17 DECEMBER 2012


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Article from BTNews 17 DECEMBER 2012

COMMENT: That was a week that was!

Normally the last couple of weeks of the year in the airline business are quiet as far as serious announcements are concerned.

Not this time around.

First of all we had Irishman Willie Walsh, Chief Executive of IAG, unveiling the new British Airways A380 and Boeing 787 seat layout, not Chief Executive Keith Williams, and telling some British journalists that the Government was failing with its fixed economic strategy and being “fixated” with immigration.  As reported by The Times on the front page.  That was on an inaugural trip for the new Seoul route.  Quite what that has to do with overseeing BA and turning around loss-making Iberia is difficult to comprehend.

Just about the same time Singapore Airlines confirmed what had been industry talk for some days – that it had divested of its 12-year-old 49% stake in Virgin Atlantic to Delta for a huge loss.  The year 2000 was not a good year investment-wise for what is undoubtedly one of the world’s great airlines.  Air New Zealand was another disastrous venture at the same time.  One could argue that the last decade has not been too kind to the carrier, Singapore losing out to the Gulf carriers as the gateway to Asia.

The Delta – Virgin marriage has yet to be consummated but there have been strong utterances regarding a “Strategic Alliance”.  Under Delta’s President, Edward Bastian, who brought about the successful Northwest merger, the Atlanta-based carrier has gone from strength to strength using London as its main European gateway.  It vies with United as the world's largest airline in terms of fleet size, revenue passenger-kilometres flown, and scheduled passenger traffic. 

Richard Branson is now 62 and is beginning to slow down slightly.  A new CEO is to be appointed at Virgin Atlantic in the coming weeks, with presumably a brief to keep the US shareholder happy and make the most of the family arrangements.  Maybe even join Skyteam.  A fascinating rather than daunting task.

In the midst of all the shenanigans, BAA (or whatever they are called these days) chose to announce the airline tenancy for the 2014 Terminal 2 (and record Heathrow figures for November).  Why the timing?  There were no major surprises, except that Virgin Atlantic domestic (operated by Aer Lingus) would operate from T2, with a caveat “Heathrow will continue to work with Virgin Atlantic on how its services might be co-located in the future”.  If Virgin wants to attract traffic from Scotland and the North onto its worldwide services where it competes with British Airways, the last thing it needs is passengers traipsing between T2 and T3.  Move Virgin to T4 and persuade Qatar to join its oneworld friends in T3. 

And last Saturday the Financial Times broke a story suggesting that Ryanair had come to an understanding to sell to BA the Aer Lingus Heathrow slots as part of a deal with the EU to acquire its fellow Irish airline.  This news and more is detailed in the  columns of BTN.

The year 2013 looks like being a better year for the European legacy airlines who, with the exception of the not independent BA, have been suffering.  Ryanair, easyJet and now Vueling are prospering in harsh economic terms.  The UK Chancellor has his head in the sand regarding the effects of airline taxation.  Maybe it is his way of solving the London airports problem in slowing down the numbers.  It has worked at Stansted. 

Davies will initially report by the end of 2013, Business Travel News keen, as things stand, on mixed-mode at Heathrow, with Northolt as an alternative, or even both.

The year opens with the London Business Travel Show in early February (BTN is taking a booth – visitors welcome) and the Aviation Club will welcome in quick succession Steve Ridgway, CEO, Virgin Atlantic Airways and Ed Bastian, President, Delta Air Lines.  Get your bookings in early.

In the holiday spirit, well done all the airlines that have made some effort not only to cheer up their weary passengers over the Yuletide but have also tried to help those less well off.

Enjoy this last edition of the year.  It has sometimes been fraught getting BTN out for midnight every Sunday for 50 weeks, but it has been achieved.  Some people have been very helpful in obtaining news and direction.  Some less so.  You may not have agreed with all our comments but freedom of speech is part of the unwritten British constitution. 

We thank all our readers and advertisers for their support over the past year and wish you all seasonal greetings for the holidays and indeed a peaceful, healthy, happy and prosperous New Year.

We will be back on Monday 7 January 2013.

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