by Lufthansa Flyer | Dec 13, 2011 | Industry News |
Boeing this morning revealed information on its largest order in company history.
In a press release this morning, Southwest Airlines and Boeing today announced the details for an order for 150 737 MAX and 58 Next Generation 737’s.
This order represents the largest quantity of planes ever ordered at a single time, and also is the largest order in terms of dollars for Boeing. The deal is valued at $19 billion at list prices, though its unlikely Southwest paid list prices for such high quantities.
Southwest is the launch customer for the 737 MAX and expects first deliveries to begin in 2017.
In all, Boeing has committments for 900 737 MAX’s from 13 customers.
by Lufthansa Flyer | Dec 12, 2011 | Airlines, Industry News |
In news reported on Monday, Lufthansa confirmed that it has executed an agreement in principle to enter negotiations with Virgin Atlantic regarding the disposition of BMI.
A Lufthansa spokeswoman confirmed the news stating that the agreement was signed at the end of November and they hope to announce a finalized deal for BMI in the coming weeks, with the transaction closing sometime in Q1 2012.
The Virgin offer appears to be in the GBP£50 million or USD$78 million range. The competing offer from IAG (Parent company of British Airways and Iberia) is thought to be twice that.
I am relieved to see Virgin finally step up and make a bid for the BMI assets. The most valuable of these assets are the approximate 9% of landing slots that BMI currently holds at London’s Heathrow. British Airways is by far the dominant Heathrow player and Virgin for years has been vocally critical about what it felt has been an unfair playing field in the British aviation market. This opportunity finally give Virgin a chance to have a tangible impact on British Airways in a way that had not been possible before.
Even though most of BMI will be worth little to Virgin, the landing slots are priceless. Landing Slots can not be manufactured unless airports expand with terminals and runways, and we know for a fact London Heathrow is not in a position to add either. I look at Virgin’s attempt to buy BMI similar to a move in Chess where sometimes pieces are sacrificed initially in order to be able to capture the more significant pieces later. If I’m Virgin Atlantic, I do what ever it takes to make sure those landing slots land in my hands.
The Chess metaphor applies to Lufthansa as well. If I am Lufthansa, I may not necessarily look at the largest bid as the best one. If a sale is made to IAG, the landing slots fall into the hands of the One World alliance thus further reducing the already weak presence of the Star Alliance in the UK. If I am Lufthansa, I may very seriously consider accepting the offer that lets the the Landing Slots “stay in the family”.
Over the years, Virgin Atlantic has been looking to join an alliance. Considering that Star Alliance member Singapore Airlines already owns a substantial stake in Virgin Atlantic, selling the gates to Virgin would pave a very easy road for Virgin Atlantic to be welcomed into the Star Alliance family and give the Star Alliance significant representation in the UK markets.
Virgin Atlantic has made this an interesting chess match to watch, and I’m sure that there will be other suprising gambits that will come out of this before all is said and done.
by Lufthansa Flyer | Dec 9, 2011 | Industry News |
In a release by the IATA (International Air Transport Association) on Wednesday, statistics indicate that airline safety rates, measured by crashes and passenger fatalities, have decreased by 50 percent thus far in 2011. With this trend, 2011 will go down as one of the safest years in the global airline industry.
IATA’s study included approximately 240 airlines in 118 countries that are members of the IATA and who operate internationally. This group represents nearly 85% of all global airline traffic.
The IATA indicated that the improvements were observed globally with the exception of Russia where airline crashes and passenger fatalities had a marked increase over a year ago. The high profile crash of a charter flight at Yaroslavl that killed 45 passengers, of which 37 were members of the Lokomotiv Hockey Team was the tragic low point in Russian aviation this year. Fellow Slovak Pavol Demitra was one of the victims in the tragedy.
To reach it’s conclusions, the IATA calculates airline safety performance by examining the number of accidents and aircraft losses per million take offs.
By these measures, North America has an accident rate so far this year of 1.18 per million takeoffs against 1.51 in 2010, Europe has a rate of 1.39 per million takeoffs against 1.59, Asia-Pacific’s rate per million takeoffs is 1.39 against 2.61, Latin America 4.57 against 6.85, and Africa has 6.34 against 17.11.
On a global measure, the rate so far this year is 4.57 per million takeoffs against 6.85 in 2010.
