A few weeks ago I mentioned to a friend who follows US politics that he should read up about Alaska Governor Sarah Palin as a likely vice presidential running mate for the 2008 Republican presidential candidate, Senator John McCain. I wasn't caught by surprise when she was selected late last week. This lady has a fascinating personal story that is now getting extensive media coverage.
At least one blog had been supporting her for months.
The aviation angles? Her husband Todd has a private pilot licence, owns a Super Cub manufactured in 1958 and registered N8149D, and they have a daughter called Piper. As was the case with Democratic vice presidential candidate Senator Joseph Biden, the first clue as to who McCain might have picked came from those who follow business jet movements. John McCain, of course, was a US Navy pilot.
31 August 2008
The United Arab Emirates concludes new air services arrangements with Jordan and Nigeria
The End of Aviation?
The New Republic has a thought-provoking article, "The End Of Aviation", dated 27 August 2008 by Bradford Plumer.
I have greater faith in technological solutions to civil aviation's current fossil-fuel challenge but it is clear that the aerospace and airline industries must adapt and do so quickly.
I have greater faith in technological solutions to civil aviation's current fossil-fuel challenge but it is clear that the aerospace and airline industries must adapt and do so quickly.
17 August 2008
Iran and the Philippines conclude first air services agreement
16 August 2008
New Zealand Minister of Tourism comments on Thai Airways' Auckland service
On 13 August 2008 the Bangkok Post reported comments by the New Zealand Minister of Tourism, Hon Damien O'Connor, on the possibility that Thai Airways International may reroute its current non-stop Bangkok-Auckland flights via Australia (see previous post).
14 August 2008
Official Australian tourism forecasts
Australia's official tourism forecasts are published twice yearly, the latest being produced in August 2008.
It is interesting to compare these with the latest New Zealand forecasts (see previous post). The Australian forecasts are predicting 0.0% inbound growth in 2008 before rising 3.3% in 2009. Outbound growth from Australia is expected to be strong - 9.9% in 2008 and 8.0% in 2009.
Tourism Australia also publishes good information on Australia's aviation markets, including market share and historical seat capacity data.
It is interesting to compare these with the latest New Zealand forecasts (see previous post). The Australian forecasts are predicting 0.0% inbound growth in 2008 before rising 3.3% in 2009. Outbound growth from Australia is expected to be strong - 9.9% in 2008 and 8.0% in 2009.
Tourism Australia also publishes good information on Australia's aviation markets, including market share and historical seat capacity data.
10 August 2008
Airline seat capacity reducing from East Asia to New Zealand but trans-Tasman competition increasing
Thai Airways was reported in the Wall Street Journal to be considering routing its non-stop Bangkok-Auckland operations via Australia.
On 26 July 2008 the Star reported that Malaysia Airlines plans to use smaller aircraft on its services to Australia and New Zealand. It is temporarily reducing capacity to Auckland by one flight per week for a month.
On 7 August 2008 the China Post reported that EVA Airways would be suspending its operations to Auckland from 1 September 2008 and Tourism New Zealand would be closing its Taipei office.
By way of background, in 2006 Garuda ceased services from Denpasar to Auckland, and Air New Zealand ceased operations to Singapore when it extended its Hong Kong services to London and commenced services to Shanghai.
On a more positive note for seat capacity to New Zealand, on 18 July 2008 Air New Zealand commenced non-stop operations to Beijing, and Pacific Blue has announced that it will be commencing trans-Tasman services on both the Melbourne-Auckland (from 22 September 2008) and Sydney-Auckland (from 14 October 2008) routes. Emirates is reported in the NZ Herald on 8 August 2008 to be planning to introduce the A380 on services to Auckland from 1 February 2009 and increase the size of aircraft it operates to Christchurch. Royal Brunei has started operating daily to Auckland via Brisbane.
It would be hard to find many examples around the world where so many airlines are competing as on the main trans-Tasman routes.
On 26 July 2008 the Star reported that Malaysia Airlines plans to use smaller aircraft on its services to Australia and New Zealand. It is temporarily reducing capacity to Auckland by one flight per week for a month.
On 7 August 2008 the China Post reported that EVA Airways would be suspending its operations to Auckland from 1 September 2008 and Tourism New Zealand would be closing its Taipei office.
By way of background, in 2006 Garuda ceased services from Denpasar to Auckland, and Air New Zealand ceased operations to Singapore when it extended its Hong Kong services to London and commenced services to Shanghai.
On a more positive note for seat capacity to New Zealand, on 18 July 2008 Air New Zealand commenced non-stop operations to Beijing, and Pacific Blue has announced that it will be commencing trans-Tasman services on both the Melbourne-Auckland (from 22 September 2008) and Sydney-Auckland (from 14 October 2008) routes. Emirates is reported in the NZ Herald on 8 August 2008 to be planning to introduce the A380 on services to Auckland from 1 February 2009 and increase the size of aircraft it operates to Christchurch. Royal Brunei has started operating daily to Auckland via Brisbane.
It would be hard to find many examples around the world where so many airlines are competing as on the main trans-Tasman routes.
Eric Beinhocker on complexity economics
I have recently finished the book The Origin of Wealth - Evolution, Complexity and the Radical Remaking of Economics by Eric D. Beinhocker from McKinsey & Company. For those interested in some provocative, non-conventional - some might say leading edge - thinking about economics, it is well worth a read.
I was intrigued to find that the key ideas in the book are neatly summarised in a presentation UPDATED (.pdf) given by the author in April 2007 that is on the UK Cabinet Office web site.
I was intrigued to find that the key ideas in the book are neatly summarised in a presentation UPDATED (.pdf) given by the author in April 2007 that is on the UK Cabinet Office web site.
New air services arrangements signed by Kenya and Congo
On 1 August 2008 it was reported from Brazzaville that Congo and Kenya had signed a new air services agreement.
The great QANTAS safety record myth
Three recent QANTAS aviation safety "incidents", including a very serious one near Manila on 25 July 2008 when a large part from the fuselage of a B747-400 was lost but fortunately no one was injured, have yet again seen misreporting in the non-aviation news media about the safety record of the airline. For example, Bloomberg fell for this myth in a 25 July 2008 story - "Qantas, which has never had a fatal plane accident in its 87-year history, ..."
As a historian this bugs me and I was intrigued to find that someone has put an article on Wikipedia with the facts, listing the airline's fatal accidents.
An Australian Transport Safety Bureau media release dated 30 July 2008 provides an update on the B747 depressurisation incident.
QANTAS has yet to lose a jet aircraft hull and I hope it never does.
As a historian this bugs me and I was intrigued to find that someone has put an article on Wikipedia with the facts, listing the airline's fatal accidents.
An Australian Transport Safety Bureau media release dated 30 July 2008 provides an update on the B747 depressurisation incident.
QANTAS has yet to lose a jet aircraft hull and I hope it never does.
A US legal perspective on the EU plan to include international aviation in its ETS
On 7 February 2008 New York-based attorney Stephen Stegich presented a 21-page paper on the European Union emissions trading scheme (EU ETS) and aviation.
Although there have been developments since it was presented (see previous post), the paper provides good background on the issues involved and touches on the legal differences between the EU and others who question the legality of what the EU is planning to do.
Although there have been developments since it was presented (see previous post), the paper provides good background on the issues involved and touches on the legal differences between the EU and others who question the legality of what the EU is planning to do.
Trial New Zealand resident departures chart
I have now completed a second Google Motion Chart. It is on New Zealand Resident Departures for the current top 30 markets and covers the period 1983-2004.
To see the animation click on Gadget1 - see top left - and then press the play button. Roll your mouse pointer over individual bubbles to see the market names. Click on them to produce a label. With the trace box (right centre) selected, click on a bubble and press play (bottom left) for a year-by-year view of changes (click on the bubble again to deselect). Multiple bubbles can be selected.
I used data on great circle distances from Auckland airport (AKL)(from Great Circle Mapper) for the X axis, real GDP per capita on a PPP basis (from Gapminder) for the Y axis and New Zealand resident departure numbers (from Statistics NZ Table 3.01) for the bubbles. Note that the market concerned is where New Zealand residents have declared that they will be spending the most time on their trip - their country of main destination. (See previous post.)
To see the animation click on Gadget1 - see top left - and then press the play button. Roll your mouse pointer over individual bubbles to see the market names. Click on them to produce a label. With the trace box (right centre) selected, click on a bubble and press play (bottom left) for a year-by-year view of changes (click on the bubble again to deselect). Multiple bubbles can be selected.
I used data on great circle distances from Auckland airport (AKL)(from Great Circle Mapper) for the X axis, real GDP per capita on a PPP basis (from Gapminder) for the Y axis and New Zealand resident departure numbers (from Statistics NZ Table 3.01) for the bubbles. Note that the market concerned is where New Zealand residents have declared that they will be spending the most time on their trip - their country of main destination. (See previous post.)
08 August 2008
Beijing Olympics 2008
The 2008 Summer Olympic in China are underway so it is time to have a few links to follow the sporting action. But first some great Olympics-related interactive graphics are available from the New York Times, such as a bubble chart on the medals awarded at every modern summer Olympics (click on the bubbles).
Now for some links:
As for the aviation connection, on 18 July 2008 Air New Zealand started operating non-stop services from Auckland to Beijing.
Now for some links:
- The official web site of the Beijing 2008 Games
- Television New Zealand's Olympics pages
- NZ Herald's Olympics pages
- stuff.co.nz Olympics pages
- NBC Olympics
- Yahoo!7 Olympics pages from Australia
- BBC Sport's Olympics pages
- International Olympic Committee
As for the aviation connection, on 18 July 2008 Air New Zealand started operating non-stop services from Auckland to Beijing.
New Zealand air services agreements available on the web
The New Zealand Ministry of Foreign Affairs and Trade has arranged for the New Zealand Treaty Series to be available on the web from NZLII.
This includes most of New Zealand's air services agreements (ASAs).
I will endeavour to compile a list of links to the ASAs and an unofficial annotation of their status.
A couple of important notes of caution though.
First, the texts are not consolidated so there may be subsequent amendments.
Second, to fully understand an air services arrangement one must almost always also read the related Memorandum of Understanding and these are generally not available on the web. They may contain quantitative restrictions on what international airlines can do and are sometimes confidential. In the case of New Zealand these less-than-treaty-status documents are held by the Ministry of Transport.
This includes most of New Zealand's air services agreements (ASAs).
I will endeavour to compile a list of links to the ASAs and an unofficial annotation of their status.
A couple of important notes of caution though.
First, the texts are not consolidated so there may be subsequent amendments.
Second, to fully understand an air services arrangement one must almost always also read the related Memorandum of Understanding and these are generally not available on the web. They may contain quantitative restrictions on what international airlines can do and are sometimes confidential. In the case of New Zealand these less-than-treaty-status documents are held by the Ministry of Transport.
New Zealand Transport Strategy 2008 released
On 5 August 2008 the New Zealand Minister of Transport, Hon. Annette King, released the New Zealand Transport Strategy 2008 UPDATED (NZTS). It is well worth a read.
References directly relevant to international air services negotiations can be found on pages 9, 41, 55 and 75.
Also released at the same time is a related new Transport Monitoring Indicator Framework. This is very much a work in progress. When compared to Australian official transport statistics New Zealand's have been much less comprehensive. This new development should help improve the situation while being more focused on the long-term targets that the New Zealand government wishes to achieve.
References directly relevant to international air services negotiations can be found on pages 9, 41, 55 and 75.
Also released at the same time is a related new Transport Monitoring Indicator Framework. This is very much a work in progress. When compared to Australian official transport statistics New Zealand's have been much less comprehensive. This new development should help improve the situation while being more focused on the long-term targets that the New Zealand government wishes to achieve.
Official New Zealand tourism forecasts
On 31 July 2008 New Zealand's official tourism forecasts for 2008-2014 were released. The forecasts are produced by an Auckland-based economics consultancy Covec. (See previous post.)
For 2008 international visitor arrivals to New Zealand are forecast to grow by just 1.2% while growth in outbound overseas travel by New Zealand residents is expected to be even weaker at only 0.6%. The former is expected to rebound to 2.4% in 2009 while the latter is expected to fall further to 0.1%.
These forecasts have a good track record of accuracy. With the gyrations in the price of oil that record will really be put to the test this year.
The econometrics techniques that go into the forecasts are very through. I am part of the Delphi panel each year. My contribution is less theoretically based!
For 2008 international visitor arrivals to New Zealand are forecast to grow by just 1.2% while growth in outbound overseas travel by New Zealand residents is expected to be even weaker at only 0.6%. The former is expected to rebound to 2.4% in 2009 while the latter is expected to fall further to 0.1%.
These forecasts have a good track record of accuracy. With the gyrations in the price of oil that record will really be put to the test this year.
The econometrics techniques that go into the forecasts are very through. I am part of the Delphi panel each year. My contribution is less theoretically based!
03 August 2008
Countdown to startup of the Large Hadron Collider at CERN
The Large Hadron Collider (LHC), a 27 kilometer-long particle accelerator straddling the border of Switzerland and France just outside Geneva, is nearly set to begin its first particle beam tests. The European Organization for Nuclear Research (CERN) is preparing for its first small tests in early August, leading to a planned full-track test in September, and the first planned particle collisions before the end of the year. The final step before starting is the chilling of the entire collider to -271.25 C.
On 30 June 2008 The Guardian published a number of articles about the LHC and what it is hoped to discover. (See previous post.)
On 2 July 2008 Scientific American carried an article about what five physics Nobel prize winners thought about the LHC.
On 31 July 2008 The Economist ran an article, noting the LHC's US$10 billion cost.
On 1 August 2008 The Boston Globe had a story with a magnificent set of 27 photographs from CERN of the equipment that makes up the LHC.
By way of comparison, the London Underground's Circle line is 22.5 kilometers long.
On 30 June 2008 The Guardian published a number of articles about the LHC and what it is hoped to discover. (See previous post.)
On 2 July 2008 Scientific American carried an article about what five physics Nobel prize winners thought about the LHC.
On 31 July 2008 The Economist ran an article, noting the LHC's US$10 billion cost.
On 1 August 2008 The Boston Globe had a story with a magnificent set of 27 photographs from CERN of the equipment that makes up the LHC.
By way of comparison, the London Underground's Circle line is 22.5 kilometers long.
Aviation emissions data from ICAO
ICAO's Group on International Aviation and Climate Change (GIACC) held its second meeting on 14-16 July 2008 (the first meeting was held on 25-27 February 2008).
The ICAO Secretariat prepared an interesting 11-page information paper on aviation data for the meeting and made an associated presentation.
The ICAO Secretariat prepared an interesting 11-page information paper on aviation data for the meeting and made an associated presentation.
Adding 9% to aviation GHG emissions for flight delays and indirect routings?
An issue of some significance when considering aviation’s global contribution to greenhouse gas (GHG) emissions is to what extent there is scope to reduce this through better air traffic management, shorter air routes, airport design, etc. Considerable progress has been made in this area in recent years, particularly in Australasia.
A number of the carbon calculators in use a few month ago when I looked worked on the basis of adding 9% to the great circle distance between two airports to allow for non-direct routes and delays/circling. The one from Back Aviation Solutions, which uses the OAG data base of global airline schedules, was among those that used this approach.
The UK Department for Environment, Food and Rural Affairs (DEFRA) is commonly cited as providing official backing for using 9% (see page 34, paragraph 4 of the DEFRA methodology paper [the link is now to an UPDATED paper]).
In the absence of anything better, the New Zealand Ministry for the Environment has used this +9% factor in an official New Zealand Government calculator (see http://www.mfe.govt.nz/
Intuitively this 9% number seemed too high, at least in the New Zealand context. For example, Airways New Zealand has been making progress in reducing domestic delay, and the introduction of flexi-tracking by both Australia and New Zealand has had a significant impact on reducing fuel consumption by allowing long-haul flights in our region to take advantage of favourable jet stream winds. Of course, accurate fuel consumption should be calculated on a time rather than a distance basis.
I have followed the references through to find the origin of the +9% factor.
DEFRA cites IPCC (1999) Aviation and the Global Atmosphere, J. E. Penner, D. H. Lister, D. J. Griggs, D. J. Dokken and M. McFarland (Eds). Special Report of the Intergovernmental Panel on Climate Change, Cambridge University Press, Cambridge (see section 8.2.2.3 at http://www.grida.no/Climate/
As I understand it, in 1992 Europe was just beginning to emerge out of the cold war and major blocks of air space were reserved for military use. One would have expected more up-to-date data to be available and sure enough Eurocontrol does seem to collect and publish it. Eurocontrol has a Performance Review Commission that produces an Annual Report, the most recent being for 2006. This includes reporting on “flight efficiency” which, for example, points to the additional distance for long-haul flights to and from Europe being significantly less than for intra-European flights (see http://www.eurocontrol.int/
Given the importance to New Zealand (and indeed the rest of the SW Pacific) of long-haul flights, this issue is of significant interest.
One wonders why this more recent information was not being used in carbon calculators and why a figure based on European experience is being applied globally. Work clearly needs to done to provide a more accurate figure for such calculations.
Intuitively I would have expected that the factor for flights across the Pacific and Indian Oceans to be much lower (possibly even negative?).
On 1 April 2008 Flight International reported that ICAO has been looking at standards for carbon calculators (see previous post). The answer that ICAO came up with is to take the great circle distance then add 50km for flights of less than 550km, add 100km for flights between 550km and 5500km, and add 125km for flights above 5500km.
Data visualisation research paper
I have found a July 2007 research paper on Data Visualisation from the Australian Bureau of Statistics particularly interesting. The key part of the paper is in the section on “Applications of Data Visualisation” (click fourth from bottom on the left-hand list).
It analyses existing data visualisation tools and techniques, covering dashboards, sparklines, search clouds, mindmap searching and treemaps, as well as Gapminder and Nationmaster. Also covered are stories created through user input and improving static two-dimensional graphs.
It analyses existing data visualisation tools and techniques, covering dashboards, sparklines, search clouds, mindmap searching and treemaps, as well as Gapminder and Nationmaster. Also covered are stories created through user input and improving static two-dimensional graphs.
Trial New Zealand visitor arrivals motion chart
I have just completed my first Google Motion Chart. It is on New Zealand Visitor Arrivals for the current top 50 markets and covers the period 1983-2004.
To see the animation click on Gadget1 - see top left - and then press the play button. As with Gapminder World animations, roll your mouse pointer over individual bubbles to see the market names. Click on them to produce a label. With the trace box (right centre) selected, click on a bubble and press play (bottom left) for a year-by-year view of changes (click on the bubble again to deselect). Multiple bubbles can be selected.
I used data on great circle distances from Auckland airport (AKL)(from Great Circle Mapper) for the X axis, real GDP per capita on a PPP basis (from Gapminder) for the Y axis and New Zealand visitor arrival numbers (from Statistics NZ Table 2.01) for the bubbles.
To see the animation click on Gadget1 - see top left - and then press the play button. As with Gapminder World animations, roll your mouse pointer over individual bubbles to see the market names. Click on them to produce a label. With the trace box (right centre) selected, click on a bubble and press play (bottom left) for a year-by-year view of changes (click on the bubble again to deselect). Multiple bubbles can be selected.
I used data on great circle distances from Auckland airport (AKL)(from Great Circle Mapper) for the X axis, real GDP per capita on a PPP basis (from Gapminder) for the Y axis and New Zealand visitor arrival numbers (from Statistics NZ Table 2.01) for the bubbles.
28 July 2008
Thailand and Australia expand air services opportunities
On 23 July 2008 the Australian Minister for Transport announced in a media release that Australia had reached a new air services understanding with Thailand. There will be a phased increased in capacity except for all-cargo operations where limits are removed.
With respect to fifth freedom operations, Thai airlines are not granted rights beyond Australia to the USA and Australian carriers are not granted rights beyond Thailand to China.
With respect to fifth freedom operations, Thai airlines are not granted rights beyond Australia to the USA and Australian carriers are not granted rights beyond Thailand to China.
Australia negotiates expanded air services arrangements with Brazil
On 23 July 2008 in a media release the Australian Minister for Transport announced that new air services arrangements had been negotiated by Australia with Brazil. Capacity limits have been increased and most route restrictions removed.
23 July 2008
Cross-price elasticity of demand examples
Harvard economics professor Greg Mankiw on his weblog has been running a series of examples of how people respond to prices. Most relate to transport behaviour switches in response to the higher price of oil:
XIII NEW - switching from private jets to commercial airlines
XII NEW - switching to more fuel-efficient aircraft
XI - switching to golf carts on the street
X - switching to the train
IX - switching to small used cars
VIII - switching to on-line education
VII - switching to scooters
VI - switching to a home closer to a rail station
V - switching to mules
IV - switching to bicycles
III - switching to mass transit
II - switching to camels
I - switching to smaller cars
I have noticed the car park at my local rail station completely fill up since petrol prices started rising. Tranz Metro is responding to this by planning to increase rail fares from 1 September 2008 and ordering new trains.
XIII NEW - switching from private jets to commercial airlines
XII NEW - switching to more fuel-efficient aircraft
XI - switching to golf carts on the street
X - switching to the train
IX - switching to small used cars
VIII - switching to on-line education
VII - switching to scooters
VI - switching to a home closer to a rail station
V - switching to mules
IV - switching to bicycles
III - switching to mass transit
II - switching to camels
I - switching to smaller cars
I have noticed the car park at my local rail station completely fill up since petrol prices started rising. Tranz Metro is responding to this by planning to increase rail fares from 1 September 2008 and ordering new trains.
20 July 2008
Canadian competition panel considers limits on foreign investment in airlines
In June 2008 the Canadian Competition Review Panel released its report Compete to Win.
Citing the situation in Australia and New Zealand where "ninth freedom" cabotage is permitted and the limit on foreign investment in an international airline is 49% (currently 25% in Canada), the panel urges the Canadian government to adopt similar regulatory measures.
News coverage of the report appeared in an article in the National Post on 26 June 2008 and an article in the Vancouver Sun on 27 June 2008.
Citing the situation in Australia and New Zealand where "ninth freedom" cabotage is permitted and the limit on foreign investment in an international airline is 49% (currently 25% in Canada), the panel urges the Canadian government to adopt similar regulatory measures.
News coverage of the report appeared in an article in the National Post on 26 June 2008 and an article in the Vancouver Sun on 27 June 2008.
Submissions on Australian aviation policy review
The period for public submissions on the planned Australian National Aviation Policy Statement has closed and they are now available NEW on the web (see previous post).
Notable submissions come from Qantas (188 pages), Virgin Blue (46 pages), Emirates (8 pages) and Singapore Airlines (12 pages).
With Australia being in close geographic proximity to New Zealand, some of the points made by Qantas about exchanging traffic rights are particularly interesting:
"1.1.4 Additional policy considerations
...
We recognise that increased competition has contributed to driving efficiencies and strengthening the competitive ability of the Australian aviation industry more broadly.
We note, however, that Australia’s policy contains a delicate balance of competing interests, and relies heavily on market efficiency principles that do not always recognise the harsh realities of international aviation, including the lack of a level playing field, and the complexity of the bilateral system. In particular, we believe that the Government should have regard to the following considerations when implementing policy to achieve further liberalisation.
1.1.4.1 Australia has limited leverage
Australia’s market size and relatively remote ‘end-of-line’ location combine to limit the leverage it can bring to bear in seeking expanded market access rights for our airlines. Indeed, Australia has few “high value cards” left to play when trading rights of access under the bilateral system. It is important that this leverage be conserved and, when deployed, used to maximise commercial opportunities for Australian carriers. This principle should guide any future consideration of access to the trans-Pacific route.
1.1.4.2 Hub carriers have significant natural advantages
Under the bilateral system, hub carriers such as Emirates, Singapore Airlines, Malaysia Airlines and Cathay Pacific can more readily combine third and fourth freedom rights in both directions to exercise sixth freedoms.
By contrast, Australian carriers, being end-of-line operators, often lack the rights needed from third countries to replicate many of the beyond point services operated by hub carriers. For this reason, reciprocal exchanges of rights do not necessarily result in equivalent improved commercial opportunities for Australian carriers.
This characteristic of the bilateral framework underscores the importance of careful sequencing of liberalisation. Qantas has consistently advocated liberalisation in end-of-line markets before hubs, to maximise Australia’s leverage and offset the hub carrier advantage inherent in the bilateral system."
Notable submissions come from Qantas (188 pages), Virgin Blue (46 pages), Emirates (8 pages) and Singapore Airlines (12 pages).
With Australia being in close geographic proximity to New Zealand, some of the points made by Qantas about exchanging traffic rights are particularly interesting:
"1.1.4 Additional policy considerations
...
We recognise that increased competition has contributed to driving efficiencies and strengthening the competitive ability of the Australian aviation industry more broadly.
We note, however, that Australia’s policy contains a delicate balance of competing interests, and relies heavily on market efficiency principles that do not always recognise the harsh realities of international aviation, including the lack of a level playing field, and the complexity of the bilateral system. In particular, we believe that the Government should have regard to the following considerations when implementing policy to achieve further liberalisation.
1.1.4.1 Australia has limited leverage
Australia’s market size and relatively remote ‘end-of-line’ location combine to limit the leverage it can bring to bear in seeking expanded market access rights for our airlines. Indeed, Australia has few “high value cards” left to play when trading rights of access under the bilateral system. It is important that this leverage be conserved and, when deployed, used to maximise commercial opportunities for Australian carriers. This principle should guide any future consideration of access to the trans-Pacific route.
1.1.4.2 Hub carriers have significant natural advantages
Under the bilateral system, hub carriers such as Emirates, Singapore Airlines, Malaysia Airlines and Cathay Pacific can more readily combine third and fourth freedom rights in both directions to exercise sixth freedoms.
By contrast, Australian carriers, being end-of-line operators, often lack the rights needed from third countries to replicate many of the beyond point services operated by hub carriers. For this reason, reciprocal exchanges of rights do not necessarily result in equivalent improved commercial opportunities for Australian carriers.
This characteristic of the bilateral framework underscores the importance of careful sequencing of liberalisation. Qantas has consistently advocated liberalisation in end-of-line markets before hubs, to maximise Australia’s leverage and offset the hub carrier advantage inherent in the bilateral system."
19 July 2008
The Avro Vulcan finds a new fan at Farnborough
The 2008 Farnborough International Airshow is just finishing up with its usual displays of spectacular flying. One piece of writing about the Show caused me some amusement - a post by Flight International journalist Kieran Daly on his weblog Unusual Attitude:
"When I wrote on 18 August 2006 that 'I've got my own doubts about how much money can be justified to keep large jets flying' I may have inadvertently given the impression that I had doubts about how much money could be justified to keep large jets flying.
The ex RAF Avro Vulcan concerned is XH558 restored by the Vulcan to the Sky Trust. Video clips of the aircraft's flying displays are available on YouTube.
For the story of RAF Vulcans in action over the Falkland Islands I thoroughly recommend reading the book "Vulcan 607" by Rowland White.
I confess to mixed feelings about old aircraft being restored to fly. All too often they crash with tragic consequences. I was fortunate enough to attend the Farnborough Air Show in 1986.
"When I wrote on 18 August 2006 that 'I've got my own doubts about how much money can be justified to keep large jets flying' I may have inadvertently given the impression that I had doubts about how much money could be justified to keep large jets flying.
"Having spent a gloriously unproductive ten minutes at Farnborough this afternoon watching an Avro Vulcan fly ... I would like to assure readers that I think the amount of money appropriate for keeping Vulcans flying is, basically, whatever it takes.
I apologise for any confusion that may have been caused."
The ex RAF Avro Vulcan concerned is XH558 restored by the Vulcan to the Sky Trust. Video clips of the aircraft's flying displays are available on YouTube.
For the story of RAF Vulcans in action over the Falkland Islands I thoroughly recommend reading the book "Vulcan 607" by Rowland White.
I confess to mixed feelings about old aircraft being restored to fly. All too often they crash with tragic consequences. I was fortunate enough to attend the Farnborough Air Show in 1986.
The symbols of nationhood
For some time I have been looking for the origin of a sometimes used quote about "flag" carriers. This from Time magazine in an article on 12 October 1970, reporting on Austrian Airlines and Swissair (since replaced by Swiss International after the latter made massive losses) is the earliest that I have found so far:
"Along with a flag and an anthem, the symbols of nationhood all too often include a money-losing national airline. Since 1950, the number of "flag" carriers has proliferated to the point that there are almost as many as there are countries in the U.N."
If anyone finds a similar earlier quote please let me know.
"Along with a flag and an anthem, the symbols of nationhood all too often include a money-losing national airline. Since 1950, the number of "flag" carriers has proliferated to the point that there are almost as many as there are countries in the U.N."
If anyone finds a similar earlier quote please let me know.
17 July 2008
New Zealand Commerce Commission investigating alleged air cargo rate fixing
On 16 July 2008 the New Zealand Commerce Commission issued a media release announcing that it was filing criminal charges against Cathay Pacific Airways, Singapore Airlines Cargo and Aerolineas Argentinas. These airlines are alleged to have not provided information and documents during an investigation into allegations of price-fixing and other anti-competitive conduct in the air cargo industry.
The New Zealand Herald carried a report about this action on 16 July 2008, including comments from Cathay Pacific and Air New Zealand.
On 28 June 2008 the Herald reported on a related very large settlement reached by some international airlines with the US Justice Department described as "the highest total amount of fines ever imposed in a criminal antitrust investigation."
The New Zealand Herald carried a report about this action on 16 July 2008, including comments from Cathay Pacific and Air New Zealand.
On 28 June 2008 the Herald reported on a related very large settlement reached by some international airlines with the US Justice Department described as "the highest total amount of fines ever imposed in a criminal antitrust investigation."
ICAO resources on the economic regulation of international air transport
Buried in the International Civil Aviation Organization (ICAO) web site are some very useful resources for those interested in studying trends in the economic liberalisation of inter-government restrictions on international airlines. These have been prepared by ICAO's Montreal-based Air Transport Bureau.
For example, in an Economic Regulation section of the web site there is the updated 7 March 2008 version of a 13-page paper "Overview of Trends and Developments in International Air Transport".
In a Databases and Studies section there are, for example, the results of a survey of member States on Airline Ownership and Control and databases on Economic Regulation. The latter includes liberalization case studies, a new summary of regulatory actions on major international airline alliances (complete with links), a list of regional/plurilateral agreements and arrangements for liberalization and a list of government-owned and privatized airlines.
For example, in an Economic Regulation section of the web site there is the updated 7 March 2008 version of a 13-page paper "Overview of Trends and Developments in International Air Transport".
In a Databases and Studies section there are, for example, the results of a survey of member States on Airline Ownership and Control and databases on Economic Regulation. The latter includes liberalization case studies, a new summary of regulatory actions on major international airline alliances (complete with links), a list of regional/plurilateral agreements and arrangements for liberalization and a list of government-owned and privatized airlines.
Airlines looking for government support in hard times
With the price of jet fuel having doubled in 12 months and a weakening global economy, the international airline industry is "battening down the hatches" by cutting services, laying off skilled staff and grounding older, less fuel-efficient aircraft.
It will not necessarily always be a case of "creative destruction" or "survival of the fittest." Past history would suggest that many "flag" carriers will again look to survive through government intervention. All around the world there are already signs of this happening:
In South America - on 17 July 2008 Reuters reported that the Argentine government is to takeover Aerolineas Argentinas from the Spanish travel group Marsans.
In Asia - on 10 July 2008 The Times reported that it understood Air India is seeking a "rescue finance package" from the Indian government of UK Pounds 270 million.
In Oceania - on 14 July 2008 Pacific Magazine reported on the latest developments with respect to the finances of Air Tahiti Nui. Note the reference to the airline's 16th recapitalisation being approved last year.
In Europe - on 15 July 2008 Reuters reported that the European Commission has received a reply to its concerns about the Euro 300 million loan from the Italian government to Alitalia.
In Africa - on 16 July 2008 SABC News reported that South African Airways says it needs another Rand 5.7 billion in government funding to reduce its debts.
In North America - the US Air Transportation Stabilization Board continues its existence and Chapter 11 bankruptcy protection provides a safeguard for US airlines.
Meanwhile in the Middle East some of the major Gulf airlines simply do not report their losses and their aircraft orders continue unabated. A 15 July 2008 Wall Street Journal article, with some more positive news from the global airline industry, suggests that Etihad Airways will miss its target of breaking even by 2010.
Finally, tongue in cheek, referring to this poster about a government funded air service means that I have all continents covered!
It will not necessarily always be a case of "creative destruction" or "survival of the fittest." Past history would suggest that many "flag" carriers will again look to survive through government intervention. All around the world there are already signs of this happening:
In South America - on 17 July 2008 Reuters reported that the Argentine government is to takeover Aerolineas Argentinas from the Spanish travel group Marsans.
In Asia - on 10 July 2008 The Times reported that it understood Air India is seeking a "rescue finance package" from the Indian government of UK Pounds 270 million.
In Oceania - on 14 July 2008 Pacific Magazine reported on the latest developments with respect to the finances of Air Tahiti Nui. Note the reference to the airline's 16th recapitalisation being approved last year.
In Europe - on 15 July 2008 Reuters reported that the European Commission has received a reply to its concerns about the Euro 300 million loan from the Italian government to Alitalia.
In Africa - on 16 July 2008 SABC News reported that South African Airways says it needs another Rand 5.7 billion in government funding to reduce its debts.
In North America - the US Air Transportation Stabilization Board continues its existence and Chapter 11 bankruptcy protection provides a safeguard for US airlines.
Meanwhile in the Middle East some of the major Gulf airlines simply do not report their losses and their aircraft orders continue unabated. A 15 July 2008 Wall Street Journal article, with some more positive news from the global airline industry, suggests that Etihad Airways will miss its target of breaking even by 2010.
Finally, tongue in cheek, referring to this poster about a government funded air service means that I have all continents covered!
ICAO aviation carbon emissions calculator
The Environmental Unit of the International Civil Aviation Organization's Air Transport Bureau has a couple of noteworthy resources for those interested in aviation and the environment issues.
In April 2008 an ICAO Carbon Emissions Calculator was released. It provides a calculation for the carbon foot print of a passengers based on entering the city of origin and destination, and class of travel. It will be interesting to see what uptake there is of this.
To me what was of more interest was the 14-page methodology paper that was released when the calculator was launched (see previous post).
Another resource available on the ICAO web site is the 260-page ICAO Environmental Report 2007 (this is an 11.31 MB download).
In April 2008 an ICAO Carbon Emissions Calculator was released. It provides a calculation for the carbon foot print of a passengers based on entering the city of origin and destination, and class of travel. It will be interesting to see what uptake there is of this.
To me what was of more interest was the 14-page methodology paper that was released when the calculator was launched (see previous post).
Another resource available on the ICAO web site is the 260-page ICAO Environmental Report 2007 (this is an 11.31 MB download).
10 July 2008
European Parliament votes to include international air transport in emissions trading system
On 8 July 2008 the European Parliament voted 640 to 30 in favour of including international civil aviation within the European Union's Emissions Trading System (EU ETS) confirming the agreement reached between the Parliament and the Council in June (see previous post). A press release from the Parliament outlines what was decided and the text as adopted is now available on the European Parliament's web site.
01 July 2008
Australia negotiates new air services arrangements with Kenya and South Africa
A 28 June 2008 statement by the Australian Minister for Infrastructure, Hon Anthony Albanese, has announced that Australia has negotiated its first air services agreement with Kenya and substantially expanded the route and capacity rights in its air services arrangements with South Africa (see recent post).
29 June 2008
EU Governments reach provisional deal with European Parliament on "cap and trade" for aviation
A Reuters story dated 27 June 2008 reports that European Union member states have reached a provisional agreement with the European Parliament and Commission on rules to govern emissions trading including aviation not only within the EU but on flights between EU member states and third countries. A press release from the European Parliament dated 27 June 2008 outlines details of the proposed scheme. Agreement was reached just before the end of the Slovenian Presidency (see previous post).
The Bush Administration in the United States, amongst others, has been opposed to the proposed measure.
The Bush Administration in the United States, amongst others, has been opposed to the proposed measure.
Hong Kong and the Philippines agree to increased air capacity
Xinhua reported on 26 June 2008 that Hong Kong SAR and the Philippines have agreed to increase capacity on air services.
On the same day there was also a press release NEW from the Philippines Department of Transportation and Communications.
On the same day there was also a press release NEW from the Philippines Department of Transportation and Communications.
Brazil and the United States agree to air capacity and routes expansion
In a statement dated 26 June 2008 the US Secretary of Transportation, Mary Peters, has announced an expansion of the air services arrangements between Brazil and the United States of America. Allowable airline capacity is increased by just under 50%, five new destinations are made available in Brazil for US airlines and some third-country code sharing is permitted. Some further detail is given in a media note issued on 27 June 2008 by the US State Department.
Brazil is one of an increasingly small number of major markets that the USA has not been able to gain agreement to "open skies" arrangements. Other notable ones are Japan and China.
Brazil is one of an increasingly small number of major markets that the USA has not been able to gain agreement to "open skies" arrangements. Other notable ones are Japan and China.
26 June 2008
South Africa making progress implementing 2006 Airlift Strategy
A 23 June 2008 story in Business Day reports on South Africa's good progress in implementing its Airlift Strategy 2006 (see previous post). South Africa is reported to have recently negotiated new air services arrangements with the United Kingdom (a substantial capacity increase), Qatar, the United Arab Emirates, South Korea, Gambia and New Zealand. South Africa is also reported to be in negotiations with Australia, India and the Netherlands.
25 June 2008
India and Japan agree to increase air capacity from 2010
On 20 June 2008 the Government of India announced details of new air services arrangements that it has negotiated with Japan to provide for a doubling of airline capacity in 2010.
An extension of the second runway at Narita airport is planned to provide for increased capacity at Tokyo's main international airport from 2010.
An extension of the second runway at Narita airport is planned to provide for increased capacity at Tokyo's main international airport from 2010.
Charter flights between the Chinese mainland and Taiwan to increase
On 13 June 2008 Xinhua reported on the signing of an agreement between two NGOs, the mainland's Association for Relations Across the Taiwan Straits (ARATS) and the Taiwan-based Straits Exchange Foundation (SEF), that will see charter flights between the Chinese mainland and Taiwan substantially increased.
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