Vol. 9  No. 73                                                     WE COVER THE WORLD                                              Monday June 14, 2010

The Week Of The A380

     There’s no doubt about it: the week of the A380 began last week in Berlin as Emirates stunned the global airline business by ordering 32 more A380s, bringing the EK fleet up to 90 planes by 2017 (pending no more orders from the Dubai powerhouse in the next 7 years).
     A380, which has been struggling for orders, looks to finally get off the shneid with total sales now at 234.
     We assume people must be reporting superior comfort for long haul and reliability—presenting the big Airbus as the global lifter that EADS hoped it would be.
     European aerospace need not look too far to figure out which carrier put the proud bird over the top.
     While there is talk that perhaps ANA will join the delivery line soon, A380 still needs to land a U.S. customer.
     Elsewhere, at ILA last week we noted how body language and the behavior of people with one another are very good at telling a story.
     Very rarely does the public get an inside view of the elite and powerful simply interacting together.
     Note German Chancellor Angela Merkel, here on a video we first ran last week, onboard a just delivered Emirates A380.
     The scene occurred just before Emirates CEO, HH Sheikh Ahmed Bin Saeed Al Maktoum, delivered prepared remarks announcing the mega order to the world.
     Chancellor Merkel is aboard an Emirates A380 aircraft with Swiss President Doris Leuthard, and HH Prince Maktoum is explaining the A380 as the dignitaries move down the aisle.
     While speaking, HH Prince Maktoum defers to the Chancellor with sunglasses in hand while discreetly moving back in the cabin to allow Chancellor Merkel forward on the airplane.
     Understanding the moment perfectly, the Chancellor defers right back to the esteemed Prince and his courteous manner, and is even pictured sitting down in a coach seat, accepting and acknowledging her host’s hospitality.
     Talk about non-verbal communication.
     All of this happens in a couple of seconds, but is fascinating nevertheless.
     Politics and business aside, the movement here is like a dance and serves as an example of total class between two people of great power and importance in the world.
     Was there anything else going on?
     We suppose that an awareness of everything being on the record is always in the forefront of everyone’s mind.
     Emirates would certainly like more European gateway access while buying airplanes on the continent… just like politicians can sure use more jobs.
     Later, just to keep things balanced, Wolfgang Mayrhuber, Chairman and CEO of Deutsche Lufthansa, was photographed with Chancellor Angela Merkel, left, and Swiss President Doris Leuthard in front of the Airbus A380 'Frankfurt am Main.’
     The A380 then took off to do what it was tasked for 350 million dollars ago, as the big DLH bird commenced non-stop service from FRA to NRT.
     But before loading the very first air cargo container aboard the A380’s inaugural cargo and passenger revenue flight, a container adorned with personal greetings and well wishes from the best cargo airline in Europe was passed onto the plane.
     Not all days and weeks can be this gemütlichkeit, but we take these moments where we can find them and celebrate the good feelings on all the main decks, and occasionally below deck on the cans.

IATA Money Machine
Hits Speed Bump

IATA's Director General and CEO Giovanni Bisignani and Aleksander Popovich, Senior Vice President for Industry Distribution and Financial Services.

      Fascinating reading in the June 7 edition of The Financial Times: “Airlines in uproar over fraud riddle!”
      It overshadowed the IATA 2010 AGM held in Berlin last week, creating an unwanted distraction and headline grabber.
      Evidently, while the slick IATA PR apparatus, which is supported by a massive HR bureaucracy, churns out regular headlines of “IATA DG slams-” this or the other and berates another hapless government or airport, thereby generating breathless agitprop, right under everybody’s nose a 15 million USD equivalent has been mysteriously misappropriated at IATA’s Thai BSP (bank settlement plan).
      Initially reported in Thailand on April 29 in several publications, the case has escalated and peaked with the reported death of the Thai BSP “responsible employee” and resistance to make up the losses from some affected airlines, including Thai, Emirates, Lufthansa and KLM.
      While legally firm, the obligation to bear the financial responsibility for an IATA employee defrauding the BSP over a period from 2006 to 2009 alarms the airlines, which speculate about a scenario in which next time it’s ten times that amount?
      The Red Shirts and the volcanic ash cloud have kept the story camouflaged in the background for a while.
      The Financial Times piece called the BSP, “… normally an unexciting division of Geneva-based IATA”!
      But how wrong the paper gets it! IATA is nothing more these days than a business, having gradually gutted its standards development expertise to bare bones levels and consistently dismissing industry experienced staff reaching the apparently unacceptable age of 50.
      Many are replaced by eager MBAs without any airline experience who are deemed to be “fast learners” by the HR geniuses.
      The clearing house, BSP, CASS and the product—manuals, electronic media and events are all fully engaged in producing that eye popping annual budget, not too shabby for a non-profit trade association.
      That’s the goose that lays the golden egg! The rest has become window dressing and it’s a shame.
      Without blushing, the lambasting IATA chief at the AGM announced his vaunted “Vision 2050” for an industry presently working on 0.5 percent margin, and this with less than a year before he will be stepping down—beat that in terms of cynicism!
      Let the next guy(s) work on that, while he prepares for a cushy retirement and a few juicy lucrative gigs afterwards.
      In the same presentation, it brags about having “improved labor productivity by 63 percent” while instructing that “labor needs to stop picketing and cooperate.” Governments need to shape up and toe the line and finally give the airlines the respect and attention they rightfully deserve.
      No official word regarding the curtains on the Thai BSP affair on his watch.

Munich Takes Its Case
To Frankfurt

     Munich’s Franz Josef Strauss is on its way to become the leading airport in Germany.
     “In the long run we will be capable of managing up to 103 million passengers yearly,” announced the airport’s Managing Director, Michael Kerkloh, at Frankfurt-based Air Cargo Club Deutschland (ACD).
      Last year, Munich reported 34 million air travelers, with 58.2 million expected in 2025 together with 850,000 tons of airfreight. In comparison, Frankfurt announced 52 million passengers in 2009 and 1.8 million tons of cargo.
     The biggest point made by Kerkloh is the ability of his airport to further enlarge the ground infrastructure. “In contrast to jammed Rhein-Main, we’ve got enough space for building additional infrastructure at our site according to growing demand,” exclaimed Kerkloh.
     Future plans foresee the construction of a third runway capable of accommodating long-haul traffic, a new passenger satellite at the airport’s apron, an additional building for the forwarding industry and handling agents with neighboring warehouse space, and last but not least, a third passenger terminal.
     He further mentioned an ongoing shift of air traffic from the European periphery to the center of the continent due to numerous new member states of the European Union in East Europe, namely Hungary, the Czech Republic, Poland, Slovakia and Croatia.
     “With Munich being right in the middle of the continent,” he said.
     One indication of this traffic shift is Lufthansa’s step to base part of the airline’s long-haul fleet in Munich.      The airport currently accommodates 25 Airbus A340-300 and -600 with the crane at the tail, which serve 32 intercontinental routes.
     In addition, Michael mentioned the strong performing economy in southern Germany with global players like Siemens, Adidas, Puma, BMW, Audi and Mercedes having their headquarters there.
     “These combined factors trigger additional air traffic, be it passenger or cargo transports,” he said.
     A lasting annoying hurdle, however, is the missing of a railway track for linking the airport with high-speed trains like the German ICE. Also an express subway is eagerly needed for faster connectivity between Munich’s central station and the airport.
     Today a point-to-point ride includes more than 10 stops, making it a tiring 50-minute trip.
     According to Kerkloh, between 400 and 500 staff of the airport’s ground handling unit will soon lose their jobs. Private competitors like Swissport/Losch offer cheaper services to the airlines. “That’s why we lost a number of clients recently,” admitted the manager. Among them are well known players like Continental Airlines, Air Berlin and Germanwings.
     “This is the price we have to pay as result of a liberalized commercial environment in the European aviation sector,” commented Kerkloh.
     The only chance to prevent more airlines from turning their back on the airport’s ground service unit is a new wage agreement that the remaining 1,500 employees would have to be willing to accept. “We are negotiating this issue currently,” Herr Kerkloh states.
Heiner Siegmund

June Awards Blizzard

     The old joke in grade school concerning awards involved licking your thumb and pressing it on a kid’s arm, saying something like: “Quick, run and show your Mom and hope she sees it before it dries!”
     These days, awards are a lot more than the stuff of kids. In fact, they’ve become big business and serve as profit sources for the companies giving out the awards.
     They even have acronyms to make them sound more important.
     Air Cargo was hit with an early Summer blizzard of awards—WACA named Atlanta as Best Cargo Airport; AFSCA named Changi Singapore as Best Cargo Airport; SCATA named Dubai as Best Cargo Airport.
      How many Best Cargo Airports can there be? It’s a little like when you have more than one child and you tell each of them that secretly, they’re your favorite.
     We noticed that SCATA only nominated Middle East airports for their awards, so perhaps the scope of which gateway is best is confined to that region.
     While convergence of opinion is part of the variety of life, it seems a bit curious that these awards, however they are determined, are rarely replicated between publications.
     In any case, the confusing answer to ‘who is the best?’ has not sucked much of the oxygen out of these awards.
     It seems that every trade show and trade publication has a closet full of honorariums to give away and a queue of folks eager and ready to win one.
     Interestingly, almost everybody we talked to outside of the ballroom was hard pressed to recall who the winners were.
     But with awards like these, it doesn’t really matter: everybody comes out a winner.

ATCA Honors Planzer

    In the USA, The Air Traffic Control Association (ATCA) gave the coveted 2010 Glen A. Gilbert Memorial Award to Neil R. Planzer, Vice President of Boeing Air Traffic Management.
    Neil Planzer is an internationally recognized expert in air traffic control and the aviation industry. He has had extensive executive experience with the Boeing Company as Vice President and principle strategist for air traffic management.
    Neil is responsible for ensuring stakeholder support for the deployment of a next-generation air traffic system. As a Boeing executive, he developed and executed concept demonstrations for air traffic control Network Enabled Operations, the cornerstone for any next generation system.
    He conceived and implemented Boeing’s strategy for air traffic global interoperability and established Boeing’s strong ties with European and global air navigation service providers.
    The Glen Gilbert Memorial Award is the highest honor of the Air Traffic Control Association and is one of the premier awards in aviation.
    It is awarded once a year to honor the outstanding, long-term achievement of an individual in the field of aviation.
    The award is named after Glen A. Gilbert, the father of air traffic control. Glen A. Gilbert (1913-1982) was a famed pilot and administrator who led the development of U.S. and international air traffic control and played a key role in the formation of the International Civil Aviation Organization (ICAO).
    Previous winners include Langhorne Bond, FAA Administrator; Joseph Del Balzo, Deputy FAA Administrator, Electrical Engineer; Najeeb Halaby, FAA Administrator and Chairman Pan Am Airways (“Jeeb” was at the helm and in some manner took the fall for Pan Am’s venturesome idea of a radical new super-jumbo airplane that dazzled the world in 1970 called the B747-100); A. Scott Crossfield, test pilot and astronaut; Captain Elrey Jeppesen, aviation pioneer and founder of Jeppesen and Co; Norman Mineta, Secretary of Transportation and U.S. Congressman; and T. Allan McArtor, FAA administrator and Chairman, Airbus Americas.
    The Glen A. Gilbert Memorial Award Reception and Banquet will be held on October 27, 2010 at the conclusion of the 55th Annual Conference and Exhibition to be held October 24-27 at the Gaylord National Resort and Convention Center in National Harbor, Maryland.
     Contact: Claire Rusk of Air Traffic Control Association, +1-703-299-2430, Ext 309 or claire.rusk@atca.org

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