Delta Airlines plans to start having its regional airline affiliate ExpressJet fly from Dallas Love Field to Atlanta using 50 seat Canadair regional jets. If they are Canadair, they’re CRJ200s most likely.
I see some good and bad in this. First, Delta is clearly interested in seeing if it can poach a few more AA customers on that route with service that is more convenient to a Dallas businessman. I suspect that it can and will succeed in that sense. In addition, this is a shot across the bow at Southwest Airlines who cannot currently offer non-stop service between Dallas and Atlanta. In this scenario, Delta will offer the better service.
The problem is that if these aircraft aren’t configured to offer business class seating and/or very comfortable economy class seating, I don’t see anyone being very interested in using the flight(s) regularly after their first experience. The CRJ100/200 is not a comfortable aircraft and could only be described as such when compared to the Embraer ERJ-140 aircraft. It’s going to take a bit more than convenience to permanently win over customers on that route from Southwest and American Airlines.
Here is a great video of lightning striking an aircraft on the ramp. Notice the flash at the forward nosegear when it happens? That’s the airframe passing the current through the aircraft so that no one in the aircraft is shocked.
After 5 years and, admittedly, some extremely tough times for airlines in the United States, Virgin America still hasn’t earned a profit. To the contrary, they seem to be walking backwards in that area in some financial quarterly results. For several years and certainly since David Cush came to be its CEO, there has been quite a bit of explaining away of these results by saying that growth is driving their losses.
People are starting to ask the question: When are you going to slow growth and realize some profitability. It’s not an unreasonable question.
When other airlines are managing profits and doing so with conservative or flat growth, it begs the question as to why Virgin America hasn’t slowed its growth at this point. There comes a time when an airline needs to “pause” and reassess its operations and I would argue that Virgin America has reached that critical moment. Pausing and re-evaluating routes and tightening up efficiencies is not a bad thing and it doesn’t mean the airline is stalled.
Virgin America arguably has a fantastic service product and its shown that it can capture profitable passengers on the right routes. The problem is that it hasn’t really taken the time to ask if some of those routes aren’t better dropped in favor of others.
Furthermore, growth doesn’t always have to come from an organic process. Looking at Frontier, one could argue that there is opportunity in a merger between the two airlines and opportunity that would have yielded synergies and profits had it been explored by now. It wouldn’t be Virgin America consuming Frontier, it would definitely be a merger of equals but it could yield some badly needed profits.
I think we are going to see some major heat on the Virgin America team to manage their way into profitability and, more importantly, increasing their cash holdings. They just decided to start hedging fuel and I would argue that this is a strategy that will tie up more money than necessary and one only needs to look at US Airways to realize that a hedging strategy isn’t necessary to succeed.
I continue to wish good things for this airline but the latest results point to an airline that could tumble quickly if it can’t show that it is getting its act together.
There has been quite a lot of publicity over Airbus’ decision to build an A320 final assembly plant in Mobile, Alabama, the same location it planned to use for an A330 tanker conversion site. Pro Boeing people decry the decision as silly and pro Airbus people see it as Airbus gaining on Boeing.
I see it as neither. Airbus building A320s in the United States isn’t going to help it sell aircraft from the “made in the USA” perspective. Airlines are businesses and its customers here in the US long since gave up caring whether or not they were on an Airbus or Boeing with aviation fans being the incredibly tiny exception.
It might help a tiny bit in that Airbus may be able to open some production slots for airlines that want aircraft sooner than later. However, that could just as easily be realized from one or two airlines deferring or cancelling orders over the next year.
It does help Airbus with profits as these aircraft will be dollar denominated aircraft but we’re only talking about an initial production rate of 4 aircraft per month . . . not a lot to realize here. And should Airbus need to slow production, guess who is likely to be the first to shut down? Yes, Alabama. Labor laws in that state will make it far easier for Airbus to shut down a US based plan than one in Europe. Their plant in China is politically driven and therefore likely to stick around despite the fact that it, at best, operates at a break even point rather than as a profitable enterprise.
Is it treading on Boeing turf? No, not really. Boeing needs to focus on its customers and keep its eye on the ball when it comes to delivering aircraft on time. Reacting to this move by Airbus is just silly.
Does Boeing need to build elsewhere? Again, no, not really. They have their production figured out and while it may prove to be smart one day to move some production off-shore, they have a handle on their needs at present and there is no driving need to search elsewhere. Besides, they have moved their production “off shore”. They started an assembly line in South Carolina.
I don’t think Airbus has made a mistake but I also don’t see this as giving them any real advantage in the marketplace and only a tiny lift on profits which Airbus could stand to realize.
Spirit Airlines began service at DFW about 1 year ago and really began to amp up its service at DFW just after American Airlines entered into bankruptcy. They’ve announced the addition of 5 new cities from DFW including Baltimore and Houston in September and Oakland and Los Angeles next April. They’ve also filed paperwork to serve Cancun from DFW.
This would bring Spirit’s service at DFW to 25 daily flights to 20 destinations in just over a year. Not bad.
Proof that the DFW market is *not* a low fare market. Spirit is seeing load factors close to 90%. JetBlue and Virgin America have discovered opportunity here as well. Delta has started flying into DFW right on top of American Airlines turf.
This isn’t just an incursion against American Airlines. It’s an incursion on Southwest Airlines turf as well. Both of these airlines have been fat, happy and sassy with their respective domains here in the DFW area. Each has enjoyed a kind of monopoly on their services in and out of the DFW metroplex area.
As a resident of the area, I’m glad to see the competition and particularly glad to see Spirit’s competition. The truth is that it is unlikely that I personally will ever fly Spirit. I’m 6’2″ tall and a big man. Spirit’s 29″ seat pitch isn’t exactly my idea of even a leisure flight at a low price.
I expect we will see even more competition in the area and particularly so at DFW. DFW airport isn’t an expensive airport to fly into and with AA’s bankruptcy, I expect we’ll see some terminal consolidation over the next year freeing up more gate space for more airlines.
I am officially sick of American Airlines bankruptcy and happy to talk about another airline: Delta Airlines.
Delta Airlines pilots have ratified a new contract that should put Delta in an excellent position to be the dominant SuperLegacy carrier in the United States. The new contract allows Delta to shift its flying from loss-making 50 seat regional jets to larger, profit-making regional jets over the next few years.
Part of this contract is what allows Delta to take on the Boeing 717 jets from Southwest Airlines. Those jets will be flown by Delta pilots and now doubt represent how Delta intends to provide more jobs for its union pilots.
Interesting to me is that 62% of the pilots said yes to the contract. I suspect this is representative of the former Northwest pilots at the company who are more strident and wish to see more of the flying being done by Delta done by Delta pilots.
Bloomberg Business Week says that American Airlines will be seeking an extension (90 days) to have an exclusive right to present a reorganization plan to the court. This would nominally prevent US Airways from making its own proposal in late September.
It’s quite likely that this extension will be granted given what has been going on with the Section 1113 hearings in that a ruling on abrogating the union contracts has been extended to August. The bankruptcy judge is likely to cooperate with American Airlines on this extension as it grants American the reasonable opportunity to put its plan together once it knows what its labor costs are likely to be.
Expect to see many unsecured creditors (unions in particular) object to this extension.
To a degree, this works in US Airways favor. It allows them to make their case stronger with unsecured creditors and point to AA’s inability to get its house in order.
I think this a mistake on AA’s part as it signals that it is now reacting to US Airways instead of its own problems. To creditors, directors on its board and others, this isn’t what you want to see in a bankruptcy.
Pay cuts are the hot point for the American Airlines unions and particularly so for the APFA (flight attendants union). The section 1113 hearings will move to abrogate those current contracts and unilaterally impose terms but that doesn’t mean the unions just have to unilaterally shut up and do nothing either.
American Airlines will still have a flight attendants union and will still be subject to NLRB (National Labor Relations Board) and the Railway Labor Act. In short, it still has to negotiate a lasting contract with the union and the union still can ultimately resort to labor actions against the airline. All the Section 1113 hearings do is potentially kick the can down the street for a few years more.
If the pay cuts are significant (and they almost certainly will be) and affect differential pay in particular, at what point do flight attendants just leave the business? It doesn’t happen very often today because seniority drives people to hang on. Seniority equals higher pay. Some flight attendants out there in the world did see the writing on the wall when it came to legacy airlines and jumped ship to other airlines such as JetBlue to start fresh and build a new career at a new airline. Some just left the industry altogether but those are few and far between in general.
But at what paycut do we see AA flight attendants seek work elsewhere? The interesting thing to me is that when flight attendants do leave the business, they generally move on to more financially rewarding jobs, not less rewarding. Granted, the economy today isn’t friendly to the idea of shopping for a new career. On the other hand, people are hiring and people are getting hired and there are plenty of jobs out there that could offer as much or more financial reward and quite possibly a better quality of life.
What also may be missed in this is that there is more incentive to jump ship for the junior flight attendants than the senior flight attendants. Retaining high paid, senior flight attendants doesn’t exactly help an airline much and that is particularly true for American Airlines.
Ryanair has launched another takeover bid for Aer Lingus offering a 50% premium over the current share value in the marketplace. Its previous bid was shutdown by the European Union on anti-competitive grounds. Etihad has expressed some interest and now Turkish Airlines is pondering an acquisition as well.
Oddly enough, no major airline group seems that interested in Aer Lingus. No other major European airline other than Ryanair seems interested. It’s down to scrappy outsiders who want a piece of the airline.
This is because the government owns a major stake in the airline and between it and Ryanair, there is a majority control issue. You can’t control Aer Lingus without one or the other selling their stake. Neither of those two parties is interested in selling their stake to someone that can either A) harm the Irish government politically or B) impact the competitiveness of the Irish airline industry. Or both (Ryanair).
I think much is made about the Irish government selling its stake and I agree that the current government is sending louder signals than most but at the end of the day, I don’t think Aer Lingus is getting sold or merged into any other airline.
I think Ryanair is interested in Aer Lingus from a long haul perspective and it provides growth in an area where Ryanair has not so far moved into. With such an acquisition, it gains not only the equipment but the know-how needed to execute a long haul international strategy.
Politically speaking, the Irish government has much to fear when it comes to politically fallout from such a sale. The airline is heavily unionized and those unions carry power when it comes to local politics in Ireland. Given the size of Ireland, all politics is local. Jobs are important in an economy that has been impacted by the Euro crisis, debt and a lack of economic growth.
An ANA 767 landed hard enough in Tokyo to bend the fuselage severely resulting in serious fuselage wrinkling forward of the wing. I suspect we’ve identified the next 767-300 to be retired from ANA’s fleet. Here is the video:
Southwest Airlines and Airtran mechanics have agreed upon a new deal and found a way to merge seniority satisfactorily. I wrote about this in February when Southwest mechanics derailed the last agreed upon deal. At that time, how seniority would be handled within the airline in general as well as in Atlanta was the primary issue.
Getting a new deal agreed upon and accepted since then is fast work by all those involved. I suspect that Southwest was able to alleviate some of the concerns involved with its moves into new aircraft and international flying. SWA has likely been able to find a way to ensure that all parties maintain some parity in their seniority and their quality of life is preserved.
Not every deal has been made the first time around in union integration in this merger but every deal has been done fairly swiftly compared to most any other merger.
Doug Parker of US Airways came to the DFW area with AA union leaders in tow to do media interviews in both Dallas and Fort Worth and make the case for a merger between US Airways and American Airlines. I have to believe that American Airlines executives would have liked to have arranged for his plane into DFW to be diverted.
So far, AA hasn’t reached any agreements with either the pilots or flight attendants. The pilots refused to send the last and best offer to its membership and we’re not surprised whatsoever. At the end of the day, even with the contracts abrogated, AA *still* has to come to terms with its unions and it’s doing a very poor job of that. Even the bankruptcy judge has pointed out that both parties will be stuck with each other.
There is a perception in these struggles that unions are always about more money. It is often portrayed as more, More, MORE on the part of airline unions and the thing is . . . it isn’t true. More money is rarely the true issue with employees.
We hear over and over again that more money doesn’t make for a more happy employee or a more productive employee. It’s quality of life that does so. The secret to Southwest’s success with its employees and productivity isn’t the high wages (although they are very high), it’s the cooperation that exists between company and unions that provides high quality of life.
Furthermore, employees really do want to see their companies succeed. Company success provides more stability than anything else for employees. So when American Airlines union leaders start talking about how they recognize that concessions will be fairly drastic no matter what the bankruptcy outcome and that their chief focus is now on company viability, don’t go thinking that is a smokescreen.
It isn’t. American’s biggest problem with its labor is not money. It’s a loss of confidence. That loss of confidence didn’t happen over night and it didn’t happen accidentally. There is little leadership at AA and that has been true since Gerard Arpey took over many years ago. AA executives are very, very good at managing certain aspects of an airline. They manage finances and fleets very well. They can apply the science in running an airline with the best of people out there.
What they haven’t been able to do is inspire employees and bring about both revolutionary and evolutionary change. They haven’t been able to get their labor to start marching together and working together to compete. That’s leadership and leadership isn’t accomplished by cutting management ranks and consolidating responsibilities. It’s about finding one Great CEO who then has to find many great managers to execute a vision and leadership.
Believe it or not, US Airways and Doug Parker do this. They do it despite big problems with their pilots and flight attendants. Despite the bickering that exists in those two labor groups alone, they still operate an airline that has improved its quality in every area and dramatically so. They get employees to cooperate and to excel at their jobs. Look at the fantastic job done in cleaning up the problems in Philadelphia, for instance.
AA unions see that and recognize what’s been lacking in their own company for a long time: leadership.
QANTAS is moving from 4 flights / week to daily flights in its DFW to Australia operations. QANTAS flies non-stop from Sydney to Dallas and non-stop from Dallas to Brisbane with follow on service to Sydney using the Boeing 747-400ER aircraft it has. Previously, it’s been reported that QANTAS load factors have typically exceeded 85% and that the flights have, at times, been load limited or range limited as a result of both passenger and cargo demand.
In other words, this route is *really* succeeding for QANTAS and is attracting a lot of American Airlines network feed. Most felt that this route would go to daily service fairly quickly and it has after about a year of service. My prediction is that the next step will be to add an A380 to the route. Think I’m crazy? I’m not.
The 3 class 747-400ER carries 364 passengers and travels the route at the very limit of its range. 85% load factor for that aircraft translates into about 310 passengers. If the aircraft is being load or range limited with those load factors, it sounds as if there is more demand than can be supplied by the 747-400ER. An A380 can supply 450 seats, ample cargo capacity and has more than ample range to fly DFW-SYD and SYD-DFW without being load limited or range limited at all. 310 passengers equates to 69% load factor for the Airbus A380. If QANTAS continues to stimulate demand and work well with AA making DFW a gateway city to Australia (which is very attractive to east coast residents), an A380 absolutely could be justified as the next step.
Remember the JetBlue flight where the captain had to be locked out of his own cabin due to unstable behavior on his part? The aircraft diverted to Amarillo, the captain was hospitalized and the passengers were accommodated with another flight crew and compensated for their inconvenience. Well, a group of those passengers is now suing JetBlue because they were “in fear for their lives” during the episode.
No doubt it was a tense and even scary moment in some respects. Unpleasant at the least and inconveniencing as well.
But a lawsuit here is just silly. Fear alone and fear that lasts a short time and fear from an event that had a good and successful outcome isn’t justification for suing an airline for millions. I wouldn’t question the fear but I do strongly question just how much fear one experiences when the airplane stays in control and the misbehaving captain is corralled and controlled in fairly short time? It’s not good, it’s not ideal but let’s face the facts: It wasn’t the worst situation that could happen either. Try a landing on a short runway in rain with a 20 knot crosswind component.
Shame on the passengers for their agreeing to be a part of this lawsuit. This is acting like a child rather than adult on their part.
The APFA and its leader, Laura Glading, are pointing at greed on the part of American Airlines CEO Tom Horton for the reason a standalone exit from bankruptcy is being pursued. I generally find the APFA to be a bit over the top and militant in their communications and they tend to follow the model of making it personal with company executives.
But even a militant organization finds a valid argument now and then. Past CEOs of airlines exiting bankruptcy have seen huge rewards from the stock they hold. Both Doug Steenland and Glenn Tilton received tens of millions of dollars. So has Delta CEO Richard Anderson. It’s a lucrative position to be in.
APFA aren’t wrong that its to the benefit of Tom Horton and his executive team to see that kind of exit. The market valuation of AA is liable to raise their rewards dramatically. It might not be “greed” but there is a huge financial incentive.
And I do think that kind of financial rewards clouds the thinking of such teams when it comes to finding an appropriate exit from bankruptcy that BENEFITS SHAREHOLDERS.
US Airways CEO Doug Parker made a more detailed case for the US Airways / American Airlines merger they are pursuing at the annual US Airways shareholders meeting. Parker is in the position of having to denigrate the airline he wants to merge with somewhat in that he has to make a case that the stand-alone approach doesn’t bring profitability while the merger approach does.
Parker argues that the two airlines together can compete globally whereas the without US Airways, American Airlines doesn’t quite get there. The problem with that viewpoint is that he’s arguing scale at various point while also saying that US Airways doesn’t *need* a merger partner to continue its profitability. So why can’t American Airlines survive without US Airways?
The answer is that the two airlines both face long term profitability risk when facing Delta and United in the marketplace. US Airways *does* need a merger partner just as badly as American Airlines does. US Airways brings an executive team, a profitable operation and network that is complementary to American Airlines. AA brings scale to the table.
The labor issues still linger out there and while they aren’t as rosy as Parker makes them out to be for such a combined airline, they also aren’t as bad as some make them out to be as well. One thing US Airways has proven is that you can run a profitable airline with a fractured labor force. They’ve done it.
Labor unions, particularly pilots and flight attendants, have got to realize that their ability to survive is predicated on accepting new models of flying at the airlines. Preserving jobs is one mandate and that’s understandable. But all unions are going to have to accept the idea that preserving those jobs may require flying on smaller aircraft at vastly lower pay scales.
AA may do US Airways a favor in getting the labor contracts thrown out in court. If a merger goes through, a new contract could take several years to get negotiated into place while new, lower terms are imposed upon the unions which save the airlines money until that new contract is agreed upon. If the unions wants to realize salary improvements, they’ll have to cede some ground on productivity, health benefits and retirement funding. The sooner they do so, the sooner they realize real gains in overall compensation and particularly so on the US Airways side.
On a related note, the USAPA (US Airways pilots union) is now expressing moderated concern about a merger from their point of view. This isn’t surprising since AA pilots would dominate a combined airline from both a seniority and numbers perspective.
American Airlines has announced direct, non-stop service from Miami to Asuncion, Paraguay with 4 flights per week starting in mid-November. Here is the kicker: These flights will be on AA 757 aircraft.
The distance between the two cities is just a bit over 3800 nautical miles and within the service range of the 757 but I suspect there will be a bit of planning done for non-scheduled fuel stops as a “just in case”.
While the flights are interesting and fit within the capabilities of the 757, I suspect these will not be pleasant, comfortable flights for those in economy class. It will be close to a 10 hour flight on a narrow body aircraft and American’s 757s aren’t well known for being a newer bunch of aircraft. The interiors and seating haven’t been refreshed in some time. First/Business class should be comfortable but I wouldn’t expect much from the back of the aircraft.
A few weeks ago, American Airlines conceded publicly that it would examine all options for exiting bankruptcy rather than just the stand-alone approach it had been evangelizing up to that point. This was due primarily to the campaign for merger that US Airways has been engaged in and the unsecured creditors committee desire to see all options reviewed.
Since that time, there have been quite a few indicators that American Airlines simply paid lip service to the court of public opinion without actually engaging in the act of reviewing merger potential. PlaneBuzz made mention of an internal town hall put on with CEO Tom Horton and the view that Horton isn’t acknowledging that a merger decision or any decision on AA’s exit from bankruptcy lies really at the hands of the bankruptcy judge and the unsecured creditors committee. In short: Once you’re in the bankruptcy court, your control over your destiny is very limited.
In addition, AA has proceeded in its talks with unions with the clear intent to win its Section 1113 motions to abrogate the union contracts. What I mean is that they haven’t made progress with the unions although I’ll concede that they have so far managed to engage the pilots enough that they are returning to the negotiation table. However, they largely went through the motions with the unions by all accounts.
CEO Tom Horton was in Beijing for the IATA conference and was quoted by Bloomberg saying: “We’re very focused on restructuring independently,” Horton said. “That has to be our focus now and anything else for the time being is a distraction.”
The problem with these developments is that the UCC (Unsecured Creditors Committee) for this bankruptcy is the one that forced AA to publicly acknowledge that it will examine all options and statements and actions like those on Horton’s part speak loudly to so far ignoring the wishes of the UCC.
And it’s notable that a large part of the UCC is made up of AA unions. The bankruptcy judge has made it clear that even if union contracts are dissolved, American Airlines still has to do a deal with the unions and unions still have to get a new contract in place. His message is that the two parties better start figuring out how to make things work under the legal framework that will continue to exist or both sides are in trouble with respect to a successful outcome. US Airways having top level agreements in place with AA unions shows at least a willingness to get a deal done that hasn’t existed at AA in more than a decade.
I will note that American Airlines does seem to be trying hard to come to terms with others on the UCC to kick the legs out from underneath US Airways. They have managed to come to terms with HP over terminating HP’s development of AA’s new passengers service system that was to be called JetStream. New IT VP leader Maya Leibman has now indicated an AA preference for buying a new system off-the-shelf and adapting AA business practices to the system rather than building a one-off system to meet the business practices of AA. That isn’t exactly the wrong direction at this point. There is less risk involved and it at most brings AA at the level of Delta and United.
HP has plenty of horsepower to offer in passenger reservations anyway. It operates the SHARES system already, for instance, and that is the one that United adopted from Continental.
But how do other creditors view advantageous terms being agreed upon with key members of the UCC? What is a union response to another UCC member getting a quick resolution vs their own membership? And can AA pull off a similar deal with Boeing and Airbus that keeps those orders on the books and Boeing happy as a member of the UCC? Maybe. Then again, maybe US Airways waves a follow on order for more Boeing aircraft to replace aging Airbus equipment? You never know.
At the end of it all, one doesn’t sense that AA has done anything to explore other options that involve mergers. To the contrary, one senses that they have retrenched and gone about their own ideas of what to do without regard to the opinions and desires of creditors. When a big majority of your creditors are your own employees who are already angry at your actions against them, there comes a time to pay attention and I don’t think any leadership at AA is paying attention.
Periodically it’s fun for mainstream media to hype the Chinese threat to Boeing and Airbus in the coming years. Irresponsible people point to the homegrown aircraft the ARJ-21 and the coming Comac C919 as evidence of this.
There are a few problems with this. First, the ARJ-21 really isn’t quite 100% homegrown. It is a regional jet based on tooling that China had from its assembly of the MD-90 aircraft. It’s wing was designed by Antonov and it’s cabin cross section, nose and tail are identifical to the DC-9 series.
Second, this aircraft hasn’t proven all that ready for real use. The wing designed failed stress testing thus limiting flight test envelopes at the direction of the Chinese Civil Aviation Authority. There are some reports that this jet is not particularly light for the mission conceived of for it and it isn’t being designed to be exactly a leap ahead of existing regional jets that not only do the job as well or better but which have far superior support in the world (Embraer E Jets and Bombardier C-700/900/1000).
It’s likely that the ARJ-21 will enter into service and find itself wholly irrelevant.
The same fate is likely for the Comac 919. This is a paper aircraft conceived as a competitor to the Airbus A320 series and Boeing 737 series aircraft. The C919 will use a CFM LeapX engine and is targeted to have a range that is significantly less than current Airbus and Boeing models have much less the new A320NEO and 737MAX aircraft. I already smell trouble here.
Comac is using technologies from avionics companies and engine manufacturers but lacks experience at integration and production that make such an airliner possible on a commercial basis. In many respects, for such an airliner to gain credibility in the marketplace, it almost has to be better than A320NEO and 737MAX offerings and it isn’t. Not on paper and certainly not in real world performance. It’s sub-par in every way.
The belief that a superior price will win over airlines is wrong. That superior price is unlikely to be less than what aircraft manufacturers are already offering airlines making large orders and price is only one component of acquisition. Other things involved are its cost to operate, cost to maintain and support from the manufacturer. The Comac 919 is not going to meet or beat either Airbus or Boeing in these areas.
So why would any airline buy such an aircraft? Because the Chinese government told them to, that’s why. It has orders but they come from Chinese airlines and in exceptionally small quantities.
Until China takes on a project that it can achieve integration and competitive operating economics on, it won’t learn how to build a major airliner. The idea that a chinese competitor arrives in the market place even in 2020 is silly. At this point, one could use a crystal ball and guess. My guess is that it is 2030 or beyond and by that point we’ll see Boeing and Airbus offering hyper-efficient new airliners that raise the stakes even higher. 2030 seems a long way off but it is only 18 years away. Look how long it took Airbus to gain marketplace traction with its product line under what were arguably far superior conditions compared to Comac’s. When you do, even 2030 seems awfully optimistic. It could happen but I, personally, wouldn’t bet money on it.
The Oneworld alliance has designated SriLankan Airlines to become a member of the Oneworld alliance. The statement talks about this happening in 18 months but it is safe to say that that is likely to take a bit longer as integration into the alliance typically takes considerable effort on the candidate members’ part.
SriLankan Airlines is a good fit with Oneworld despite its small size. It currently serves a great majority of Oneworld hubs and focus cities. SriLankan has flights to hubs such as London, Singapore, Tokyo, Frankfurt, Dubai, Delhi, Hong Kong, Rome, Moscow, Dublin, Athens, Paris and Brussels. All of which are served more than adequately by Oneworld partners and most have dominant Oneworld airlines operating from them.
What’s in it for Oneworld? For one, it adds Sri Lanka to the map and that’s an area experiencing exceptional growth since peace settled on the country. It also provides connecting service to destinations in the region such as the Maldives and southern India. Colombo, Sri Lanka is potentially an excellent connecting point for partners airlines to use as a stopping point for flights from Australia to the Middle East and/or Europe.
It’s good for Oneworld but I’m waiting for American Airlines to start blowing its horn about this being a fundamental part of their revenue strategy with codeshare partners. If that happens, I’m laughing.
