Monday, 30 March 2015

Germanwings. A time for calm.

 Most of the industry response to the "Shock, Horror, Something must be done" media outcry in the wake of the Germanwings tragedy has been measured and low key.

If all the demands for the grounding of all pilots feeling a bit depressed or with girlfriend, boyfriend, partner, spouse, former spouse, children, bank manager etc problems were met, the skies might go a bit quiet. As in all walks of life most cope with these things in their own ways and the threat of grounding would only make the pressures worse.

The downside from the post 9/11 locking of cockpit doors was always going to be that at some time in the future there would be an event inside the cockpit about which those outside could do nothing. That has now happened certainly once and maybe several times. Unexpectedly, none of the events has been terrorism related.

The lesson learned in many industries is that when one possibility of failure is excluded the risk flows round it to the next point of weakness, often created by the solution to the first. In the flight crew case if a cabin crew member replaces an absent pilot,who is going to check out that person for their babysitting role ? How and how often? If  it's a predictable person- eg the Purser,-then all Pursers will have to be checked out too. If  it's a random person, huge numbers of cabin crew would need to be vetted and trained in what to do in an emergency.When the problem arises it won't be a case of sitting looking out of the window. They will need to know how to and be able to act swiftly and decisively and before they too are at best neutralised.

Calls for ground control to replace pilot control in drone style raise the risk of unfriendly takeover. The technology is there but so are the concerns. A transfer of control in the event of an onboard fire or incapacitation is already possible but the safeguards against the aircraft being hijacked via misuse of the same system are unresolved and no easy answer is in sight.

The BA response that it will not comment on its response to the Germanwings crash is the best one and a model for all others. Answers which are thoughtfully and thoroughly considered and assessed are the best. Kneejerks may keep the press away for a while but are not recommended. 

Tuesday, 24 March 2015

You don't really want cheap travel do you?

Astonishingly this is the Danish unions' proposition to passengers departing Copenhagen airport. Posters have been put up urging passengers to protest against the arrival of Ryanair and their cheap flights, presumably by not flying with them. It's enough to send the customers straight to Ryanair's ticket desk and then walking through the terminal waving their tickets in the air. Mr. O'Leary, no shrinking violet, is no doubt enjoying the free publicity.It's expensive to advertise at airports.

Last week the self same unions blocked  Ryanair's first Copenhagen flight arguing that the airline's terms and conditions do not meet Danish standards. This is despite there surprisingly being no legal minimum wage in Denmark. O'Leary argues that the airline could not operate if they couldn't get people to fly for them. They aren't forced labour, so what's the problem?  From the second day his aircraft have been coming and going successfully. Clearly the union bretheren are not happy but we can safely assume the passengers are.

Sunday, 22 March 2015

And now the EU protectionists join the Gulf debate.

Following swiftly in the wake of our post earlier yesterday about the dead hands of old fashioned protectionism rearing their anti competitive heads in the USA,Routesonline reports that the EU is joining the fray by agreeing a "Joint Approach" to the Gulf airlines and others. No surprises that France and Germany are leading the charge in an attempt to wrap a blanket around Air France and Lufthansa.

This is dismal news. They seek to ensure "fair competition", for which read "as little as possible", between the EU carriers whose histories are littered with many kinds of government assistance and the brassy, ambitious and challenging newcomers. In EU-Think how dare these challenge the established high cost, largely unadventurous establishment airlines ? What right have customers got to expect competition, lower fares, more routes, better service?

The implications are serious. Lengthy considerations, studies, and negotiations can drag on for years. They are the meat and rink of administrators everywhere. They ensure job continuity and gatherings in exotic places. The more complications the better. In the meantime the future is put on hold.

The new airlines have invested billions in US and EU built aircraft and engines. They will continue to do so. The A380 programme would be dead without Emirates. Would the US and European legacy carriers have invested in similar sized fleets and expansion if the newcomers didn't exist? Most unlikely.

The history is that liberalisation of  air service agreements is relatively recent and in some places still fragile. There are predicable rearguard actions by "national"airlines and governments now that what looked good when they were dominant doesn't look quite so good with the arrival of new competitors who could eat into business previously regarded as rightfully belonging to the encumbents,- even if they wouldn't have developed it anyway.

 Until around twenty years ago national laws relating to bilaterals forced airlines to apply IATA dictated terms and conditions to air travel. When smaller newer  carriers in particular started "cheating" from the 1960s onwards (They had to. How else could they compete with Pan Am, TWA, BA, Air France etc?) there were repeated attempts by the majors to bring the recalcitrants back into line via "Yield Improvement Programmes" and similar. Anti Trust laws prevented US airlines from officially taking part but they tended to follow the outcomes. Any ideas that price competition stimulated the market or was good for customers were dismissed by the big legacy national carriers as they manned the defensive barricades. IATA controlled the price of everything from the spend on each meal to what constituted a sandwich. Creative Scandinavian had some problems with the latter. Airline staff were told to fear the shadow of the IATA inspector and exercise no discretion. (To their credit many airlines and individual staff deployed common sense on the day). Member airlines faced fines for violations. That was before the arrival of Malaysia-Singapore and others on the long haul scene in the 1970s. They shattered the mould. Eventually IATA micro regulation was overwhelmed by the tsunami of newcomers with their nett fares, pricing by day and flight, different approaches to catering, service and almost everything else. Despite that some legacy attitudes still lie close to the surface of governmental and old airline thinking.

The EU transport ministers now claim that the Gulf fraternity and Turkish are benefitting from "major subventions and government guarantees". That's just like their national carriers used to do and many would argue still do many subtle ways. Routesonline quotes Violeta Bulc, the EU Transport Commissioner, as saying "Aviation (for which read primarily the legacy national carriers) is very much challenged by competition right now and we need to address it in a more comprehensive way". For which read "kill it". Another transfer of national powers to the centralist one-size-fits-all Commission is proposed leaving the EU's operatives to negotiate with the governments of the new upstarts, including Brazil, China and Turkey and any other irritating emergent countries wishing to play in the airline game. That is dangerous for any EU member states with more liberal attitudes.

The whole prospect is retrogade and nightmarish. It treats airlines as some sort of national interest business to be treated differently from almost any other commercial activity. Illogically it places the interests of old fashioned airlines above other more dynamic employment and wealth generators especially the highly successful  aircraft manufacturers and tourism related industries. It also places customer interests right at the back of the line for consideration.

Rather than go back to the trade barriers of old, the US and Europe need to tell their once dominant airlines that nationalistic protectionism (a state subsidy in itself) is outdated and it's up to them how they compete for business and whether or not they survive. The UK no longer has a national airline. BA, the national brand is owned by a Spanish company and if it disappeared tomorrow something else would take its place. The same is true almost anywhere and certainly goes for the US majors and the EU nationals. The airline industry is one of the most vigorous and successful innovators on the planet. The days of US and European domination of the international business are long gone .The balance has shifted eastwards.  Twenty or more years ago the oriental airlines pushed their way to the front. Now it is the turn of the Middle Easterns. In ten or twenty years time it may be something or somebody else. Do the customers want to go back to where they were with the dead hand of unsmiling authorities dictating who goes where, how often ,with what service levels and at what price? The answer from the EU Commission appears to be "Yes". Hopefully before going too far down the moralising and defensive path someone in Brussels will realise that choking off traffic rights is a totally unproductive way to go and that politically being at loggerheads with much of the world south and east of Rome over the issue is not worth the ongoing political aggravation it would cause the EU.

 Ideally the whole concept of government control of these would go in the bin and thousands of regulatory jobs with it. Aviation would just be another global business. Unfortunately that is not likely to happen soon. Meanwhile all eyes will be on the US to see how their government reacts to the airline lobbying. While the EU seems to have ignored Airbus ("Different department, not Transport") in the US no doubt Boeing will making the manufacturers' voice heard. Others should be shouting too.

Saturday, 21 March 2015

The US Legacies cry to Mum about the new Gulfies.

 The US legacy carriers pleas to President Obama for protection against the new era open skies competition from Gulf  airlines is no surprise. It is the default position of once dominant businesses faced  with a new order which requires a complete rethink of where they are, where they want to be and how to get there.

 The new Gulf carriers have broken through the old order and redefined the geography of much long haul travel. That's what the Asian carriers, originally led by Malaysia-Singapore Airlines did in the 1970s and 80s. They have also invested heavily in large fleets of state of the art Boeing aircraft  and in new concepts and levels of customer service. Above all they have a sense of purpose, energy and urgency,- and their people smile. Within around 8 hours flying of two thirds of the world's population their home bases the Gulf airlines have opened up one stop travel from almost any primary, secondary even tertiary city in the world  to almost any other .They have transformed the patterns of and access to travel worldwide. It is true that there are some losers among the previously dominant airlines but the laws of evolution dictate that if these do not adapt to the new world they will become history.

Asking for state protection against the newcomers is an entirely negative move. For years the US pushed for Open Skies agreements from a position of strength . It can not now reasonably go back into a defensive bunker because some of the dynamics have changed. Arguments about subsidies and other financial and political benefits will go on for ever.

 Hopefully President Obama will politely thank the petitioners for coming and tell them to pull themselves together and go back out and take on the world as it now is. Boeing, GE Engines, the US tourism industry and business should then give a big sight of relief and get on with making money.

Footnote: In talking about the Gulf airlines we include Turkish who now fly 219 international routes.

Monday, 9 March 2015

Heathow - Justine Greening defends Putney.

Ms Greening, once Britain's Transport Secretary and now dispenser of foreign aid funds as International Development Secretary has been at it again.

The lady, whose West London Putney constituency lies under one of  Heathrow's flight paths, has been sounding off  about Heathrow. According to the Times she says it is "in the wrong place for our infrastructure, air pollution and noise borne by local communities" (most of whose inhabitants have moved in long after the arrival of the noisiest ever 707s, DC8s and VC10s of the 1970s.).

These sorts of loose statements about Heathrow being in the wrong place easily take root and become accepted as fact.

The reality is the opposite. It is in precisely the right place for Britain's national infrastructure and for the economy of much of London and the swathe of towns as far west as Swindon and even Bristol. Many of them have grown or are where they are because of it .They benefit enormously from it being where it is and would suffer immensely if it were to be strangled.  Sadly Ms Greening's vision extends only as far as Putney and avoiding a P45 (termination form) after May's General Election. The airport sits right by the intersection of the M4 which leads to all points west and the M25 London orbital motorway which connects with all the other motorways out of London. Ironically the majority of the pollution comes from the two motorways rather than air traffic. Also close at hand is the soon to be electrified Great Western main railway line which offers direct services to points west and ,via connections at Reading, to most of the country. From 2021 the line will at last have a direct loop running through the airport terminals. Nowhere will be better served. Contrast that to Gatwick's location (too far south) and worse still that of the proposed island site in the Thames estuary. Ms Greening's infrastructure and location argument could not be more wrong. It is time she lifted her eyes beyond Putney.

Unfortunately Britain's General Election is going to see more politicisation of the issue. With that comes the possibility of politicians making rash statements from which they can not easily subsequently escape. That's what David Cameron needlessly did in the run up to the 2010 election . It has resulted in a 5 year delay under the cover of the Davies Commission which was told not to report before the 2015 election. What will happen next is anybody's guess. The arguments for Heathrow are obvious and compelling but the eventual decision could depend on who allies with whom after the election. The tradeoffs made by the leading parties with the minnows could see the undemocratic tail wagging the winning major dog. What's best for UK Plc could be a very distant consideration. The best decision of all would be to let both Heathrow and Gatwick expand and fight it out between them to the benefit of all users and the national economy. Will that be Sir Howard Davies verdict backed by whoever is the government of the day?  Don't bet on it.

Monday, 2 March 2015

Eurostar Service Recovery Fails....again

Eurostar today continued its lamentable record of dismal failures to recover from operational setbacks.

A person on the tracks was killed. Unfortunate though it was there is nothing suspicious about his death.

Despite that it has taken around six hours to restart services from the London end and substantially
longer from other end.

How can that possibly be justified?