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Brisbane 787 base opens up North America for Qantas.

Qantas Boeing 787-9
A Qantas Boeing 787-9

Flights from Brisbane to Chicago, Seattle or Vancouver may be on the cards in the wake of a decision by Qantas to base four of its long-haul Boeing 787-9  Dreamliners in the Queensland capital.

The Australian carrier announced the decision Tuesday and said all four Brisbane-based aircraft would be in place by the end of 2018.

The decision is expected to generate 470 direct and indirect jobs and opens up the possibility of new tourism-generating routes to North America or even though its Perth hub to Europe.

The flying kangaroo is using its Melbourne-based 787s to fly to non-stop to London from March and it has indicated it may also look at other destinations such as Paris. The 787 first route will be Melbourne- Los Angeles in December.

Read: Paris tipped as next Qantas nonstop.

Brisbane is expected to get its first aircraft from mid-2018 and Qantas boss Alan Joyce said  it would offer a step change in comfort and efficiency.

“Each aircraft we base in Brisbane brings new jobs,’’ Joyce said. “One hundred and twenty of our Dreamliner cabin crew and pilots will be based in the city, with many choosing to settle in the state. A further 350 indirect jobs are expected to be created as a result.”

Joyce did not reveal where the planes would fly but the announcement noted they made possible non-stop routes to Seattle, Chicago and San Francisco in the US, Vancouver in Canada and Asia.

“We’ve said that initially our Dreamliners will replace the routes that our older 747 fly but there are also new destinations we are looking at given the capability of the aircraft,’’ he said..

“A range of exciting options is on the table that will help drive tourism to the state and we look forward to making that decision in coming months.

The airline will take delivery of its first Dreamliner in mid-October and is expected to fly it initially on domestic routes such as Melbourne-Perth.

Although the planes are new to the mainline operation, the group has experience flying the type through B787-8s operated by budget offshoot Jetstar.

Queensland is the birthplace of Qantas and it operates 58 return, direct international services each week from Brisbane to Auckland, Christchurch, Queenstown, Hong Kong, Los Angeles, Noumea, Port Moresby, Singapore and Tokyo.

It has a maintenance facility in the city and has been upgrading its lounges at the city’s airport.

The agreement to establish the new base was part of a “coordinated proposal” by the Queensland Government, Brisbane Airport Corporation, Brisbane Marketing and Tourism Australia.

It comes as Brisbane Airport is building a new runway that will double capacity as it  cements its position as a major Australian gateway.

Airport chief executive Julieanne Alroe described the announcement as a vote of confidence for Queensland and a significantly and timely announcement by Qantas.

“These new aircraft have a flight range of nearly 16,000 kilometres (8,500 nautical miles), opening up a new world of opportunities, securing opportunities in the tourism, trade, investment, business and education sectors for many years to come,’’ she said. .

“For Queensland travellers it will mean having access to more non-stop ultra-long haul routes direct from Brisbane in an aircraft that offers unparalleled passenger comfort, while also positioning Brisbane as the new gateway for access into North America.’’

Qantas has also challenged manufacturers Airbus and Boeing to refine their ultra-long range jets to allow it to fly from Sydney to London or New York non-stop.

 

Australia’s REX sees blue skies after profit jump.

Regional
A REX SAAB 340. Photo: Rex

Australia’s Regional Express (REX) is headed for bluer skies after profits rose sharply in 2016-17 and passenger growth recovered.

The Regional Express Group reported a net profit of $A12.6 million for financial year 2017, compared to a 2016 loss of $A9.56m. Operational pre-tax profit jumped from $A4.3m to $A17.8m on turnover of $A281m.

The nation’s biggest independent regional carrier is predicting the current year’s profit will be higher again, with the percentage increase in the mid-teens.

Group passenger numbers increased by 9 per cent thanks to new operations in Western Australia with the airline recording a more modest 3 per cent recovery in passengers across its “traditional” network in the East.

Fiscal 2017 was the first full year of REX operations in WA  and the airline said it was pleased with passenger growth on flights from Perth to Albany and Esperance.

The increased passenger numbers and a 3 per cent improvement in yield brought in an additional $A7m in revenue, while the company also benefited to tune of $A6m from lower fuel prices.

REX executive chairman Lim Kim Hai said Rex had produced a solid result which bucked a trend which saw airlines such as Qantas, Air New Zealand and Singapore Airlines report significant pre-tax profit declines and Virgin Australia posts pre-tax losses of almost $A300m.

Read: Qantas sees strengthening demand as it posts second highest profit.

“I see a bottoming out of the declines we experienced in the prior six years with a modest but clear recovery (3 per cent improvement year-on-year on the traditional network) of passenger numbers in FY17, which no doubt mirrors what is happening in the Australian economy,’’ he said in a statement.

“Early indications from the first two months of this new financial year confirm the trend we saw in FY17.”

“As long as the Australian economy continues this modest recovery, I have confidence that Rex will continue to perform well.’’

The airline, which operates 50 SAAB 340 turboprop aircraft and 1500 weekly flights to 50 destinations, declared a full -franked final dividend of 10 cents per share.

In its outlook, the airline said the first two months of  the 2018 financial year appeared to confirm the trend of modest recovery in passenger numbers.

It expected the fuel price to remain soft and said activity in the mining fly-in, fly-out sector appeared to be firming.

Potential headwinds included a lower Australian dollar if the US raises interest rates and the potential impact on the world economy of protectionist measures from the Trump administration or the situation in North Korea.

“The board believes that the Australian economy will continue on a modest recovery and this will translate to a similar growth in Rex’s passenger numbers,’’ the airline said in its profit outlook. “If this growth materialises, rex sees its profits increasing in the mid-teens in percentage compared to (the) prior year.’’

Aerolineas has high Asian hopes for Etihad codeshare.

Aerolineas-passengers-codeshare-Etihad
Etihad and Aerolineas Argentinas will codeshare on key routes

Aerolineas Argentinas is hoping a codeshare agreement with Gulf carrier Etihad Airways will help strengthen its presence in the fast-growing Asian market.

The Argentinian carrier has partnered with Abu Dhabi-based Etihad to codeshare on its flights from Buenos Aires to Rome and Madrid and on connecting flights across the Gulf carrier’s network of more than 100 destinations.

Also in the pipeline is the ability for members of the airlines’ loyalty programs to earn and redeem points on each other flights.

“This is a very good opportunity to consolidate and increase our offer to one of the most important hubs in the Middle East,’’ Aerolineas chief commercial officer Diego Garcia said in a statement. “It also allows us to improve our load factors, optimise the use of the fleet and strengthen the image of Aerolíneas Argentinas in the Asian market.

“We hope that this agreement will also be the gateway for many tourists to visit some of the most attractive landmarks in our country.”

The agreement gives Etihad customers access to Bueno Aires and nine other Argentinian destinations: Córdoba, Mendoza, Rosario, Iguazú , Salta, Mar del Plata, Bariloche , Trelew  and Ushuaia.

Read our review of Etihad.

The Gulf carrier axed its service to South America earlier this year when it dropped flights between Abu Dhabi and Sao Paulo, Brazil.

The carrier subsequently reported  a $US1.87 billion net loss and announced it would no longer support loss-making investments in Alitalia and airberlin.

Read: Airline chiefs generally upbeat as Etihad posts massive $US1.87bn loss.

The 2016 loss included a $US1.06 billion charge from writing down the value of aircraft and a further $US808 million hit its investments in the beleaguered European carriers, both of which are now in administration.

The downturn came as Middle Eastern carriers grappled with increased competition, a downturn in oil prices that affected their home markets and the impact of terrorism on Europe.

 

International flights soar deep in the heart of Texas

Condor at Austin-Bergstrom
A condor flight at Austin-Bergstrom International Airport

Dallas-Fort Worth and Houston still have a huge lead when it comes to international fights to the Lone Star State, but once-sleepy Austin is adding a slew of new routes.

From  March 27, 2018 low-fare Norwegian launches nonstop service from Austin-Bergstrom International (AUS) to London Gatwick.

This presages a  battle with British Airways, which already offers nonstop AUS – London Heathrow flights. Before BA’s flight you had to fly or drive 180-miles (289 km)  north to Dallas-Fort Worth, or 155-miles (249 km) southeast to Houston’s Bush Intercontinental Airport to catch a nonstop European flight.

Norwegian plans to fly 787s on the Gatwick run; BA already employs the long-legged, fuel-efficient Boeing on the route.

Meanwhile, German low-fare carrier Condor is adding a third weekly AUS – Frankfurt flight. The route’s being flown with a venerable 767-300ER, an aircraft that’s fading fast from passenger service around the world.

March also sees short-lived nonstop service from the Texas city to Amsterdam Airport Schiphol. The occasion is SXSW (South by Southwest), a cross-generational mecca that’s part conference, part film festival and all cutting-edge.

Delta will also use a 767-300 on the route and service is set for March 8, 9 and 14, 2018. It goes away after that.

There’s  also more service to Mexico City on

Aeromexico; flights on low-fare Volaris to Guadalajara, San Jose Del Cabo and Cancun on Southwest Airlinesp; and Air Canada to Toronto.

On the domestic scene,  Delta just started nonstop A319 flights from Austin to Seattle-Tacoma, one of Delta’s international gateways.  Along the East Coast,  Delta recently began nonstop Austin-Boston flights.

Ultra-low fare Frontier is doubling the number cities served from Austin to 16. New routes include Charlotte, Cincinnati, Columbus, Ohio; New Orleans, Phoenix, Raleigh/Durham, Ontario, California and San Jose, California. This latter destination is important for Austin businesses, further connecting the two centers of high-tech research and manufacturing.

As for the bigger picture, Austin-Bergstrom in May (the last full month for which figures were available) set a new passenger record with 1,217,824 flyers traveling through the former US Air Force base.

Qantas reshuffles executive team.

workers unions

A significant reshuffle of Qantas management will see new bosses at the carrier’s international and budget arms as key players move into new roles.

The first major change to the Australian airline group’s executive structure since 2014 comes after the airline last week recorded its second highest underlying pre-tax profit on record and called on aircraft manufacturers to deliver planes capable of flying Sydney-London non-stop.

Read: Qantas sees strengthening demand as it post second highest profit.

The reshuffle will see Qantas International & Freight chief executive Gareth Evans take over the Group CEO role at Jetstar.

The current executive manager of freight, catering and airports – Alison Webster – will move into the role as a new addition to the executive team.

Webster has almost 30 years experience in aviation in Australia and the UK., including a number of senior executive roles at Qantas.  She has been executive manager at freight, catering and airports since 2014 and prior to that was responsible for international customer experience and cabin crew.

She also worked in operations and commercial roles at British Airways.

Jetstar Group chief executive Jayne Hrdlicka will move to head Qantas Loyalty and Digital Ventures, which will now also include innovation.

Marketing, brand and corporate affairs boss Olivia Wirth becomes chief customer officer, retaining her existing portfolios and adding responsibility for customer and digital strategy.

Also staying put with an added workload is Qantas Domestic chief executive Andrew David, who takes on responsibility for Qantas freight, catering and airports.

Group executive people and culture Jon Scriven is retiring after eight years in the role and is being replaced by outgoing Qantas Loyalty head Lesley Grant.

General counsel and company secretary Andrew Finch will take on the added responsibility for office of the CEO.

Qantas Group chief executive Alan Joyce said the new structure would help the company keep delivering for customers and shareholders.

“Over the past three years, our senior executive team has led the Group through a major turnaround,’’ he said in a statement. “We’re now entering a phase of ongoing improvement and innovation, and these changes will help drive that.

“This is also about making the best use of the considerable leadership talent at the top level of our organisation.’’

Transition to the new executive team will begin in November.

Qantas sees strengthening demand as it posts second-highest profit.

qantas results

Qantas is expecting to benefit from stronger demand in the current financial year after announcing its second highest underlying pre-tax profit and a competition for a next generation of  ultra-long-range planes.

The airline posted a 2016-17 net profit of $A853m, down from last year’s record  of $1.03 billion, which included a $A141m gain from the sale of airline’s Sydney domestic terminal, but still a strong result compared to many of its Asia-Pacific peers.

The figure translated to underlying pre-tax profit of $1.18 billion, down from $A1.53 billion, and gave both shareholders and staff a windfall.

The airline’s domestic unit put in a strong performance with earnings up $A67 million, to $A645m, compared with a year ago to offset a $A185m earnings decline from international operations, to $A327m, in the face of increased competition.

Qantas Group chief executive Alan Joyce said the airline expected to see the continued strength in the domestic market, which posted a record result, and improvements in international and freight operations.

Read: Qantas challenges Boeing and Airbus for more range.

Joyce the airline was seeing continued strong demand in the domestic market from all areas except the resources sector.

“If you break it down domestically, we’re seeing strong demand from the corporate market outside of resources, we’re seeing strong demand from SMEs, strong demand in the leisure,’’ he told AirlineRatings. “We’re seeing a weakness in the resource side that’s easing but the strength in the rest of the corporate market is more than compensating.”

There may also be a sign of  “ green shoots” in Australia’s important resources market, the Qantas boss said.

“We’re forecasting still a slight decline but we think that may be bottoming out and with the resources prices recovering maybe that’s the start of the turn in that performance,’’ he said.

On international routes,  Joyce said there was a moderation of the  decline in unit revenues seen by all airlines.

Read: Qantas to upgrade A380s.

“The capacity levels that are being added internationally are easing, both in the first half and in the second half,’’ he said. “I think Air New Zealand said the same thing and we would be in complete agreement with what they’re saying there.’’

Joyce said the airline had not seen much capacity added on  the Pacific but there had been a spike  from China and some growth on Middle East routes.

“Hong Kong’s had a bit of growth, as we know, but there’s moderation everywhere else,’’ he said.

In other business units,  Jetstar Group earnings were down $A35m to $A417m compared to year ago while while freight fell $A17m, to $A47m, in tough conditions.

The airline said careful capacity management, cost control and yield management helped drive the record domestic result while the decline in the international market was driven lower fares stemming from 8.5 per cent capacity growth in the wider market.

Jetstar’s result was the second highest on record with its Australian operations performing strongly and included another net profit from Asia,

Qantas Loyalty posted another record profit $A369m, up $23m, and added 400,000 members t0 reach a membership of 11.8 million.

Joyce said the airline was delivering significant value to shareholders and was in a strong position that allowed it to make significant announcements about new aircraft and refurbishments on its flagship Airbus A380s.

He said the airline’s $A2 billion, three-year turnaround program was complete but the airline was still targeting annual cost savings of $400m.

“We have a plan to keep delivering sustainable returns well into the future,’’ he said. “We’re investing in lounges, Wi-Fi and cabin upgrades, looking at new aircraft to evolve our network and diversifying into new businesses like insurance and financial services.’’

The airline is expecting increase group capacity by about 3 per cent in the first half but expects overall domestic capacity to fall by 1 per cent, mainly due to the resources slowdown.

Group international capacity is expected to grow by 5 per cent driven by previously announced new routes into Asia.

Qantas to upgrade A380s

Qantas
Image: Qantas

Qantas is to undertake a major upgrade of its 12 A380s to improve passenger comfort on long haul flights and tap the growing market for premium travel.

Structural changes are focused on the upper deck where 30 economy seats will be removed and some partitions and a crew workstation rearranged to use space more effectively.

This will allow for an additional six Business Class and 25 Premium Economy seats, increasing the overall seat count on the aircraft by one and increasing premium seating by 27 per cent.

Read: Qantas challenges Airbus and Boeing for more performance for new non-stops 

Other elements of the refurbishment program include:

Replacing Business Class Skybeds with the latest version of Qantas’ Business Suites with every seat having direct aisle access.

Installing the airline’s new Premium Economy seat in a 2-3-2 configuration. This seat is almost 10 per cent wider than the model it replaces and will debut on the 787 Dreamliner later this year.

Reconfiguring the front of the A380’s upper deck to redesign the passenger lounge to provide more room for First and Business Class customers to dine and relax.

Enhancing First Class, which remains in its current configuration on the lower deck.
Qantas says each suite will be fully refurbished, including contoured cushioning and a larger, higher resolution entertainment screen.

Economy also comes in for some treatment with new seat cushions and improved inflight entertainment.

The airline says work on the first A380 is expected to begin in the second quarter of the calendar year 2019.

All 12 aircraft will be upgraded by the end of 2020.

Qantas Group CEO Alan Joyce said “customers love the A380.

This upgrade is a major investment in putting the next generation of seats on the aircraft as well as more creature comforts to maintain its status as one of the best ways to fly,” said Mr Joyce.

“We’re seeing increased demand for Premium Economy and Business Class on the long-haul routes that the A380 operates, including from people using their Qantas points to upgrade.

“When you combine this upgrade with the other investments we’ve been making in new aircraft and new cabins, it will give us consistency with our premium seats across the A380, A330 and incoming 787 Dreamliner,” added Mr Joyce.

Qantas challenges Boeing and Airbus for more range

Emirates say 777X in good shape
Boeing 777-8X & 777-9X

Qantas is challenging Boeing and Airbus to refine their latest ultra-long-range jets to enable the airline to fly virtually anywhere in the world non-stop.

The Australian airline wants to be able fly non-stop between the east coast of Australia to London and New York within five years.

Qantas will announce its aircraft wish list as part of its 2017 results announcement in Sydney on Friday August 25.

The airline said in a statement that “no aircraft currently in service has the range to fly these direct routes with passengers and luggage at full capacity.”

“Two next-generation aircraft that are currently in development – Boeing’s 777X and a long-range version of Airbus’ A350 (the -900ULR)– can get close.”

“Qantas has issued a challenge to both Airbus and Boeing to extend the range of the new aircraft under development and make these non-stop flights possible by 2022,” the statement said.

Both the 777X and A350 series offer significant improvements in passenger comfort, fuel burn and range over the aircraft they are replacing.

Qantas is keen to develop more non-stop routes after the surge of bookings for the Perth to London Boeing 787 non-stop service that will start in March.

A direct flight from Melbourne / Sydney / Brisbane to London would cut up to four hours off total passenger journey time to just over 20 hours and three hours for a direct flight to New York.

The airline said customer research showed that the transit stop airport experience is often one of the most stressful parts of the journey, particularly where a connecting flight is involved.

“Direct flights reduce interruptions mid-flight which often interfere with sleeping, eating or movie watching,” the airline said.

Qantas said “that removing the need to stop at a particular airport en-route also means airline flight planners can choose the fastest and most efficient route between Australia and London/New York depending on weather and prevailing winds.”

As part of its feasibility assessment, Qantas is already running wind route analysis using the power of cloud computing.

This involves processing up to 10 years’ worth of real-world weather patterns to run different flight path scenarios to form a statistical picture of fuel burn and therefore aircraft range on the key routes.

 

Cathay Dragon plans expansion with A321neos.

cathay dragon A321neo
An A321neo in Cathay Dragon livery.

Cathay Pacific subsidiary Cathay Dragon has signed a preliminary deal to take 32 Airbus A321neo single-aisle aircraft listing at $HK32  billion ($US4bn) as it moves to modernise its fleet.

The longer range and higher capacity 321neos will replace and expand Cathay Dragon’s current single-aisle fleet of 15 A320s and eight A321s from 2020.

The airline plans to use the additional aircraft to chase growth beyond its current network of 56 Asian destinations.

“The Airbus fleet has been serving Cathay Dragon well over the decade,’’ Cathay Pacific chief executive Cathay Dragon chairman Rupert Hogg said in a statement.

“With the A321neo we expect to benefit from a very significant increase in operating efficiency, while increasing capacity in the Cathay Dragon network in order to expand our reach to more customers.

“The intention to purchase these 32 environmentally-friendly aircraft will allow us to add new destinations to Cathay Dragon’s network, increase frequency on some of our most popular routes and expand our network in the region in order to provide more travel choices and convenience to our customers.”

A number of airlines have been using A321neos in lieu of  widebody aircraft  and Cathay has previously flagged this as a possibility for Its subsidiary.

Airbus says the A321neo has a seating capacity of up to 240 passengers and an extended range of up to 6,850 km. It offers a significant increase in operating efficiency as well as a 50 per cent reduction in noise compared to current A321s.

Cathay Dragon also flies 24 widebody A330-300s and Cathay Pacific  is a big Airbus operator, with a fleet of 37 A330-300s and 17 A350-900s.

The parent airline has another 31 A350s on order, including the larger A350-1000.

It recently posted a $HK2.05 billion ($US262m) loss for the first six months of 2017 and predicted the second half was likely to be just as bad.

Read: Cathay posts $HK2 billion first-half loss.

Robokiwi greets passengers at check-in and gates

Chip the android.

There are some airlines whose customer service staff could be described as robotic but Air New Zealand has never been one of them — until now.

The carrier has teamed with one of Australia’s big four banks to run a trial at Sydney Airport using a “social humanoid robot” to greet passengers.

Similar trials using robots have been conducted elsewhere, notably at Amsterdam’s Schiphol airport.

Read about Amsterdam’s robot.

Shenzen Boa’am International Airport in the southern Chinese province of Guangdong has even had a taser-armed “robocop” on duty.

Read about China’s robocop.

In this case, the robot is a friendlier chap called Chip and his role is to help AirNZ customers check in and at the gate prior to boarding.

Chip can read a boarding pass, for example, and reassure customers they are in the right place.

The experiment with the Commonwealth Bank is one of number of projects the Kiwi carrier is investigating after placing a bigger emphasis on using technology to offer a better experience to customers.

They include, Oscar, an  artificial intelligence–backed chatbot has been introduced to assist customers with a more personalised online experience or biometric bag drops which identify customers using facial recognition.

“We are also experimenting with potential enhancements of the future, including the idea of our cabin crew one day using Microsoft’s HoloLens augmented reality viewers on board our aircraft,” says Air New Zealand chief digital officer Avi Golan.

Commonwealth Bank has been looking at social robotics since 2016 to investigate how robots such as Chip they can be used in a commercial context.

The bank’s general manager of innovation labs, Tziana Bianco, believes the airport trial is good example of why companies would invest in social robotics and how they can bring to life information that can be boring when delivered on a screen.

“People interact with them in a very social and sometimes emotional way, which means they can enhance experiences in ways that other technologies are unable to do,” Ms Bianco says.

“Chip is one of the most advanced humanoid robots in the world, and is perfect for our work aimed at understanding how humans and robots interact in dynamic social spaces.”

There may be less enthusiasm among customer service staff who have been watching in action a competitor for their jobs during the five-day trial, which ends Friday.

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