CH cover june new:cover novemver NEW.qxd
5/29/2010
3:33 PM
Page 1
Rs 60
June 2010
CRASH!! THE MANGALORE CRASH HAS RAISED QUESTIONS ABOUT ‘CRITICAL’ AIRPORTS, AIR SAFETY AND THE STATE OF THE COUNTRY’S AVIATION SECTOR.
Document1
5/30/2010
12:04 PM
Page 1
Edit page.qxd
5/31/2010
2:00 PM
Page 1
EDITOR-IN-CHIEF’S NOTE
Mangalore and how not to manage the media
T
here will be many lessons to be learnt from the Mangalore air crash. Perhaps, one of the most obvious is the need for a unified response to the media. On the day of the crash, there were half-adozen briefings: AI Director (Personnel) was giving out information on behalf of Air India in Mumbai, AAI Chairman V P Agrawal spoke to the media at the Airports Authority headquarters in Delhi, Civil Aviation Minister Praful Patel spoke to the media after visiting the crash site, Secretary Madhavan Nambiar held his own press conference in the evening and then finally the Minister briefed the Prime Minister and spoke to the media once again. One of the recommendations after the Kandahar hijack episode was the setting up of a high-powered committee with a laid-out SoP (sandard operating procedures) that included clarity on briefing the media through a designated spokesperson. The logic was simple: there were too many voices speaking at the same time and the cacophony caused enormous confusion. The best way forward was to have clarity by funneling all information through a single window. Alas, ten years down the line nothing’s changed. It is understandable that Praful Patel spoke to the media both at Mangalore and Delhi. As the Minister, the buck stops with him and it is only fair that the media (the 24-hour news channels) get his perspective. But much of the misinformation could have been easily avoided if only the SoP had been followed in toto. Take a look at some of the inferences floating around: Mangalore airport has a runway that is dangerously short for B737/A320 operations. Wrong. Infact; it is longer than Patna airport where the last major crash took place ten years ago. The Patna runway is just 6,000 plus feet and the A320s operate with a 30 per cent payload
CRUISING HEIGHTS June 2010
penalty. Talk to the AAI officials and they’ll tell you how much more dangerous Patna is as compared to Mangalore. And mind you three of the last five Civil Aviation Ministers have been from Bihar (Sharad Yadav, Shahnawaz Hussain and Rajiv Pratap Rudy) and still nothing much has moved. No questions on this, though. Expat pilots have no idea about the terrain and there are language issues, too. Well, Emirates, Etihad, Qatar, Singapore Airlines and Cathay have nothing but expats manning every department. On one Qatar flight I took, the cockpit crew included a Moroccan and a Qatari and the in-flight crew was from Philippines /Jordan/India/Bangladesh and Sri Lanka. Just look at the last three or four mishaps and all had Indian crews. The Air Sahara aircraft that overshot the runway four years back at Santa Cruz had an Indian commander and an Indian first officer! So much for the Indian Commercial Pilots Association (ICPA) assertion that the expats are to blame. The shoulder length is not in conformity with ICAO (International Civil Aviation Organisation) regulations. Wrong again. When the runway was built, the specifications were perfect in keeping with the requirements. Now with the A380s and 787s coming in, the specifications have been modified. But not every airport changes the specs on the ground as they are modified. It’s for the airlines to be aware of the specs and fly accordingly. In any case, there has been more than 30,000 flights into Mangalore since the runway was extended in 2006 (earlier with the nearly 6000 feet runway, Alliance Air was operating its 737-200s and Jet the NG 737-400s), no pilot complained to the DGCA and there had been no mishaps. Maybe all this could been brought to the notice of the media much earlier if there had been a thought-out briefing. There are many lessons to be learnt from this crash. Media management is one of them.
1
Off the cuff
Content 2-3 march CH 2008 final new.qxd
It’s toxic! Samples taken secretly from the planes of popular airlines have raised fresh concerns over passengers inhaling contaminated air. Cabin air quality is the word that comes up again and again in context with toxic air on board modern passenger airplanes. As part of an investigation by a German television network, ARD, and Schweizer Fernsehen (Swiss television), 31 swab samples were taken secretly last month from the aircraft cabins of popular airlines. These were analysed in laboratories at the University of British Columbia, under the supervision of Prof Christian van Netten, a leading toxicologist. Twenty-eight were found to contain high levels of tricresyl phosphate (TCP), an organophosphate contained in modern jet oil as an antiwear additive, which can lead to drowsiness, headaches, respiratory problems or neurological illnesses. Scientists refer to the condition as Aerotoxic Syndrome. Dr Mackenzie Ross, a clinical neuropsychologist at University College London, says the illness may be affecting up to 200,000 passengers each year. Scientists and pressure groups claim that the toxins enter the cabin as a result of the "bleed air" system that is used on modern aircraft. Air is drawn out of the compression section of the engine and cooled. It then enters the cabin, where it mixes with recirculated air that has passed through filters designed to remove bacteria and viruses. However, these "recirculated air" filters do not remove fumes or vapours from the engine. So if engine oil or hydraulic fuel leaks, toxic chemicals can contaminate the air supply. So if engine oil or hydraulic fuel leaks, toxic chemicals can contaminate the air supply.
5/29/2010
4:47 PM
Page 2
contents
AIR CRASH AT DAWN
p30
The crash at Mangalore was one of the country’s worst aviation disasters. While investigations will reveal what went wrong and who is to blame, the big question that is on everyone's lips is: How safe is it to fly in India?
NEWS DIGEST
p8
The Maharaja's unending troubles, attacks on the AAI, more Gulf carriers are flying in to challenge Indian carriers and much more. CRUISING HEIGHTS June 2010
SPECIAL REPORT
p26
Delhi Airport goes green as the airport authorities in addition to structuring a world-class terminal plan massive plantation both inside as well as outside.
BUSINESS IS GOING PLACES N
Planman Marcom / ACE / 07/ 2010
E SE
WS
W
NE
NW
YOUR
S
India’s first International Cargo Airline, soon to launch scheduled International Cargo Operations
24/7
Fast
Efficient
Reliable
Your business is going places. We make sure it reaches cruising heights. Spanning 150 countries, meeting varied logistic needs, delivering cargo across destinations, ACE. Accelerating Business Dynamics. Envisaged and incorporated by Indian visionaries with more than 250 years of collective experience.
Accelerating Business Dynamics
Aryan Cargo Express A Subsidiary of Aryan Cargo & Express Logistics Pvt. Ltd.
www.acex.in A-87/88, Road No. 4, Mahipalpur Extn., New Delhi- 110037 India | Tel: +91-11-47184545 | Telefax: +91-11-47184520
Content 2-3 march CH 2008 final new.qxd
5/29/2010
4:47 PM
Page 4
contents ARTICLES NEWS VIEWS EDITS INTERVIEWS CLIPPINGS PROFILES NEWS DIGEST
CRUISING HEIGHTS Volume V No 2
Editor-in-Chief K SRINIVASAN Managing Editor
TIRTHANKAR GHOSH Consulting Editor
R KRISHNAN Co-Ordinator Editor
PRIYANKA SAXENA
SPOTLIGHT
p58
After the late delivery issue with the Dreamliner, the rapport of India and Boeing is again in trouble with the contract of C-17 Globemaster III aircraft as the US President wants the C-17 manufacturing to end.
Special Correspondent (Mumbai)
GLOBAL EYE p24
ROOHI AHMAD
The IATA has released the international traffic figures for April 2010. The growth that was seen at the beginning of the year took a nosedive when flights to and from Europe had to be grounded because of the volcanic ash from Iceland. A detailed report on the traffic figures.
Reporters
JASLEEN KAUR, SREYA SHANDILYA, PUNIT MISHRA Art Director
BHART BHARDWAJ Design
RUCHI SINHA, PRADEEP JHA, SHIV Photo Editor
H C TIWARI Director
RAVI SHARMA (Mob. 9650433900)
Director (Admin & Corporate Affairs)
RAJIV SINGH Regional Sales Manager (South)
KARTHIK K. V. (Mob. 9880209405)
Senior Manager (Marketing)
VARUN MALHOTRA
CARGO
(Mob. 9871866651/9650433099)
p47
Business Development
Two cargo airline operators have expanded their wings and want to fly higher. There are challenges but they are confident enough to handle them.
PRANAV KHULLAR (Mob. 9650433088)
Asst. Manager (Corporate Affairs)
AMIT SINHA (Mob. 9650433599)
Subscription
JAYA SINGH
BACK PAGE
p72
What was so special about the I M Pei-designed Terminal Six at New York's JFK airport? A nostalgic piece about the terminal that is all set for demolition.
SNIPPETS
p66
It is celebration time for BIAL; DIAL CEO gets more responsibility; Emirates offers its fliers stays in style; AirAsia starts flying from Chennai to Penang and more.
4
Cover Design: Ruchi Sinha
CRUISING HEIGHTS June 2010
(Mob. 9650433044)
Executive Director
RENU MITTAL Editorial & Marketing office: Newsline Publications Pvt. Ltd., D-11 Basement, Nizamuddin (East), New Delhi -110 013 , Tel: +91-11-41033381-82
All information in CRUISING HEIGHTS is derived from sources we consider reliable. It is passed on to our readers without any responsibility on our part. Opinions/views expressed by third parties in abstract or in interviews are not necessarily shared by us. Material appearing in the magazine cannot be reproduced in whole or in part(s) without prior permission. The publisher assumes no responsibility for material lost or damaged in transit. The publisher reserves the right to refuse, withdraw or otherwise deal with all advertisements without explanation. All advertisements must comply with the Indian Adver-tisements Code. The publisher will not be liable for any loss caused by any delay in publication, error or failure of advertisement to appear. Owned and published by K Srinivasan 4C Pocket-IV, Mayur Vihar Phase-I, Delhi-91 and printed by him at Nutech Photolithographers, B-240, Okhla Industrial Area, Phase-I, New Delhi-110020.
Periscope 4-5 March 2008.qxd
5/29/2010
4:51 PM
Page 2
Desirable
PERISCOPE
“
“It will create revenue for them.”
KAPIL KAUL, Head, Centre for Asia-Pacific Aviation (CAPA) India on Kingfisher Airline’s proposed marketing alliance with British Airways on domestic network.
New strategy “A few Indian LCCs will also do so.” AJAY PRAKASH, General Secretary, Travel Agents Federation of India (TAFI) on low-cost capacity increase in the international skies.
Yeah…
LETTERS TO EDITOR
“It is revenue lost forever.”
ACCORDING TO airlines, volcanic ash contains abrasive glass-like particles that can cause engines to become AIR INDIA clogged. More than 100,000 SPICEJET flights were cancelled and some 10 mn passengers were reported DASHED TO THE GROUND stranded around the world. The after-effects of volcanic ash took the airline industry by storm as illustrated in the story (Eyjafjallajokull-ed!, May 2010). New measures should be taken to counter volcanic ash as the losses due to volcanic ash touched $1.7-bn as reported by IATA. The global airline industry should take serious note of it otherwise the industry will be caught again on the wrong foot if it again happens. Ranga Prasad, Chennai Rs 60
May 2010
TONY FERNANDES, CEO of AirAsia while talking about a full plane with low yield is better than a half-empty plane with high yield.
Praful Patel Minister, Civil Aviation
Wilbur Ross, Head, WL Ross & Co.
Sanjay Aggarwal CEO, SpiceJet
WARRING OVER
THE TURNAROUND COMETH?
Arvind Jadhav CMD, Air India
RARELY HAS NATURE REACTED SO RUTHLESSLY AS EYJAFJALLAJOKULL DID BRINGING INTERNATIONAL AVIATION TO ITS KNEES. HAVE WE LEARNT ANYTHING FROM THE DISRUPTION?
Illustrations: Rajeev Kumar
(Post out, May 2010) story was interesting to read. Nagpur which is poised to become a major multi-model cargo hub airport has indeed suffered a big blow due to the closing of India Post's "night mail" service. Until a few years ago, India Post was brimming with confidence having Nagpur as its hub for its major operations. After starting its operations, India Post was going fine having started many new routes. The airmail services started by the company were indeed a brave step against the onslaught of private carriers. Cargo activities by India Post was being contemplated as next big thing in cargo but unfortunately it died a slow death. Raj Goyal, Karnal
6
The appointment of four independent directors in Air India will bring a new sense of responsibility as exemplified in the story (New faces, new games, May 2010). As a matter-of-fact, this major restructuring was needed as the airline was passing through turbulent and trying times. The experience of these doyens of the industry will bring a new confidence and would definitely resurrect the Maharaja's fortunes in near future. No doubt, the Air India management has taken a wise decision by appointing these four independent directors. Riya Jaiswal, Surat All correspondence may be addressed to Editor, Cruising Heights, D-11 Basement, Nizamuddin (East), New Delhi -13, OR mail to cruisingheights@newsline.in.
My question is… “When and where did Baldauf master the art of turning around a company riddled with insurmountable problems?” JITENDER BHARGAVA, former executive director, Air India (AI) on the advertisement brought out by AI inviting applications for the post had stated that preference would be given to those who had turned around performance of a large organisation.
Wow! “It is plain logic. You will struggle to drive a Mercedes soon after driving a Maruti.” NASEEM ZAIDI, Director, DGCA on India’s aviation regulators’ finding that pilots flying more than one type of aircraft in one duty shift are prone to accidents.
Long live PPP “We are looking for private partners to develop a medium-range civilian transport aircraft.” PRITHVIRAJ CHAVAN, Minister, Science and Technology on India’s ambitious plans to design and develop an indigenous medium-range civilian transport aircraft.
Responsible guy! “We as a growing and responsible carrier will always be on the lookout for growth opportunities.” SUDHEER RAGAHAVAN, Chief Commercial Officer, Jet Airways as the airline posted a net profit of Rs 106 crore during October-December in 2009-10.
CRUISING HEIGHTS June 2010
Periscope 4-5 March 2008.qxd
5/29/2010
4:51 PM
Page 3
Luxurious lounges
was in first place while Bahrain’s Dilmun Lounge was on the top in the Middle East and Africa. Among the other highly commended lounges were: Mexico: Aeromexico - Salon Premier Ciudad de Mexico, Terminal 2, Mexico City Panama: Continental Presidents Club, Tocumen Internatuional, Panama Singapore: Ambassador Transit Lounge, Terminal 3, Changi, Singapore Switzerland: Swiss-Lounge, Y Terminal, EuroAirport, Basel-Mulhouse UAE: DCA Business Class Lounge, Terminal 1, Dubai UK: No.1 Gatwick, South Terminal, Gatwick, London.
COLD STATS
Airport lounges can ease some of the pain of travelling and the SUMAQ VIP lounge of Lima’s international airport has been voted the world’s best for 2010 by independent airport lounge programme Priority Pass. Priority Pass that gives frequent travellers access to airport lounges regardless of their class of travel or which airline they’ve flown, asked more than 30,000 passengers from all over the world to pick their favourite lounge from among a 600-strong list. The lounge at Peru’s Jorge Chavez International Airport tops the list. By region, Continental Presidents Club, Terminal E, Houston, Texas, was voted the best lounge in North America and Zurich’s Panorama Lounge the best in Europe. In the Asia Pacific, KAL Lounge, Concourse A, in Seoul’s Incheon Airport
LOOKING GLASS Long live the fight for better work conditions and air safety!
ASH ATTACK! Truly speaking “It was the right time to get involved in merger discussions.” JEFF SMISEK, Chief Executive Officer, United Airlines
“Right deal, right time.” GLENN TILTON, Non-executive chairman, United Airlines
Both on the merger of United Airlines parent UAL and Continental Airlines.
CRUISING HEIGHTS June 2010
7
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 8
NEWS DIGEST
MOOLAH FOR THE MAHARAJA !
A
ll those who opposed Air India’s disinvestment way back in 2003, need to introspect. One wonders what gave them the confidence and optimism that the ailing state-owned carrier (two then) would pull up and cruise smoothly. Seven years after the demise of divestment, we now have a major tragedy that saw Air India’s five-
PROBLEMS IN COCKPIT: ICPA cribs and AI management ignores.
year-old baby Air India Express’ flight coming from Dubai crashing in Mangalore killing 158 people on board the 30-monthold Boeing 737-800 a week after the airport’s new terminal building was formally inaugurated. Every TV channel and anyone who had flown even once masqueraded as an expert stating there was something seriously
wrong with not just the second-longer runway at Mangalore airport but also with Air India (we mean the combined mess it is in after the merger) and the way it was dealing with key sections like the pilots. The pilots on their part thought that this was their moment as they shot off a letter to the Prime Minister accusing inexperienced expat pilots as being the cause (incidentally it was an expat commander who was at the helm of the illfated plane) for the airline’s problems. They used the Mangalore air crash as the weapon for hitting out at expats and argued for Indian pilots to fly in India’s varied terrains. It was interesting to note that pilot bodies like the ICPA never lost an opportunity to reconsolidate their position and often poor passengers were caught in the cross-fire between the pilot body and the Air India management. ICPA often cribbed about strenuous FDTL (Flight Duty Time Limit), monetary allowance etc. But never did it complain in writing to the DGCA (Directorate General of Civil Aviation), AAI (Airports Authority of India) or Ministry of Civil Aviation about the uncertain airport terrain/runway as the one deemed to be in Mangalore. Never did they formally alert the regulator about the possible impact it could have on the safety and security as is being made out now, nearly four years after the 8,038-foot-long second runway at Mangalore airport was put into operation and which, during this period, saw a cumulative 32,000 flights flying into and out of the table top airport. While we have given more details
JOTTINGS
MEHRAM NAGAR POSES THREAT
8
IGI Airport: Tough task ahead
After a recent security audit conducted by the Intelligence Bureau, Mehram Nagar village, on the periphery of the Indira Gandhi International Airport, has been listed as a security threat to the airport. While the IB report recommends relocation of the village for the safety and security of the airport, the villagers — mostly employed at the airport — are not ready to budge from the land allotted to them in 1965. The Delhi government was informed of the IB report and has been asked to take action on the relocation of Mehram Nagar village at a recent meeting chaired by Union Cabinet Secretary K M Chandrasekhar on airportrelated matters. Besides security threat, the village is causing bird menace to the airport due to unauthorised slaughter-houses and pig farms. At least 100 acres of village land, owned by the Delhi Cantonment Board (DCB), also house a quick response base of the prestigious National Security Guard (NSG), and one of the five operating bases of the highly secretive Aviation Research Centre (ARC) of the R&AW. Apart from top intelligence and security force bases, the village also has a Delhi Police colony and office of the Deputy Commissioner of Police (Airport). It shares a boundary with at least 200 metres of the airport’s perimeter wall on the side of Runway 28-10.
CRUISING HEIGHTS June 2010
Our biggest deals for Canada’s biggest city
Ontario Escapade An Ontario adventure ticks all the boxes, with national icons, urban excitement and amazing shopping. Experience cosmopolitan Toronto with its own unique multicultural cuisine or feel the spray of mighty Niagara Falls. Visit the vibrant nation’s capital of Ottawa or historic Kingston, two cities that showcase Canada’s rich heritage and natural beauty of the 1000 Islands.
www.ontariotravel.net/india
CruisingHeights_India_poster.indd 1
5/27/2010 8:17:49 AM
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 10
NEWS DIGEST taking delivery of the 27 Boeing 787 Dreamliners Air India had placed firm order. The first of the Dreamliners is slated to arrive in April 2011 or less than 10 months from now. The 27 Boeing 787s are expected to cost Air India $3.5bn. With the help of the new funds, Air India’s current paid-up capital would go up to Rs 2,415 crore thus giving more room to play with the debt-equity ratio and enabling it to borrowing more. The new directors working on the new turnaround plan are targeting various ways and means to bring down the annual interest burden and repayment cost of the IT DOESN’T BOTHER ME: Only some months from now, the Dreamliner is arriving and there is no preparaacquisition of new aircraft. Air tion in advance from AI’s side. India is annually incurring Rs about these things in our main story, the five new independent directors met with 2,600 crore as interest payments and its fact remains that Air India itself is going the Finance Minister in the third week of working capital in the current fiscal 2010through a series of aborted take-offs, May a few days before the air crash. They 11 is expected to balloon to Rs 19,000 landings, mid-course corrections but still sought government support for a crore from the previous fiscal’s Rs 17,000 far away from any recognisable moratorium on loan and interest payment crore. SBI Caps have already been destination. This brings us once again to by Air India to public sector banks from appointed to restructure its debt. The new the main Air India story which the whom it had taken loans for various Board appointees feel that by reducing the government hopes to re-write after purposes. On the occasion, the Civil interest rate on short-term debt from 11 per inducting five independent directors. After Aviation Minister Praful Patel said while cent to eight per cent Air India will be able agreeing to inject Rs 2,000 crore in Rs 1,200 crore could come in as early as to save yearly Rs 500 crore. principle, the government actually June 2010, Air India on its part would have Further, if the salaries are rationalised transferred Rs 800 crore in fiscal 2009-10 to focus on marketing and present another by 15 per cent, it could save another to shore up the combined entity’s equity. It turnaround plan that should include route Rs 500 crore. While its current short-term then promised that it would pump in rationalisation, fleet reduction, lower debt as signified by the working capital etc another Rs 1,200 crore in Air India manpower costs etc. is Rs 17,000 crore, its long-term debt is Rs provided it shed some flab, improved its A part of the fund infused would be 22,000 crore till now. To meet or neutralise performance, cut costs etc. utilised for paying at least 15 per cent of part of the cost, the new directors are It was in connection with this that the the pre-delivery commitment to Boeing for fondly hoping to increase Air India’s
RTI TANGLE IN THE SOUTH
Citizens seeking information about the functioning of Bangalore airport can go right ahead and shoot their questions under the Right to Information (RTI) Act. But that’s not possible in Hyderabad, Delhi or Mumbai as the airport operators in all these places have obtained a “stay” from their respective high courts on orders from the Information Commissions of the states stating that airport operators fall under the purview of the RTI. The Karnataka High Court has however confirmed the orders of the Information Commission of the state. The stay in the case of Hyderabad airport has been in operation since last September when the management had moved the AP High Court. But now, RTI activists in the city have decided to move the AP High Court seeking to vacate a stay on the case. This followed the move where the AP Information Commission had declared the airport company running the show to be a public authority, as it had a 26 per cent government stake, with 13 per cent equity held by the AP government and another 13 per cent stake by the Airports Authority of India (AAI). But the airport operator, GMR, filed a writ petition in September last year challenging the decision. It was on this that the High Court put a stay order after one hearing. The RTI activists to move the court in Hyderabad will cite a recent verdict of the Madras High Court which declared public
10
private partnerships (PPPs) that deliver public goods the ‘public authorities as they deliver public utilities’. Activists will also cite Section 2 (h) of the RTI Act, according to which any authority or body owned, controlled or substantially funded by the state
Under the ambit: Bangalore airport has come under the purview of RTI
government can be included within the Act’s purview. “The airport is substantially financed by the state government which is why it automatically gets covered under the RTI Act,” told C D Arha, Chief Information Commissioner (CIC) of the state, to the journalists.
CRUISING HEIGHTS June 2010
AD dummy.qxd
5/26/2010
10:50 AM
Page 1
NewsDigest june.qxd
5/31/2010
12:14 PM
Page 12
NEWS DIGEST
Fali Homi Major
Amit Mitra
revenues by Rs 1,300 crore. Air India, in line with this thinking, is planning to withdraw from loss-making routes which it actually had begun to do even before these directors entered Nariman Point HQ of the maharaja. The new whiz-kids have said that Air India will have to increase its load factors to 80 per cent. How they do it is their problem. It has also said its Boeing 777 will fly 14 hours a day and its Airbus aircraft 10 hours a day. Now if we get some industrialists, industry chamber expert, former air force chief, a cement industry expert etc to advise Air India to increase its loads and increase aircraft utilisation, one can well imagine the serious erosion of intellectual wealth of Air India besides the monetary wealth. In the first half of May 2010, Air India issued a press release taking pride in the increased number of passengers it flew which was in the range of 17 per cent but then it was still short of the industry average of 22 per cent. Air India’s international traffic load factor was 69 per cent compared to Jet Airways’ 81 per cent. So there is something fundamentally
Anand Mahindra
wrong with the maharaja and it is simply not able to attract passengers notwithstanding the spanking new aircraft it has acquired. What is increasingly disturbing is the attitude of its top management to blame the big birds and seeking to lease them lock, stock and barrel and get much smaller planes. Obviously it may hope to fill smaller planes but then certainly its revenues will never increase as fondly hoped by its new directors which in combination with cost cuts could bring some stability in Air India. We may recall the reply Air India furnished to the Parliamentary Standing Committee in April 2010. Air India management said that the drop in yields during the first half of 2009-10 was mainly attributable to low demand in the light of economic slump and excess capacity in the market coupled with competition in the domestic and international sectors. The low-cost carriers were occupying 60 per cent market share in the domestic market and have been undercutting fare with full service carriers. Similarly, on the international routes, due to capacity
HYDERABAD, DELHI AMONGST THE BEST Airports across India are making a mark on the international aviation map. Two airports from our country have bagged the top honours from the Airport Council International. While the Rajiv Gandhi International Airport (RGIA) in Hyderabad has been ranked as the world’s best airport (in the 5 to 15 million passengers category), Delhi’s Indira Gandhi International Airport (IGIA) was conferred the fourth best airport award in the world
Harsh Neotia
Yusuf Ali
mounted by different carriers, especially the Middle East and Gulf carriers, who have the hubs in the Gulf, the yield has taken a substantial dip. It said that the induction of brand new aircraft had to a certain extent help Air India recapture the market share and improve the load factor on several routes and this trend was expected to continue and would negate the dip in yields over a period of time. But what we want to say is what happens to the yield when your interest cost keeps on mounting at a rate faster than the rate at which yields and revenues rise. The Parliamentary Standing Committee has commented, “Since all the parameters are laid down for PLI (productivity linked incentive) payment, the committee does not see any scope for reduction in employees’ PLI. Even after achieving all the parameters, if the company is making losses, the reason for losses obviously lay somewhere else.” In this context it said that the misplaced government policies and priorities were the main reason for the losses. Beginning July 2010, the low-cost
(in the 15-25 million category) and ‘Best Improved Airport’ in the Asia Pacific region in recognition of its substantial improvement in passenger amenities. The Airports Council International (ACI) is an autonomous and independent body that rates airports on 34 parameters which included services of key regulatory agencies at the airport like customs, immigration, security, ground handling, ambience of the airport, cleanliness of the terminals, passenger satisfaction etc. The awards were presented in China by the Airport Council International, which has 575 members operating over 1,633 airports in 179 countries.
FORUM TO PROTEST UDF
RANKED HIGH: Rajiv Gandhi International airport has set incredible benchmarks.
12
All India Airport Users’ Forum (AIAUF) based in the UAE is planning to start an intensive campaign against the proposed move for introducing users’ fee at Thiruvananthapuram International Airport. The Airports Economic Regulatory Authority in India has permitted Airport Authority of India to collect, for a period of 10 years, an ad hoc user development fee of Rs 755 (more than Dhs 60) from every international passenger flying out of the new airport to be opened shortly in Kerala’s capital. President of AIAUF in Sharjah, K M Basheer, condemned the move to charge users, most of whom are Gulf-based Keralites. “It’s totally unfair
CRUISING HEIGHTS June 2010
NewsDigest june.qxd
5/29/2010
4:54 PM
carrier SpiceJet will begin to fly to SAARC (South Asian Association for Regional Cooperation) destinations and even South-East Asian routes on low-fare basis. Then what will Air India do for yield and passengers? SpiceJet is only a curtainraiser, the intense competitor international LCCs like Flydubai, Silkair, Nok Air, Air Arabia are set to give or rather intensify the competition, which may hit all Indian carriers, with Air India not being an exception. Should the government decide to give a moratorium on loan and interest repayments by Air India to public sector banks? Then Prime Minister Dr Manmohan Singh’s government can rightly be accused of launching the 21st century loan mela which, he, with great difficulty, abolished in 1991 at the time of initiating economic reforms. Hence while we want to say long live India, the ailing carrier wants it to be long live Air India. Maybe it will be appropriate for us to recall what we had mentioned about erosion of intellectual and monetary wealth of Air India. According to Air India insiders, over the next three years, and if
Page 13
things continue to drift as of now, then 3,000 officer-level employees of Air India — from functional directors to the level of AGM — would have retired. Then what will Air India do and how will it meet this acute talent gap? As it is there has been no meaningful recruitment for the last 20 years at all levels except for pilots, engineers and other technical staff. Strangely even at the level of pilots there is a severe shortage of commanders. In our April 2010 issue we had reported of the demand made by the Central Training Establishment (CTE) at Hyderabad to take over the training of pilots for Boeing 787 provided the relevant simulator was installed there. For the 27 B787 order Air India has placed it will
require 254 pilots. During 2011 alone it is expected that more than six Boeing 787 will come up. It is now less than 10 months for the Dreamliner to come, but there is no advance action plan to start training pilots, both co-pilots and commanders for the 787s. These planes can fly for very long hours, which means you need additional crew sets. Which in turn means Air India needs to prepare from yesterday. Otherwise, it will be the same Air India Express story — without the expat pilot commanders flying Dreamliners will remain only a dream. Instead of sabotaging the fine facility available at CTE in Hyderabad, which has a full runway available at the adjacent Begumpet airport (incidentally an A380 actually landed in full public view during the First India Aviation Show in October 2008), Air India also needs to be market oriented instead of behaving like the misdirected ICPA (Indian Commercial Pilots Association), which is the collection of pilots belonging to the erstwhile Indian Airlines. We hope the new directors also devote attention to this aspect.
Cochin International Airport Gateway to Kerala,"God's own Country."
India's 1st Greenfield Airport under Public Public - Private Partnership (PPP) model. Passenger friendly & Environment friendly Airport Fourth largest Airport in terms of international Passengers.
CIALinvites Airlines. CharteredFlightOperators. Exporters&Importersofperishablecargo. CargoFreighterOperators. AerospaceIndustries.
Kerala -A Tourist's paradise & a 'Must See Destination'. CIAL offers quick connection to all tourist destinations in Kerala. Dedicated facilities for Freighters. State -of- the art Centre for perishable Cargo. Over-night parking facilities for Aircrafts. Airport based SEZ*. CIAL Academy for MBA, M.Tech &various Airport Oriented Diploma courses. MRO for wide bodied aircrafts.
Cochin International Airport Limited Kochi AirportP .O;Emakulam-6831 11. kerala,India
CRUISING HEIGHTS June 2010
Visitus:www .cochin-airport.in Contact:jp@cochin-airport.in Tel:9539701512
13
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 14
NEWS DIGEST
I UNFAIR TO THE AAI
Sitaram Yechuri
s there an alleged conspiracy to kill the Airports Authority of India? If one goes by the recommendations of the Parliamentary Standing Committee on Transport, Tourism and Culture, it certainly appears so. And if one looks at the replies of the government to the questions posed by the Committee then it seems to the contrary even though a doubt remains that AAI is indeed getting a raw deal, notwithstanding the below standard level of its staff at certain grades. In its report presented to the two houses of Parliament on May 6, 2010, Committee chairman Sitaram Yechury said he along with other members unanimously felt and recommended that the existing HAL airport in Bangalore and Begumpet airport in Hyderabad (the Committee chose to spell it as Bangalore and not Bengaluru) should not be closed for commercial operations in order to commission private Greenfield airports. It said for the first time in the country the government-owned airports built on tax-payers money were closed for the commissioning of private Greenfield airports where profit earning was the main motto rather than service to the passengers. The Committee said not only was this in complete contravention of the “level playing field” concept but also did not appear to be rational. In this context, it regretted at the reluctance of the government to accept the Committee’s earlier unanimous recommendations presented to Parliament on the subject without giving any reasons which negated the very purpose of the Parliamentary
on the part of the Indian aviation authorities to introduce users’ fee at Thiruvananthapuram airport, to be charged only from international passengers,” he said. He noted that users’ development fee at Kozhikode and Kochi airports was scrapped after prolonged legal fight and protests from expatriate Indian organisations spearheaded by AIAUF, which highlights the fact that the users’ fee could be unaffordable to hundreds of expatriate workers. “We will not allow this unjust fee to be introduced and will oppose the move tooth and nail,” he said. Basheer further said that the AIAUF has already started gathering support from the Gulf expatriates and more protests would be held in the coming days. “We are planning to organise (an) airport march and will prevent (the authorities from) collecting the fee from Gulf-bound passengers. We had got a similar fee scrapped after a hard-fought struggle at Kozhikode and Kochi Airports,” said Basheer.
Committee system. It said in its May 2010 report that government still had time to renegotiate the issue with the concessionaire and could still modify or scrap the clause which facilitated the closure of the existing airports. The possible revenue implications of such re-negotiation should not inhibit the government from proceeding on such a course in national interest. It felt that since the air traffic was growing in a big way, having two airports in a particular city would be a commercially viable option for the operators. In this context, the Committee noted that between the time when traffic (handling capacity) projections were made and concession agreement signed and now the actual traffic had grown more than three times. So it strongly recommended that the existing Hyderabad and Bangalore airports should not be closed for commercial operations. Should the Government of India renege on it then it will be defaulting on the obligations. The government said further in its reply that general aviation services (other than commercial arrangements) continue to be provided at the existing airports. The government had two rounds of discussions with the BIAL to urge it to initiate immediate steps to expand capacity in all respects at the Devenahalli Greenfield airport. The proposal to allow ATR-type aircraft to operate out of the older HAL report was rejected by BIAL as being against the concession agreement. A similar story was narrated in the case of older Begumpet airport in Hyderabad. The Committee countered saying that commercial civil aviation activities
necessary infrastructure would be expanded and further strengthened. The AAI has sought 200 acres of land “to build additional infrastructure”. Among the North-Eastern airports, airports only in Agartala and Guwahati have night-landing facilities. At present, on an average, ten aircraft operate every day through the Agartala airport, connecting Delhi, Kolkata, Guwahati, Imphal and Silchar in southern Assam. Guwahati airport is the main and only international airport in the North-East
AGARTALA GOES INTERNATIONAL Preliminary work has begun to upgrade the Agartala airport into an international airport to boost the region’s connectivity with Southeast Asia. The decision to upgrade the Agartala airport was taken as part of the India’s Look East policy. As part of the plan, the terminal building, air traffic control tower, runway and other
14
Claiming International Tag: Agartala airport
CRUISING HEIGHTS June 2010
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 16
NEWS DIGEST HAL and Begumpet airports respectively. Secondly, should the older airport be opened then it would make it highly inconvenient for the passengers to land at the older airport and travel to new airports to take connecting domestic or international flights. And thirdly, there was a technical reason where it would be unadvisable for simultaneous operation of two parallel runways guided by separate ATC staff as it would lead to confusion and pose flight
Rajiv Gandhi Bhavan
safety issues. What is interesting to note is that there is a functioning ATC to guide general aviation aircraft in the two older airports. It is curious that a high-level government committee has been appointed to examine the possibility of allowing a new airport at Greater Noida on the demand of Mayawatiled UP government and which (if it comes up) will be within the 150km of the existing Delhi airport. And as per the concession agreement, no airport is supposed to come up within 150km radius
India, though there exists other 11 operational airports in the landlocked region, namely Tezpur, Dibrugarh, Jorhat, Lilabari (all in Assam), Dimapur, Silchar, Agartala, Shillong, Lengpui (Aizawl) and Imphal — apart from Bagdogra in the Himalayan foothills in West Bengal. There are nine more non-operational airports in the North-East.
CARGO POINT AT AIRPORTS UNSAFE, SAYS BCAS Next time you board a flight after going through stringent airport checks; do not take it for granted that the aircraft is sanitised and safe. Security at the cargo entry point is lax. The Bureau of Civil Aviation Security (BCAS) has found that while passenger entry points at the domestic terminals of the country’s major airports are under almost impenetrable security cover, the cargo points allow more or less free access to anyone. Cargo points at international terminals have relatively better security. According to the DNA, Inspectors from the BCAS — an agency under the Civil Aviation Ministry — walked into the supposedly
16
of Delhi or Mumbai airport. And should it come up, then the existing affected airport operator will be given the first right of refusal, subject to some conditions. The GMR-led Delhi airport has already told the government that opening a new airport at Greater Noida will seriously impact its revenue stream. So if the government can contemplate allowing a Greenfield airport in the Mayawati land, which is within 150km of the existing DIAL then what is the harm in allowing AAI to restore its own airports in Begumpet Hyderabad and HAL airport in Bengaluru. If telecom minister Raja can be accused of mishandling grant of 2g spectrum then what does one say about succumbing to Mayawati pressure? The Standing Committee said that AAI, while undertaking major expansion of Ahmedabad and Trivandrum, sought a UDF of Rs 300 per passenger, as prescribed IRR (Internal Rate of Interest) was not being achieved. The government turned down the proposal. But it however allowed the private operators to collect UDF/ADF in the four metro airports of Delhi, Hyderabad, Mumbai and Bengaluru. All this was done before the AERA (Airport Economic Regulatory Authority) was set up and even the demand of AAI had come before AERA was in place. Now, very conveniently, all such requests are directed to AERA as it is mandatory — the best way to hit the ball out of Rajiv Gandhi Bhavan. We will tell you more about this discrimination in our next issue. Photo: H.C. Tiwari
continued in the Bengaluru HAL airport with the consent of the management of BIAL and Government of India whereas the concession agreement and the notification issued by the Government of India clearly prohibited any commercial aviation activity. This showed that if the government wanted, it could operationalise the old airports notwithstanding the concession agreement. It, therefore, reiterated that HAL airport at Bengaluru and Begumpet airport should be made operational for domestic civil aviation. In this context, it said the Don Muean international airport (old Bangkok airport) was closed completely on opening of new Suvarnabhumi airport on September 28, 2006, which was 40 km away from the city. However, due to persistent demands of low-cost carriers and higher cost at the new airport, the old airport was reopened on march 24, 2007, without restrictions on distance or aircraft capacity. Yet another example it gave was that of the Dallas Love Field airport (United States) which was closed after the new DFW (Dallas Forth Worth) International Airport was opened. There was no concession agreement between the operator and regulator or the federal government. However, Southwest airlines was permitted to operate from the old airport even after opening of the DFW International Airport as it was not a signatory to the agreement. In reply to this the government said the concession agreement for Hyderabad and Bangalore international airports did not permit the continued operation of the older
high-security cargo zone of some airports in the early hours without being asked for identity cards. Sealed cargo is loaded on to aircraft directly from these zones. Ideally, the cargo section should have security equalling that of passenger entry points, but sadly that is not the case. Cargo reaches the section sealed after checks. If the entry of visitors is not restricted, someone can easily put a time-bomb in a cargo packet or box.
BOOSTER INVESTMENT AT MUMBAI AIRPORT
Growing Big: Mumbai airport will have more funds at its disposal
CRUISING HEIGHTS June 2010
AD dummy.qxd
5/31/2010
11:55 AM
Page 1
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 18
NEWS DIGEST so that load of an aircraft will be distributed evenly across the structure. Keeping in mind the future flow requirements, the bank of the river has been widened from 140 metres to 200 metres. A no-objection certificate from the public works department was observation, AAI went back to the drawing obtained and the widened banks will board. ensure that there will be ample space for Meanwhile in Chennai, another water to flow under the bridge. These engineering marvel is getting ready — a steps are being taken to prevent flooding runway bridge across the Adyar River of the runway. The height of the runway that can even take the weight of an A380 and the bridge is a couple of metres aircraft. The bridge is being built so that above the 2005 flood level that wrecked the secondary runway can be extended havoc at Chennai airport. over the bridge to the other side of the Consolidated Construction river. The country’s first bridge over Consortium Ltd (CCCL) is building the which a runway will be laid, will be bridge while a joint venture of KGL and supported by 477 pillars. BCPL is building the Around 2,440 presecondary runway stressed concrete girders extension. AAI started will be placed over the works to extend the pillars to make it an 2,035m secondary integrated structure. The runway by 1,400m, bridge will be 200m long including 835m on the across the river and northern side of the river 462m wide. in January 2009. Most of About 50 per cent of the work on the extended the work on the bridge portion of the runway has has been completed. The been completed. Once Airports Authority of the construction of the India (AAI) is hoping to bridge is over, the complete the project this runway will be laid over V P Agrawal November. This bridge it across the river. The is different from the regular bridges airport has started to increase the level built over the roads. This is going to be of the existing secondary runway to an integrated structure consisting of make it align with the extended portion, piers, girders and concrete embankment said an AAI official.
INDIA TO GET ITS FIRST RUNWAY ON A RIVER
A
Photo: H.C. Tiwari
s it gets futuristic and cutting edge, the Airports Authority of India is all set to get its first bridge-on-sea runway. The Authority has proposed to extend the runway at Agatti Island (Lakshadweep) by building a 1,000-foot-long bridge on the sea and link it to the existing 4,500-foot-long runway of the airport. This link along with a new terminal building is expected to be built at a cost of Rs 150 crore within 24 months of approval. At present, ATRs operate to Agatti. But the small airstrip means there’s a load penalty — a less than full load to accommodate for the short strip, 70-seater plane can’t have more than 48 passengers to remain light enough and operate on the available 4,500 feet. Once the runway is 5,500 feet, ATRs can operate to capacity and Canadian Regional Jets operated by Jet can also fly in, said a senior official. The bridge-on-sea emerged as an option to the original AAI plan of linking Agatti with the next island by connecting the sea in between in the direction of the runway. The idea then was to make the runway long enough to accommodate the big Boeing 737s and Airbus A320s. This plan did not get environmental clearance as there’s a turtle colony in the direction of the runway where land was proposed to be reclaimed, said sources. Following this
Mumbai airport said it will invest Rs 2,280 crore this fiscal on modernisation and development work as against Rs 1,306 crore in FY 2010. A Mumbai International Airport (MIAL) spokesperson said that the company had targeted a Rs 2,280 crore investment this fiscal. In comparison, MIAL had targeted a Rs 2,300-2,500 crore capital expenditure for the Mumbai airport in the last financial year. The country’s busiest airport is being modernised and developed by MIAL, a joint venture between Airports Authority of India (AAI) and a GVK-led consortium, with 26 per cent and 74 per cent equity, respectively. While Rs 570 crore and 412 crore of the projected Rs 2,280 crore investment are expected to be incurred during the first two quarters, the remaining two quarters would entail an investment of Rs 663 crore and Rs 635 crore, respectively, according to a Planning Commission report on the civil aviation sector. MIAL envisages a total investment of Rs 9,800 crore on the airport project, which is likely to be completed by 2012.
COMPLAINTS ANYONE? While Jet Airways continues to fly high with a dominating presence among airlines in India, it also leads in the number of passenger complaints and flight cancellations, as per the data released by the Directorate General of Civil Aviation.
18
Passengers carried by domestic airlines from January to April, 2010 were 162.82 lakh as against 133.41 lakh in the corresponding period of year 2009, registering a growth of 22.05 per cent. Paramount had the highest bookings in April at 84 per cent, followed by Indigo at 82.4 per cent.
CRUISING HEIGHTS June 2010
Fraport – Airport Operations from Austria to Xi’an.
The Company Fraport AG is a leading player in the global airport industry. Following its initial public offering (IPO) Fraport has become the second largest listed airport company in the world, by revenues. Fraport’s expertise is based on more than 80 years of aviation history at Frankfurt am Main, Germany. Frankfurt Airport (airport code = FRA) is located about 12 kilometers from downtown Frankfurt. A renowned pioneer for decades, FRA serves as Fraport’s home base and as a showcase for the company’s know-how, technology, products, and services. With outstanding connectivity to all five continents of the globe, FRA is a intermodal hub with one of the largest catchment areas in the world and direct access to the German high-speed railway network. FRA is strategically situated in the heart of Germany and the European Union. Airlines can profit from high utilization rates and traffic yields.
Range of services The company prides itself in being a leading-edge provider of integrated airport services. Besides managing FRA, Fraport AG and its subsidiaries provide the full range of planning, design, operational,
commercial and management services for airports around the world. Fraport AG serves as a neutral partner to the world’s major airlines: offering a complete package of aircraft, cargo, passenger and other ground handling services. Outside Germany, the company has ground services op-erations in Austria. Other areas of Fraport expertise include cargo and ground handling, real estate development, airport retailing, IT services, intermodal concepts, environmental management, hub management, training, etc.
Fraport worldwide Through investments, joint ventures and management contracts, Fraport is now active on 4 continents. Fraport served some 78.2 million passengers in 2008 and handled 2.1 million metric tons of cargo (airfreight and airmail) at the Group’s airports. Fraport, which bids for airport management projects worldwide, was awarded a 30-year concession for operating, managing and developing Indira Gandhi International Airport (IGIA) in India. Together with state-run Airports Authority of India (AAI) Fraport AG has formed “Delhi International Airport Private Limited (DIAL)”. Fraport is the nominated “Airport Operator” and an Airport Operator Agreement
concluded with DIAL – under which it will be utilizing its extensive airport expertise developed over the past 80 years to assist with the operation, management and development of IGIA. Currently Air India offers three weekly passenger flights and Lufthansa offers daily passenger flights from Frankfurt to New Delhi. From April, Air India plans to provide daily connections.
Fraport AG Frankfurt Airport Services Worldwide 60547 Frankfurt am Main, Germany E-mail: marketing@fraport.de Internet: www.fraport.com www.frankfurt-airport.com Contact: Ansgar Sickert Vijender Sharma Fraport Airport Operations India Pvt. Ltd. Paharpur Business Centre Suite 302 21, Nehru Place New Delhi – 110 019, India Phone: +91 11 4120 7355 (AS) +91 11 4120 7334 (VS) Fax: +91 11 4120 7558 Mobile: +91 99 1038 2806 E-mail: ansgar.sickert@fraport.in vijender.sharma@fraport.in
NewsDigest june.qxd
5/29/2010
4:54 PM
Page 20
NEWS DIGEST
JAI HO 777, BUT NOT FOR AI !
HEAVY LOADS, HIGH FLYING: Qatar Airways, with its B777F, is continuously expanding its services across the globe.
E
ven as Emirates continues to expand, the other Gulf carrier, Qatar Airways seems to be moving really fast to catch up. Though it will take some time to do that, the fact remains that Qatar will now be part of the overall Gulf team, let by the unanimous leader Emirates, to challenge the Indian carriers. According to Akbar Al Baker, CEO, Qatar Airways, its fleet size, which grew to 80 in early March 2010 or doubling in just five years has added the first of its four brand new Boeing 777 freighter it is acquiring to increase its presence in the cargo market. On May 17, 2010, its Boeing 777-F flew non-stop from the Boeing’s Everett factory in Seattle, Washington, USA to Doha. The new aircraft has a payload capacity of 102 metric tonnes, which is almost double the capacity of A300-600 freighter. According to Al Baker the just acquired Boeing 777 freighter has the longest range of any twin-engine freighter and is based around Boeing 777-200LR aircraft of which Qatar has six operating ultra-long-haul routes from Doha to Houston, Melbourne and from June 24 to Sao Paulo and Buenos Aires in South America. Qatar over the weeks will press into service its new freighter to Amsterdam, Lahore, Dubai, Karachi, Chennai, Sialkot, Frankfurt and Amman. From June, 2010 Qatar is planning three weekly flights to Hong Kong. As on date, Qatar has four freighters, of which, one is B777 and the three others are A300-600. It is acquiring three more B777-F which will join Qatar’s fleet by the summer of 2011. In a way like Emirates but in a smaller way, Qatar’s
20
freighters will push out Indian carriers on the cargo market other than what Indian carriers can carry in their belly. In this context, we must say that Deccan 360’s A310 freighters (two of them and if Captain Gopinath is planning for two more) will simply be eating dust should the Qatars and Emirates scale up their cargo and freight operation into and out of India. It was in April 1990 (Arif Mohammad Khan as the Civil Aviation Minister under VP Singh Government announced that India had allowed an Open Sky Policy for Freighters). This means there is no restriction on the frequency of freighter aircraft to fly in and out of India and any number of times provided they get the slot. But unlike passenger operations, freighters are really not as fastidious about slots as commercial flights. By 2013, Qatar is planning to operate a fleet of 120 aircraft by which time its global network will rise to 120 destinations. The airline has ordered 80 Airbus A350s, 24 A320s, 60 Boeing 787s and 32 B777s. The deliveries had already begun in November 2007 and continue to unhindered. According to Al Baker the airline had also ordered five A380s but decided to defer them for deliver to 2013 as Qatar expected the super jumbo to mature more and reduce in weight to make its commercial operations really profitable. The deliver time of 2013 has also been fixed because by that time the new Doha International Airport would open for commercial operations. So apart from placing an order for 200 aircraft worth $40bn, Qatar Airways is set to become one of Thales’ launch customer CRUISING HEIGHTS June 2010
for the latest In-Flight Entertainment (IFE) and communications systems for its B787 which it is set to receive like Air India from 2011. Qatar’s 60 B787 will have Thales Top Series System which features a range of overboard product solutions including passenger touch screen displays, interface options for personal electronic devices and 3D audio technology. Qatar Airways will also be Thales’ launch customer for new passenger handset controller with multi-tasking capabilities. It also proposes to integrate broadband into the IFE. Perhaps we can tell the story now here. At a luncheon meeting during the March 2010 India Aviation one saw Al Baker, Naresh Goyal, Praful Patel, Vijay Mallya and couple of others sharing a big round table. During the discussion, Al Baker reportedly told Naresh Goyal that he should not spend too much money on the seats he provided in his B777-300ER or the A330-200s because for the same price Qatar was able to get four seats. As we are told Al Baker apparently told Naresh Goyal of Jet Airways that it was pointless to spend $250,000 special seat as it did not really bring in revenues because there were other more important parameters which made a difference in the product. We are told Praful Patel enjoyed the chat. Now let’s get back to the new threat posed by Qatar to Indian carriers in addition to what Emirates has already done. Against the 190-odd frequencies which Emirates fly weekly into and out of India and accounting for 50,000 seats, Qatar in five years of its launch has already got 71 services a week spread across 11 key points — Hyderabad, Delhi, Mmbai, Chennai, Ahmedabad, Kochi, Trivandrum, Kozhikode, Goa and Amritsar. In contrast Emirates clocked the 190 frequencies a week after 25 years’ operation. It may be recalled that Emirates was set up in 1985. We may mention that Air India has withdrawn its AmritsarLondon-Toronto flights leaving the field wide open for Qatar among others to fully exploit. After all Qatar can now fly from Doha to Amritsar and fly back to Doha, its hub, and then onwards to London, Houston, Toronoto and what not. It can even transport Sikhs from Amritsar to South America. Even as we witness these developments and likely developments, we see Air Indians perpetually cribbing, crying and its new directors seeking alms from the government.
NewsDigest p 22.qxd
5/29/2010
4:20 PM
Page 8
NEWS DIGEST NEW BEGINNINGS: Civil aviation minister, Praful Patel inaugurated the Corporate Office Building of Pawan Hans Helicopters Ltd in Noida.
A
ccording to a recent PTI report, the Government of India will soon be granting mini Ratna status to Pawan Hans Helicopters Limited (PHHL) which plans to acquire 100 helicopters over the next few years.
PAWAN HANS GETS A NEW HOME
BIG BIDS FOR NEW AIRPORT
G
ammon Infrastructure Projects, GVK Developmental Projects, GMR Infrastructure and Larsen and Toubro have passed the first stage of bids to build the Kushinagar International Airport. GMR was rated the highest, on financial and technical capacity. Kushinagar is about 60km west of Gorakhpur, in eastern Uttar Pradesh. The four are now eligible for the second stage, the deadline for applying to which ended this month. The Department of Tourism, Government of UP, had invited applications from interested bidders earlier this year for upgrading an existing airstrip to an international airport at Kushinagar and integrated development of a ‘Buddhist circuit’, covering the Buddhist heritage sites of UP, on a design-build-finance-operatetransfer (DBFOT) basis. About 41,600 foreign tourists visited Kushinagar during 2008, according to the department. After evaluating the financial and technical capacity of the bidders, Hyderabad-based GMR Infrastructure was rated the highest by the evaluating
22
committee. GMR was awarded 387 marks on its technical capacity and had the highest weighted average net worth of Rs 12,424.3 cr in the financial capacity category. L&T came a close second in technical capacity and scored 290 marks, while GVK had the second highest weighted average net worth, of Rs 5,685.97 crore. The marks were awarded on the basis of the experience of each company in operating, commissioning and constructing airports. The minimum net worth of the applicants had to be Rs 300 crore at the close of the preceding financial year. GMR spokesperson said, “We are always looking out for good opportunities in the AAI’s regional airport privatisation initiatives. How and when we bid depends on the right fit with our business model.” A notable absentee from the list of bidders for this first stage was Reliance Infrastructure (R-Infra). A senior executive from RInfra had earlier said that the company was interested in bidding for airports with some existing infrastructure, not in erecting new ones.
CRUISING HEIGHTS June 2010
While recently inaugurating the new corporate office of the helicopter firm at Noida, Praful Patel, Minister, Civil Aviation, said, “Pawan Hans will get the mini Ratna status soon and it will also have a board of independent directors” The Airports Authority of India (AAI) is the only aviation Public Sector Undertaking (PSU), which has been accorded the mini Ratna status so far. Patel also added that PHHL, which is already the biggest chopper company, has plans to acquire 100 helicopters in the next few years. With a paid-up capital of about Rs 114 crore, PHHL recently paid a dividend of Rs 11.37 crore to the Indian government which holds 78.5 per cent of equity and the remaining stake being held by oil major Oil and Natural Gas Corporation Limited (ONGC). Since 1992-93, it has till date paid Rs 205.88 crore as dividend. Patel's announcement about the grant of mini Ratna status came in the backdrop of the chopper firm consistently reporting profits.
A NEW HELIPAD AT ROHINI
T
he Environment Ministry has approved the terms of reference for the development of the country’s first fully automated helipad in the Capital. To be constructed by Pawan Hans Helicopters Ltd of the Ministry of Civil Aviation, the Rs 65-crore helipad is proposed to be spread over 25 acres in Sector 36, Rohini (New Delhi), said the official sources. The plot has been allotted by DDA as per the Master plan of Delhi.
AD dummy.qxd
5/31/2010
11:37 AM
Page 1
Globe Eye.qxd
5/29/2010
4:24 PM
Page 8
GLOBAL EYE
AI monument vandalised
A320 PRODUCTION TO 38 PER MONTH J
A
V A N D A L I S E D MONUMENT that honours 329 victims of an Air India terrorist bombing will be restored in time to mark the 25th anniversary of what was Canada’s worst air disaster, next month. Members of the Indian community are outraged that someone has stolen a stainless steel “gnomon” or “shadow caster” that produces a shadow on a memorial sundial when lit by the sun. The thieves also used black paint to spray graffiti on the face of the sundial. The monument has been in a remote corner of Humber Bay East Park in Etobicoke since 2007. Police said that the gnomon was unbolted from the sundial and stolen earlier this month. The names of the victims are etched onto nine panels of polished black granite fronted by the sundial. It faces a memorial in Ahakista, Ireland, near where the plane went down. Barrie designer Ralph Boumeester said the gnomon was made using elements of the Indian flag. “It lines up with the sun on every anniversary,” Boumeester said, adding, “I was surprised, shocked and saddened when I heard what had happened.” Air India families joined Prime Minster Stephen Harper, Premier Dalton McGuinty and Mayor David Miller at the unveiling ceremony of the sundial in June 2007.
24
OHN LEAHY, COO-CUSTOMERS, AIRBUS, REVEALED THAT AN A320 family production rate increase to as many as 38 aircraft per month is being contemplated. Airbus in March announced an increase in the monthly A320 family production rate in December from the current 34 to 36, citing ‘continuing demand’ and a ‘record backlog’. Leahy said, “The company is evaluating an increase in A320 production not only as planned from 34 aircraft to 36 per month, but maybe up to 38.” He said that the production increase would depend on market and economic conditions. Airbus is investing €100mn ($129mn) annually to enhance the longterm value of A320 family aircraft. One key investment is the next-generation winglets known as sharklets that were launched last November and will be fitted on A321s entering service in 2012 with Air New Zealand as the launch customer.
Boeing to up production rate
B
OEING HAS ANNOUNCED that it will increase 737NG production from the current 31.5 per month to 34 per month in early 2012. “The planned rate increase is aimed at satisfying continued strong demand,” the manufacturer said, adding, “In addition, the company continues to study further potential 737 rate increases, given continued customer demand.” Boeing Commercial Airplanes President and CEO Jim Albaugh said, “Even through the global economic downturn, our diverse 737 backlog has remained very strong. Increasing the 737 production rate is the right thing to do to meet the growth and fleet replacement needs of our customers.”
CRUISING HEIGHTS June 2010
Soaring high E
MIRATES GROUP has recently reported a net income of AED 4.2bn ($1.14 bn) for its fiscal year ended March 31, 2010. This is a substantial increase over an AED 1.49 billion profit in 2008-09, marking its 22nd consecutive profitable year despite what it described as ‘a year fraught with worldwide market instability and economic uncertainty’. Ahmed bin Saeed Al Maktoum, Chairman and CEO, said, “It has been an exceptional year of continued profitability against a backdrop of the worst global recession in generations.” He noted that the carrier took delivery of 15 new aircraft in FY 2009-10 comprising four A380s, 10 777-300ERs and one 777F and carried 21 per cent more passengers year-over-year.
Globe Eye.qxd
5/29/2010
4:24 PM
Page 9
Iraqi Airways gone bankrupt
T
HE IRAQI GOVERNMENT WILL CLOSE THE STATE-owned Iraqi Airways after declaring it bankrupt. Going by the BBC reports, Iraq’s transportation ministry has blamed the closure on the damaging dispute with Kuwait over war reparations. Kuwait Airways says that the Iraqi flag carrier owes it about $1.2bn for aircraft and plane parts taken during the Iraqi invasion of Kuwait in 1990. The Iraqi ministry blamed “harassment” from Kuwait for
No third runway
the airline's failure. Last month, lawyers acting for Kuwaiti authorities tried to have an Iraqi Airlines plane confiscated at the London’s Gatwick Airport. It had just arrived following the first direct flight between Baghdad and London for 20 years. The airline's chief executive also had his passport confiscated and was held in London, but has since returned to Iraq. Earlier this week, Iraqi Airways said that it would end flights to Europe and Sweden because of the efforts of Kuwait to retrieve compensation.
ASH SLOWS DOWN GROWTH: IATA
T
HE UK’S NEW COALITION government indicated that it would cancel plans for a third runway at the London Heathrow and refuse additional runways at Gatwick and Stansted, stating that it is committed ‘to implement a full programme of measures to fulfil our joint ambitions for a low carbon and eco-friendly economy’. The resolution was listed in the document setting out the accord between Conservatives and Liberal Democrats on a number of issues. The joint policy agreement also said that the new government would replace the current and controversial Air Passenger Duty with a per-flight duty. EasyJet said it “welcomed” the coalition government’s pledge to reform the daft Air Passenger Duty, which taxes full planes but not empty ones. Responding to the plan to scrap LHR’s third runway, airport operator BAA commented that it “will work with the new government to ensure that airport’s policy provides the strong international trading connections on which the UK’s jobs and future competitiveness depend”.
T
HE INTERNATIONAL AIR Transport Association (IATA) has recently announced the international scheduled air traffic results for April 2010. According to the result, passenger demand slumped by 2.4 per cent as a result of massive flight cancellations centred in Europe during the six days in April following the eruptions of an Icelandic volcano. The fall in traffic interrupted the industry’s recovery from the global financial crisis. “The ash crisis knocked back the global recoveryimpacting carriers in all regions. Last month, we were within one per cent of pre-crisis traffic levels in 2008. In April, that was pushed back to seven per cent,” said Giovanni Bisignani, Director General and CEO, IATA. On the international passenger demand front, the ash crisis accentuated the asymmetrical nature of the economic rebound. European carriers posted an 11.7 per cent demand drop in April (compared to a 6.2 per cent increase in March). Uncertainty of service reliability in the aftermath of the ash cancellations and major unrest in Greece as a result of the currency crisis added to the weaker European demand
CRUISING HEIGHTS June 2010
during the month. Limited GDP growth expectations of 0.9 per cent continue to dampen demand across the continent. North American carriers posted a 1.9 per cent decline in demand, primarily as a result of the impact of the ash crisis on North Atlantic routes. This is a major step backwards from the 7.8 per cent growth recorded in March. This fall in demand was less than half the 4.5 per cent cut in capacity, pushing load factors to 80.2 per cent. Asia-Pacific carriers saw their strong growth slow to 3.5 per cent (from the 12.9 per cent growth recorded in March). Robust GDP growth of seven per cent (Asia excluding Japan) is supporting the strong recovery. Middle Eastern airlines recorded the strongest traffic growth at 13.0 per cent, which is about half the 25.9 per cent increase of the previous month. African carriers also saw their recovery slow down to 8.6 per cent growth in April, down from the 16.9 per cent growth recorded during the previous month. Latin American carriers posted a 1.2 per cent increase for the month, a quarter of the 4.6 per cent growth recorded in March, which was already a weak month as a result of the Chilean earthquake.
25
IGI Ariport story.qxd
5/31/2010
12:07 PM
Page 2
SPECIAL REPORT
Ready for launch: While brick, tar and cement are busy structuring the Terminal 3 at the Indira Gandhi International Airport, the authorities, in their zeal to make it a world class terminal, are leaving no stone unturned as they spearhead with their mission of planting 10 lakh trees.
S
lated for opening on July 3 by Prime Minister Manmohan Singh and Sonia Gandhi, the Terminal 3 is spread in an area of 5.2 million sq feet. It will be an integrated terminal, handling both domestic as well as international flight operations. Managing the burgeoning traffic growth, Delhi airport has become the busiest in India, leaving Mumbai behind, and today handles around 750 flights a day. The total passenger traffic at Indira Gandhi International Airport was 25.25 million flyers against 24.80 million at Chhatrapati Shivaji International Airport in 2009. The new Terminal 3 building, currently
26
There will be around 39 different kinds of trees, around 26 types of plants, some 86 varieties of shrubs and six types of cacti that will be planted
CRUISING HEIGHTS June 2010
under construction will have the capacity to handle an additional 33 million passengers annually by the Commonwealth Games. On completion, the terminal will become the world's third largest passenger terminal after Dubai International Airport's Terminal 3 and Beijing International Airport's Terminal 3. Intricate landscapes, variety of plants, cacti and bushes will now adorn the spanking new Indira Gandhi International Airport. Promotors GMR who are piloting the Rs 12,000 crore makeover of Delhi International Airport Ltd (DIAL) that will operate IGI are straining every muscle to make sure the
IGI Ariport story.qxd
5/31/2010
12:07 PM
Page 3
Terminal 3 June 3 opening deadline of the Terminal 3 is met. For starters, the barren landscape around the airport will be a sea of green and a riot of colours in a couple of months when close to 10 lakh trees and small plants are planted. Travel along the route and you will see a battery of maalis feverishly busy planting, watering and tending to the samplings. For external landscaping, about 320 different varieties of plants and trees will be used while over 266 varieties of plants will be used for internal landscaping. Over 922,000 trees and plants will be planted for the entire project, according to an official estimate. There will be around 39 different kinds of trees, around 26 types of plants, some 86 varieties of shrubs and six types of cacti that will be planted both inside and outside the terminal. Landscaping for an area of 70 acres outside the terminal and 10,000 square metre inside the terminal building will be done. About 39 types of groundcovers and soft landscaping work
The barren landscape around the airport will be a sea of green and a riot of colours in a couple of months when close to 10 lakh trees and small plants are planted. Travel along the route and you will see a battery of maalis busy planting and watering
CRUISING HEIGHTS June 2010
will be carried out on the lawns covering 30,000 square metres. While most of the plants have been selected from plant nurseries across the country and a few varieties have been flown down from abroad including exotic varieties of Orchids have been sourced from Thailand and Dioon Spinosa from Mexico. EDAW, an international firm in Hong Kong has done the landscaping work for the airport. This has been done along with a Bangalorebased landscape architect company — Beyond Built — which is assisting in the structuring of the project from the conception stage to completion. EDAW was involved in the landscape design of Hong Kong International Airport, Hong Kong Disneyland and many other international projects. About 10,000 plants will be regularly maintained at a nursery near the terminal. The nursery will also be used for research and development in horticulture for the terminal landscaping later on.
27
Traffic Data june new.qxd
5/29/2010
4:26 PM
Page 2
TRAFFIC DATA PASSENGER GROWTH Passengers carried by domestic airlines from January to April, 2010 were 162.82 lakh as against 133.41 lakh in the corresponding period of year 2009 thereby registering a growth of +22.05%.
APRIL 2010 SEES STEADY GROWTH
P
MARKET SHARE Airline-wise details of market share of scheduled domestic airlines for the month of April 2010 are
28
CRUISING HEIGHTS June 2010
assengers carried by domestic airlines between January 2010 and April 2010 were 162.82 lakh as against 133.41 lakh in the corresponding period of 2009, thereby registering a growth of +22.05 per cent. An analysis of capacity (ASKM) and demand (RPKM) data on year-to-year basis indicates that the trend of increase in both capacity and demand continued in the month of April, 2010. The total number of domestic passengers carried by the scheduled airlines of the country in April, 2010 was 41.88 lakh as against 39.03 lakh carried by the same carriers in the month of March this year. The break-up for the month of April 2010 is: Air India (Domestic) — 7.62 lakh, Jet Airways — 7.66 lakh, Jet Lite — 3.18 lakh, Kingfisher — 8.98 lakh, SpiceJet — 5.27 lakh, Paramount —0.13 lakh, GoAir — 2.46 lakh and IndiGo — 6.58 lakh. The percentage share of the carriers in the month of April 2010 was: Air India (Domestic) 18.2 per cent, Jet Airways — 18.3 per cent, Jet Lite — 7.6 per cent, Kingfisher — 21.4 per cent, Spice Jet — 12.6
Traffic Data june new.qxd
5/29/2010
4:26 PM
Page 3
SEAT FACTOR
CAPACITY VS DEMAND
April 2010 observed higher seat factor primarily due to beginning of tourist season.
Analysis of Capacity (ASKM) and Demand (RPKM) data on Year-to-Year basis indicates that trend of increase in both the capacity and demand continued in the month of April 2010 also.
Y
VARIOUS REASONS OF CANCELLATIONS
ON-TIME PERFORMANCE (SCHEDULED DOMESTIC AIRLINES) The overall On-Time Performance (OTP) of scheduled domestic airlines for the month of April 2010 has been 80.7%.
% of Total Ops
OTP
100
On-Time Performance (%)
89.8
88.1
87.6 79.3
80
77.1
76.3
74.6
74
60
ON-TIME PERFORMANCE (FOREIGN AIRLINES)
40 25.6
22.4
20
11.4
8.8 4.2
0.5
19.9 7.2
0 Kingfisher
Paramount
IndiGo
Go Air
Spicejet
NACIL (I)
JetLite
Jet Airways
Though there are 70 foreign carriers operating to/from India, at the time of compilation of this report, OTP data of 46 carriers was received. The overall On-Time Performance (OTP) of these 46 carriers for the month of April, 2010 has been 76.6% in departures and 77.6% in arrivals.
FIVE AIRLINES HAVING HIGHEST OTP (DEPARTURES)
per cent, Paramount — 0.3 per cent, GoAir — 5.9 per cent and IndiGo — 15.7 per cent. The seat factors of the domestic airlines in the month of April 2010 was: Air India (Domestic) — 72.9 per cent, Jet Airways — 74.2 per cent, JetLite — 78.1 per cent, Kingfisher Airlines — 75.8 per cent, SpiceJet — 81.0 per cent, Paramount Airways — 85.0 per cent, GoAir — 78.0 per cent and IndiGo — 82.4 per cent.
April 2010 observed higher seat factor primarily due to beginning of tourist season. The overall cancellation rate of scheduled domestic airlines for April 2010 was 2.5 per cent. The number of passenger-related complaints of scheduled domestic airlines for April 2010 has been 3.5 per 10,000 passengers carried.
On-Time Performance The overall On-Time Performance CRUISING HEIGHTS June 2010
(OTP) of scheduled domestic airlines for April 2010 was 80.7 per cent. As for the On-Time Performance of foreign airlines, the figures are shown in the chart above. There are 70 foreign carriers operating to/from India. At the time of compilation of this report, OTP data of 46 carriers was received. The overall On-Time Performance (OTP) of these 46 carriers for April 2010 has been 76.6 per cent in departures and 77.6 per cent in arrivals.
29
cover story june.qxd
5/29/2010
4:59 PM
Page 30
COVER STORY
DEATH AND DESTRUCTION
ON IX 812 U nlike the Airbus A320 crash on February 14, 1990 or the subsequent two air accidents in India till 2000, the Mangalore air crash — the first in these ten years — involving Air India Express Boeing 737-800 on May 22, 2010, was captured by the electronic media and transmitted to millions of TV viewers within an hour of the accident. The crash took away the lives of 158 including those of the crew members while miraculously sparing eight. Even as the news channels were transmitting the rescue operations live and much before the crucial Cockpit Voice Recorder and the Black Box containing the Digital Flight Data Recorder were recovered, commentators on the idiot box had passed their verdicts that ranged from the pilots commit-
ting an error of judgement of the table top runway/airport to that the Mangalore was too risky for commercial aviation. If either of these two explanations was unacceptable, others shifted the blame on pilot fatigue. Indian Commercial Pilots Association (a unionised body of former Indian Airlines pilots now part of Air India) or ICPA went to the extent of hinting at the role of expatriate commander pilots for inadequate knowledge about India’s terrain. What ICPA failed to say was that all the previous accidents of stateowned carriers did not involve any expat pilots. The fact that Air India Express Flight IX 812 carrying 166 people on board including six crew members from Dubai had overshot the table top runway at Mangalore from its threshold touchdown point by 2000 feet thus leaving less than 6000 feet of the 8038-foot-long second Continued on page 34
CATASTROPHE: 158 innocent lives succumbed at Mangalore.
30
CRUISING HEIGHTS June 2010
cover story june.qxd
5/29/2010
4:59 PM
Page 31
THEORIES HAVE BEEN DOING THE ROUNDS ON THE CAUSES OF THE WORST AVIATION DISASTER IN A DECADE. BUT BEFORE WE JUMP TO CONCLUSIONS, WE WILL HAVE TO WAIT FOR THE FINAL FINDINGS OF THE COURT OF INQUIRY INTO THE CRASH, WRITES R KRISHNAN.
DEVASTATION: Airport crew and local people took for sign of life amidst the wreckage
CRUISING HEIGHTS June 2010
31
cover story june.qxd
5/29/2010
4:59 PM
Page 32
COVER STORY
AI EXPRESS:MILES TO GO The air disaster at Mangalore airport on May 22, 2010, in which 158 people perished has not only marred the safety record of Indian aviation but also brought into focus the functioning of Air India Express, the low-cost airline of Air India.
A The airline lacked the professional touch in its functioning from day one. AIE, though given a dream start with AI handing over a large chunk of its lucrative Gulf routes on a platter, was never really able to take off in glory and attain its full potential 32
ir India, which has been in the business of international flight operations for over six decades, sensing the changing market trend, initiated an exercise in 2003-04 to launch a low-cost international airline. One cannot recall any other instance of Air India ever thinking ahead of time in the post-JRD Tata era, other than this. Credit is, therefore, due to the management of that time, particularly K Roy Paul, the then Secretary, Civil Aviation, who was doubling as Chairman of Air India, for the vision displayed in launching Air India Express much before other lowcost airlines were to subsequently emerge and eat into Air India’s traditional hold on the market. With several Indian carriers now operating to Gulf and Middle East and low-cost Gulf carriers having stepped up their frequencies to various destinations in India, Air India would have been precariously placed with regard to its hold on the India-Gulf market if only AIE (Air India Express) had not been set up to cater to the price sensitive passengers on these routes. To digress, the broad contours of the budget airline were worked out by an inhouse committee comprising senior directors of Air India. It was envisaged that quite like the successful low-cost airlines in Europe, AIE should be established as a new airline, based on low-cost expenditure platform, employees on contract, etc. for operating services to destinations in Gulf and the Middle East to begin with, and later expand CRUISING HEIGHTS June 2010
services to cover cities in South East Asia. The aim was to cover all major destinations that could be covered in a flying time of up to 4-4 ½ hours. 18 B737-800 aircraft in single-class configuration with 189 seats were accordingly ordered. As the delivery of new aircraft was to take time, a decision was also simultaneously taken to lease seven of these aircraft for commencement of operations at an early date. On April 29, 2005, AIE was formally launched at Thiruvananthapuram amidst much fanfare with the inaugural flight operating to Abu Dhabi. As it happens with most plans formulated by government-controlled organisations, while the conceptualisation was good, the implementation had been tardy. The airline lacked the professional touch in its functioning from day one. AIE though given a dream start with Air India handing over a large chunk of its lucrative Gulf routes on a platter, was never really able to take off in glory and attain its full potential. Now that AIE has been in the business for five years, it’s time to take a hard look. How successful has AIE been? Has the budget airline met the objectives with which it was launched? Let’s look at various key performance parameters.
LOAD FACTOR It is imperative for low-cost airlines to attain high load factors for it to be able to offer low fares. Notwithstanding the fact
cover story june.qxd
5/29/2010
4:59 PM
that it was provided a readymade market by Air India, AIE had averaged 80 per cent occupancy factor during the years of robust market growth — 2005-2008; and under 70 per cent in the period thereafter affected by economic meltdown. This can by no yardstick be described as a creditable performance particularly because IndiaGulf market wasn’t affected to the extent other markets were. Quite like its parent company, Air India, one notices a total absence of marketing effort. Low-cost airlines do advertise and undertake aggressive cost-effective sales promotion drives, though not at a scale at which legacy carriers do. AIE, for reasons best known to it, has stayed away from both highlighting its USPs and making inroads into new markets. Is there a desire to attain load factors in the 85-90 per cent range? Perhaps not! In fact, on some sectors the load factors are an abysmal 40 per cent.
AIRCRAFT UTILISATION With AIE having taken delivery of all its 18 new aircraft and the seven leased aircraft awaiting return in a phased manner, it is imperative for AIE to enhance aircraft utilisation which currently is no where near the levels that other low-cost airlines strive, and are able to achieve. A relatively poor utilisation of aircraft has had an adverse impact on its network growth. With fewer than 200 flights per week being operated there is a pressing need to increase aircraft utilisation and network. In fact, most low-cost airlines are able to offer cheap tickets only because they succeed in attaining optimal utilisation of aircraft coupled with high number of passengers, factors seemingly being ignored by AIE management.
PROFITABILITY As it appears a total lack of transparency followed by Air India and AIE in their cross-accounting systems, one cannot rule out the possibility of several costs incurred by Air India not being recovered from AIE, all with a view to showing that Air India Express has been a successful venture. With a finance official now at the helm as the Chief Operating Officer, revenues vis-à-vis expenditure need to be critically looked into. This is imperative because unless the true financial picture emerges, a corrective action can simply be not initiated. The faster it is done, the better. Further, AIE was conceptualised and launched prior to the merger. The position has changed drastically post-merger as IC also had smaller aircraft in its fleet and was using it for operating flights on almost the same routes. With the rationalisation of flights done to apparently favour AIE, revenues of IC-coded flights natural-
Page 33
ly took a beating, thus affecting the financial health of the parent company, Air India, in the past three years. Most airlines world over have realised that the low-cost airline biz is a different cup of tea when compared to legacy airlines. In fact, low-cost airlines launched by legacy carriers haven’t tasted the same kind of success as new, independent low-cost airlines have. Ryan Air, Easyjet and Air Asia had no background of the industry and hence could be innovative in their approach to make these airlines a roaring success. Many cost-effective decisions of AIE initially envisaged, based on global low-cost airlines, were subsequently diluted to follow the Air India systems. To make budget carriers successful one needs to be ruthless on all cost heads. What Air India has clearly lacked is the experience required for running a low-cost airline — efficiently and in a cost-effective manner. The lack of professionalism witnessed in running of Air India has unwittingly been passed on to AIE, which should have logically introduced the best work practices of successful airlines. The most significant failure of Air India thus far has, however, been on the management front. There does not appear to be any professional management structure at all. One of the areas of which AIE had come in for strident criticism following the Mangalore air tragedy was on management structure. Whilst in the first year, the then CMD V Thulasidas virtually functioned as the head with little time to devote, the mantle in September 2006 was transferred to Capt P P Singh, a commercial department officer, who had just retired. After allowing him to run the show for three years, came the shocker. Andy D’souza, GM (Finance), with virtually no credentials to justify the appointment, was designated as the COO. It is apparent that AIE hasn’t attained the potential and success that it should have on key performance parameters viz aircraft utilisation, network, market share, cost effectiveness. Fiveyear span is a fairly long time to sort out the chinks in the system. For AIE to realise its full potential and not get marginalised it will have to break from Air India and evolve its policies and procedures that suits it best. The negatives of Air India will be required to be kept at quite a distance away if AIE wishes to survive. And the beginning will have to be made by having some professionals at the helm to drive the company to new heights and not leave it on auto-control for it to crash land. (The writer is an aviation expert and a former airline employee.)
CRUISING HEIGHTS June 2010
Low-cost airlines undertake aggressive cost-effective sales promotion drives, though not at a scale at which legacy carriers do. AIE, for reasons best known to it, has stayed away from highlighting its USPs and making inroads into new markets 33
cover story june.qxd
5/29/2010
4:59 PM
Page 34
COVER STORY runway for the Boeing to roll down had scripted the fate it met. The fact that the aircraft hit one of the few poles supporting the landing radars, swerved to its side, broke into two and fell into the 200-foot-deep gorge is now part of a tragic history. The occurrence of the air crash, however, itself has raised many possible causes of the accident. As we have mentioned, the causes could have been: An error of judgment of the pilots; The new 8038-foot-long runway inaugurated in 2006 was unsafe; The failure of the ATC to guide the pilots during the ill-fated plane’s approach for landing; A communication gap between the pilots and the ATC; A technical problem in the two-and-ahalf-year-old Boeing 737-800; or As the ICPA alleged, a lack of knowledge on the part of the expat pilot. It could be anyone of these causes or a combination of some of them. Hence, to pass judgement even before the Court of Inquiry has begun its work and the Directorate General of Civil Aviation (DGCA) gets cracking with its investigations will be unfair. All of us will have to wait for the Court of Inquiry, the DGCA, the aircraft’s manufacturer Boeing and the National Transport Safety Board of the US which flew in its specialists, to put their heads together and decode the CVR (Cockpit
DESPERATE: The rescue operations in full swing at Mangalore airport.
Voice Recorder) and DFDR (Digital Flight Data Recorder) to identify the cause or causes of the air crash. The fact that the pilots were experienced was evident from the hours of flying they had logged. The 53-year-old expat commander of Flight IX 812 Captain Zlatho Glusica had 10,000 hours of flying experience and had been flying the same type of aircraft for Jet Airways before he joined Air India Express two years ago. He had touched down at Mangalore airport a number of times earlier and at least 19 times since he joined the Air India Express. His Co-Pilot, also from Jet Airways, had 3450 hours of flying experience
AIR CRASHES - DGCA (SPECIFICATIONS)
DECEMBER 2, 1995 DELHI AIRPORT Plane : B-737/ IC-492/From Jaipur to Delhi Pilots : Capt. Adil Mistry/ Co-pilot: Sandeep Marwah Cabin crew : four Passengers : 98 Casualties : None Injuries : Six Cause of accident: The Indian Airlines accident was caused by the combined effect of (a) The injudicious and impru-
34
dent decision of the Pilot-in-Command to hastily complete the flight in the inadequate time available before the notified closure of Delhi airport for a VVIP flight, (b) The dangerously unstabilised approach made by the Pilot-in-Command, primarily due to his failure to decelerate the aircraft in time, (c) The failure of the First Officer to call out significant deviations from the stipulated approach parameters, (d) The failure of the Pilot-inCommand to carry out a missed approach in spite of his approach being grossly unstabilised, (e) The inadvertent omission of the Pilot-in-Command to arm the speed brake before landing, (f) Touch-down of the aircraft at excessive speed and too far down the runway, (g) Failure of the First Officer and Pilot-in- Command to monitor the automatic deployment of the speed brake, and failure of the Pilot-inCommand to deploy it manually, (h) Impact of the aircraft with an 18-inch high cement-concrete cable duct in the kutcha ground beyond the over-run area.
CRUISING HEIGHTS June 2010
JULY 30, 1998 KOCHI AIRPORT
Plane
: Do-228-201/From Kochi to Thiruvananthapuram Cabin crew : Three Passengers : Three Casualties : Three Injuries : Six Cause of the accident: After take-off, the Indian Airlines aircraft pitched up uncontrollably, stalled and fell to its right and crashed. The uncontrollable pitch up was
cover story june.qxd
5/29/2010
4:59 PM
and had landed at Mangalore airport’s second runway 66 times. The two pilots had last flown into Mangalore on May 17, just five days before the air crash. Thus, they both had adequate knowledge about the second runway and the terrain surrounding the airport including its top-down approach while flying into and out of the table top airport. Incidentally, the commander was a British national of Serbian origin. True, the Bajpe airport, as Mangalore airport is called, has been described as a “critical” facility with an unforgiving geography. Even though the airport is well-equipped to handle smooth take-offs and touch-downs, there is no room for error because no course correction is possible. For instance, at the end of the 8038foot-long runway, there is nearly 295 feet of loose sand-filled land which is supposed to help in stopping an overshooting aircraft. This is as per ICAO (International Civil Aviation Organisation) norms. Even otherwise, an airport with a runway length of 7500 feet is considered adequate to receive landings by narrow body jets like the Boeing 737 NG series and A320s. In sharp comparison to the older runway at the same airport, the length that was available for landing the Boeing 737 classic series like the 737-200 was only 6000 feet. Thus, before the 2006 inauguration of the second runway, the older but much
Page 35
Even though the Mangalore airport is well-equipped to handle smooth take-offs and touch-downs, there is no room for error because no course correction is possible
FOUND: The Black Box of the plane in question
shorter runway was used by Indian Airlines subsidiary Alliance Air to operate its Boeing 737-200s. In fact, two of these few surviving Boeing 737-200s are still being used by Alliance Air for its freight/cargo operation for India Post. These Boeing 737-200s are over 25 years old. In the case of the Air India Express Boeing 737-800, it overshot the second runway leaving no chance for a sudden stop or getting stuck in the sand bed stretch after the runway. There was no room available for error and course correction became impossible. There are a few more critical airports in the country (see the accompanying box) and of these the one at Calicut is also on Continued on page 40
caused by sudden uncommanded downward movement of the Trimmable Horizontal Stabilizer leading edge. Poor aircraft maintenance practices at Short Haul Operations Department contributed to the accident.
JULY 17, 2000
PATNA AIRPORT Plane : B-737/Alliance Air from Kolkata to Delhi Pilot : Capt. Sohan Pal
Cabin crew Passengers Casualties Injuries
: : : :
Six 52 60 Seven
Cause of the accident: The cause of the Alliance Air accident was loss of control of the aircraft due to human error (aircrew). The crew had not followed the correct approach procedure, which resulted in the aircraft being high on approach. They had kept the engines at idle thrust and allowed the air speed to reduce to a lower than normally permissible value on approach. They then manoeuvred the aircraft with high pitch attitude and executed rapid roll reversals. This resulted in actuation of the stick shaker stall warning indicating an approaching stall. At this stage, the crew initiated a Go Around procedure instead of approach to Stall Recovery procedure resulting in an actual stall of the aircraft, loss of control and subsequent impact with the ground.
CRUISING HEIGHTS June 2010
JULY 1, 2007 INDORE AIRPORT Plane : ATR 72-212A/From Bhopal to Indore Cabin crew : Four Passengers : 49 Casualties : None Injuries : 53 Cause of the accident: The Pilot-inCommand of Jet Airways in absence of bounce recovery guidance adopted selfperceived technique and kept on adding engine power along with aircraft pitch manipulations to salvage the aircraft from the bounce on landing and gravely damaged the aircraft structure.
35
cover story june.qxd
5/29/2010
4:59 PM
Page 36
COVER STORY
DIFFICULT TAKE-OFFS AND LANDINGS FIRST RUNWAY Runway length: 500 ft (152m) Surface: Asphalt Direction: 06/24 SECOND RUNWAY Runway length: 500 ft (152m) Surface: Asphalt Direction: 07/25 THIRD RUNWAY Runway length: 9,040 ft (2,755m) Surface: Asphalt Direction: 07L/25R
CALICUT INTERNATIONAL AIRPORT Runway length: 9,377 ft (2,860m) Surface: Asphalt Direction: 10/28 Acreage: 378 acres Airport equipment: ILS CAT-1, distance measuring equipment, a modern voice communication system, a digital airport terminal information system, a digital voice tape recorder, a satellite communication network and a remote work station system. Capable of handling: Boeing 777200/-200ER, Boeing 747, AB 320, B 737-800
36
on May 14, 2007. A new terminal was built in early 2009 on 377 acres.
LEH AIRPORT Airport equipment: Very High Frequency Omni Range (VOR), Distance Measuring Equipment (DME) Capable of handling: B737, A320
LENGPUI AIRPORT Runway length: 8,200 ft (2,500m) Surface: Asphalt Direction: 17/35 Acreage: 781.83 acresres Airport equipment: Very High Frequency Omni Range, Distance Measuring Equipment, ILS CAT-1 Capable of handling: B737, A300
The airport was sanctioned after the struggle which began in 1977 under the leadership of freedom fighter the late K P Kesava Menon. Campaigning by industrialists, politicians and the public resulted in the commissioning of the airport on April 13, 1988. Calicut Airport was given the status of international airport on February 2, 2006 AAI has provided runway lead-in lighting system that has been put into service for night operations since October 2003. A 15,000 m2 (160,000 sq ft) international arrival terminal similar to the spacious modern international departure terminal became operational
CRUISING HEIGHTS June 2010
The Leh airport is one of the highest airports in the country built at 10,682 ft above the sea level. The airport is named after one of India’s and Ladakh’s leading lights Kushok Bakula Rinpoche. Due to the presence of mountain winds in the afternoon, all flights in Leh take off and land in the morning, around 7am.
The airport is considered to be the first large airport in the country to be built by the State Government and the second largest airport in the North-East region. The construction work of the airport was started in December 1995 and was completed in February 1998 and inaugurated on December 12 same year. ILS CAT-1 was operated at Lengpui airport in August 2009.
cover story june.qxd
5/29/2010
4:59 PM
Page 37
Airport equipment: Non-Directional Beacon, VHF Capable of handling: Dornier-228
SRINAGAR AIRPORT Runway length: 12,090 ft (3,685m) Surface: Asphalt Direction: 13/31 Acreage: 52.6 acres Airport equipment: Very High Frequency Omni Range (VOR), Distance Measuring Equipment (DME), Flight Information Display System Capable of handling: A320, B737
PORT BLAIR AIRPORT Runway length: 10,795 ft (3,290m) Surface: Asphalt Direction: 04/22 Airport equipment: Very High Frequency Omni Range (VOR), Distance Measuring Equipment (DME), ILS Capable of handling: AB 320, A320, Boeing 737-200, Dornier-228
It is named after the Indian freedom fighter Vinayak Damodar Savarkar. There is a road that crosses the runway; traffic must be stopped for aircraft to take off. Heavy rain flooded the airport during May 2008 and halted traffic. As of April 2009, construction work to add a second airplane parking bay is in progress.
Direction: 07/25 Acreage: 254 acres Airport equipment: Very High Frequency Omni Range (VOR), Distance Measuring Equipment (DME), ILS Capable of handling: A320, B737
The airport is named after one of the greatest saints of Kashmir, Sheikh Noor-ud-din Noorani. The airport has undergone extensive renovations, including
The airport is named after “Lok Nayak” Jayaprakash Narayan (1902-1979), an Indian independence activist and political leader.
KULLU AIRPORT Runway length: 3690 ft (1125m) Surface: Asphalt Direction: 16/34 Acreage: 81.68 acres
improving the runway, a new terminal for departure and arrival, air bridges and other operational facilities, and was inaugurated on February 14, 2009.
PATNA AIRPORT Runway length: 6,410 ft (1,954m) Surface: Asphalt
CRUISING HEIGHTS June 2010
37
cover story june.qxd
5/29/2010
4:59 PM
Page 38
COVER STORY
CRITICALITY MEANS EXTRA
MEASURES HAVE TO BE ADOPTED During his tenure as the Director General of Civil Aviation, Kanu Gohain brought in a number of changes in the working of the directorate. He had pointed out that “the basic concept of safety is that you have to have a safety management system in place”. His views on the Mangalore mishap.
W
Kanu Gohain
It is well known that the Airports Authority of India (AAI) has gone on an ambitious programme of setting up a satellite navigation system. Once that is put in place, it will help in more precise operations 38
hen we say something is critical that means there are some features in the airports’ functioning where there are elements of risk. For example, if the runway length is not up to the requirement for a particular type of an aeroplane’s operation, we may call it critical since in that case you would require extra efforts to maintain the safety level. In a short runway or a runway not commensurate with the performance of the aircraft, the payload or the weight of the plane has to be decreased. In the case of Mangalore, at both ends of the airport, there are two valleys going down to around 200 ft. That is why it is critical. In many parts of the world, there are airports with runways going to the sea. These airports too would be termed critical. Criticality arises from the fact that extra measures have to be adopted for safety. One critical example is the Patna airport. Similar to Mangalore airport is Calicut airport where there are valleys at the end of the runway. Then there is Kullu because of the hills around it. There are other airports too, where some kind of criticality is involved in operations like Lengpui in Mizoram or Port Blair, which was a critical airport at one point of time. The length of the runway at the airport has been increased to 9000 ft — it was 8000 ft earlier — and on one side of the runway there was a hillock. The runway at Patna, for example, is much shorter than that at Mangalore. The aeroplane that touches down at Patna should do so at the correct spot. When an aircraft lands, there is a thud. That is when the wheels touch the ground and a little bit of G-loading is there. At airports which are not on the critical list, you may not experience the thud. Instead, the plane glides smoothly. That leads to floating on the runway. At Mangalore, the strip width (on either side) of the runway is 150 ft. It has recently been enhanced to 300 ft as per CRUISING HEIGHTS June 2010
ICAO regulations. There is no danger in the 150 ft and is meant to accommodate the swinging of the aircraft after it lands. Often the aircraft swings to one side of the runway instead of staying in the middle due to strong winds from one side. The strip is meant to accommodate the swerving of bigger and faster aeroplanes. There are some reports that the navigational equipment at Mangalore were less than required and, therefore, our ‘critical’ airports need to be upgraded and enhanced in terms of equipment. I do not think so. The equipment available are adequate. For those who do not know, the primary navigational equipment are the VOR (short for VHF omni-directional radio range, a type of radio navigation system for aircraft) and the DAV that provides the distance to the aircraft in relation to the airport. In addition, we have the Instrument Landing System (ILS). These aids put the aircraft in the exact line of the runway. They also provide the proper approach profile to the aircraft. These aids are sufficient for aircraft to land safely. It is well known that the Airports Authority of India (AAI) has gone on an ambitious programme of setting up a satellite navigation system. Once that is put in place, it will help in more precise operations. And once there is precision with the improving technology, the aircraft will be able to land and take off safely. The crash investigation (in the Mangalore accident) is going on. Generally, whenever an investigation takes place, according to the ICAO philosophy, it is not to apportion blame on anybody because no one deliberately causes a crash but to find out what actually had gone wrong for the person in command to make an error. There are various factors that contribute to make a mistake. The investigation finds out what made the professional and trained persons commit the mistake. From these observations and findings, recommendations are made to ensure that similar errors do not occur.
cover story june.qxd
5/29/2010
5:00 PM
Page 39
MANGALORE: AAI’S FUTURE-READY AIRPORT
T
he mishap at Mangalore might have brought down the international airport’s reputation a few notches but it cannot be denied that the Airports Authority of India (AAI) put in a lot of effort to complete the airport’s modernisation. Located about 22 km from Mangalore city, the airport was inaugurated in 1951 by Prime Minister Jawaharlal Nehru. It has come a long way since then and today is a future-ready airport. The upgradation and modernisation of the airport was taken up by AAI as part of the development of 35 non-metro airports in the country. What is significant is that at Mangalore airport, the airside development was matched by the cityside developments taken up by the Karnataka Government. The developments started with the construction of the new runway. That put Mangalore among a privileged category of airports with extra runways. The paradigm shift occurred when it was decided to build a New Integrated Terminal Building (NITB). The NITB has a peak hour capacity of 500 passengers
with 20 check-in counters. There are 14 immigration counters: six for arrivals and eight for departures. A number of reports have indicated that the airport lacked equipment. The AAI has taken up steps to establish Airport Operations Control Centre (AOCC) integrated with various IT systems and Airport Operational Data Base (AODB) for the NITB.
The Air Traffic Control equipment installed at the airport has been providing aerodrome control service, approach control service, area control service for all flights departing/arriving and over flying Mangalore area control. In addition, there is the aerodrome control and approach control service provided from a temporary ATC Tower in the operational area.
MANGALORE INTERNATIONAL AIRPORT Acreage: 583 acres. Airport equipment: Very High Frequency Omni Range (VOR), Distance Measuring Equipment (DME), ILS, secondary radar Capable of handling: Boeing 737-800, ATR 72-500, A310, A321, AB 320 Flights handled: 32 flights per day FIRST RUNWAY Runway length: 5,300 ft (1,615m) Surface: Asphalt Direction: 09/27 SECOND RUNWAY Runway length: 8,038 ft (2,450m) Surface: Concrete Direction: 06/24 The main runway is a precision approach CAT I ILS runway. All runways have edge lights, threshold lights and runway end lights.
The airport was opened in 1951 as the Bajpe Aerodrome. On January 10, 2006, an Airbus 319 of Kingfisher Airlines was the first aircraft in that class to land. The second runway was constructed and commissioned on
CRUISING HEIGHTS June 2010
May 10, 2006. The airport has handled 30,000 flights since then. The second runway is not the shortest in the country. International operations at this airport began in 2006 and the terminal building was inaugurated on May 15, 2010.
39
cover story june.qxd
5/29/2010
5:00 PM
Page 40
COVER STORY the list. Its runway is shorter than the one in Mangalore. Besides, others on the critical list include the in-valley situated Leh airport as well as Port Blair that is blocked by a mountain on one side and, therefore, allows only uni-directional operation irrespective of winds. A theory doing the rounds immediately after the crash goes something like this: if Mangalore airport had an Approach Radar the accident could have been averted. While the theory may hold water, it is a fact that none of the Air India, Indian Air India Express, Jet Airways or Kingfisher airlines pilots who have been regularly flying into and out of Mangalore ever informed the Airports Authority of India (AAI) or the Directorate General of Civil Aviation (DGCA) of such a requirement. According to these stories, the initial investigations (that took place within hours of the crash) showed that the ill-fated AI Express 737800 which locked in with the ILS at 6 am was “High on Approach” and was not properly aligned to the glide path which led the plane to overshoot the touchdown zone and cause the crash. Had there been that Approach Radar, Air Traffic Control (ATC) could have seen it and alerted the commander. Pilots would also have noticed the error themselves. An Approach Radar has an ILS panel to monitor the progress of a plane once it establishes contact with the ILS and in that sense is an important backup. In bigger and busier airports like Mumbai and Delhi, the ATC is able to warn the pilots of any mis-alignment with the glide path, etc. But it is true that the final call is always taken by the pilots and if they find they are not on mark, they pull up and come round before they attempt a second time for a comfortable landing. At the crash site, the throttle of the aircraft near
PLANE FACTS
HOPEFUL: Relatives of the passengers await news of survivors.
40
Nearly 6,000 people have lost their lives in around 400 plane crashes across the world in the past 13 years. According to a 2007 report by USbased aerospace firm Boeing, a total of 5,147 people were killed in 364 rpt 364 accidents, involving 286 commercial and 70 cargo jets, between 1998 and 2007. Of them, 78 were fatal accidents, while 146 were hull loss accidents, in which the airplane was totally destroyed or damaged beyond economic repair, according to the ‘Statistical Summary of Commercial Jet Airplane Accidents, 1959-2008’. Since 2008, there have been about 40 such accidents, including the recent Air India plane crash in Mangalore. The number of casualties in the past three years stands at around 1,000. Ten days before the Mangalore air crash, an Afriqiyah Airways plane from Johannesburg crashed while it was trying to land in the Libyan capital of Tripoli, killing 103 people. Only a nine-year-old Dutch boy survived the crash. A month ago, Poland’s President Lech Kaczynski and 92 others were killed when their aircraft crashed near the western Russian city of Smolensk. On June 1, 2009, 228 people on board an Air France Airbus A330 perished when the aircraft ran into thunderstorms and crashed into Atlantic Ocean on the way to Paris from Rio de Janeiro. On June 30, 2009, 153 people were killed when a Yemenia Airbus 310 en route the Comoros Islands crashed into Indian Ocean. Fifteen days later, all 168 people on board an Iranian passenger plane were killed when the aircraft crashed near the city of Qazvin. In August 2008, a Spanair plane crashed on takeoff at Barajas Airport in Madrid, Spain. Of the 172 people on board, 154 were killed. Two other major air accidents of the year were Santa Barbara Airlines plane crash of February that killed 46 people and Itek Air flight crash in Bishkek, Kyrgyzstan, which claimed 71 lives. In 2007, 119 people were killed when a TAM Airbus skidded off the end of the runway across a major roadway and struck a gas station and building, bursting into flames in Brazilian city of Sau Paulo.
CRUISING HEIGHTS June 2010
The year 2006 witnessed three major crashes, killing more than 450 people. While 128 people were killed in a Sibir (S7) crash in Russia’s Irkutsk region in July, 170 were killed in August in a Pulkovo Airlines aircraft crash in Ukraine’s Donetsk. Some 154 people were killed in a Gol Airlines plane crash in Brazil a month later. In August 2005, a West Caribbean Airways flight crashed in the Sierra de Perija Mountains on the ColumbianVenezuelan border, killing all 160 people on board. Around 143 people were killed when a Boeing 737-230 from Mandala Airlines veered to the left and crashed into a residential neighborhood 500 yards past the end of the runway in Medan, Indonesia. 104 people were killed when a Kam Air flight crashed into 11,000 ft Chaperi Mountain near Kabul in February 2005. In February 2003, 275 people were killed when an Iranian Revolutionary Guard military plane crashed into a mountain and a Sudan Airways plane crashed near Port Sudan, killing 116. A month later, over 100 people lost their lives when an Air Algeria plane failed while attempting to take off and crashed at an airport in Algeria. The year 2002 witnessed four major plane crashes, two of which involved Chinese airlines. The deadliest among them was the Boeing 747 of China Airlines that broke apart midair and crashed into Taiwan Straits on May 25, 2002, killing all 225 on board. Before that, another Air China flight had crashed into a mountain, in fog, wind and rain while attempting to land at Kimhae Airport in Busan, South Korea. Of the 166 passengers and crew, 128 were killed in the disaster. In November 2001, an American airlines Airbus A300 crashed after takeoff from JFK Airport into the New York City borough of Queens, killing over 265, including people on the ground. Another American airlines aircraft crashed near Arlington, Virginia in July that year, killing 189 people, while 145 lost their lives when a Vladivostokavia airliner reduced to flames in Siberian woodlands the same month. Source: Agencies
Document2
5/30/2010
1:21 PM
Page 1
cover story june.qxd
5/29/2010
5:00 PM
Page 42
COVER STORY
STRANGE AIRPORTS KANSAI INTERNATIONAL AIRPORT, OSAKA, JAPAN Due to the sky-high population density of many Japanese cities, space availability is a serious problem. In Osaka, this necessitated the creation of an airport outside the city. The Kansai International Airport is a modern engineering marvel, constructed mainly of glass and steel, and built entirely as an artificial island, over the sea at a depth of 56 to 59 feet. It is considered to be one of the greatest architectural feats of the late 20th century.
QAMDO BANGDA AIRPORT, TIBET Kansai was originally planned as an alternative to the crowded Narita airport but the cost of operating there was rather expensive for many airlines.
GIBRALTAR AIRPORT, GIBRALTAR Gibraltar Airport is the civilian airport that serves the British overseas territory of Gibraltar. As Gibraltar is nestled on a tiny piece of land, squashed between Spain and the sea, space is the major concern. It is because of this that the main road through Gibraltar, Winston Churchill Avenue has to cross the runway. So, when planes land, the traffic along Gibraltar’s main road comes to a complete standstill. Gibraltar Airport has the distinction of being the closest airport to the city that it serves, being only 500 metres from Gibraltar’s city centre.
42
What makes Qamdo Bangda Airport unique is its altitude. At over 4200m above sea level, the thin air makes it more difficult to stop an aircraft landing. The low air density at this altitude makes a higher takeoff and landing true airspeed necessary, and therefore a longer
MADEIRA AIRPORT, PORTUGAL The airport is located near Funchal, Madeira, Portugal. It controls national and international air traffic of the island of Madeira. The airport was once infamous for its short runway which, surrounded by high mountains and the ocean, made it a tricky landing for even the most experienced of pilots. The original runway was only 1,600m in length, but was extended by 200m eight years after the crash of a Portugal flight in 1977 and subsequently rebuilt in 2000, almost doubling the size of the runway, building it out over the ocean.
CRUISING HEIGHTS June 2010
runway. The airport is 2.5 hours by mountain road from the county seat of Chamdu/Changdu/Qamdo. The long commute is the result of no flat land closer to the city being available to construct an airport. Visitors are warned before landing to move slowly on leaving the plane and that they may feel light headed or dizzy because of the thin air.
COURCHEVEL INTERNATIONAL AIRPORT, FRANCE Getting to the iconic ski resort of Courchevel requires navigating the formidable French Alps before making a hair-raising landing at Courchevel International Airport. The runway is about 1,700 feet long, but the real surprise is the large hill toward the middle of the strip. One takes off downhill and lands going uphill here. The hill, which has an 18.5 per cent grade, is so steep that small planes could probably gain enough momentum rolling down it with no engines to safely glide off the edge.
cover story june.qxd
5/29/2010
5:00 PM
Page 43
TONCONTIN INTERNATIONAL AIRPORT, HONDURAS
ICE RUNWAY, ANTARCTICA
CONGONHAS AIRPORT, SAO PAULO, BRAZIL
Near the centre of Honduras’ capital city, Tegucigalpa is the notorious Toncontin International Airport, which has been the subject of scrutiny following several accidents, including a 2008 crash that killed five. The airport opened in 1934, an era when planes were less powerful and didn’t require such lengthy runways. Toncontin’s runway is just over 7,000ft long, situated in a valley surrounded by mountains which is awfully short for 747s and the irony is that planes are forced to land and take off in the same direction because they won’t be able to clear the mountains otherwise.
The Ice Runway is one of three major airstrips used to haul supplies and researchers to Antarctica’s McMurdo Station. There is no shortage of space on the Ice Runway, so super-size aircraft like the C-130 Hercules and the C-17 Globemaster III can land with relative ease. The real challenge is making sure that the weight of the aircraft and cargo doesn’t bust the ice or get the plane stuck in soft snow. As the ice of the runway begins to break up, planes are redirected to Pegasus Field or Williams Field, the two other airstrips servicing the continent.
Most major cities have an airport, but rarely are they built just five miles from the city centre, especially in metropolises like Sao Paulo. Congonhas’ close proximity to downtown can be attributed in part to the fact that it was completed in 1936. It may be a convenience for commuters; it places a strain on both pilots and air traffic control crews. It becomes a challenge in terms of safety to just get the plane in there. Fortunately, Sao Paulo’s many high-rise buildings are far enough away from the airport so that they aren’t an immediate obstacle for pilots landing or taking off.
SVALBARD AIRPORT, NORWAY
JUANCHO E YRAUSQUIN AIRPORT, NETHERLANDS ANTILLES Getting to this paradise-like island can be a bit distressing, thanks to a 1300-footlong runway, slightly longer than most aircraft carrier runways. Large planes do not land here, but the small runway is difficult even for Cessnas and similar aircraft. “The little X means don’t land there,” says Schreckengast, a former
Navy pilot who is no stranger to landing on less than lengthy runways. “It’s challenging, but if you don’t have something like that, the people here don’t get things they routinely need, like mail.” Given the limited amount of land and rolling topography of the island, not many other options exist.
Svalbard is a cluster of Norwegian islands sitting in the Arctic Ocean. Of three airports within the archipelago, Svalbard Airport is open to commercial travel, making it the world’s northernmost airport. Engineers used the region’s brutally cold climate to their favour during construction and built the runway on a layer of permafrost. The airport was completed in 1975, but slight seasonal changes caused sections of the runway to become uneven. A project was launched in 1989 aimed at insulating troublesome sections of the runway from the ground, which proved relatively successful.
These are some of the dangerous airports; others that are vying for the title of critical airports are:
Gustaf III, Saint Barthélemy, France; Copalis State Airport, Grays Harbor County, Washington, United States; Lukla, Nepal, Denver International Airport, Colorado, United States; Don Mueang International Airport, Bangkok, Thailand; Koh Samui Airport, Thailand; Paro Airport, Bhutan; Matekane Air Strip, Lesotho; Quito Airport, Ecuador; Wellington International Airport, New Zealand; Narsarsuaq Airport, Greenland; Kai Tak Airport, Hong Kong
CRUISING HEIGHTS June 2010
43
cover story june.qxd
5/29/2010
5:00 PM
Page 44
COVER STORY
Whose fault is it anyway?
44
Photo: H.C. Tiwari
Statistics prove that one in every four air crashes across the globe happen due to an error during landing, as was the case with the recent Air India Express crash at the Mangalore Airport that claimed 158 lives. Boeing’s analysis shows that around 24 per cent of the total 364 plane accidents, between 1998 and 2007, were caused by technical or human error while landing. During the 14-year period from 1995 through 2008, commercial transport aircraft were involved in a total of 1,429 accidents involving major or substantial damage. Of those, 431 accidents (30 per cent) were runway-related. Of these, 417 or 97 per cent were runway excursions (when an aircraft fails to confine its takeoff/landing within the limit of designated runway) like the AI Express Boeing 737 Mangalore crash. 41 of the 431 runway accidents involved fatalities. Excursion accidents accounted for 34 of those fatal accidents, or 83 per cent of fatal runway-related accidents. Eleven per cent of the total 5,147 fatalities were attributed to accidents due to problems in landing. According to the report titled Statistical Summary of Commercial Jet Airplane Accidents, 1959-2008, a majority of accidents (57 per cent) occurred while the aircraft were cruising. As per the report, of the total accidents, about 12 per cent took place during the takeoff, 8 per cent during the plane’s initial climb and 12 per cent between the period of climb and cruise, accounting for 43 per cent of the total fatalities. Around 1,985 people have lost their lives in air crashes caused by loss of control in flights. Over 1,100 were killed in accidents classified under controlled flight into terrain, in which a pilot inadvertently flies an aircraft into terrain without knowing about the obstacle. The third biggest reason behind fatal accidents was the failure or malfunction of an aircraft system or component.
CLARIFICATIONS: Madhvan Nambiar, Secretary, Civil Aviation addressing a press conference after the Mangalore air crash.
In bigger and busier airports like Mumbai and Delhi, the ATC is able to warn the pilots of any misalignment with the glide path, etc. But it is true that the final call is always taken by the pilots CRUISING HEIGHTS June 2010
the flight deck was found in the forward position suggesting a possible attempt to take-off after landing. This is an issue that is also exercising the minds of experts over the crash at Mangalore. The commander, Zlatko Glusica, confirmed around 6.03 am that he had established contact on ILS Runway 24 after which the ATC reconfirmed its clearance to the flight to land. Ten minutes before the scheduled landing, according to the AAI, the airport inspector had also inspected the runway and communicated to the ATC his clearance to land. The AAI has said there is nothing wrong with the infrastructure at Mangalore airport. The pilots permitted to fly to Mangalore are well aware that it has a table top runway (see the accompanying box) and are expected to adhere to the guidelines. The AAI said the Take-Off Distance Available (TODA) and Landing Distance Available (LDA), the Exhilarated Stop Distance Available (ESDA) and the Take-Off Run Available (TORA) of the airfield are all known to the pilots. Only pilots with required skills and certain flying hours are asked by airlines to operate in such airfields. Pilots know the stipulation and they cannot blame the infrastructure. To top it all, it was the DGCA that cleared the second runway which also conforms to International Civil Aviation Organisation standards. Civil Aviation Minister Praful Patel who accepted the moral responsibility for the crash told the press that apparently all technical parameters and systems appeared to be in place. The visibility was six kilometers, there was no rain, the runway was not wet and there were no strong winds. Yes by all stretches of the imagination, it certainly was not an accident waiting to happen. But it happened.
cargo COVER june 2:cargo COVER june 2.qxd
5/29/2010
2:55 PM
Page 1
AIR CARGO & LOGISTICS
June 2010
Rishi Raj Singh Dungarpur
Colonel Vishnu Singh Rawal Capt Padmaja Shankar
ACE’s ready for
Capt Mukut Pathak
the world
Two of the country’s big air cargo movers are in different phases of operations. While one is rearing to expand internationally, the other is keen to extend its footprint on the domestic front.
Globemaster: Yes, no, maybe? p58
Air cargo is a separate discipline p56
Ten Boeing C-17 Globemaster IIIs — heavy lifters — all have been ordered but will they be delivered? That is the question that is troubling the Indian Air Force authorities.
Growing air cargo business demands a new approach as it has become financially independent and started forging independent relationships with customers, writes D J Ghosh
Last in first out + Atilla Lise Interview.qxd
5/29/2010
2:50 PM
Page 2
LAST IN/FIRST OUT
TRENDS
India is ascending in the logistics sector GROWING MANUFACTURING sector over the last few years has opened several opportunities for the logistics market. The fast-paced growth of the industrial sector, coupled with the more sturdy progress of the agricultural sector, has necessitated extensive supply chains across the country to facilitate sourcing and distribution of production. This is the recent study of Frost & Sullivan on Indian logistics sector. The study discloses that the total logistics market in India earned revenues of Rs 3533.9 bn in 2009, representing about 6.2 per cent of the country’s GDP. The market is expected to reach Rs 5,640 bn by 2014, witnessing a CAGR (compound annual growth rate) of 9.9 per cent between 2009 and 2014. The transportation segment accounts for about 62 per cent of the total market reiterating the
fact that it is the most important logistics function for all industries. However, Indian logistics service providers (LSPs), the study says, fail to satisfactorily meet end-user expectations. Keeping in mind the challenges faced by the LSPs and end- users, Frost & Sullivan’s Transportation and Logistics Practice is organising an exclusive strategy workshop for the logistics sector ‘Future Supply Chain Strategies’. The workshop intends to assemble a network of today’s best thinkers, visionaries, and thought leaders from across key industry sectors such as automotive, IT hardware and telecom equipment, retail, and pharmaceuticals in India, for the specific purpose of developing ‘Future Supply Chain Strategies’.
OPPI upset over poor cold room facility ORGANISATION OF Pharmaceutical Producers of India (OPPI) expressed serious concern over the poor cold room storage facility at the country’s major airports and seaports. Pharmaceutical companies have been facing problems with respect to cold room storage at the New Delhi airport terminal. Over the years the pharma companies have been relying on major airports and seaports for quality storage infrastructure and service as per GMP (good manufacturing practices) norms for export and import of pharmaceuticals. “Unfortunately, pharmaceuticals are, by and large, treated like just any other product at these ports, even today. We have reported and impressed upon the authorities that due to inadequate storage and handling of these drugs at ports, high dwell time, dispersed multiple authorities from whom clearances are required, the quality of the products may get adversely affected due to temperature excursions,” informed Tapan Ray, Director General, OPPI. “There is no separate air-conditioned examination area/loading bay for perishable cargo.The perishable cargo is examined outside the cold room at normal temperatures. Also the loading bay provided for taking goods out of the airport is the same as is used for normal cargo,” he added.
46
“A joint formulation of the common concerns our industry is confronted with in political debates is essential. Our industry contributes substantially to the global economy, but we lack political and public awareness.”
Andreas Otto
Executive Board Member Lufthansa Cargo, at the recent 2010 CNS Partnership Conference in Miami
CRUISING HEIGHTS June 2010
IT MIGHT just well be the next blue-eyed sector in India.With investments in the line of $1 trillion, the logistics sector is definitely gearing up as JVs, PE players, cross-border acquisitions, strategic investments and even universities foray into the hitherto ignored and complex sector. As the country awaits its first free trade warehousing zone (FTWZ) in Mumbai to start operations from May 23, 2010, experts are upbeat this may well transform the landscape of the country.The Indian market is growing and exports are looking up too, reasons Vishwas Udgirkar, executive director with PwC (Pricewater house Coopers). “India is touted to be a manufacturing hub and its success will depend upon logistics support. So it’s a logical step to develop the sector. FTWZ and logistics parks will completely change the landscape, as there is a very strong demand for modern warehousing facilities. People are watching the FTWZ rollout very closely, and its success will open floodgates in the sphere,” he adds. Recently,Vision India Real Estate announced its plans to develop logistics parks in Bangalore and Chennai with a $110-mn outlay.The company has reportedly claimed that 60 per cent of the warehouse space in both the parks had already been booked. KPMG estimates that logistic costs in India contribute to 13 per cent of the GDP while they are only about eight per cent in developed countries. Reducing logistic costs by one per cent of the GDP translates to savings of over $7.5 bn. Manish Saigal, executive director & head (transportation and logistics), KPMG, explains these figures give a good indication of the level of inefficiency in the sector in India. "As a lot of logistics will be outsourced, third party logistics will add fuel to the sector.”
Cargo Lead story.qxd
5/29/2010
2:15 PM
Page 3
CARGO
Dream flights — SOME GOOD, SOME NOT
so good
Two air cargo operators — possibly the only two of their kind in the country — are keen to carve out a niche for themselves. It is still early days and the hurdles are many but both Capt G R Gopinath and Capt Mukut Pathak are rearing to fly, reports Tirthankar Ghosh. ithout doubt, 2009 was challenging for the air cargo sector all over the world. Some bucked the trend while others wilted. The effect in India was negligible, thanks largely to the huge domestic market. Amidst the turmoil all around — at least that was the general feeling — there were a few brave souls who had the foresight to plan and launch air cargo outfits. Today, five months into 2010, the new outfits — the nearly-year old Capt G R Gopinath’s Deccan 360 and the two-month-old Capt Mukut Pathak-led Aryan Cargo Express (ACE) — are on their way to consolidation and stability. The ACE chief continues to steadfastly
W
hold on to his belief that while cargo is not glamorous, “I realised that there was a very strong case to set up a robust airline based out of India because this country is not just a very big market but its location is unique. He mentioned that a carrier based out of India would be able to provide a fantastic amount of connectivity within the Asia, Europe, Australia/New Zealand and Africa areas. Literally burning the midnight oil to start the operations of what he referred to as the first Indian international freight carrier, Capt Mukut Pathak’s dream — one that he has been nurturing since 2007 — has started
CRUISING HEIGHTS June 2010
bearing fruit. Aryan Cargo Express (ACE), the dedicated cargo airline that he heads as Chairman and Managing Director, started flying from March 4, 2010. “We operated the flight from Dhaka to Brussels,” said Capt Pathak (see the following interview) and went on to proudly mention that it was “an achievement in itself in the history of India: an Indian airline operated its first flight from international
47
Cargo Lead story.qxd
5/29/2010
2:15 PM
Page 4
CARGO
destination to another international destination… No airline in India has ever done it. Servicing the foreign markets in this postrecession period with the air cargo industry slowly emerging from the downturn has not bothered Capt Pathak. In fact, the ACE chief is optimistic about the immense potential and importance of cargo movement, in India and globally. As a dedicated cargo airline, he told C RUISING H EIGHTS , ACE offers tailormade services to customers worldwide. The carrier has the first mover advantage and that is, perhaps, why Capt Pathak and his team have kept themselves away from domestic operations. He said, “You will not be able to make money in a
48
The carrier has the first mover advantage and that is, perhaps, why Capt Pathak and his team have kept themselves away from domestic operations. purely domestic market operation. The moment you enter the market, you will face competition. To begin with, there are the low-cost carriers, which will start selling their space at any cost.” That, according to Capt Pathak, would create a kind of unhealthy competition in the domestic sphere. Result: the sustainability as a purely domestic operator will be in dire
straits. Capt Pathak’s nonintegrated model sticks to ACE’s core competence: running a safe and reliable airline. “We provide airport-to-airport connectivity and for the last mile we use services of large trucking companies, courier companies and freight forwarders. An integrated carrier provides connectivity from B(usiness) to C(onsumer).
CRUISING HEIGHTS June 2010
ACE will be B to B and for a steady supply of goods, mentioned Capt Pathak, and added: “We are talking to freight forwarders only.” Having done an indepth study of the world market vis-à-vis India, ACE is implementing its plans charted out in the initial blueprint. With a startup capital of Rs 100 crore, the three-partner ACE (the other two being Rishi Raj Singh Dungarpur and Colonel Vishnu Singh Rawal) has started operating in Asia and Europe with an Airbus 310-300F. Another A310 will join the fleet later this month while two MD-11s are scheduled to be inducted towards the end of the year. ACE, in fact, has not yet started scheduled operations. With only one
Cargo Lead story.qxd
5/29/2010
aircraft, the carrier has limited itself to charter flights. Capt Pathak outlined his reasons: “Technically, it will be foolhardy to start scheduled operations with just one aircraft. If the aircraft had some technical problems, we would have a major situation on our hands. Therefore, to avoid such kind of situations, we are delaying scheduled operations. Even so, the average utilisation of that aircraft is 13 hours against 14 hrs of operation, which is considered a good operation.” The carrier has started utilising its base in Delhi to the hilt. “We are almost at an equal distance from Europe and the Far East. This is an advantage for us since we will be able to move cargo from China,
2:15 PM
Page 5
South East Asia, the Far East and SAARC nations to Europe, the Middle East, North Africa and East Africa.” In addition to Delhi, Aryan Cargo has two other hubs: at Bangkok and Sharjah. From these three centres, ACE serves the South Asian Association for Regional Cooperation nations (Pakistan, Bangladesh, Nepal, Bhutan, Sri Lanka, Maldives, Afghanistan and India) as well as South East Asia, China, West Asia, the CIS and European countries in the first phase. While the second phase of growth would connect the Far East, North Africa and Australia/New Zealand, the third phase would see ACE furthering its operations to the Americas. When that does happen, ACE would become a global cargo carrier. ACE’s launch came at a very crucial juncture. Capt Pathak is quite aware that yields are under pressure in Europe. At the same time, the air cargo segment is growing in Asia and that is where ACE’s main
While no statement about the actual amount spent by Ambani has come from official sources, it is believed that RIL has sunk in a whopping $25-30 mn. market is. As for the Indian air cargo industry, it is preparing for a rebound of sorts in 2010. Data released by the Airports Authority of India (AAI) shows that domestic air freight has grown in double digits year on year since May 2009, and, export freight too started growing marginally since August last year. ACE is wooing customers with its “flexibility, reliability and above all with expertise. We will be bringing in superior service levels to the market — and mind you, everything will be done by Indians,” said Capt Pathak apt Gopinath, on the other hand, is also going Indian in the pursuit of his dream of launching and running “a
C
child of Deccan because of the nightmare and frustration of the logistics of (maintaining) Air Deccan (aircraft)… We had FedEx, we had UPS and Blue Dart/DHL. But their focus was taking India to the rest of the world, not bringing India to India”. He had with him Jude Fonseka, a 30-year verteran from the air cargo, express logistics and airline industry, who was ready to ensure the fruition of his vision. Fonseka had mentioned to C RUISING H EIGHTS in April 2009, on the eve of the launch of Deccan 360: “For many years, the East was dependent on the West. Today, the country’s growth has enabled us to return the favour. To sustain India’s growth, Continued on page 52
FROM OUR FILES: Capt Gopi (left in a white shirt) shares a light moment with Jude Fonseka (centre, suited) and Kiran Grandhi (right), Chairman, Airports, GMR Group, at the press conference to announce the launch of Deccan 360 at Delhi.
CRUISING HEIGHTS June 2010
49
M pathak Interview new.qxd
5/29/2010
2:24 PM
Page 2
CARGO
“
The recovery has been unexpectedly good
”
On a high after the commencement of operations, Captain Mukut Pathak is looking forward to full-scale scheduled charter operations from the end of this year. He outlined his plans to C RUISING H EIGHTS and also spoke about the problems that operators like him face. Excerpts from the interview:
Q
ACE started with its first international flight. How many planes do you have now? We have one plane right now and the second aircraft we will be picking at the end of May. We have to go a bit slow on our expansion plans... the first one is an A310 from Air India while the second one is also an A310, ex-Air India.
A
You mentioned that you have to go slow on your expansion plans... We have to go slow because the line training of our first officer has got delayed and as a result we were not in a position to pick up our second aircraft — it was supposed to come towards the end of April — since we would not be able to exploit it fully. Therefore, we delayed taking the second aircraft. And now our first batch of first officers are ready. We could have achieved our target but couldn’t because of the ash clouds. Ten days of chartered flights were cancelled because all
50
the flights were through Brussels...it was a big loss for us.
gain valuable market intelligence and increase our data base.
You are getting your second aircraft in May. What are your plans to enhance your fleet? In our original business plan we were supposed to have four Airbus freighters and two MD11s by the end of September this year or by the end of this year. Now we have revised our business plans and we are stopping at two A310s and we are planning to add three MD11s by AugustSeptember this year. And at the same time after the induction of the MD11s we will be going ahead with the induction of Boeing 737-400s or Boeing 757s for domestic regions, for SAARC countries and Central Asia.
Are you taking full loads? As far as loads are concerned we are very happy with the loads and also the yields that we are getting on them. And once we start our scheduled operations — possibly around the first week of June — we are very sure that we will do well. We can start schedule operations with one aircraft today but it will be foolhardy to start with only one plane because if there are technical problems, we will be unable to provide service to our customers. To avoid that kind of a situation we are delaying it till we get a second aircraft. We are making maximum utilisation of the aircraft that we have: around 13 hours of flying a day against our projected 14 hours.
On an average how many flights are you doing in a month? Right now, our aircraft came out of A-Check on May 11, 2010 and we have done three charters already. Our charters are from India — Delhi, Mumbai, Chennai — to Hahn in Germany. And the aircraft is fully booked for charters for the next ten days. So, we are doing very well and that is helping us
CRUISING HEIGHTS June 2010
Are you getting queries for charters to China? Yes, lots of them. But don’t you feel, Captain, that China is virtually a one-way traffic? That’s the reason we are not
M pathak Interview new.qxd
5/29/2010
operating charters to China now. I had told you earlier and I still maintain that India has a much more developed sector than China. I remember I told you that three-fourth of my network is a balanced network while only 25 per cent of the network is unbalanced. However, I correct myself today to say that 85 per cent of my network is balanced and only 15 per cent is unbalanced. Because whatever data we have gathered till now, we are very sure that when we start operations out of China or Far East towards India and Europe, we will be getting full loads all the way. Only when an aircraft moves from India to an eastern hub, i.e. Bangkok that is where we will have less than 50 per cent load. From Bangkok we will be getting 100 per cent loads for the Far East. It is only in 15 per cent of my network that we have lower loads.
2:24 PM
Page 3
As far as the domestic sector is concerned do you expect more players like you to come in? There are many people who are fence-sitters and are watching the growth of
available who have expertise in operating a passenger airline but the pool of manpower qualified enough to launch a cargo airline is very small — or rather nil. Therefore, I do not think that the people who jump on to the air cargo bandwagon will be able to make a mark in the long term. If you recollect there were five airlines which were granted licenses for cargo operations. At the end of the day, there are only two left in the business. While others have spread themselves out, we want to stick to our core business: flying from point to point. As I told you earlier, our core competence is to run a successful, safe and competent airline. Keeping that in mind, we have decided to remain an airport-to-airport operator.
I believe that Delhi, which is the top airport in the country, I would rate it at par with Dhaka, one of the worst in Asia as far as cargo goes. The so-called warehouse in Delhi airport is no warehouse at all. In fact, the three shining examples of airports in India — Delhi, Mumbai and Chennai — are no better than the airport at Dhaka. We have this very warped ground handling policy. The airlines are fleeced in any and every possible manner. The ACAAI is not a spokesperson for the airlines. We face problems at the airside and warehousing sides. We have to devise strategies to overcome these problems. We are going to make a presentation to the Ministry of Civil Aviation regarding the problems that we are facing.
Deccan 360 and Aryan Cargo Express. Once they see that we are doing good business, they will jump in. But what we have to see will be the level of competence of these players who wish to make a foray into this specialised segment i.e., cargo business. It is very different from the passenger airline business. In India you have a pool of a large number of people
Now that you are well into your operations, what do you feel about the infrastructure? We are far, far behind. If in other parts of the world, the air cargo infrastructure is in Kalyug, we are still in Satyug. The kind of infrastructure available in Bangkok would place the airport among the top three in the world. Our airports would not figure in the top 10.
We also face problems with the customs. You see, when you are doing domestic operations, the customs does not come into the picture but when there are international operations — in fact, for the moment we are the only dedicated international operators — we face severe problems. We knew it was bad but we did not know that it was so bad!
is no lean season, the rates are still high and the recovery has been unexpectedly good. And it’s not just in India but all over the world — except for Europe. Even the US has started exporting and importing large amounts. It’s only Europe which is down otherwise there is sound recovery in all markets all across the globe. In the domestic market, there has been a growth of 20 per cent this year in cargo which is very huge comprising automotives, machinery, etc. And, sometimes perishables.
Where is this 15 per cent network? This is only when we go from India to Bangkok. You have GSAs in Bangkok... Yes, we have got clearances from Hong Kong, from Bangkok, from Hahn, Sharjah for our scheduled operations. But do you think there is enough business in India? Yes, the domestic market is growing. In fact, in my previous interaction with you I stated that we were expecting the cargo sector to recover fully only towards September-October 2010. I told you it has to first recover the losses made in the past and only then will the real recovery start because then it will also have to face the lean period of March, April, May, June. Fortunately, what we are seeing is that this time there
CRUISING HEIGHTS June 2010
51
Cargo Lead story.qxd
5/29/2010
2:15 PM
Page 8
CARGO inter-dependency of Tier-1, Tier-2 and Tier-3 cities will be just as crucial as the inter-dependency of the global economy. Transportation can accelerate this interdependency by enabling a larger segment of cities to be a part of this growth. Our goal is to be the catalyst of that change.” A few months down the line, Capt Gopinath’s plans to have his footprint across the country stopped. Reason: lack of funds. “You can’t run a logistics business without a network. You can’t get clients if the network is not there. Hence, we needed to establish that network. There is a huge frontloading of cost. You need to have presence in 10-15 airports on the day you launch your service,” he mentioned in a recent interview to the Hindu Businessline. He crossed that hurdle when Mukesh Ambani, Chairman, Reliance Industries, bought between 26 and 50 per cent stake in Deccan 360. With that partnership, Capt Gopi believes he will have “access to 11 airports while others with far more years in the business have presence in seven to eight airports. We have 1,000 trucks, 70 warehouses, eight surface hubs plus huge real estate in Delhi, Chennai, Rajkot and so on, apart from the hub we have in Nagpur. So, the day I launch, I am twice the size in reach.” He also pointed out that he was looking at “how to scale up and at what pace”. While his business model includes focusing on smallscale industries and realtime management of goods, his dream is to have a Deccan 360 connection in every district of the country. The Ambani link has had its fallout and is being
52
Ambani’s stake has made life easy for Capt Gopi. For quite some time now, he had been on the lookout for finances to run Deccan 360. widely seen as the Captain’s growing pains. Perhaps, under pressure to reduce costs, Deccan 360 has had to get rid of its expatriate staff. Heading the list was the soft-spoken and low-profile Chief Executive Officer Jude Fonseka. Presently the Managing Director of CFX Aviation Ltd, Malaysia, the Sri Lankan-born
Australian citizen Fonseka had joined Deccan 360 to fulfill the Captain’s dream of creating an Indian version of FedEx. While Fonseka did not offer any reasons except to say in an email to a publication that “there are many reasons behind my decision… I will be happy to share the reasons at a suitable time”, it is widely
CRUISING HEIGHTS June 2010
felt that the departure of the expatriate employees has taken place simply because Capt Gopinath wants to reduce costs. It is also believed that he could also be under pressure from partner Mukesh Ambani. While no statement about the actual amount spent by Ambani has come from official sources, it is believed that RIL has sunk in a whopping $25-30 million. That, incidentally, has enabled Ambani to put two persons on the fivemember Deccan Cargo and Express Logistics’s board. Ambani’s stake has made life easy for Capt Gopi. For quite some time now, he had been on the
Cargo Lead story.qxd
5/29/2010
lookout for finances to run Deccan 360 and had even mentioned that he was looking at something like $25 to 30 mn which would help him increase the number of aircraft and vehicles in his set up (he has eight freighters, a fleet of over 300 trucks and 850 vehicles nationwide, eight major surface hubs, with a capacity of more than 300 tonnes per night by air and more than 60 warehousing hubs now). His plan is to have a pan-India presence connecting 100 cities in the next 12-18 months. Outlining his plans, he pointed out in the interview that his vision was to make Deccan 360 ubiquitous. “It must be
2:15 PM
Page 9
present in the length and breadth of the country. If someone wants to set up a factory in a remote corner of Tamil Nadu, he should be able to do it because of Deccan 360. There is huge opportunity for us. In the US, the express logistics business alone is worth $60 bn, in Europe, it is $35 bn; in China, it is $7 bn, and in India, it is a mere $700 mn. Therefore, our company should become synonymous with logistics…” Capt Gopi’s dream is similar to Mukesh Ambani’s. His RIL is involved in the business of oil, gas and petrochemicals and he has been looking to increase his exports from
CRUISING HEIGHTS June 2010
his refinery. While RIL has made its presence felt in the shipping sector having taken over Rewa Port, Mukesh Ambani plans to enlarge his business activities when the new airport at Navi Mumbai comes up. for quite some time, Ambani has been concentrating on setting up a farm-to-plate supply chain. He has his Reliance Fresh, the chain of retail stores across the country selling fresh fruits, vegetables and even grocery products. A cargo airline, therefore, fits into his scheme of business. According to sources in RIL, Ambani had chalked out plans to buy 40 planes more than a year ago. These were meant to transport vegetables, fruits, etc across the country. At that time, however, he realised that pilots for these planes would be hard to come by and, in fact, he had sent out a circular to all his office staff with a simple request: if any young employee or even children of senior staffers wanted to become pilots, the company would fund their training. The only stipulation: they would have to serve RIL for a period of five years. The company spokesperson pointed out that while engineers would be preferred, students who had physics, chemistry and mathematics in high school would also be eligible. All the applicants would have to sit for an examination to qualify for the course. The selected trainees would be sent abroad for commercial pilot’s licenses with the company spending around Rs 30 lakh per candidate for their training. A shrewd
businessman that he is, Mukesh Ambani had plans to start a cargo airline and when Capt Gopi started looking for funds— in fact, there were reports that Deccan 360 was evaluating a stake sale option while scouting around for private equity investment — RIL was presented with an opportunity that it could not ignore. Ambani is said to have offered around Rs 6 bn sometime in the middle of April this year. Capt Gopi, however,
It is no wonder that Ambani said in a statement issued to the press after the deal was finalised, “We believe that our collaboration with Deccan 360 will see a transformation in the logistics domain in India.”
53
Cargo Lead story.qxd
5/29/2010
2:15 PM
Page 10
CARGO
With such a captive business, a lot of Deccan’s working capital needs as well as the seed money for expansion of the network can be met by Capt Gopinath. refused but Ambani dangled a carrot. He offered the entire logistics requirement of Reliance Retail (the company runs 900 stores offering fresh vegetables, fruits, clothes and even car accessories and general grocery in 80 cities across 14 states of India). With such a captive business, a lot of Deccan’s working capital needs as well as the seed money for expansion of the network can be met by Capt Gopinath. Incidentally, the Deccan 360 chief insisted when questioned by the media about the sale: “We want to make it clear that it is not a sale... We would rather say that they (RIL) have invested in the company.” It makes sense for Reliance Retail to get into the aircargo and logistics business. Speed and reliability is needed to transport perishables like vegetables and fruits. With its own cargo flights, RIL will be able to keep costs under control. To top it all, Reliance Retail would be able to take advantage of the 60-odd warehouses that Deccan 360 has across India. Mukesh Ambani could not have got it better.
54
Deccan 360 is the first Indian company to create a hub and spoke distribution model with a state-of-theart hub that is under development on 50 acres at Nagpur. It is no wonder then that Mukesh Ambani said in a statement issued to the press after the deal with Capt Gopi was finalised, “We believe that our collaboration with Deccan 360 will see a transformation in the logistics domain in India.” It would be worthwhile to recall RIL’s earlier plans to set up a dedicated cargo airport in its yet-to-take-off Special Economic Zone in Haryana. RIL had also decided to put up a
CRUISING HEIGHTS June 2010
Cargo Lead story.qxd
5/29/2010
2:15 PM
Page 11
Perhaps, what is important for the air cargo industry is that India is also emerging as a quality component manufacturing base with the advantage of low production costs. oth carriers have immense faith in the country’s industrial growth. Captain Pathak and Gopinath are not wrong. Reports indicate that the automotive industry could be the ray of hope that the air cargo sector could be looking forward to. The country is among the fastestgrowing auto markets in the world today with a burgeoning passenger car market and a high interest market for automakers the world over. In fact, India exported more than 3,50,000 passenger cars in comparison to 2,35,000 by China. It is true that the global recession had its effect on car sales, which came down drastically last year. Production too had gone down. Carmakers, however, started innovating and with unique engineering solutions have managed to overcome the slowdown. Today, the Indian automotive industry is emerging as a winner leading experts to predict that more than 50 per cent of the growth in the automotive sector will occur in emerging markets through 2015. To top it all, India will be at the forefront of this trend, playing an increasingly prominent role in the global industry. In fact, the automotive sector is expected to contribute 10 per cent of its GDP by 2016. The last auto expo in
B
dedicated cargo base in Patalganga that could handle Airbus A320-type or B737 -type aircraft or even bigger wide bodies. None of these plans took off. But now with the Deccan 360 tie-up, RIL has not only got into the logistics business — on land and in the air — but has got an opportunity to re-launch its airports, fleet of freighters, etc. projects. There are many in the industry who point out that Capt Gopi may as well say goodbye to Deccan 360. The reason: the Ambanis do not give a majority stake to any of their business partners. Only time will tell if that is going to happen or not.
CRUISING HEIGHTS June 2010
Delhi saw Japanese car giants Toyota and Honda showcasing their global compact models, specially created for the Indian market. A recent survey by consultancy firm KPMG pointed out that in the next five years, the global automotive market will see a whole new range of Indian and Chinese vehicle manufacturers. In fact, India’s status will improve from the 11th rank it holds as the largest passenger car maker to the seventh spot in the coming few years. Perhaps, what is important for the air cargo industry is that India is also emerging as a quality component manufacturing base with the advantage of low-production costs. Today, Honda, for example, exports crucial components from its new plant in Rajasthan to its headquarters in Japan. Even Hyundai and Suzuki have established India as their export hubs. However, this galloping growth would find the going tough if infrastructure does not improve. While Capt Gopinath is setting up his own hub at Nagpur airport, Capt Pathak said that the situation was “terrible” at international airports — at least for air cargo. The country needs to move ahead if it wants to address the road to air cargo maturity. The top priority has to be land transportation infrastructure.
55
Cargo
Colmn.qxd
5/29/2010
2:11 PM
Page 2
COLUMN/CARGO
Air cargo as a dedicated science Like a grown up child that has lived for too long under the same roof as his parents, it is now evident that air cargo operators have stayed for too long under the umbrellas of their passenger counterpart and now they have to grow up as a separate entity, feels DJ Ghosh. s the dedicated air cargo business evolves and grows, a new science must emerge to cater to this new and emerging industry. Like a child who has grown into an adult, achieved financial independence from his parents, and acquired a new circle of friends, air cargo businesses must stand on their own two feet; forge independent relationships with their customers and suppliers, different from their passenger brethren. And while a significant portion of global air cargo is still carried in the bellies of passenger aircraft, dedicated freighter aircraft and freighter operators are here to stay. Each new day, and each frayed cord from the passenger business will propel air cargo operators towards creating their own independent platform and in the process a whole new dedicated science on how this emerging business should be run. We believe that this new identity brings significant opportunity and the need for a greater degree of specialisation. All the major suppliers to the airline business will now need to specially tailor their products to suit the needs of dedicated cargo airline operators. Air cargo value proposition is very important in this reference. Any value proposition should be based on researching every aspect of the cargo airline business, to create new benchmarks on how this business should be run. The industry needs to create a body of knowledge and intelligence to turn air cargo into a dedicated and profitable science, separate from the passenger business. As a start, we need to work with each of the following types of partners and principles towards achieving this objective: airline customers, long-term contracts, aircraft manufac-
A Any value proposition should be based on researching every aspect of the cargo airline business. There is a need to turn air cargo industry into a separate, dedicated and profitable science.
DEDICATED FACILITIES ARE A NECESSITY: The new identity of dedicated air cargo business will grow as a significant opportunity.
56
CRUISING HEIGHTS June 2010
turing, aircraft financing, dedicated cargo airports, airline investors, air cargo shippers/ freight forwarders, MROs and part suppliers and last but not the least the application of information technology. I will address these issues one by one. The industry should steadfastly promote the business case for all airlines, integrators, freight forwarders and government agencies to “outsource� the operation of their cargo aircraft to specialised freighter aircraft operators. If we talk about long-term contracts, then to encourage stability, innovation and eventually cost savings, we need to move towards very long-term cargo airline contracts, of 10-12 years or more. Large shippers need to drive this move to long-term thinking, and encour-
Cargo
Colmn.qxd
5/29/2010
2:11 PM
Page 3
age their forwarder partners to do the same. Short-term thinking, manifested in short-term contracts, has been the curse of this industry. Aircraft manufacturers are another very important issue in this regard. We need to work towards moving 100 per cent of all cargo on new and converted dedicated cargo aircraft, away from passenger aircraft, thus ensuring the long-term viability of the freighter business and ensuring the safety of passengers. Eventually, passenger aircraft need to be re-configured for passengers and their bags only and not for freight. All freight should move only on specialised freighters. The industry needs to partner with banks and leasing companies to help create “Special Cargo Aircraft Related Financing Structures” (SCARFS), distinct from passenger aircraft financing, to lower financing costs for new and used freighter aircraft, thereby creating a new market for their products in the global air cargo market. Financiers need to recognise that if long-term contracts are in place for freight operators, their revenue model will be much more stable than that of passenger operators which depend more heavily on daily market-based pricing, assisted by revenue management systems. In addition, air cargo needs to rapidly migrate from higher-cost hub airports to lower-cost dedicated cargo airports with dedicated facilities for cargo operators and freight forwarders. In the long run, all air cargo should move through dedicated cargo airports. Large shippers and forwarders need to make this happen. Also, the air cargo industry needs to work with Wall Street research analysts to spruce up its very shoddy investment image. Working
RENOVATING ITSELF: Air cargo needs to migrate from higher-cost hub airports to lower-cost dedicated cargo airports with exclusive operations for cargo operators and freight forwarders.
with these analysts, we need to create a separate set of metrics and a distinct investment class for the air cargo business. We hope that this transparency will create a path for venture capital, private wealth and institutional money to enter the air cargo business. Air cargo shippers/freight forwarders are another important factor that affects the sector significantly. We need to carefully study the dynamics of each type of air cargo product and air cargo customer, and promote specialisation, branding and product differentiation in the transportation of each product category. At the same time, the industry needs to specialize in seamless “end to end” temperature controlled global transportation solutions, to cater to both the growing perishables and pharmaceuticals markets. Additionally, to drive new efficiencies in our business we must work with both MROs and parts-suppliers under long-term agreements to lower the costs of maintaining and increasing the reliability of our aircraft. And as I said earlier at every stage of our business, we must incorporate the latest information technology into our offerings to streamline and optimise all processes across the supply chain.
To drive new efficiencies in our business we must works with both MROs and parts-suppliers under longterm agreements to lower the costs of maintaining and increasing the reliability of our aircraft.
(The writer is President, American Friendship World Air Cargo Corporation.)
CRUISING HEIGHTS June 2010
57
C-17 Globemaster.qxd
5/29/2010
2:08 PM
Page 2
CARGO
Heavy trouble Growing business equations between India and United States notwithstanding, the recentlyordered ten C-17 Globemaster III from Boeing for the military could face delivery problems since the US President and his Defense Secretary want the C-17 manufacturing programme to end. Boeing has, however, maintained that everything is going according to schedule.
he 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, 2010, the US Defense Security Cooperation Agency notified the US Congress that India had requested 10 Boeing C-17 Globemaster III aircraft and associated equipment, parts, and logistical support for an estimated cost of $5.8 bn. In the associated equipment were 45 F117PW-100 engines (40 installed and five spare
T
58
Lall, Vice President and Country Head, Boeing Defense, Space & Security, India, said that his company was very pleased with the Indian government’s interest in acquiring the C-17 to modernise its airlift capabilities, and “we 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 it meet its growing domestic and international responsibilities. On its part, the Boeing company too issued a statement saying that the deal had brought India “one step closer to modernising its airlift capabilities with the world’s most advanced airlifter… The C-17, which is available now and without development risk, is the only airlifter that possesses true
engines), 10 AN/ALE-47 Counter-Measures Dispensing Systems and 10 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. The country has fewer than 20 IL-76 Soviet-era aircraft. To top it all they are more than 20 years old and do not fit in with today’s need for technologically superior, easier to maintain and larger planes that can transport troops, men and material within the country in war and in times of emergencies. The Indian request was welcomed by Boeing. Vivek INSIDE OF C-17: Globemaster is as huge as it can carry 72 tonnes of load at a time.
CRUISING HEIGHTS June 2010
tactical and strategic capabilities”. Timothy J Roemer, US 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 US and India. “The potential sale of C-17s strengthens the growing partnership between our two countries, and demonstrates our enduring commitment to sharing the world’s best technology with India,” the Ambassador said and went on to point out that the “sale will offer economic benefits for both India and the United States and will likely include significant job creation in both countries. India is a leading partner in
C-17 Globemaster.qxd
5/29/2010
2:08 PM
Page 3
AN-32
Who’s the Strongest?
Driven by 5,100 hp AI-20 turboprops AN-32’s 14,750 pound/ 6900 kg load capacity. The AN-32, a twin engine turboprop, medium tactical transport aircraft, can carry five crew and 39 paratroopers or a maximum load of 6.7 tonnes. The aircraft can fly at a speed of 530 km/hr.
C-17 Globemaster III Powered by the engine Pratt & Whitney PW2040 (Four), C-17 Globemaster III has the wingspan of 51.74 m. The maximum payload is 72 tonnes with the cruise speed of 830 km/h having the capacity to carry 4 crew (2 and 2 observers).
Specifications Engine
C-17 Globemaster III Pratt & Whitney PW2040 (Four)
Ilyushin Il-76 AN-32 (TD) D30-KP ser.2 TVD AI-20D type by-pass turbojet (Two) (Four)
Wingspan
51.74 m
50.5m
29.2m
Length
53.04 m
46.6m
23.75m
Height
16.79 m
14.76m
Maximum Payload
72 tonnes
50tonnes
Cruise Speed
830 km/h
750-780 km/h
Flight Crew
2 (and 2 Observers) 6
8.75m 6.7tonnes 470-530 km/h 3 to 5
IL-76s The Ilyushin Il-76 is a fourengine heavy duty/long haul military transport plane capable of flying at a maximum speed of 780 km/hr. It has a twin 23 mm cannon in tail turret and capacity to carry 225 paratroopers or 40 tonnes freight, wheeled or tracked armoured vehicles.
our efforts to promote regional stability, peace and economic growth.” Despite the Ambassador’s enthusiasm, the situation seems to have suddenly changed with President Barack Obama and Defense Secretary Robert Gates wanting the C-17 manufacturing programme to end. Both feel that the planes are too big. In fact, the US Air Force stopped inducting C-17s from 2006. According to sources in the Indian government, a number of US politicians are lobbying to ensure that the Boeing facility in California does not down its shutters. Apparently, the 5000 employees at the facility — aware that the assembly lines will stop — have been
CRUISING HEIGHTS June 2010
demanding fatter pay packets. The company has not stopped the production of the C-17 in 2009, it sold C-17s costing around $3bn. Whatever the outcome of the President’s desire, Boeing is going ahead with its plans for India. It is going to send the Globemaster III for trials in India in June. The trials will take place because India wants to see what it is acquiring. According to Tommy Dunehew, VicePresident, Business Development, Boeing, the Government of India has insisted on the trials. According to newsreports, Boeing puts together 16 C-17s in a year. Most of them are meant for the US Air Force. However, over the last few
59
C-17 Globemaster.qxd
5/29/2010
2:08 PM
Page 4
CARGO
“Boeing is prepared to accommodate the order” Says Vivek Lall, Vice President and Country Head, Boeing Defense, Space & Security, India as he believes that India needs a strategic airlifter like C-17 Globemaster III and also that there is no problem at all in delivering this heavy lifter to India.
The C-17 is the only strategic airlifter currently in production.
Why do you think is the Globemaster so necessary for India? We believe that the C-17 is ideally suited for India because it will allow the Indian Air Force to use the advanced airlifter to modernise India’s armed forces with new cargo capabilities. In particular, the C-17 is designed to operate in and out of highaltitude airfields in extremely hot or cold environment with large payloads. With its payload of nearly 1,70,000 pounds, the C-17 can fly strategic distances directly into small austere airfields with 3,000-foot landing strips. The C-17 has participated in numerous worldwide operations since 1990. Today the C-17 supports US troops fighting terrorism in Afghanistan and Iraq and those responding to humanitarian disasters globally. India will also be able to use the C-17 for humaniatrian and disaster relief operations in the country and around the world. Most recently, C-17s from around the world provided relief to the victims of earthquakes that struck Haiti and Chile. The C-17 is the most advanced airlifter ever built. It continues to perform superbly in current operations and is the “airlifter of choice” for both US and Allied commanders. Combining both strategic and tactical capabilities, the C-17 is the global airlift standard for long-range direct delivery of outsize cargo and passengers. The C-17 forms the backbone of international airlift missions, supporting numerous contingency, humanitarian relief, and peacekeeping efforts around the world.
Q A
60
What would the whole deal entail? The C-17 system will include aircraft, support and training required to perforation operations. The US will offer India in a Letter of Agreement (LoA) a complete range of products and services, of which some may not be required by the Indian Air Force. India and the US will negotiate which items are needed after a comprehensive site survey at the proposed home base for the C-17s. Once it is finalised, a detailed and comprehensive review of the Letter of Agreement (LoA) with the Indian government will likely highlight a number of line items that will not be included in the final proposal, such as unique equipment not requested, waived fees, etc. The final executed LoA will thus be limited to only those items purchased by the Indian government. The final contract cost will be based on actual Indian Air Force requirements that have not yet been determined and negotiated. This higher value goes beyond the aircraft and associated Government Furnished Equipment (GFE) to include potential support options India may choose to operate the aircraft with maximum effectiveness and efficiency during their lifetime. Apparently, there are moves to close down the Boeing facility in California. If that does happen — which would not take place all of a sudden — will the Indian order be affected? Boeing is prepared to accommodate an order from India as soon as it is finalised. The programme currently has orders through September, 2012, and anticipates additional orders that will extend the line even further. We anticipate that the growing international interest we’re seeing in the C-17 will allow us to keep the production line open for many years beyond 2012.
CRUISING HEIGHTS June 2010
years, the C-17 has lost popularity and orders have gone down forcing Boeing to bring down the production rate to only 10 by the middle of next year. There are currently 212 C-17s in service around the world, including 193 owned by the US Air Force. The C-17 planes have 19 international customers, including the British, Canadian and Australian air forces. The planes will be delivered to India only after two years of signing of the contract. The US President’s desire to stop the production of the C-17s has sent the Indian defence establishment in a tizzy. India needs heavier lifters than the present IL76s which can carry around 45 tonnes with a crew of six. The C-17 can carry double the load with three crew members. Despite its size — 174ft length, 55ft height and about 170ft wingspan — a pilot can fly the aircraft with a simple joystick. In addition, the aircraft can take off quickly with its four Pratt & Whitney F-11-7-PW100 turbofan engines. The Globemaster III has often been deployed for disaster relief operations in various parts of the world. Recently, the US Air Force transported a brigade of men, tonnes of equipment and 400 vehicles over five nights, flying 17 shifts in the big bird. Work on the first C17 started on August 28, 1981, when McDonnell Douglas won the contract though the first flight took place on September 5, 1991. In fact, the plane that rolled off the assembly lines exceeded air force design specifications and the big bird was able to lift off from shorter runways. However, 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.
Cargo Jottings New.qxd
5/29/2010
2:02 PM
Page 3
CARGO JOTTINGS No frills and lots of mess DESPITE HAVING all the regulatory clearances from departments like the Ministry of Defence, Ministry of Environment and Forest, Ministry of Home Affairs, director general of civil aviation, airports authority of India and steering committee, the mega aerotropolis project of Rs 3,000 crore near Shahpura in Rajasthan is stuck with the state government. This may give a big jolt to the efforts of the state government in “attracting investment”. The promoter company, Rajasthan Aviation Infrastructure India (RAIPL), had signed an MoU with the previous government for setting up an international standard airport and other aviation-related industries over 4,500 acres in Rajasthan under the Greenfield Airport Policy (2008). The policy permits private organisations to build airports if permitted by the Centre. Nikhil Gupta Now, it’s been over a year that the agreement was signed. Now that all the clearances are in place, but the state government is not giving its nod for the project. The company claims that the delay is in signing up of the state support agreement with state government. “The progress is slow. Unless the state support agreement is signed, practically, we cannot take up the project further. The state government support is needed for acquiring land and other infrastructural facilities like water, road and power,”
said Nikhil Gupta, Managing Director, RAIPL. The company claims to have financial back-up of organisations like Sumitomo Mitsui Banking Corporation Japan, ING Bank, Netherlands, ABN Amro Bank and BMR Advisors besides strategic partnership with Fraport (Frankfurt Airport Services Worldwide, Germany) for managing the airport operations. Fraport is a fullservice provider in the airport management field and owns the Frankfurt airport in Germany and also has operations in Delhi international airport. “The state government is not convinced with the ability of the company. The net worth of the company is just Rs 5 lakh which poses a serious question mark on the financial health of the company to execute this Rs 3,000-crore project. We are reviewing the company’s claims and credentials,” a government official had said.
Emirates sees India as a growing market SKY CARGO, Emirates Airline’s air freight division, saw strong growth potential for its operations in Malta, said Ram Menen, Divisional Senior Vice-President, Cargo, Emirates Airline. “It is important for us,” he said of the Malta route. “Every government that wants to have an export-based economy must allow capacity in. In Malta, 90 per cent of the cargo travels through passenger aircraft bellies — that belly capacity is extremely important for the country. “Much of the activity here is supply chain operations — our expertise in cargo is to create that business supply chain in itself. The sustainable activity that a country embarks on
Boeing gives productivity tool to Blue Dart BLUE DART Aviation announced that US-based commercial airline-maker Boeing will provide a software-based productivity tool for its Boeing 757-200 fleet, designed to unifying its maintenance data. ‘Maintenance Performance Toolbox’, the software-based productivity tool, will also provide business solutions, materials and engineering services and give round-the-clock global customer support. Blue Dart Aviation has four Boeing 757-200 in its freighter fleet and they will now be provided the Maintenance Performance Toolbox by Boeing Commercial Aviation Services, it said in a statement. “Our Maintenance Performance Toolbox selection is a significant investment for Blue Dart which will help us remain competitive and add value to our customers,” Tulsi Nowlakha Mirchandaney, Managing Director, Blue Dart Aviation, said. “Blue Dart’s decision to implement Toolbox, coupled with the airline’s status as an all-Boeing operator, provides a strong foundation for our collective future,” Boeing India President Dinesh Keskar said. Blue Dart Aviation currently flies four Boeing 757-200s. It also has three Boeing 737-200s.
MAINTAINING PERFORMANCE: With Boeing’s new software tool Blue Dart will be able to unify its maintenance data.
needs capacity, and we see a lot of opportunities here. It is in our interest that the country grows.” Also, he added that India will be a major and growing export market; India and China, both of which were insulated by their considerable domestic markets, will become strong consumer regions. Sky Cargo considers the Middle East and Gulf countries to be very promising regions for its business, boosted by the rebuild in Iraq and Afghanistan. The airline is adding strength to its distribution capabilities in Africa, where many countries are leap-frogging technology as they are able to introduce the latest platforms to their brand new markets. By operating from Dubai — which Menen insisted, recently got more bad publicity than it deserved, and a little economic slowdown served to decrease the tempo of the city’s hurried growth — Emirates is in a powerful position, and bracing itself for further expansion. Sixteen new freighters will join the fleet over the next few months, while the passenger operation is taking delivery of a new aircraft every month. The airline’s capacity deployment is balanced so that capabilities are relatively easy to optimise across its 100-plus destination network.
CRUISING HEIGHTS June 2010
61
Cargo Jottings New.qxd
5/29/2010
2:02 PM
Page 4
CARGO JOTTINGS Vietnam Airlines picks Kale’s solution KALE CONSULTANTS Ltd announced that Vietnam Airlines has selected Kale’s Revera and Amber solutions for its passenger and cargo revenue accounting requirements respectively. The airline will deploy these solutions on licensed basis. Kale’s new passenger and cargo revenue accounting solutions — Revera and Amber respectively — help airlines implement industry best practices to proactively adapt to dynamic market conditions. They enable airlines to efficiently manage the rapidly growing and complex revenue accounting operations and achieve efficiencies in the long run. Speaking on the occasion, Mai Huu Tho, Deputy Director, Finance, Vietnam Airlines, said, “Revenue accounting is critical component for Vietnam Airlines, aiding us in gaining insight and assessing our operations and growth plans. It was important for us to choose a solution which incorporated industry best practices and offered the latest requirements.” Revera, Kale’s new passenger revenue accounting solution, helps airlines implement industry best practices to proactively adapt to dynamic market conditions. It enables airlines to deal with the most complex revenue accounting environments and respond to the demands of the senior management with speed and accuracy. “We are delighted that Vietnam Airlines has chosen Kale’s PRA and CRA solutions for its complete revenue accounting
requirements. We believe that this is the beginning of a long and fruitful relationship with Vietnam Airlines. Revera and Amber have proven to be industry leading revenue accounting solutions present in the industry today and we are seeing a lot of traction for these offerings,” said Ravi Chakravarty, Sales Head, EMEA & Asia-Pacific, Kale Consultants Ltd.
Wallenius Wilhelmsen Logistics takes green steps WALLENIUS WILHELMSEN Logistics (WWL), a global shipping and logistics company, managed to cut its green house gas emissions by 32 per cent last year. The company also cut its sulphur dioxide (SO2) emissions by 135,000 tonnes in a nine-year period from 2000 to 2009, an amount nearly equal to all the SO2 emissions from road vehicles in the United States for an entire year. “Even in times of global economic crisis, we must continue to build value for our customers,” declared Arild B Iversen, CEO of Wallenius Wilhelmsen Logistics. “An efficient supply chain, with reduced environmental risks in every possible step, is one of the surest ways to cut costs while benefitting the environment.” The figures cited above are contained in the company’s 2009 Environmental and Social Responsibility Report (www.2wglobal.com/esr), the shipping industry’s first emissions inventory report to receive third party verification that it conforms to the accounting requirements of ISO 14064-1 and The Greenhouse Gas Protocol (GHG Protocol). Melanie Moore, Global Head of Environment and Quality, Wallenius Wilhelmsen Logistics commented, “We are working hard to minimise our environmental footprint by working closely with our customers to reduce their carbon risk in the supply chain while creating real economic and brand value.
DHL launches LCL from Cochin to Colombo DHL, ON May 5, 2010 announced the opening of its new ocean freight terminal in Cochin and the launch of its weekly direct Less than Container Load (LCL) Consol services connecting Cochin, India to Europe, North America and emerging markets via DHL's multinational gateway in Colombo, Sri Lanka. The new service from Cochin via Colombo offers customers reliable and superior services with reduced transit times of up to three days. Cochin is a major port on the west coast of India and is gaining prominence as an important gateway for India's trade. Cochin serves not just the state of Kerala, but also the neighbouring states of Karnataka and Tamil Nadu, all of which are witnessing high growth rates in foreign trade. With nearly all key infrastructure projects linked to the setting-up of its trans-shipment terminal being close to completion, Cochin is expected to become a major hub of maritime export and import trade. Port authorities expect to handle 600,000 TEUs in the first year and an impressive 3 mn TEUs by 2014. Said Amadou Diallo, Chief Executive Officer, DHL Global Forwarding, South Asia Pacific, "With the timely introduction of this new LCL service, we can offer opportunities to our customers to increase their footprint in global commerce as the world's economy picks up. "This fixed direct LCL Consol service connecting Cochin to the rest of the world, has further strengthened our ocean freight product to support customers especially in the spices, palm oil and coir business sectors,” he added. Speaking on the occasion, Christoph Remund, Chief
62
GAINING PROMINENCE: As DHL has launched LCL Consol Services from Cochin to Colombo, Cochin port became more important for trading business.
Executive Officer DHL's Lemuir Logistics India, said, “The launch of this vital service is part of DHL’s on-going plans to expand its own operated, weekly guaranteed, LCL services globally. This is in line with our commitment to the Indian logistics Industry to provide value-added solutions to customers through constant product innovation and increased efficiency.” Sanjay Tejwani, Director, Oceanfreight, DHL Global Forwarding India, added, “The launch of the new service will boost trading activities between Cochin and the rest of the world. In particular, small and medium enterprises will benefit from our service flexibility and reliability.”
CRUISING HEIGHTS June 2010
Cargo Jottings New.qxd
5/29/2010
2:02 PM
Page 5
FedEx Trade Networks opens new offices TO PUT into practice its global expansion plans, FedEx Trade Networks has opened three additional offices in its Europe, Middle East and Africa (EMEA) region. This latest step includes new operations in Warsaw and Gdynia, Poland and Dubai, United Arab Emirates. FedEx commented that the strength of the Polish economy, in addition to its central location in Europe and on the Baltic Sea, will enable significant intra-European trade via the offices in Warsaw and Gdynia. As one of the fastest growing cargo hubs in the world, Dubai's strategic location between the Asia-Pacific and European markets better connects FedEx Trade Networks customers to both of those regions. “Our customers tell us that they prefer doing business with providers that have a physical presence in the regions in which they trade,” said Fred Schardt, President and CEO, FedEx Trade Networks. “This is why we will continue to enhance our infrastructure and expand our international presence in key markets.” Since initiating its worldwide expansion plan in 2008, FedEx Trade Networks has opened a total of 25 new freight forwarding offices. “We strive to provide our growing international customer base with the most flexible and reliable freight forwarding solutions possible,” said Schardt. "Providing our customers with access to regional support in their local language and time zone is yet another example of how we continue to do just that.”
Lufthansa Cargo is “Best European Cargo Airline” LUFTHANSA CARGO has received a top honour at the 2010 Cargo Airline of the Year Awards. The German carrier was named “Best European Cargo Airline” at the gala awards night held in London at the weekend. The Cargo Airline of the Year Awards, which are presented by the renowned trade media company Air Cargo Media, is now in their 28th year. More than 23,500 freight forwarders from 72 countries took part in the online survey this year. Lufthansa Cargo received the highest number of votes in the category “Best European Cargo Airline”, ahead of Air France/KLM and British Airways, which were ranked second and third, respectively. “The Cargo Airline of the Year Awards are the most prestigious in the global air cargo business”, says Ray Crane, Chief Executive Officer, Air Cargo Media. “Thousands of votes from freight forwarders have nominated Lufthansa Cargo the leading European cargo carrier, and I am delighted that the airline has received this deserved recognition. Accepting the award on behalf of Lufthansa Cargo, Kim Bullen, Director UK & Ireland, said: “Lufthansa Cargo has worked very hard in recent times to achieve a really high quality worldwide. In our home market of Europe this recognition by our customers is particularly pleasing and we greatly thank them for this prestigious award.”
DHL and Emirates share security practices EMIRATES AND DHL are to establish a security partnership to enable Emirates Group Security and DHL Express to share best practices and information and security threats. The companies will also promote joint training and educational activities. Commenting on the partnership, Abdulla Al Hashimi, Divisional Senior Vice President, Emirates Group Security, said: "Sharing of best practices and exploring synergy in training and education among major players are important aspects of producing comprehensive and practical approaches to combating threats in the aviation industry. This is another program which embodies the symbiotic relationship between stakeholders in the cargo industry." "Enhanced security standards in the UAE will also build stronger consumer confidence in the air cargo sector," Garry Kemp, Managing Director, DHL Express Middle East, North Africa and Turkey, added.
UPS establishes alliance with alibaba.com UPS ON May 6, 2010, announced its strategic alliance with AliExpress (www.aliexpress.com), a new online wholesale marketplace, launched by Alibaba.com. Through its alliance with UPS, AliExpress now offers users the key benefit of managing their shipping and tracking processes online via UPS shipping technology integrated into
WINNING POSE: Lufthansa team at the award ceremony.
the AliExpress platform, including the ability to print UPS shipping labels and request pick-up for their UPS packages all from within the AliExpress website. “Our partnership with UPS is crucial to the success of AliExpress, as one of our main goals is to make international trade for our buyers and sellers, including the shipping of their products, as easy, safe and convenient as possible,” said David Wei, CEO of Alibaba.com. “UPS’s shipping technology, ease of use and trusted premium global services will help us fulfill this goal.” “UPS is committed to the growth of China’s involvement in global e-commerce as part of our overall strategy,”said Jordan Colletta, vice president, e-Commerce Marketing at UPS. “Through our alliance with Alibaba, we hope to partner with more small and mid-sized Chinese businesses to simplify their logistics processes and connect them with new buyers and sellers worldwide.”
CRUISING HEIGHTS June 2010
63
CH sub from:IIIrd cover.qxd
010
d
over
er k cov
main:c
.qx er NEW
2/20/2
Page
PM
12:14
5/21/2010
11:41 AM
Page 1
Welcome to Cruising Heights
1
novemv
Outloo
March
2010
8 AM
Rs 60
0
/201
3/29
qxd
mver
Page
CRUISING HEIGHTS has been part of the Indian aviation scene for many years now. In this period, we have established a name for quality reporting and analysis on issues relating to every aspect of the aviation business.
1
10:2
NEW.
ve r no
cove
NEW: ver
CH co
Rs 60
2010 April
Rs 60
May 2010
Patel Praful r, ion Ministe Aviat Civil
avan Madh iar Nambetary, Secr y of MinistrAviation Civil
Praful Patel Minister, Civil Aviation Wilbur Ross, Head, WL Ross & Co.
Sanjay Aggarwal CEO, SpiceJet
AIR INDIA
THE TURNAROUND COMETH?
WARRING OVER
SPICEJET
Arvind Jadhav CMD, Air India
sidas n Thular India deva Vasu CMD, Ai er Form
One of the first true aviation magazines of the country, CRUISING HEIGHTS was started with the idea of supporting professionals in the airline business to make informed choices on a variety of subjects—from ground handling to cargo to airport development—all of which are transforming the Indian aviation scene in mind-boggling ways. We also target the general reader—the educated Indian who is keen to be an informed Indian—to know what's happening in the aviation business. So, the magazine is professionally written in a style and manner for everybody to understand. Published twelve times a year, CRUISING HEIGHTS reports in depth on all facets of the aviation and aerospace environment in the country and also as events affect us from overseas. Dedicated news and regular feature sections in each issue on airlines, airports, policy and personalities.
DASHED
av d Jadh Arvin Air India CMD,
TO THE GROUND RARELY HAS NATURE REACTED SO RUTHLESSLY AS EYJAFJALLAJOKULL DID BRINGING INTERNATIONAL AVIATION TO ITS KNEES. HAVE WE LEARNT ANYTHING FROM THE DISRUPTION?
Only Rs.60/
Join our aviation loving family…
Please accept my subscription for 12 issues of Cruising Heights
Name____________________________________________________________________________________________ Address____________________________________________________________________________________________ Ph. No.______________________e-mail__________________________________________________________________ Payment
Cash
Cheque
Cheque/DDNo. _________________________________________________________________________________________ Drawn on____________________________________________________________________________________________ _________________________________________________________________________________________________________________ No. of Issues
Newsstand Price
Discount
You Pay
You Save
12
Rs. 720/-
10%
Rs. 648/-
Rs. 72/-
Date............................
Signature of Subscriber..................................... Cheque / DDs should be drawn in favour of
NEWSLINE PUBLICATIONS PVT. LTD. Send your subscription to Newsline Publications Pvt. Ltd., D-11 Basement, Nizamuddin (East), New Delhi -110 013 Contect us on : +91-11-41033381-82, e-mail: jaya@newsline.in
"
focus
june.qxd
5/29/2010
4:35 PM
Page 3
FOCUS FEATURE
SHOWCASING
INDIAN BUSINESS AVIATION
GENERAL AVIATION AT THE CROSSROADS: Industry professional at the first session of the Indian Business Aviation Expo 2010 held in Delhi.
IU Events, a UK-based organisation specialising in aviation conferences and exhibitions, and Exhibitions India Group jointly organised the first B2B Indian Business Aviation Expo (IBAE) 2010 designed to address the needs of the Indian market. The expo was organised at hotel The Lalit, New Delhi during February 24-26, 2010. The role of the Indian Business Aviation Expo was to set the agenda for the emerging business and general aviation sector in India. The event spread over three days provided an appropriate platform for synergy between professionals from different sub sectors of the industry and deliberated on the potential of the business aviation sector in India. A large gathering of over 150 delegates from the business aviation industry attended the event. The mammoth task ahead for the sector requires the unstinting support and collaboration of the policy makers and the collective will of multi stakeholders committed to making India the regional hub for providing world class aviation services in Asia. Prashant Sukul, Joint Secretary, Ministry of Civil Aviation expressing support for the sector advised that the Business Aviation Association of India (BAAI) should list out
M
the issues impacting services provided by the operators, for discussions with the ministry. An eclectic delegate profile including operators, government, industry associations, lawyers, financial and funding institutions, IT and software support, infrastructure planners and providers, pilot groups, insurers, MROs, FBOs, OEMs. etc. participated at the global forum and gained insights into ideal regulatory policies and business solutions for the benefit of the industry. On the sidelines of the conference, an exhibition for manufacturers, suppliers and service providers relevant to the business aviation industry, showcased cutting edge product and services. The event was well attended by representatives from Ministry of Civil Aviation, Airports Authority of India, Airports Economic Regulatory Authority, Pawan Hans Helicopters, Airworks India Engineering, Amadeus India, Bangalore International Airport Limited, Delhi International Airport Limited, CAE, Center for Asia Pacific Association, Dassault Aviation, Deccan Charters, Fraport, Hawker Beechcraft, Jetex Flight Support, Jeppessen Limited, Merlinhawk Aerospace, Pratt & Whitney (Canada), Religare Aviation, Textron, Winnipeg Aviation, amongst others.
CRUISING HEIGHTS June 2010
65
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 2
SNIPPETS
DOMESTIC AIRLINES BIAL picks up international award BENGALURU INTERNATIONAL Airport Ltd (BIAL) has been acknowledged with the title of the Best Emerging Airport by Emerging Markets Airports Awards (EMAA) hosted by the Airport Expo, Dubai, on April 26, 2010. The gala awards ceremony was marked with the presence of a galaxy of senior decision-makers from the airports fraternity, civil aviation authorities, airports and aviation suppliers numbering 550. Commenting on the awards ceremony, Raj Menon of EMA Awards said that the competition was tough owing to the strong sector growth, and the increasing awareness about the awards. “Bengaluru International Airport was declared the winner… These awards are an excellent tool, allowing airports from across the region and beyond to compete.” “We are thrilled! This award is a showcase of the teams’ hard work and dedication, and personally it is a proud moment for me... Our Indian airports are soon becoming truly international… While this award is flattering, it pushes us further to continue with our dedication and sincere efforts in taking this airport to the next level of growth”, said Marcel Hungerbuehler, CEO, BIAL. Double delight for BIAL: Bengaluru International Airport Limited, on May 7, 2010, became one of the first airport operators to receive the ISO 27001 certification. This certification is recognised internationally as an Information Security Management System (ISMS) standard and plays an important part in assisting organisations of all types to understand the fundamentals, principles and concepts to improve protection of their information assets. Venkataram Arabolu, Managing Director, BSI India, commented, “We are delighted to recognise the efforts put in by the BIAL management to become ISO 27001 compliant. This is an official recognition of BIAL’s ongoing commitment towards creating awareness of the various security policies.” On receiving the certification, Marcel Hungerbuehler, President, BIAL, said, “We are extremely proud that our Information Security Management System complies with the stringent ISO 27001 certification standards. Information security has always been put on priority at BIAL and our ICT department has been carrying out various programmes and initiatives to ensure we meet the certification standards. As always our aim is to focus our dedication and sincere efforts in taking this airport to the next level of growth.” Moveo Systems, a provider of
innovative next-generation human interaction solutions, has signed an agreement with Bengaluru International Airport Ltd to deploy a multi-lingual human interactive airport solution, claimed to be the first of its kind. The Bengaluru-based company will set up easy-to-use
ACCOLADES: Peter Farmer, MD, 3DReid Architects, giving away the award to Marcel Hungerbuehler, CEO, BIAL.
interactive and intuitive touch panel kiosks at strategic locations across the airport that will enhance the interaction levels with passengers. The kiosk will be a one-point of contact which will provide information regarding the airport services, the various food and retail options, airlines, immigration, customs protocol and travel guidelines. Additionally, the passenger will receive live news feeds, destination, weather and city guides at the kiosk. To the frequent flyer, one of the additions will be this kiosk's capability of issuing flight alerts via SMS. While benefiting the passenger with a wealth of information and engaging content, the mTracker application has been developed to capture passenger feedback, thereby enabling the airport and airlines to continually enhance performance. Sankalp Saxena, Chairman and CEO, Moveo Systems, said the solution sets a new global benchmark for digital interactivity in touch based airport solutions. "The ability of this system to provide both English and Kannada interfaces is the first of its kind across airports in India. With this new technology we hope to add a new dimension to our passengers' experience by increasing engagement and stimulation t o their travel," said Marcel Hungerbuehler, CEO, BIAL.
Indian infrastructure sees new partnership HONEYWELL AEROSPACE, Arizona, has announced Indiabased Air Works a regional forward-stocking location partner for key mechanical and avionics parts. “This agreement allows Honeywell to expand its support capabilities for Gulfstream and Dassault operators in India and the Middle East regions by positioning line replaceable units (LRUs) intended for aircraft on ground (AOG) support in Bengaluru, India. Local support in this growing area of the world is critical, and the agreement with Air Works reflects our commitment to continuously improve customer satisfaction, asset availability and support regional operators and OEMs,” said Paolo Carmassi, President, Europe, Middle East and Africa, Honeywell Aerospace. Honeywell will be supplying Air Works with a variety of
66
SETTING ASSETS: The new partnership will strengthen Indian aviation infrasturcture.
CRUISING HEIGHTS June 2010
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 3
products for Gulfstream and Dassault aircraft including fuel pumps, full authority digital electronic controls, digital electronic engine control, display units, navigation and guidance units, enhanced grounded proximity warning units and various modules for our integrated avionics systems. As an authorised Honeywell Service Center, Air Works will have the capability to support Falcon 2000, Falcon 900 and Falcon F7X aircraft as well as Gulfstream GIV, GV, G450, and G550 aircraft. Speaking on the occasion, Ravi Menon, Executive Director, Air Works Engineering Pvt Ltd, said, “We are extremely proud to be regional forward-stocking location partner for Honeywell in India. This development really complements our business and will help us serve our customers better. We will extend our parts and logistics capabilities to support all of our customers and our OEM partners.”
Kingfisher’s has the youngest commander THE SKY is the limit for 21-year-old Bavicca Bharathi, who may soon become the country’s youngest commander after acquiring her advanced training pilot licence (ATPL). Bavicca, who currently works as a co-pilot with Kingfisher Airlines, has flown 1,500 hours to get her ATPL. The airline is supporting Bavicca in her endeavour and will send her for commander training. “She will be sent for commander training and I am sure it will be another feather in her cap as well as our airline’s cap,” said Prakash Mirpuri, Spokesperson, Kingfisher Airlines.
GMR Aviation Academy introduces new courses IN COLLABORATION with Jeppesen Aviation Training Services, GMR Aviation Academy, a subsidiary of Boeing, announced Flight Operations Management training courses at its training academy at Rajiv Gandhi International Airport, Shamshabad. Under this course, Jeppesen will offer training for flight operations officer/flight dispatcher courses slated for June, 2010. The training programmes being offered are comprehensive and employ the most current international regulatory information and technical data. Due to incessant demand, Jeppesen will now offer UAE GCAA (General Civil Aviation Authority) compliant dispatch courses in India to prepare trainees for a UAE flight operations officers license. Graduates of this course are eligible to take a short FAA (Federal Aviation Administration) course at Denver headquarters in the US to achieve an FAA dispatch license. Students enrolling on this course will also learn about the duties and responsibilities of the aircraft dispatcher with in-depth knowledge of commercial aviation dispatch procedures, work rules, local and international regulations and the use of sophisticated electronic flight planning systems, flight following and weather software. Individuals interested in a challenging and rewarding career in the airline industry, seeking a UAE GCAA aircraft dispatcher license and airline operations control (AOC) staff, who wish to advance to the position of a dispatcher/flight operations officer will benefit from this course. The Jeppesen Flight Operations Management and Dispatch programme is compliant with the standards of International Civil Aviation Organisation (ICAO) and the recommendations of IATA Operational Safety Audit (IOSA), UAE General Civil
Aviation Authority (UAE GCAA), Civil Aviation Advisory Publication (CAAP) and as well as several other civil aviation authorities. Successful participants will be given the chance to participate in an oral and practical exam to obtain an UAE GCAA Dispatcher License.
DIAL CEO holds another responsibility PS Nair, Chief Executive Officer (CEO) of Delhi International Airport Pvt Ltd (DIAL), has been elected as a Director of Airports Council International (ACI) Asia-Pacific Regional Board for a threeyear term. Besides Nair, three other Directors viz. Russell Balding, CEO, Sydney Airport, Australia; Serirat Prasutanond, President, Thailand Airport Authority and Robert Daniel Waloni, Executive VP Angkasa Pura II Airport, Indonesia have been elected to represent on the ACI Asia-Pacific Regional Board. Considered the voice of the world’s airports, ACI works to foster cooperation throughout the air transport industry. It has 575 members operating over 1633 PS Nair airports in 179 countries and territories. PS Nair has 33 years of experience in all facets of airport management encompassing operations, commercial and cargo, infrastructure planning and development. Prior to joining DIAL as CEO in 2009, he had been the CEO of GMR Hyderabad International Airport Limited (GHIAL), a full-time Board Member of the Airports Authority of India (AAI) as well as the Airport Director of Thiruvananthapuram, Mumbai and Delhi airports.
GHIAL is a winner again GMR HYDERABAD International Airport Ltd (GHIAL) has bagged the Routes Airport Marketing Award in the Indian SubContinent category for the second consecutive year. The Routes Asia 2010 — a networking event for the region’s air service development industry, held in Adelaide from April 18 to April 20, 2010 — concluded with the announcement of the winners for the Asia Pacific region of the internationally accredited Routes Airport Marketing Awards. The Rajiv Gandhi International Airport, Hyderabad received the winner’s position in the Indian sub continent, scoring over four other airports from the regions that were shortlisted. Raveen Pinto, Head, Airline Marketing, GHIAL, received the award from the organisers. Speaking on the occasion, P Sripathy, CEO, GHIAL, said, “The Rajiv Gandhi International Airport is honoured to receive this award for the second time in a row. We sincerely thank all the airlines that voted for us, and assure them that we will work even more closely with them in the coming months.”
CRUISING HEIGHTS June 2010
67
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 4
SNIPPETS Jet is judged the best AT THE glittering ceremony of Condé Nast Traveller India Awards in Mumbai on April 28, 2010, Jet Airways was adjudged the ‘Best International Airline’. The award has been introduced by British Condé Nast Traveller magazine, together with Vogue.com and cntraveller.in to celebrate the launch of Condé Nast Traveller in India in October 2010. Sudheer Raghavan, Chief Commercial Officer, Jet Airways said, “We are proud and honoured to receive this award from Condé Nast Traveller in recognition of our renowned international service. The ‘Best Indian Airline’ award is
testimony to our commitment to focus on the needs of the passenger and to enhance the Jet Airways experience for our customers. We will persist in our endeavor to exceed customer expectations and create benchmarks in service standards for others to follow.” Jet Airways celebrates ‘Green’ anniversary: Jet Airways celebrated a ‘green’ 17th anniversary on May 5, 2010, with a tree-plantation drive participated by employees representing various departments of the airline at new upcoming headquarters in Bandra, Mumbai. Over a hundred employees from all the various departments across the airline from in-flight services and finance to flight operations and cargo planted 25 saplings, in the presence of senior company officials. Speaking on the occasion, Nikos Kardassis, CEO, Jet Airways, said, “Jet Airways is a responsible corporate citizen and our tree-plantation drive on the occasion of our 17th anniversary is an expression of this approach. For the airline, it is a small attempt to inform and educate its staff to respect and
68
make their own small contribution to the environment.” Jet and SBI enable flying on EMI basis: Jet Airways has tied up with SBI Card, enabling its customers to book their tickets online through credit card on an EMI basis. Under this offer, SBI credit card-holders would be able to convert their ticket purchases into zero per cent EMIs with tenure of six months. The tie-up with SBI Card is a unique travel option aimed at making air travel more economical and cost-effective for family travel., Jet Airways chief commercial officer Sudheer Raghavan said, “This scheme will help families undertake visits to tourist spots, and encourage domestic tourism.” “We are delighted to partner with Jet Airways and offer SBI cardholders an affordable travel option. This offering is in line with our focus on the travel segment as it enables air travellers a unique opportunity to fly now and pay later without any additional costs,” said Abhay Kumar Singh, CEO, SBI Cards and Payment Services Pvt Ltd’s. Jet launches mobile site: Jet Airways has launched a secure and user-friendly mobile site, m.jetairways.com. The mobile site will provide guests access to a range of information and services on Jet Airways including information on the network, call centre contact details, Jet privilege programme benefits and privileges and the latest news and special offers. Moreover, guests can also check for the lowest fares available for a given sector and date through the mobile site. The search facility is available for both one-way and return journey across all Jet Airways and code share flights. If a guest wants to book the flight searched for there is a call option on the mobile site which facilitates the user to instantly connect to the call centre and book tickets through the secure IVR payment gateway. Jet Airways introduces ‘Konnect Select’: Jet Airways Konnect has launched the all-new ‘Konnect Select’, a premium cabin on several domestic routes, on April 26, 2010. ‘Konnect Select’ is specifically targeted at the business and leisure travellers who desire more flexibility, comfort and benefits. The new Jet Airways ‘Konnect Select’ will feature wider and more comfortable seats similar to Jet Airways (Business Class) seats with a 40-inch seat pitch, in a front cabin separated from the all-economy cabin by a divider offering enhanced privacy on Jet Airways Konnect Boeing 737 flights. The services also include complementary in-flight reading material, a welcome drink, and complimentary hot meals on-board. According to Sudheer Raghavan, CCO, Jet Airways, “Jet Airways has always been proactive in responding to market demands… Jet Airways ‘Konnect Select’ will offer our guests a superior in-flight product that is close to Jet Airways full-service business class product, at reasonable fares, as well as additional on-ground, in-flight and Jet privilege benefits.” Konnect’s new connection: Jet Airways Konnect service marks the addition of Dehradun to Jet Airways’ extensive pan-India network. According to Nikos Kardassis, CEO, Jet Airways, “We are delighted to add Dehradun to our network with the introduction of the new daily flights to the city from New Delhi. Besides being the capital of Uttarakhand and a very popular tourist destination, Dehradun is also one of the country’s leading educational centres and as such, there has been growing demand for enhanced air connectivity on this sector. We are confident that our new Jet Airways Konnect service will prove very popular with our guests.”
CRUISING HEIGHTS June 2010
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 5
INTERNATIONAL AIRLINES Emirates launches services to Al Medinah Throughout summer, to cater to increased demand during the peak travel period, Emirates is going to launch a new service to Saudi Arabia. The twice-weekly flights will be in place from July 2, 2010 to September 24, 2010, and will be operated by an Airbus A330200. The service will be available in a three-class configuration including 12 First Class seats, 42 Business Class seats and 183 Economy Class seats.
Dubai, luxurious complimentary hotel stays. First Class passengers receive a two-night stay with breakfast at the newly opened Armani Hotel Dubai, while Business Class passengers get a one-night stay with breakfast at The Address Downtown Dubai. With the offer, premium passengers also get the chance to experience literally being on top of the world with priority tickets to the ‘At the Top, Burj Khalifa’. Valid from June 1, 2010 to August 31, 2010, the offer is applicable to Emirates’ First and Business Class passengers travelling to or via Dubai who hold a valid return ticket. Travel must originate outside the UAE and the entire booking must be made either in first or business class. Some restrictions will apply for certain points of origin and fare types. Russell Sheldon, Senior Vice President, Emirates Network Sales and Development said, “We are always looking for ways to enhance and add value to our offerings for our premium customers… What could be more stylish than staying in two of the most iconic hotels today — Armani Hotel Dubai and The Address Downtown Dubai? This excellent offer further extends the outstanding service our premium passengers have already come to expect whenever they fly with Emirates.” Emirates arrives Amsterdam: Emirates celebrated its latest European destination while the Netherlands celebrated the Queen’s Birthday. As the nation buzzed for Koninginnedag, or Queen’s day,
Ahmed Khoory, Senior Vice President Commercial Operations, Gulf, Middle East and Iran, Emirates, said “Emirates is delighted to be able to offer flights to Al Medinah al Munawarrah throughout the busy summer months. This new, limited time, service means that Emirates will have four gateways into the Kingdom of Saudi Arabia across the peak summer holiday, ensuring we are able to sufficiently service the thousands of people travelling to and from the country. We are confident that this service will benefit both those travelling overseas from Medinah on their summer holiday, and also those visiting as part of their pilgrimage.” Emirates’ stylish stay offer: Emirates Airline has teamed up with Armani Hotel Dubai and The Address Downtown Dubai to offer its First and Business Class passengers flying to or via CELEBRATING THE ARRIVAL: (L-R) Maarten de Groof, Executive Vice President & CCO Schiphol Group, Ali Thani Alsuwaidi, UAE Ambassador to the Netherlands, Gilles Arnout Beschoor Plug, Ambassador of the Kingdom of the Netherlands, Kees van Spronsen, Consul General of the Kingdom of the Netherlands, and Salem Obaidalla, Senior Vice President, Commercial Operations, Europe & Russian Federation, Emirates, after the arrival of Emirates plane.
YOU ARE WELCOME: Emirates’ First Class passengers receive a twonight stay at the newly opened Armani Hotel Dubai, while Business Class passengers get a one-night stay at The Address Downtown Dubai. With the offer, premium passengers also get priority tickets to the ‘At the Top, Burj Khalifa’.
Emirates received a VIP welcome at Schiphol International Airport for its VIP delegation and other passengers aboard the inaugural flight from Dubai. Obaidalla, on the occasion said, “We are very excited about the product we are bringing to the route — we have the latest 777 aircraft — and we are especially proud that we are the only carrier offering First Class between here and Dubai. We know that many thousands of people from the Netherlands already enjoy flying with Emirates, taking our flights out of Dusseldorf. Our new daily service will make life much more convenient for those heading to Dubai and onwards to our more than 100 destinations.”
CRUISING HEIGHTS June 2010
69
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 6
SNIPPETS Enjoy summers at Disneyland CATHAY PACIFIC and Dragonair have introduced Hong Kong Disneyland vacation offers on India to Hong Kong routes and beyond. Travellers can take advantage of “Buy 2 Get 1 Free” —fares start from Rs 42,422 inclusive of taxes or “Buy 3 Get 1 Free” — fares start from Rs 37,912 inclusive of taxes. This offer is valid for sale from 1 March until 7 July 2010, for travel from 1 March until 14 July 10. Hong Kong Disney land vacation offers featuring an array of valueadded benefits as the travellers have the chance to enjoy summers at Hong Kong Disneyland, fun rides, Broadway-style shows and more. The offers are inclusive of round trip economy class or business class tickets to Hong Kong, hotel accommodation, park admission tickets, return airport/hotel transfers, “stay and play for two days” offer, Disney fast pass, park meal coupon (for guests of Hong Kong Disneyland hotel only) and late check-out.
Qatar wins host of awards DOHA-BASED Qatar Airways has claimed international awards, winning three accolades at two award ceremonies in Dubai. The carrier retained its Leading Business Class Airline in the Middle East title for the fifth time as voted by travel industry professionals in the World Travel Awards.
AirAsia flies from Chennai to Penang AirAsia, on April 28, 2010, has started flying from Chennai to Penang and with this inaugural flight AirAsia became the only airline in Malaysia to operate this route connecting Penang and Chennai. To welcome over 165 guests on the inaugural flight, Lim Guan Eng, Chief Minister of Penang, was present at the Penang International Airport, together with Tuan Law Heng Kiang, Penang EXCO for Penang State Tourism, Development and Culture, Dato’ Aziz Bakar, Chairman, AirAsia-Berhad and Ooi Geok Ling, Managing Director of Penang Global Tourism. Speaking on the occasion, Guan Eng said, “AirAsia’s extremely affordable fares starting from RM199 (INR 2,999) one way for this new direct flight from Chennai to Penang will definitely contribute to the number of tourists arriving into
HELLO GUEST: Lim Guan Eng, Chief Minister of Penang welcoming the guests from the inaugural flight with goodie bags at the Penang International Airport..
70
The airline’s Premium Terminal for First and Business Class passengers at Doha International Airport was named Leading Airport Lounge in the Middle East. The two awards were presented at a ceremony held at The Address in Dubai Marina. At a separate ceremony organised by Business Traveller Middle East for travel industry professionals held at the Jumeirah Emirates Towers Hotel, Qatar Airways took home the airline award for Best Economy Class in the Middle East for the second year. Akbar Al Baker, CEO, Qatar Airways, said, “Most airlines invest heavily in developing their premium cabins and, while we continue to do this, Qatar Airways strives to innovate in Economy Class ensuring our high standards are maintained and passenger expectations are exceeded worldwide.” Qatar Airways Supports Bite Bahrain: Qatar Airways made its presence at this year's Bahrain International Travel Expo (BITE) as Gold Sponsor of the annual event. The sixth edition of the regional travel show took place under the patronage of Shaikha Mai bint Mohammed Al Khalifa, Minister of Culture and Information of the Kingdom of Bahrain. The three-day show attracted thousands of visitors to Bahrain's capital of Manama. In Bahrain for the show, Akbar Al Baker, Chief Executive Officer, Qatar Airways, reinforced the airline's long-term commitment to growth with continued investment in new aircraft, new routes and improving airport infrastructure ahead of next year's opening of the New Doha International Airport. Speaking at a press conference, Al Baker said, “We are looking forward with excitement to the month of June, which will see three new routes being added to our network. This will bring our number of routes to over 90 destinations spread across six continents.” Penang this year… We are very delighted with this new addition of direct flight to India, boosting connectivity from the Penang International Airport as well as further charting the historically-rich, unique and multi-cultural state of Penang on the world map. We hope the over 165 guests from Chennai on this inaugural flight will experience Penang and return again.” Another reason to celebrate: AirAsia has launched its inaugural flight to Mumbai from Kuala Lumpur signifying its foray into Western India. Marking a major tourism and economic coup for both countries, commenced on May 6, 2010, AirAsia will be servicing the Kuala Lumpur - Mumbai route between the Low Cost Carrier Terminal and Chhatrapati Shivaji International Airport with four direct flights weekly through its long-haul, low-fare affiliate, AirAsia X. The event was kicked-off with a traditional Indian welcoming dance for the Malaysian entourage, and was attended by Tony Fernandes, Group CEO, AirAsia and Founder of AirAsia X, Azran Osman Rani, CEO, AirAsia X, Kathleen Tan, Regional Head, Commercial, Wan Zaidi, Consulate General of Malaysia, Mumbai, Manoharan, Director, Tourism Malaysia, Mumbai and Sujata Thakur, Regional Director, India Tourism Mumbai (Maharashtra). “We are thrilled to start this much-awaited service to Mumbai today and provide the people of this magnificent city with unrivalled low-fare flights to Kuala Lumpur, the gateway to ASEAN and beyond. AirAsia, the world’s best low-cost airline, is determined to help in enhancing the tourist and commercial links between India and Malaysia. Mumbai is our sixth destination city in India, after Trivandrum, Kolkata, Chennai, Kochi and Tiruchirappali,” said Fernanades.
CRUISING HEIGHTS June 2010
Snippets Aviation New.qxd
5/29/2010
1:57 PM
Page 7
SITA touches $60 mn success THE COMMUNICATIONS and IT solutions provider to the world’s air transport industry reported consolidated revenues of $1.49 billion for the year 2009. This is within one per cent of the previous year’s figures and has allowed SITA to return more than $60 mn in cash and price reductions to its member owners. Francesco Violante, Chief Executive Officer, SITA, said, “In what was a turbulent year for the air transport industry, our achievement of $1.49 billion revenue is significant and is in line with our customer satisfaction levels which reached a record 97.6 per cent last year compared to 91.2 per cent in F Violante 2008. We also had a contract renewal rate of almost 100 per cent. Paul Coby, SITA Board Chair and CIO British Airways, said, “SITA has been transformed over the last four years into a strong industry partner with an absolute focus on our customers’ needs and challenges in a tough business environment.”
Nas Air to start flights to India RIYADH-BASED low-fare carrier Nas Air will launch India services from June 1, 2010 with flights to Kochi, while services to Kozhikode, Mumbai and New Delhi will start later. On the launch, Nas Air, a subsidiary of aviation firm Saudi National Air Services (NAS), is offering promotional fares starting at Rs 4,500 to attract Indian passengers.
Safi Airways enters India Safi Airways, a private Afghan carrier, could soon become the fourth airline from that country to operate flights to India. Kabul is of huge strategic importance to New Delhi, where it has invested heavily. Already three carriers from that country Ariana Afghan Airlines, Pamir Airlines and Kam Air - operate 14flights-a-week to and from Delhi. Air India, the only Indian carrier having operations to Afghanistan, operates six-flights-aweek to Kabul. India was one of the first countries to resume commercial air operations to Kabul after the fall of the Taliban regime. The Directorate General of Civil Aviation (DGCA) has given its in-principle approval to Safi Airways to operate flights to India. The “operating authorisation”, as it is known in aviation parlance, means that Safi can begin its India operations the moment “seats per week” are available as per the “Air Services Agreement” between the two countries.
MAS offers super discounts The Malaysia Airlines (MAS) announced 50 per cent discount for Kuala Lumpur-bound travellers from the country. A one-way ticket to Kuala Lumpur from Chennai would cost as low as Rs 5,567 under this scheme. The all-inclusive summer airfare is offered from five gateways of the airline, which operates 29 weekly flights from New Delhi, Chennai, Mumbai, Bangalore and Hyderabad. “We are optimistic that Indian travellers will make the most of this airfare to enjoy the best of Kuala Lumpur,” said Azahar Hamid, Regional Manager, South Asia operations, Malaysia Airlines. “Our summer fare series offer the travellers the ease, comfort and convenience of a full-service carrier at budget rate while enjoying the travel totally relaxed,” added Hamid.
A P P O I N T M E N T S IBS team has new faces THE IT solution provider for the global aviation industry, IBS Group has announced some top-level changes in the Management Team of the company. According to the announcements, Murray Smyth has assumed charge as the Global Head of the Airline Passenger Services. Murray has over 20 Murray Smyth Akshay Shrivastava years of experience in the airline industry leading Sabre Airline Solutions in Europe, Middle East and Africa before joining IBS. Earlier he held senior positions in Deloitte Consulting and Unisys. Akshay Shrivastava has assumed charge as the Global Head of Business Solutions and Service Delivery and also holds additional responsibility as Head, Airline Cargo Solutions department. Prior to joining IBS, Akshay worked for Emirates in a career spanning 24 years in the airline industry.
Eurocopter has new VP CÉCILE VION-LANCTUIT has been appointed as Eurocopter Group’s Vice President of Corporate Communications. In her new role, Vion-Lanctuit reports to CEO Lutz Bertling and oversees all internal and external communications for Eurocopter. Cécile VionLanctuit Prior to this new position, VionLanctuit, 43, was Eurocopter’s Head of International Media Relations since January 2007, and previously worked as one of the company’s press officers. She came to Eurocopter in April 2006 from parent company EADS, where she worked at the Munich Headquarters during four years as Senior Manager Media Monitoring and Impact Control in charge of the EADS Group’s image. She joined the company in Paris as a Corporate Auditor in late 1999.
Prameet joins Kale KALE CONSULTANTS Ltd appointed Prameet Savla as Vice President, Central Technology Group, to oversee software development, project delivery, IT infrastructure and testing Prameet has over 14 years of experience in Information and Technology. He has a deep understanding of product development life cycle and world-class product management process. He has extensively worked on high availability, scalable, and multi-tenant SAAS-based solutions. He also brings along with him the experience of deploying solutions on Cloud Infrastructure, an important element for cost-effective deployment of the demanding SAAS offerings. Prameet has Bachelors in Instrumentation and is a project management certified professional, Project Management Institute, US A.
CRUISING HEIGHTS June 2010
71
back page 72 new.qxd
5/29/2010
1:35 PM
Page 2
BACK PAGE
I
t was the national design competition winner; it was the first in the world to employ the extensive use of glass window walls and now it is going to be destructed. It is exquisitely designed and still beautiful Terminal Six at John F Kennedy International Airport (JFK), New York which opened on a 22-acre site at the gateway in 1960. The order of destruction came from Port Authority of New York & New Jersey. IM Pei, designer of Terminal Six, had this to say at the opening, “In planning, form and structure it was designed to provide unique solutions to congestion, particularly vehicular traffic, which, by 1960, had already become the most critical problem to confront airport planning. The terminal itself was designed for simplicity, restraint and high visibility amid the airport’s clutter of unrelated, assertive buildings.” Using glass as a primary building material-again, a first in US airport construction-the terminal consists of two rectangular pavilions for arrivals and departures, interconnected with two cylindrical satellites for boarding/deplaning. Doubleheight window walls hung from a space frame and supported by concrete columns
72
They are shattering the
beauty
surround the main (departures) pavilion outside the building. On April 29, 2010 the Port Authority, in a tersely written statement, counted this beauty with a bunch of old, unused, derelict buildings at the airport, marking it among places that should not continue to exist at JFK International Airport. Port Authority Chairman Anthony R Coscia said, “Our airports must keep up with the times if we want to remain competitive for air passengers and cargo. This demolition program will allow us to keep JFK modern and ensure that it remains a contributor to the region’s economic growth for many years to come.” Chris Ward, Executive Director, Port Authority said, “Maintaining obsolete CRUISING HEIGHTS June 2010
DON'T DESTROY PLEASE: (Clockwise from left) beautiful iin side views of Terminal Six and IM Pei — the man who designed this exquisite this terminal.
buildings that were built 60 years ago is not a prudent use of our limited resources. Instead, this action will position the airport to expand to accommodate the future growth of our airline and cargo tenants.” “So much going on at the time (when it was constructed in the 1960s) was hulking Brutalist architecture (which I love), overly complicated late-modernism, or underdeveloped Post-Modernism. Terminal Six by contrast was such a simple idea executed so crisply and serenely. It really is the work of a master,” he added.
AD dummy.qxd
5/31/2010
11:45 AM
Page 1