragmented distribution. With Amadeus focus now on airline IT it is not hard to see that actually distribution control can be effectively managed through the Airlines' PSS (Passenger Sales and Service aka internal Res Systems). So PSS systems are today doing much of what the GDS did before. If PSS systems were added into the loose definition of GDS in a redefined term of Distribution Platform then Amadeus would fail in my opinion the test of dominant control. Specifically we believe at T2 that the System User agreement should be examined in the same context as the "neutral" GDS agreements.
Now let’s consider the term "Control". The 3 participating owner carriers (and I choose my words carefully hear) are indeed much stronger than they were in the late 1980s and 1990s when the regulations were drawn up. Further the US share of the Transatlantic market has fallen significantly in actual passenger counts. The concentration of control among the 3 is pretty compelling.
However take both terms together - Control AND Distribution - and add ALL system users, CTP (Star Alliance - Common Technology Platform) users, all ALTEA users in the EU together and there is clearly a dominance and concentration of market power the likes of which we have NEVER seen before.
It was our hope that the EC would enact the new legislation for the protection of the consumer and the smaller EC airlines to prevent abuse of the monopolistic power concentration that can occur in situations such as these. Unlike the US market - the EC has the power of judge jury and executioner. They can both write and implement legislation. There is no check of the legislature at this level. Appeal to the judiciary is such a laborious process that it is effectively mute in all but the most high profile of cases. AND it takes many years of significant expense to challenge.
The story is not yet over and there will be many more plot twists. The EC has been known for using some of the Black Arts to conjure up dark forces cloaked in respectability. Let’s hope that
Olivier Onidi doesn’t turn out to be the real Voldermort.
For further reading we recommend going to the EC's Transportation section, Air Transport Portal: http://ec.europa.eu/transport/air_portal/index_en.htm.%20Specifically look a the comments on "Possible revision of Regulation 2299/89 on a Code of Conduct for computerized reservation systems (CRS)" http://ec.europa.eu/transport/air_portal/consultation/2007_04_27_en.htm
Note that the EC uses the older term CRS Computer Reservation System - rather than the more common GDS, Global Distribution System. Perhaps this different wording has an impact on the actual spells used.
OK so I carried the Harry Potter metaphor a bit far but my comments are valid. You have been warned. I have experienced first hand the power of the EC in this regard and how they listen to the "home team" of Amadeus lobbyists.
Other resources I suggest are to go to the BTC's website. http://businesstravelcoalition.com/
Cheers
Timothy
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
19 July 2007
Southwest jumps onto Paypal bandwagon
So the ball is SLOWLY rolling but definitely there is momentum
We have been advocating the use of non-credit card financial fulfilment for some time. We believe that there are considerable savings in various areas such as cross border payments and reduced credit card fees that can be garnered if the merchant is prepared to "shop" around.
With Visa now experiencing Debit card rates of more than 50% the time is right for the use of alternative solutions such as eBay's Paypal and Google's Checkout services.
Well done WN - any more takers?
cheers
Timothy
We have been advocating the use of non-credit card financial fulfilment for some time. We believe that there are considerable savings in various areas such as cross border payments and reduced credit card fees that can be garnered if the merchant is prepared to "shop" around.
With Visa now experiencing Debit card rates of more than 50% the time is right for the use of alternative solutions such as eBay's Paypal and Google's Checkout services.
Well done WN - any more takers?
cheers
Timothy
18 July 2007
Sao Paulo's Congonhas airport - comment
Having flown into this airport frequently (and its corresponding short runway counterpart in Rio) I can personally attest to the scary nature of the experience. The airport is tiny in comparison to other facilities. Given the significant daily traffic not just on the Rio - Sao Paolo run but also flights from there to many other places the location was a major factor in this tragic accident.
I will also however suggest partial culpability at several doors.
Whatever the actual reason for the accident we can say without a doubt that there is more than one issue at stake here. Due to the nature of the Brazilian market it is unlikely that this will ever come out as part of any official investigation.
1. The airport which sits on a small plateau is surrounded by dense population. This would not be tolerated in many other cities. Some of the housing may not be legal. A slum in Brazil (Favella) is not the same as we might expect, speaking from a Non-Brazilian point of view. Hundreds of thousands of people live in these makeshift cities in both Rio and Sao Paolo.
2. The only way to land is to slam the aircraft down on the runway and full thrust reversers and braking to slow the aircraft down. For a fully loaded A320 this is no small feat. Even 737s (Gol and Varig) and F100s (TAM) (the other jets that use the airport) have a hard time with this. There is little to no margin for error.
2. The pilots who fly the shuttle routes are highly competent and used to the "normal" conditions. This was far from normal having been one of the wettest winters in memory.
3. The runway had been repaved but not re-grooved
4. There had been a court case in which a judge had ruled that the airport was safe under pressure from the official bodies.
5. At least once in the preceding months since the runway re-surfacing had a pilot complained of the danger in the runway condition
6. Infraero - the former military organization charged with the infrastructure of the airports in Brazil and its counterpart ANAC http://www.infraero.gov.br/, http://www.anac.gov.br/ respectively are both politically influenced organizations.
7. TAM has been aggressively growing (as has GOL and others) without much check. The aggressive expansion has occurred at a time when the former national carrier VARIG went into deep decline (now only handling less than 3% of the total traffic) and when the air traffic control system was shown to be severely lacking. (See GOL midair collision).
8. TAM has had a poor record of safety particularly with its F100 aircraft. Even Wikipedia doesn’t log all of the accidents. In addition its hero Rolim Amaro was himself killed in a TAM Helicopter crash.
Enough guilt and blame to go round. Our thoughts and prayers are for the victims and their families. Let’s hope that this is a catalyst to cause reform and better oversight by the authorities. Brazil is a great country. its people are some of the nicest you can hope to meet. Let’s hope for the best for them
Cheers
Timothy
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
Our thoughts and prayers go
I will also however suggest partial culpability at several doors.
Whatever the actual reason for the accident we can say without a doubt that there is more than one issue at stake here. Due to the nature of the Brazilian market it is unlikely that this will ever come out as part of any official investigation.
1. The airport which sits on a small plateau is surrounded by dense population. This would not be tolerated in many other cities. Some of the housing may not be legal. A slum in Brazil (Favella) is not the same as we might expect, speaking from a Non-Brazilian point of view. Hundreds of thousands of people live in these makeshift cities in both Rio and Sao Paolo.
2. The only way to land is to slam the aircraft down on the runway and full thrust reversers and braking to slow the aircraft down. For a fully loaded A320 this is no small feat. Even 737s (Gol and Varig) and F100s (TAM) (the other jets that use the airport) have a hard time with this. There is little to no margin for error.
2. The pilots who fly the shuttle routes are highly competent and used to the "normal" conditions. This was far from normal having been one of the wettest winters in memory.
3. The runway had been repaved but not re-grooved
4. There had been a court case in which a judge had ruled that the airport was safe under pressure from the official bodies.
5. At least once in the preceding months since the runway re-surfacing had a pilot complained of the danger in the runway condition
6. Infraero - the former military organization charged with the infrastructure of the airports in Brazil and its counterpart ANAC http://www.infraero.gov.br/, http://www.anac.gov.br/ respectively are both politically influenced organizations.
7. TAM has been aggressively growing (as has GOL and others) without much check. The aggressive expansion has occurred at a time when the former national carrier VARIG went into deep decline (now only handling less than 3% of the total traffic) and when the air traffic control system was shown to be severely lacking. (See GOL midair collision).
8. TAM has had a poor record of safety particularly with its F100 aircraft. Even Wikipedia doesn’t log all of the accidents. In addition its hero Rolim Amaro was himself killed in a TAM Helicopter crash.
Enough guilt and blame to go round. Our thoughts and prayers are for the victims and their families. Let’s hope that this is a catalyst to cause reform and better oversight by the authorities. Brazil is a great country. its people are some of the nicest you can hope to meet. Let’s hope for the best for them
Cheers
Timothy
Timothy J O'Neil-Dunne
Managing Partner - T2Impact Ltd
Global Travel eBusiness
Tel (US) +1 425 836 4770
Mobile (US) +1 425 785 4457
Mobile (International) +44 7770 33 81 75
Fax +1 815 377 1583
UNIVERSAL VOICEMAIL BOX +1 425 749 4221
http://www.t2impact.com/
Our thoughts and prayers go
13 July 2007
FINALLY a deal on EU-US Data
OK so it was inevitable but its at least good to know that you (and me) can go to Europe after July 31st after an 11th hour agreement between the US and the EC on the handing over of data for US Homeland Security.
http://online.wsj.com/article/BT-CO-20070713-705251.html?mod=dist_smartbrief
The DoHS is still somewhat in disarray and still have not resolved many of the grand plans they announced but cannot implement post 9/11 but this is a small step.
I have no sympathy for the airlines in this case who are complaining that it will squeeze existing tight profit margins. What do they expect - largesse?
Now we have this deal in place all is at peace between the US and its transatlantic counterparts. So now perhaps we can get on with the business of a full and true open skies and a free market across the pond
Cheers
Timothy
http://online.wsj.com/article/BT-CO-20070713-705251.html?mod=dist_smartbrief
The DoHS is still somewhat in disarray and still have not resolved many of the grand plans they announced but cannot implement post 9/11 but this is a small step.
I have no sympathy for the airlines in this case who are complaining that it will squeeze existing tight profit margins. What do they expect - largesse?
Now we have this deal in place all is at peace between the US and its transatlantic counterparts. So now perhaps we can get on with the business of a full and true open skies and a free market across the pond
Cheers
Timothy
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