Indian carriers set to connect more UK cities

India and Britain are set to amend a bilateral pact to allow airlines from the two countries to expand their reach to smaller cities, two civil aviation ministry officials said on condition of anonymity. The move will set the stage for Air India and Kingfisher Airlines Ltd to enter so-called domestic code-sharing agreements with British Midland Airways (BMI) and British Airways Plc. (BA), respectively, as sought by the Indian carriers earlier this year. Code sharing allows an airline to include a connecting flight operated by another carrier on its own ticket. The practice is followed mainly for international flights.

The expected amendment will make Britain the sixth country in which Indian carriers can have domestic code-sharing pacts, after the US, France, China, Japan and the Netherlands. “This will allow passengers to have access to interior points on the same ticket,” said a ministry official. The amendment will also put the two Indian carriers on their way to joining global airline alliances, or networks of airlines that have code-sharing agreements with each other. Air India, operated by National Aviation Co.  of India Ltd, wants to join the Star Alliance, of which BMI is a member. Kingfisher wants to join Oneworld, which includes BA. Analysts say the British carriers, which have a limited domestic network, will gain more from the amended agreement by enjoying access to the much larger Indian market. “BA will get more than Kingfisher. The UK has limited city pairs that BA operates... (However) BA can interline and transfer to over 40 Indian cities and milk Kingfisher’s network for their own customers. This money will go to BA, not Kingfisher— Kingfisher will get nothing but a small cut,” said Saj Ahmad, a London-based aviation analyst.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

Kingfisher launches two new services to UAE

India's leading private air carrier, Kingfisher Airlines, has launched two new international flights connecting the UAE to New Delhi and Mumbai. The new routes — from Dubai to New Delhi, and Dubai to Mumbai, means, Kingfisher now operates 21 weekly flights between the UAE and India, the company said in a statement. All flights on the new routes are being operated with Kingfisher Airlines' Airbus A320 fleet. The flights on the Dubai-New Delhi route would include a dual-class cabin with five-star luxury on Kingfisher First and Kingfisher Class while the Dubai-Mumbai flight would include only the Kingfisher Class.

“I am delighted to announce the launch of the two new flights from Dubai to India,” the airline's Chairman and Chief Executive Officer, Mr Vijay Mallya, said. “Kingfisher Airlines has redefined the whole experience of flying and with the launch of these new flights, discerning flyers on these popular international routes will now have the choice of traveling with India's favourite airline,” he said in a statement. Kingfisher Airlines will be the only airline to operate from the UAE to Mumbai, New Delhi and Bangalore. The Dubai-Mumbai flight offers numerous connecting flights to Bhubaneswar, Goa, Udaipur and Nagpur, the company said.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

New York illustrates airline deal's allure

The combination of United and Continental Airlines would upend the balance of power at New York's airports. Continental was already the dominant player at one of the three, Newark Liberty International Airport. But in merging with United, it would gain a much bigger network of domestic routes in the United States and connections to the rest of the world that would leave its rivals in New York Delta Air Lines and American Airlines struggling to catch up.

While New York would be just one of the new airline's 10 hubs, the battle for market share there offers a window into why United and Continental found a merger so attractive. All the major U.S. airlines have been looking for ways to regain the upper hand as air travel has begun to rebound worldwide. And New York was already a major focus of their attention. Its airports Kennedy International, La Guardia and Newark play a critical role in both domestic and international travel. Combined, they account for four of the top five domestic routes and constitute the biggest hub in the United States for international flights. ``It's the most contested market there is,'' said Gail Grimmett, the senior vice president at Delta Air Lines in charge of New York. ``That's because it's the largest revenue pool.'' A big piece of the battle is for business travelers, who account for the bulk of the industry's profits.

To woo them, airlines are introducing sommelier-selected wines and lie-flat beds to their business cabins on international flights from New York. They are sprucing up shabby terminals and expanding their networks. If the United-Continental merger succeeds, the new airline will have a share of about 55 percent of domestic travelers in the United States and 65 percent of international travelers at Newark, where Continental has been building its lead for 10 years. Delta, which bought Northwest Airlines two years ago to become the biggest airline in the United States, has used its new muscle to expand its presence at both La Guardia and Kennedy. American, which was once the biggest airline in New York, has been losing ground. Until now, United has not been one of the big players in the area.

All this competition for the New York market has kept air fares relatively low so far. But analysts caution that if an airline becomes too dominant at any one airport, there would be less pressure to keep the lid on prices. Such concerns could raise antitrust issues for United and Continental's planned merger.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

Lufthansa loss widens for quarter

Deutsche Lufthansa AG said Tuesday its net loss widened in the first three months of the year due to higher fuel costs, strikes and bad weather, but the German flagship airline reiterated that it expects operating profit to rise in 2010. Lufthansa posted a first-quarter net loss of €298 million ($393 million), compared with a year-earlier loss of €267 million, even though revenue rose to €5.8 billion from €5 billion. The first-time consolidation of unprofitable Austrian Airlines and British Midland Airways, or bmi, helped Lufthansa increase first-quarter revenue but weighed on the company's operating profitability. The carrier's operating loss reached €330 million, compared with a €44 million loss a year earlier. "Overall performance to date has further strengthened the executive board's expectations of achieving a positive operating result higher than last year's." Lufthansa said. Despite the wider net loss and operating results.

Lufthansa said its first quarter also reflects "positive demand trends in the cargo and passenger business." The forecast for a higher operating result comes despite the volcanic-ash cloud that grounded much of European air traffic for nearly a week last month. Lufthansa Chief Executive Wolfgang Mayrhuber has estimated the shutdown cost the airline about €200 million. Irish flag carrier Aer Lingus PLC, meanwhile, said it halved its operating loss in the first quarter, as lower fuel and staff costs more than offset a drop in revenue. But the beleaguered airline faced another hit to revenue as a new volcanic-ash cloud forced the temporary closure of Irish airports on Tuesday.

The company reported an operating loss of €37.8 million, compared with a €74.8 million loss a year earlier, even though revenue fell 1.8% because of weak consumer confidence and capacity cuts. Aer Lingus Chief Executive Christophe Mueller, who took up the post last September, said he was "very encouraged" by the first-quarter trading, but added that it's "appropriate to remain cautious on the full year 2010 performance.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

Air India gets $475-million bridge loan from StanChart

National Aviation Company of India Ltd, the holding company of Air India, has secured a bridge loan of $475 million (Rs 2,137 crore) from Standard Chartered Bank at an overall rate of 350 basis points above Libor. The loan is to part finance the purchase of three Boeing 777-300 ER aircraft. The airline has already received the first of the three aircraft in March this year. The remaining two will be delivered by the end of May and July respectively.

“It is a bridge loan taken for six months against the security of aircraft. This loan will be re-financed with a delivery finance loan in the next four to six months, which would be a cheaper loan,” said a senior official in Air India. NACIL had floated a tender on April 6, 2010 inviting offers for long-term loan funds for financing the purchase of three B777-300 ERs and one spare engine for up to $475 million, scheduled for delivery in 2010.

According to the tender document, US ExIm Bank's final commitment for the delivery financing has already been received. The document said the Government has approved the provision of the Government of India guarantee to support the financing for the project cost. “However, NACIL would prefer to obtain the GoI guarantee to the minimum extent to save on guarantee cost”. The financing for first 17 aircraft had been tied up in three tranches of seven, three and seven aircraft. According to the document, NACIL has already taken delivery of these aircraft.

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The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).

AirAsia looks to triple India share of passenger mix

AirAsia, one of Asia’s best own low-cost airline brands, expects to fly around two million passengers to and from India in the next three years, more than triple the six lakh Indians it currently flies. “Mumbai is our sixth destination city in India, after Trivandrum, Kolkata, Chennai, Kochi and Tiru Chirapalli. We will be adding Bangalore, Hyderabad and Delhi too this year,” said Tony Fernandes, group CEO, founder of AirAsia. Fernandes said the airline is also interested in mounting flights to Pune, Amritsar and Coimbatore at a later stage.


The airline flew over 23 million passengers in 2009 globally. On Thursday, AirAsia inaugurated its flight to Mumbai from Kuala Lumpur signifying its foray into the western India market. The airline will operate four direct flights per week through its long haul, low fare affiliate, AirAsia X, Fernandes said. The firm has deployed Airbus A330 aircraft on the Mumbai-Kuala Lumpur route. As a special offer it will make available Mumbai-to-Malaysia tickets for Rs 1,193 (excluding airport tax) on Friday (May 7). Jointly, the AirAsia group will have a total of 148 flights per week to various destinations in India by end of this year, the statement added. Financial Chronicle learns that the company is planning to raise over $360 million to fund its aircraft acquisition in this calendar year. “We would be raising around $30 million as debt per plane to fund the acquisition of 12 Airbus aircraft this year,” said Azran Osm an Rani, CEO, AirAsia X.

The airline currently has a fleet of 92 Airbus aircraft and would be adding nine A320 and three A330 aircraft by end-2010. “We are in talks with European export credit agencies to raise funds for this purchase,” added Rani.

The above article was extracted from Skyline updates of Skyline College. Skyline College is amongst the top MBA and BBA institutes in Delhi, Gurgaon (NCR).