AirportBusiness Blogs

I have on my computer a blistering e-mail attacking ALPA, the union of many airline pilots. This diatribe cometh not from hardhearted management or flaming free-market entrepreneurial types, but from airline pilots.

You may well know that the International Civil Aeronautics Association (ICAO) is reported to be in the final stages of changing the so called Age 60 Rule so that airline pilots elsewhere can fly to age 65 rather than age 60. The ruling has no legal force in the U.S., however. At least not for U.S. pilots employed by U.S. companies.

It’s not quite that simple, of course, but basically, foreign airlines flying to, from, and over the U.S. will be able to use pilots over age 60. U.S. airlines will not. The U.S. guvmint has thus mandated and ALPA—which I imagine has more young pilots than old pilots—is not fighting it.

The result is predictable. Many pilots will retire from American, Delta, United, FedEx, US Airways (and other companies then still in business), then go to work for foreign airlines. These older pilots will be landing right behind and just in front of 59-year-old pilots at MIA, JFK, LAX, et al. The e-mail I received says that at least one U.S. air carrier already has plans to sell the company to a foreign entity, then use pilots over age 60. (Foreign ownership of airlines operating in the U.S. has been restricted, but that, too, seems to be easing.)

Many pilots say this entire situation will be used to squeeze pilot salaries, and I rather expect they are right.

I wonder how it will come out.

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News of late from Airbus has been nothing short of startling, centered around the manufacturer’s announcement that it will be delaying deliveries of the much-anticipated A380 airliner. Singapore Airlines, the launch customer, reacted by ordering 20 787 ‘Dreamliners’ from Boeing. Recent articles in The Wall Street Journal and the Financial Times highlight the OEM’s plight …

- “Canceling the A380 altogether should be an option on the table.” (TWSJ, June 20, Richard Aboulafia, Teal Group)
- “Last week’s shock warning that A380 deliveries would be delayed by six to seven months because of production problems has plunged Airbus and EADS, its parent company, into crisis.” (F.T., June 21)

Also following the announcement, leasing firm ILFC warned it could cancel up to $3 billion in A380 orders. And Airbus is rethinking its other new aircraft, the proposed A350, but reportedly has little engineering strength to divert to that effort because of the problems with the super-jumbo airliner.

All this gets back to the issue of planning for airports. FAA’s Kate Lang told airports at the recent annual AAAE meeting in San Diego that it’s all about planning these days for airports. Reason is, it has become very difficult to predict what will happen with the airline industry. The A380 is one more example. A number of airports have already spent millions to handle the A380; a number more are in the planning stage. At this juncture, “wait and see” would be an appropriate plan.

Thanks for reading.
jfi

DayJet plans to revolutionize charter with 239 Eclipse jets that it already has on order. Somebody has been revolutionizing charter since the Wright Brothers first charged for a sightseeing ride, but I’m still a sucker for a new idea.

DayJet is another of those aviation companies formed by smart business people with past successes in other industries. I’d laugh, but I remember laughing at FedEx, so I restrain myself.

DayJet has several new—or almost new—ideas. First, the company spent much time and money on a unique computer program that will supposedly work miracles. I don’t understand that program, so will not discuss it.  

Second, DayJet has those 239 Eclipse VLJs on order, and VLJs have been much heralded as being the future of the charter business. I still have doubts, but many people with money and brains are betting on it.

Third, DayJet is going to sell charter by the seat. You can buy a seat for a trip instead of an entire airplane and will share an airplane with others who bought individual seats. This reminds me of the old round piston engines; when looking at the diagram I can understand how the master cylinder works, but not when you take the diagram away. Likewise, when I read the news stories on DayJet—in every publication from The Wall Street Journal down—this on-demand charter by the seat makes sense to me. When I try to explain it, however, I get confused.

Finally, DayJet has the one new idea that truly fascinates me: They plan to operate on short legs between only a few cities that are, as they say, “underserved” by the airlines. Now that might make the difference. DayJet will start with only five such “DayPorts,” in Florida: Pensacola, Tallahassee, Gainesville, Lakeland, and Boca Raton. Expansion is planned into other southern cities.

I wonder—has aviation ever had so many new ideas to watch at once?

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I am a devotee—some say fanatically so—of the free market. Lately, however, I have been a bit worried about the marketplace when it comes to the airline industry.

I worry about airline use of marginal airports like Ronald Reagan Washington National Airport (the name of the place is longer’n the runway) and Midway. You can argue all day about my use of that word “marginal”, but I have heard so many heavy-iron pilots complain about those airports (strictly off the record, of course) that I have become a believer.

Use of these and other marginal airports seem to serve the free market, at least in the short run. They are cheaper and/or more convenient for airline and/or passengers. In the long run? I worry.

One thing’s for sure. When people worry, the guvmint gets involved faster’n an episode of “Desperate Housewives” can get around to sex, and here we go, ‘round again.

Today’s USA Today reports that the guvmint—the FAA—proposes new restrictions for airline landings at limited airports. It’s hard to argue against the goal, but Lord only knows what will come of the rules. The article says the new rules could bar some landings during “severe winter storms”. That makes sense but raises more questions. Who will write the rules, interpret the weather and decide which landings can or can’t be made? Will those people be better at making the decisions than are the crews in the cockpits?

I don’t know the answers. I doubt the guvmint does. But, as always in aviation, it will be interesting to watch!

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Reading the mission of the Business Travel Coalition (BTC), via its website (www.btcweb.biz), finds the following: “Our organization seeks to bring transparency to travel industry policies and practices so that customers can influence industry and public policy issues of strategic importance to them.” Founded in 1994 and based in Radnor, PA, the BTC does a good job of getting its PR into the general media. Its most recent position, however, is one that seems a bit farfetched. 

On June 1, BTC came out in support of a call by the U.S. House to have the General Accountability Office (GAO) study the “best use of a Dallas Love Field closed to commercial airline traffic.” This falls in line with BTC’s other position concerning Love: It is calling for Southwest Airlines to move all its airline operations over to DFW, which it calls underutilized. 

A more logical and far-thinking proposal came recently from DFW itself – a call for a regional authority to oversee the airports in the Dallas-Ft. Worth Metroplex. While quite restrictive in its original outline, DFW has at least opened the door to a new approach. In line with that should be the outright repeal of the Wright Amendment. Let the market forces determine air carrier growth in the Metroplex, not a federal law that really has created for a different era. Dallas-Ft. Worth today is a massive population base that could use regional thinking, not restrictive thinking.  The BTC proposal only appears to cloud up even more a very murky issue. 

Thanks for reading.  jfi      

Are things finally looking up for the airline industry?

Delta—though operating in bankruptcy—actually made a profit in a recent month, airplanes are flying with more seats full at higher fares, capacity is down, and even the legacy airlines are looking better for the future. Dare we hope?