Travels And Aviation NEWS: Air India Signs OnPoint Solution Agreement for Its GE90 Engine Fleet

GE Aviation and India's national carrier Air India have signed a 20-year OnPointSM solution agreement that covers its GE90 engines. The value of the agreement is not being released.
Air India will expand its maintenance, repair and overhaul (MRO) capabilities at its Mumbai, India facility to include GE90 engine overhaul. The current schedule calls for the Mumbai facility to be certified for basic GE90 MRO by 2012. Eventually, Air India plans to build a new MRO facility in Nagpur, India, that will include GE90 testing capabilities.
As part of the OnPoint solution agreement, GE will provide Air India with comprehensive material support, training and assistance on overhaul workscoping. While Air India develops its GE90 MRO capabilities, GE will provide the airline with overhaul services at GE's MRO facilities to support the carrier's GE90 engine fleet.
"Air India has more than 40 years of providing high-quality MRO services in India," said Nalin Jain, country director for GE Aviation. "Adding GE90 engine overhaul service is the perfect expansion of Air India's MRO capabilities."
"Air India has already established partial capabilities on GE90 engines in Mumbai with the help of GE. Three engine overhauls were recently completed, saving us shipping costs and also reducing our turnaround time significantly. This will help us as we prepare to take on third-party work in the facility," said Mr. K. M. Unni, SBU Head of the MRO SBU and Board Member, Air India.
Air India ordered 23 GE90-powered Boeing 777 aircraft in 2005 and currently operates 20 of these aircraft with the remaining three aircraft to be delivered in the next few years.
OnPoint solutions are flexible, long-term commitments designed to meet customers' unique engine services needs. Backed by GE's world-class support, these solutions help lower our customers' cost-of-ownership and maximize the use of their assets. Available OnPoint services include overhaul, on wing support, new and used serviceable parts, component repair, technology upgrades, engine leasing and diagnostics.

3. Jet Airways Net Profit Up 11%
MUMBAI – Jet Airways (India) Ltd. Wednesday posted an 11% increase in third quarter net profit, missing market expectations as rising sales were offset by higher tax expenses.

India's biggest airline by market share posted a net profit of 1.18 billion rupees ($26 million) in October-December, compared with 1.06 billion rupees a year earlier.

Sales rose 20% to 32.62 billion rupees from 27.23 billion rupees, but the airline's profit was dragged down on a tax expense of 996.4 million rupees, against just 500,000 rupees a year earlier.

It didn't specify what led to the rise in taxes.

The average estimate in a poll of six analysts was for Jet Airways to post a net profit of 2.78 billion rupees on sales of 36.45 billion rupees.

The carrier posted a 24.2% earnings before interest, taxes, depreciation, amortization and lease rentals margin during the quarter. It didn't immediately give a comparative figure.

"The EBITDAR margin is more or less in line with our expectations, but the taxes took us by surprise, said Mahantesh Sabarad, a Mumbai-based analyst with Fortune Equity Brokers.

"The good thing is that Jet's tax expense primarily comprises of deferred tax so there is no cash outgo," he added.

The airline's shares fell on the lower-than-expected results. The stock closed down 1.64% at 503.15 rupees on the Bombay Stock Exchange. The benchmark index ended 0.38% lower.

Still, the company's improvement in operating performance reflects a recovery in the aviation sector, long out of the throes of the global downturn in 2008 and 2009. Rising personal income levels and a growth in corporate activity have encouraged more Indians to fly in the past year.

Airlines, especially Jet Airways and Kingfisher Airlines Ltd., have in turn raised ticket prices over the last several quarters to improve margins.

Jet Airways said it flew 3.94 million passengers during the just-ended quarter, up 15% year-on-year. It had a domestic load factor of 77% during the quarter compared with 75% a year earlier.

The airline managed to fill 80% seats on average--a number it has maintained over the last few quarters--on its overseas flights, compared with 82.5% a year earlier.

The company is expected to have load factors of 76% on its domestic flights and 80% on international operations in the fourth quarter, said Senior Vice President M. Shivkumar on news channel CNBC-TV18.

Jet Airways spent 10.97 billion rupees on fuel--its biggest operating expense--up 24% from the year earlier quarter. Total expenditure climbed 17% to 30.72 billion rupees.

4. IndiGo Airways: India's hottest low-cost carrier

NEW DELHI, India — India's IndiGo Airlines may be the world's hottest low-cost carrier. But the company's lightning fast sprint to the top of the food chain offers something else for market watchers: a new spin on the so-called "bottom of the pyramid."

This month, close on the heels of the record-setting, $15.6 billion purchase of 180 passenger jets from Airbus, IndiGo topped state-owned Air India to become the country's second-largest carrier — matching liquor baron Vijay Mallya's full-service Kingfisher Airlines with an 18.6 percent share of the market. It also announced it would start international service with flights to Singapore, Bangkok, Dubai and Muscat this summer.

Since 2008, when the company booked its first profit even as high fuel prices and the economic downturn ravaged its competitors, IndiGo's net income has grown more than five times — from a shade under $20 million to more than $120 million. And the Center for Asia Pacific Aviation reckons its one of the hottest airlines to watch in 2011, saying, "Airports in the Indian subcontinent, Gulf and Southeast Asia take note: IndiGo is coming."

With Boeing forecasting that Indian air traffic will grow 15 percent a year over the next five years and that India will require more than 1,000 commercial jets over the next 20, according to the Wall Street Journal, that may just well make IndiGo the fastest growing airline in the world's fastest growing aviation market. And questions about how it will pay Airbus for all those shiny new planes — which will be rolling in until 2025 — has already boosted excitement about a possible IPO.

But it's the secret behind the five-year-old, low-cost airline's meteoric rise that's most intriguing.

Like Tata Motors did with the much hyped, sub $2,500 Nano, IndiGo used the promise of India's huge, untapped market to lure partner organizations into offering bargain-basement prices — which was key to the low-cost airline's initial purchase of 100 A-320 jets from Airbus in 2005.

But where Tata has stumbled at the bottom of the pyramid — the late business professor C.K. Prahalad's term for the largest, but poorest segment of consumers — IndiGo redefined the low-cost model to compete for business with full-service carriers by offering more than cheap tickets.

"IndiGo's investment in the training of its staff and its [aircraft] fleet killed whatever difference might have existed between an LCC and a full-service carrier," said Kapil Kaul, South Asia head of the Centre for Asia Pacific Aviation. "The service is the same, the planes are all new, the buses are brand new."

Thus, while Tata struggled to sell the Nano to the lower middle class, first-time car buyers it targeted — partly due to bad publicity surrounding a few vehicles catching fire — IndiGo was able to turn regular business travelers into loyal customers because it never acted like a budget airline.

From the beginning, its purchase of all new aircraft helped it avoid maintenance problems, and superior planning helped it to match or exceed the on-time performance record of its full-service competitors — even though rapid turnaround of its planes was the key to the company making money.

According to India's Directorate General of Civil Aviation (DGCA), in 2010 IndiGo topped market leader Jet Airways with an on-time performance record of 85 percent — though Kingfisher notched 86 percent — and beat out its nearest low-cost competitor by a substantial margin. Moreover, thanks to its first big order of new planes, it had the lowest flight cancellation rate of any Indian carrier.

"The first order of 100 aircraft [from Airbus in 2005] was game-changing. They got a wonderful order, and a good price that gave them the leverage that a startup carrier requires," said Kaul, citing the superior maintenance support that the purchase gained them from engine and airframe manufacturers. "That [big one-time buy] ensured they became part of the manufacturers' business model." With the recently announced purchase of 180 more A-320s, the company is set to increase its advantage.

But IndiGo also went beyond the basics to reinvent the first-time flyer segment. When Air Deccan, the pioneer low-cost carrier in India, acquired by Kingfisher in December 2007, was struggling to fight the impression that their planes operated like public buses with wings, IndiGo pushed best practices even when there was no compelling reason to do so.

In a country where other carriers shared passenger-stair vehicles and the top airline still had to have disabled passengers carried up the staircase to plane height by ground crew, for instance, IndiGo brought in larger, handicapped accessible passenger ramps from day one. Similarly, the company equipped check-in staff with hand-held scanners that allowed passengers without baggage to avoid the dreaded scrum at the counter. And at least in the beginning, flight attendants manning the beverage carts addressed even lowly economy class passengers by name (with the aid of the seating chart).

"They've been way ahead of the other LCCs in terms of public perception for reliability and reputation," said Ajay Prakash, president of the Travel Agents Federation of India. "I, too, would recommend IndiGo over the other low-c

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1. 5 cops face raps over US Navy officer's death

MANILA, Philippines – Five officers of the Philippine National Police Aviation Security Group (PNP-ASG) will face homicide charges for negligence in connection with the death of Filipino-American US Navy Lieutenant Commander Scintar Mejia last December 26, 2010.

Pasay police chief Senior Superintendent Napoleon Cuaton made the recommendation after an investigation into Mejia’s death.

The US Navy officer allegedly committed suicide by jumping off the PNP-ASG headquarters.

Cuaton also recommended additional investigation for 11 other police officers led by Chief Inspector who Norberto Lumbera, Jr., who could face administrative charges.

Doubts over the cause of Mejia’s death surfaced following an autopsy made by Dr. Joseph Palmero, medico-legal officer of the PNP.

The autopsy showed that Mejia incurred a deep wound and a chest fracture.

Pasay investigators found out that the US Navy officer did not have the injuries before an attempt was made to revive him.

Cuaton said Mejia reportedly had a psychological problem amid his ongoing divorce with his wife in the United States.

Mejia was arrested by PNP-ASG personnel for alleged drug possession.

An investigation by the Philippine Drug Enforcement Agency, however, showed that the white powder supposedly found in Mejia's luggage tested negative for cocain.

2. Airline tax hit
THE government will earn an additional income of $78 million from rejuvenated tourism and $1 billion from exports should it exempt international air carriers from paying the Gross Philippine Billings Tax (GPBT) and the 3 percent Common Carrier’s Tax (CCT).

Batangas Rep. Hermilando Mandanas, chairman of the House Committee on Ways and Means, said that the Philippines is the only country that charges GPBT and CCT taxes on international civil aviation and sea travel.

Both taxes are levied on all revenues, passengers, cargoes and excess baggage.

3.Grounded in the Philippines

MANILA - A tussle between the Philippine government and a private German company over the construction of a US$425 million airport has exposed the legal risks for foreigner investors in the Philippines at a time President Benigno Aquino is seeking foreign funds to finance badly needed infrastructure spending.

A recent ruling by a United States arbitration court in favor of Germany's Fraport AG Worldwide Services Inc over the Philippine government has raised diplomatic tensions between Berlin and

Manila and could jeopardize future development assistance if Aquino's administration doesn't find soon an amicable solution to the business conflict.

The Washington-based International Center for Settlement of Investment Disputes (ICSID) handed down a decision in late December to reinstate Fraport's right to file an arbitration and compensation case against the Philippine government. The decision marked a reversal of a 2007 ICSID ruling that found Fraport had violated Philippine laws that cap foreign ownership of key investments, including airports, at 40%.

In a previous ruling, ICSID found that the Filipino firms working in a consortium with Fraport had entered into a secret shareholder agreement that would have allowed the German company to maintain managerial, operational and financial control over NAIA-3, or Terminal 3, of Manila's Ninoy Aquino International Airport, in compensation for Fraport's financing most of the project.

In 2004, the Supreme Court declared the original contract null and void because it exceeded the legal foreign ownership cap. The government subsequently seized the terminal in 2007 and partially opened the new airport facility the following year. It has since hosted several concessionaires, including popular budget airline Cebu Pacific, at the new terminal. The Fraport-led consortium, known as PIATCO, has sent eviction letters to the airlines for "illegally" using the terminal.

The contested project has dragged on for over a decade, long enough to span four different Philippine administrations. German Ambassador to the Philippines Christian-Ludwig Weber-Lortsch recently said the 42 million euros (US$52 million) lost through a partial investment guarantee for the project is the biggest loss the federal German government has incurred in decades.

He claimed that the government cannot legally operate the terminal because it was privately funded and that the issue has dampened broad foreign investor sentiment towards the Philippines, particularly among Europeans. "It is a matter or credibility. You need to be sure what you signed will be honored," he said.

The saga has clouded Aquino's pitch to foreign investors to help finance new public infrastructure projects. He promised during a road show last year to promote public-private partnership development schemes that he would ensure a level playing field for foreigners and that the Philippines would be more foreign investor friendly under his watch.

Faced with perennial fiscal shortfalls, the Philippines needs lots of private funds to finance infrastructure spending and propel economic growth to its target rate of between 8% to 10%, a clip experts say is needed to reduce endemic poverty. Current infrastructure spending in the Philippines represents less than 3% of gross domestic product (GDP), well below the 5% average in other Asian countries.

The World Bank recently estimated that the Philippines needs some US$35 billion to $45 billion in fresh investments from the private sector to improve its infrastructure over the next 10 years, including upgrades for the country's aging and often decrepit airports. Domestic air traffic at NAIA is expected to reach 40 million passengers by 2017, double the 20.5 million passengers who flew in 2007, according to the Airport Council International, a global association of airport operators.

Investments are also needed to restore foreign confidence in Philippine aviation. In 2007, the US Federal Aviation Authority's International Aviation Safety Assessment downgraded the country's aviation ratings from Category 1 to Category 2 due to safety concerns of its airlines. Former Senator Mar Roxas II later estimated that the downgrade cost the country hundreds of millions of dollars in lost investment and tourism, mostly from the US and Europe.

Political contract
The PIATCO consortium won the NAIA-3 deal in 1997 during the administration of president Fidel Ramos. Fraport, which manages the Frankfurt airport, later joined in 1999 during the time of president Joseph Estrada. The contract was canceled in 2002 by president Gloria Macapagal-Arroyo on the vague grounds that it was disadvantageous to the government. The cancellation triggered legal cases in the Philippines and abroad that have now dragged on for almost a decade into the Aquino administration.

Under Aquino, the Justice Department recently announced that it has recommended the filing of criminal charges against Fraport and PIATCO officials. It claimed in its recommendation that Fraport used front companies, or dummies, to circumvent the foreign ownership limit law, known here as "anti-dummy" laws. It also said Fraport admitted during ICSID hearings that its direct and indirect stakes in PIATCO had reached 61%.

PIATCO officials responded in a statement saying that the Aquino government's lawyers are in "cahoots with their favored business personalities" and that "it will use the anti-dummy charge as its last card". The PIATCO statement, signed by Moises Tolentino Jr, vice president for legal and administrative affairs, did not give specific names.

However, it is known in industry circles that the original proponent and losing bidder for the project was a consortium composed of some of the country's top tycoons, including mall magnates John Gokongwei and Henry Sy, banking tycoon Alfonso Yuchengco, real estate mogul Andrew Gotianun and Philippine Airlines' owner Lucio Tan - some of whom are known corporate allies with the Aquino administration.

Meanwhile, German ambassador Lortsch said that he had privately asked the Aquino administration to "facilitate a legal, fair and timely solution" and that Berlin preferred an out-of-court settlement to the conflict. He suggested that a negotiated settlement "would help boost the credibility of the administration and the economy".

In comparison, Lortsch noted that the late president Corazon Aquino, Benigno's mother, honored the international debts incurred during the disgraced Ferdinand Marcos regime - a not-so-veiled suggestion that Aquino should restore the terms of the original contract brokered under Ramos.

The airport dispute has affected the provision of German soft loans for the Philippines, including funds earmarked earlier for combating HIV/AIDS, malaria and tuberculosis.

Lortsch downplayed reports in the local media that Germany was also reconsidering other financial assistance to the Philippines, including ongoing development and environment projects in Mindanao, to pressure the government over the dispute. Either way, bilateral relations and Aquino's credibility with foreign investors is sinking fast.

4. DOTC chief says 'Category 1 status within reach'
MANILA, Philippines – “We are leaving no stone unturned in getting back our Categoy 1 status,” declared Secretary Jose P. De Jesus of the Department of Transportation and Communications as he keynoted the 2nd Philippine Aviation Summit held at the Main Function Hall PAF Aerospace Museum Col. Jesus Villamor Airbase Pasay City, on Jan. 19, 2011.

In a speech read for him by DOTC Undersecretary Glicerio Sicat, Secretary de Jesus said only two key remaining items remain to be accomplished for Philippine aviation to get back to its Category 1 status – and thus enable Philippine carriers to expand routes in the United States and to be allowed once again to land on European soil.

“We are leaving no stone unturned in improving, upgrading, expanding and modernizing all aspects of Philippine aviation,” the secretary pointed out.

“The good news is that we are only a few steps away from getting back our Category 1 status,” De Jesus said.

De Jesus also cited a feasibility research entitled “Greater Capital Region Airport Rationalization Study” on a planned integration of operations of the NAIA in Metro Manila and the Diosdado Macapagal International Airport (DMIA) in Clark, Pampanga.

The scope of the study includes three key areas: analysis of issues on airport development in Metro Manila, formulation of an optimum airport security plan; and preparation of a development plan for DMIA and NAIA.

He added that the aviation sector is being geared up “for the next challenge which is the Open Skies policy that may govern our flying community whether in its pure or altered form.”

The Transportation chief also said changes in the aviation sector include strengthening the Civil Aviation Authority of the Philippines (CAAP) by separating its operational functions from its regulatory duties, resulting in “efficient, responsive, and even caring airport operations.”

“It is a maxim of good governance that the functions of regulation shall be distinct and separate from the purely operational in order to install a built-in check-and-balance system within one sector,” the secretary stressed.

De Jesus recently appointed seven aviation professionals to key posts in the CAAP while its database undergoes modernization “for easy access and retrieval” of vital information about Philippine aviation.

The package of reforms unwrapped by De Jesus during the aviation conference also consisted of the commissioning of the Ninoy Aquino International Airport Terminal 3 (NAIA3) for full commercial operations by yearend, and the construction or rehabilitation of many more international airports nationwide.

Underscoring the government’s thrust in developing further the country’s civil aviation sector, De Jesus described the projects he cited as “notable examples of our earnest and vigorous initiatives to build new international airports, to upgrade or modernize existing ones, and to pursue a sustainable program of airport improvements.”

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<div class="photo-text text">Be quick about it: there are free Lonely Planet iPhone city guide apps for 13 US and Canadian cities up for grabs this week</div>

1.Free Lonely Planet iPhone city guides for US, Canada (usually worth $8)

f you're stuck at a snowbound city in the US or Canada, or simply planning to visit North America at some stage, you can now grab free Lonely Planet iPhone guides for over a dozen cities.
And it's an impressive grab-bag of the best destinations for both work and play: Boston, Chicago,Las Vegas, Los Angeles, Miami, Montreal, New Orleans, New York City, San Francisco, Seattle, Toronto, Vancouver and Washington DC.
Each guide normally costs US$7.99, but for this week Lonely Planet is making them available for free. It's a similar for-a-limited-time-only deal as the travel publisher offered in December last year for European city guides to help travellers stuck across the continent due to the severe winter weather conditions. (Lonely Planet also gave away European city guides in early 2010 when airborne volcanic ash shut down much of Europe's airspace.)
But you'd better be quick to click, as the deal lasts until 6pm Friday February 4th in the US (or 1pm February 5th in Sydney).
Once you've downloaded these apps to your iPhone or iPod Touch, however, you'll receive all future updates for free – so it makes sense to grab 'em whole the going is good!
You can download these free apps from either the US iTunes Store or the Australian iTunes Store, depending which store you have an account with (if you're in Australia then you're 99.9% likely to have an Aussie iTunes account, although some Mac fans have gone to the trouble of setting up a US-based account – click here for the why and the how).
These links will take you to the free Lonely Planet city guide download site for the Australian iTunes Store.
Boston
Chicago
Las Vegas
Los Angeles
Miami
Montreal
New Orleans
New York City
San Francisco
Seattle
Toronto
Vancouver
Washington DC

If you're in the US or have an account with the US iTunes Store, these are the links you'll want:
Boston
Chicago
Las Vegas
Los Angeles
Miami
Montreal
New Orleans
New York City
San Francisco
Seattle
Toronto
Vancouver
Washington DC

2.Expedia partners with WestJet

Popular global online booking agency Expedia announced Monday that it has entered into a multi-year agreement with Canadian budget airline WestJet Airlines.
Under the new strategic distribution agreement WestJet’s schedule and fares will now be available to the public on Expedia, Hotwire and Egencia websites. Vice President of Sales for WestJet, Duncan Bureau said that the new deal with Expedia will allow WestJet to market its complete inventory to target a wider travel audience.
Furthermore, he adds that WestJet is confident that the agreement will reach new travelers each month and make the booking process easier and more streamlined.
Currently, WestJet offers over 400 daily stops in 70 different locations in Canada, Mexico, the Caribbean and the US. Expedia announced back in January that it had signed a similar agreement with US Airways to offer its full range of services, including all fares.
Expedia has been in the news for severing partnerships as well. With its most recent parting with American Airlines over a booking row, the global travel agency said that AA would not be featured on the site any longer due to its direct booking system.
The move to remove American Airlines fares from the site comes as several travel organisations join the fight against airlines demanding direct booking schemes. According to Expedia and other online price comparison sites, direct booking could threaten consumers ability to make side-by-side comparisons on fares.

3.Hawkair switches terminals

Passengers flying to Vancouver with Hawkair will be landing at the Vancouver airport’s main terminal instead of the south one as of April 2.

“The biggest impetus to making this decision go forward is the fact that the Canada Line is now there....and other carriers have said that in order for our relationship to grow stronger with them, we need to be in the main terminal,” said airline general manager Rod Hayward last week.

The airline already offers a reduced north-south fare if passengers fly onward with WestJet and Central Mountain Airlines, owned by the same parent company as owns Hawkair, flies out of the main terminal.

Hayward said about 35 per cent of all the people flying out of the Terrace airport connect on to other flights in Vancouver, and Hawkair only has a small portion of this number.

“Other carriers have always held back from negotiating with us, because of the distance involved and the ability to seamlessly transfer passengers and luggage,” he said.

He also said the services the main terminal offers gives a lot more choice to their customers; the move means passengers will be able to connect with other airlines without changing terminals, and reach downtown in 22 minutes through Skytrain’s Canada Line. Other benefits of the main terminal include car rental agencies, dining and shopping options, an on-site hotel and shuttle service to local hotels.

Hawkair has operated out of the south terminal for the past 10 years; Vancouver Island-bound passengers have the benefit of an agreement with Pacific Coastal which uses the south terminal.

Hayward said Hawkair will look for another Island carrier after the move.

“The south terminal has been a good home to us in Vancouver but we feel the move to the main terminal provides many benefits for our passengers including easier connections and ground transportation options,” Hayward said.

“It’s not an easy decision to make, but we just looked at the long-term growth potential, and the convenience of the main terminal,” he said, noting that a lot of the company’s traffic is medical travel, who are happy with the move to the main terminal.

Hawkair operates Dash 8-100 and Dash 8-300 series aircraft.

While Hawkair will have its own counter in the main terminal, the move will allow Hawkair and Central Mountain to share some facilities.

Hawkair’s marketing director Darryl Tucker said the combined airlines will be of service to the local economy in anticipation of economic growth arising from mining developments, hydro power developments and Rio Tinto Alcan’s smelter rebuild.
NewS.33.20110130235250.hawkair_20110202.jpg

NewS.33.20110130235250.hawkair_20110202.jpg

4. Pensions, wages top issues for Air Canada workers

Pensions, wage increases, benefit improvements and scheduling are among the top issues as Air Canada opens negotiations next week with the union representing customer service agents.

Canadian Auto Workers president Ken Lewenza will join the opening round of talks with Air Canada when the contract talks for customer servce agents begin Feb. 11. (Francis Vachon/Canadian Press)
Canadian Auto Workers president Ken Lewenza will join the opening round of talks Feb. 11.

The union says workers have made tremendous sacrifices to help the airline get back to profitability but that wages have not kept pace with inflation.

A survey of members identified wage increases, paid lunch breaks, vacation, sick time and benefit improvements as the top issues, according to a union bargaining update available to members.

The CAW said its workers want respect from Canada's largest carrier and to be paid accordingly.

Pensions dominated the last round of collective bargaining, with the unions agreeing to provide Air Canada a 21-month holiday on past service pension contributions and fixed payments until 2014.

The union said Air Canada is again raising concerns about the funding of the pension plan. But it does not intend to have this round of bargaining "sidetracked by pension discussions."

Meanwhile, Jamie Ross has been named president of the local union representing 3,800 customer service and sales agents after Leslie Dias was appointed national staff representative.

An election for president will take place in the spring.

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