Airline financial expert and Air Cargo News FlyingTypers Special Commentaries Editor Dr. Julius Maldutis returns with his monthly recap and look ahead at the airline business.
     Julius Maldutis Ph.D is President Aviation Dynamics Contact: juliusmaldutis@aol.com

     Economic recovery under way.
     European Union and U.S. will experience a financial meltdown.
     Deep water oil spill in Gulf of Mexico could have a prolonged negative impact on oil futures.
     National debt of Greece is 113% of GPD, while U.S. is at about 50%.
     Airline fundamentals are improving.
     Airline mergers have not worked in the past.
     AMR will not propose a merger with USAir.
     AMR acquired three airlines and shut them all down. AMR will coordinate operations with BA. AMR will coordinate operations with JAL.
     Continental’s acquisition of UAL will be approved by the end of 2010.
     Continental will dominate UAL operations and management by the end of 2012.
     Delta/NWA will need to show it can achieve promised synergy benefits.
     US Airways will seek a merger with one of the smaller airlines such as AirTran.
     Hawaiian Airlines has ordered 27 A-330 and A-350 aircraft that could result in a new successful airline.
     Air Canada (AC.B) showing signs of economic recovery.

FlyingTypers
Up Close & Personal

China Forum Future Scope

     Organized by the Civil Aviation Administration of China (CAAC), the China Civil Aviation Development Forum 2010 was held in Beijing from May 12-13, attracting nearly 400 top officials and executives from all over the world.
     The Forum has been held every May since 2007, and this year's theme is “Preparing for a New Era of Global Civil Aviation.”
     Key speakers at the forum include Mr. Li Jiaxiang, CAAC Administrator; Mr. Raymond Benjamin, Secretary General of International Civil Aviation Organization (ICAO); Mr. Randy Babbitt, Administrator of Federal Aviation Administration (FAA); etc.
     Just one day before the Forum, Mr. Li Jiaxiang and Mr. Randy Babbitt had signed Annex 12 to the Memorandum of Agreement for Technical Cooperation in the field of Civil Aviation between CAAC and FAA, marking another step of cooperation between the two sides.
     At the forum, Mr. Li Jiaxiang responded to the rumor that the cargo business of three main domestic airlines would be consolidated: “It will finally depend on the airlines themselves.”
     “Cooperation, recombination and alliance are all ways to improve international competitiveness for domestic airlines.”
     Mr. Randy Babbitt gave a brief speech on “Cooperation Makes Win-Win,” specifying fields in which the U.S. and China could find more spaces to cooperate: Engineered Materials Arresting Systems (EMAS) for runway safety, Aircraft Airworthiness and Next Generation Civil Aviation System.
     Mr. Raymond Benjamin, (left) Secretary General of ICAO, delivered a speech titled “New Technology, Green and International Cooperation are Critical for Global Aviation Industry In The Future.”
     “The most effective way of preparing for a new era of global civil aviation is one of the most traditional and successful forms of global governance—international cooperation.”
     “International cooperation is also the essence of ICAO, a forum with 190 Member States.”
     Traffic in 2009 declined in all regions except for the Middle East, where carriers posted a strong 10 percent growth, while Chinese carriers registered a relatively good performance, albeit with a negative growth rate.
     “The long-term forecast for the airlines in the region is for 7.2 percent annual growth for the next 20 years, well above the world average of 4.7 percent for the same period.      And all of this points to the need in China for more than 3,000 passenger and freighter aircraft.”
     Mr. Raymond Benjamin also introduced what ICAO has been doing to bring the world together around the fundamental challenges that are safety, security and sustainability.
     Tian Min, (right) CFO of Commercial Aircraft Corporation of China, brought more information about the C919 airplane that the firm is now using in his speech, “C919 Airplane and China Civil Aviation Market.”
     “C919 program chooses the domestic market as the entry point and gives equal consideration to the global market. And it will provide serialized mode with different seat numbers and flying range to meet the various demands of customers.
     “The C919 airplane is to supply a single-aisle, mid-short range commercial transport airplane series to the civil aviation market, and is planning to have a First Flight at the end of 2014, and come into service after obtaining TC in 2016.
     “The C919 program is now entering into the pre-development phase.”
      Breakthroughs have been achieved in many fields, such as further development of concept design, research and development of nose engineering coordination mock-up, selection of domestic and international suppliers, research and development of domestic-made materials, tacking key technologies and establishment of maintenance support.
David

     The Boeing C-17 Globemaster III aircraft is causing as many headaches to the top brass in the Indian Air Force as the heavy loads it is capable of lifting. Reason: while India has recently ordered ten of the big birds, there is a possibility that they might not even make it to the assembly line.
     On April 23, the U.S. Defense Security Cooperation Agency notified the U.S. Congress that India had requested ten Boeing C-17 Globemaster III aircraft and associated equipment, parts, and logistical support at an estimated cost of $5.8 billion. Included in the associated equipment were forty-five F117-PW-100 engines (forty installed and five spare engines), ten AN/ALE-47 Counter-Measures Dispensing Systems and ten AN/AAR-47 Missile Warning Systems. India had mentioned that the planes would be used to replace its aging Russian-made AN-32s and IL-76s. Incidentally, the aircraft will be delivered three years after any deal is signed.
     Boeing Vice President and India country head of Boeing Defense, Space & Security Vivek Lall welcomed the Indian request and said that his company was very pleased with the Indian government’s interest in acquiring the C-17 to modernize its airlift capabilities, and “look forward to working closely with them.” He went on to add, that the C-17 could fulfill India's needs for military and humanitarian airlift to help meet its growing domestic and international responsibilities.

     Timothy J. Roemer, U.S. ambassador to India, also pointed out that the C-17 Globemaster III and its overall potential value would not only provide India with the kind of power it was seeking, but also act as a binding force in the relationship between U.S. and India.
     The situation seems suddenly to have changed with President Barack Obama and Defense Secretary Robert Gates wanting the C-17 manufacturing program to end. Both feel that the planes are too big. In fact, the U.S. Air Force stopped inducting C-17s in 2006. According to sources in the Indian government, a number of U.S. politicians are lobbying to ensure that the Boeing facility in California does not down its shutters. Apparently, the 5,000 employees at the facility — aware that the assembly lines will stop — are demanding fatter pay packets. The company had not stopped the production of the C-17 in 2009, it sold C-17s costing around $3 billion.
     According to news reports, Boeing puts together sixteen C-17s in a year. Most of them are meant for the U.S. Air Force. However, over the last few years, the C-17 has lost popularity and orders have gone down, forcing Boeing to bring down the production rate to only ten by the middle of next year.
     The decision has sent the Indian defense establishment into a tizzy. India needs heavier lifters than the present IL-76s, which can carry around 45 metric tons with a crew of six. The C-17 can carry double the load with three crewmembers.
     On the other hand, if Boeing does stop the production of the C-17s, India could find itself with a bunch of planes that would turn into museum pieces in a short time and that would certainly defeat the purpose for which the planes are being acquired.
Tirthankar Ghosh

DLH A 380 Takes Off

     There was an old-fashioned hangar party in Frankfurt last week as Lufthansa unveiled its newest aircraft: the super-jumbo A380.
     A380s will fly from Frankfurt DLH to Tokyo, Beijing and Johannesburg. Older 747-400 jumbos (that will be) displaced by the A380s will serve other cities, and some will retire.
     Biggest hit (hard to miss) are the sumptuous first class Lufthansa A380 lavs (sans the showers) aboard EK variants of the big bird — high, wide and handsome compared to any other currently aloft.

B777F To QR Cargo

In a recent issue of Air Cargo News FlyingTypers we ran an item on the new Qatar Cargo B777F but forgot to link these videos, of other QR B777s, which are among the best of its kind you will ever see.

About Barry

     Barry Gibson, one of the pillars of our industry in the UK, has passed away.
     I have not seen Barry for many years, but we once had a close business relationship as his company's cargo was handled at my company's warehouse facilities at London Heathrow.
     This is of course a time for reflection, and for sympathy for Barry's family and close friends.
     Barry's wife Brenda would like to keep things simple and has asked attendees to wear bright clothing and not funeral attire to reflect Barry's life style.
     I will not be attending the funeral as I am travelling.
     But I shall think about the meaning of events in England.
     We all carry this wonderful industry forward upon our shoulders.
     We do everything in our power to live our lives (and our professional lives) fully for the time that is allotted to us. And people like Barry help to show the way.
Oliver Evans
Chief Cargo Officer
Swiss WorldCargo

If You Missed Any Of The Previous 3 Issues Of FlyingTypers
Click On Image Below To Access

FT051910

FT052610