Tuesday, November 15, 2011

Nevada Governor Raises $28K for Reno Air Race, IHOP Victims

The first-ever Nevada Day Governor's Banquet has raised $28,000 for victims of the Reno air race crash and the Carson City IHOP shooting.

RENO, Nev. (AP) - The first-ever Nevada Day Governor's Banquet has raised $28,000 for victims of the Reno air race crash and the Carson City IHOP shooting.

Organizers tell The Reno Gazette-Journal more than 500 people attended the event at Grand Sierra Resort and nearly $14,000 was raised through ticket sales, silent auction proceeds and donations.

The Grand Sierra Resort's owner matched the contributions to bring the total near $28,000.

The crash and shooting claimed 16 lives in northern Nevada in September.

Eleven people were shot Sept. 6 when a mentally ill man walked into the IHOP restaurant and opened fire. Four people were killed before Eduardo Sencion committed suicide.

Eleven people died and scores were injured when a plane crashed Sept. 16 near an area crowded with spectators at the air races.


Aviation parts supplier Tracer enters receivership.

Tracer Corp., a small Milwaukee firm that supplies parts to the commercial-aviation market, has gone into receivership.

The 18-year-old company, 1600 W. Cornell St., has been hurt by a slowdown in the airline industry, attorney Michael S. Polsky, who has been appointed as Tracer's receiver, said Monday. Polsky said he is still trying to determine if Tracer can be sold as a going business.

In a document filed in Milwaukee County Circuit Court, Polsky said Tracer's liabilities total $5.5 million. The debt includes $3.3 million owed to BMO Harris Bank, which holds a secured interest in substantially all of Tracer's assets, and $1.2 million in accounts payable.

The firm's assets carry a book value almost equal to the debt, according to the court filing, but their market value is significantly less. Further, the company has only about $1,000 in cash and $336,000 in other current assets, the filing shows.

Tracer had 10 employees before running into its current difficulties, but now has only three, Polsky said. William D. Morales, the company's president, declined to talk about the business situation.

Receiverships are state court proceedings similar to bankruptcy. Acting on behalf of creditors, a receiver tries to reap as much as possible from the assets of a financially troubled firm, sometimes selling them in total to a new owner who continues the operations, and sometimes auctioning them piecemeal.
 

http://www.jsonline.com

Kingfisher Airlines seeks more money to keep flying

Vijay Mallya​, chairman of loss-making Kingfisher Airlines​ Ltd, said on Tuesday it was too early to write off the carrier, which is saddled with about $1.5 billion (Rs.7,590 crore today) in debt and has been cancelling around 50 flights a day to cope with a cash crunch.

“It is not fair to write us off, do not write our epitaph,” he said.

He also presented a plan to revive the fortunes of the airline, India’s second largest by passengers carried. Mallya’s briefing came after the airline said losses in the quarter to September had widened to Rs.468.66 crore from a Rs.230.81 crore loss in the year earlier. The cancellations that began on 8 November have been extended to 15 December.

Mallya claimed he is not seeking any bailout from banks,but wants fresh working capital of up to Rs.800 crore as jet fuel prices are rising. He didn’t make any mention of a possible equity infusion by the promoters as had been sought by some lenders.

“Kingfisher Airlines’ accounts with banks are standard. We have not defaulted on any loans or interest to be paid,” he said. “We could have handled the flight cancellations in a better way. We made some mistakes.”

Mallya said he has been in talks with banks, seeking ways to reduce interest costs. Kingfisher was cutting costs, looking to induct a strategic domestic investor and rationalizing the fleet.

It is cancelling orders for two Airbus A340​ planes and postponing the purchase of five A380s, besides exploring options to import jet fuel directly.

Kingfisher’s loss widened as its jet fuel costs surged 70.21% to Rs.816.81 crore in the September quarter, obliterating any gains from the 10% increase in sales to Rs.1,528.16 crore.

Mallya’s statements drove up the Kingfisher stock after it slumped 4% in early trade—it closed 2.34% up at Rs.21.85 on BSE on Tuesday.

However, investors rushed to sell other airline stocks—SpiceJet Ltd fell 5.65% to Rs.21.70 and Jet Airways​ (India) Ltd slipped 8.1% to Rs.238.70. In the last three days, the Kingfisher stock has gained 11.2% on hopes that cash infusions may be forthcoming.

Viability is a big challenge for the carrier, said D.K. Aggarwal, chairman and managing director of domestic brokerage SMC Investments and Advisors.

“Going forward, promoters will need to infuse more capital in the company to ensure viability and existence in a tough market scenario,” he said.

Kingfisher hasn’t made a profit since its start in 2005. It made a net loss in the year ended March of Rs.1,027 crore on total income of Rs.6,496 crore.

Following a debt recast, a consortium of 13 lenders took a 23.21% stake in Kingfisher in April. Debt as of 30 September stood at Rs.7,544 crore.

SBI Capital Markets Ltd drew up the debt restructuring plan for Kingfisher.

The merchant banking arm of State Bank of India​ (SBI) is working on the “long-term viability of the company” to arrange funds from banks, said Kingfisher CEO Sanjay Aggarwal.

SBI chairman Pratip Chaudhuri said on Sunday that Kingfisher has to bring in at least Rs.400 crore of equity from other businesses to rescue the carrier. On Tuesday, it appeared the airline had been able to convince lenders about its viability.

“Loans given to Kingfisher are a standard asset on SBI’s book and on the books of all other lenders in the consortium. There are no issues as far as the asset quality is concerned as of now,” said A.P. Verma, chief credit risk officer at SBI. “The exercise of conversion of part of the loans to equity and asking more guarantees were done nearly one year back when the loan restructuring of Kingfisher took place. There are no such plans now.”

SBI has asked the company for a detailed blueprint for its revival, Verma said. Kingfisher executives said the carrier will submit its proposal by next week.

“Banks have never asked (us) to bring in more money,” Mallya said.

Mallya said an Indian strategic investor has approached Kingfisher for a possible investment, without divulging details.

He called on the government to allow foreign airlines to invest in Indian carriers, but did not specify whether he is in talks with any such overseas entities.

Mallya has approached the Directorate General of Foreign Trade to allow the direct import of jet fuel to bring down costs. SMC’s Aggarwal said this could lead to savings of 8-10%.

The airline is also exploring the option of spinning off its frequent flyer programme into a different entity, said Ravi Nedungadi, president and chief financial officer of UB Group​.

Nedungadi said the promoter group has already pumped in nearly Rs.800 crore since the beginning of the year and is willing to support the airline.

Most other UB Group stocks fell on Tuesday. McDowell Holdings Ltd lost 4.77% to close at Rs.47.90, United Breweries Holdings Ltd lost 2.66% to end at Rs.82.40, UB Engineering Ltd lost 7.05% to finish at Rs.41.50 and United Spirits Ltd​ lost 11.09% to close at Rs.767.15.

Nedungadi said the airline has at least $200 million held with its lessors as maintenance reserve. “We are talking to banks to issue a letter of credit to lessors to release $200 million,” he said.

The airline is in the process of filing for a Rs.2,000 crore rights issue, Nedungadi added.

“These are all short-term strategies,” said a senior airline consultant, who has been advising private and foreign airlines. “The airline has to go for a major overhaul.”

Dinesh Unnikrishnan and Ashwin Ramarathinam contributed to this story.

http://www.livemint.com

Emirates to build Dh400m flight training academy. Move expected to help ease the industry's shortage of pilots

Dubai: Emirates yesterday revealed it would invest Dh400 million to establish a flight training centre at the Dubai World Central development in Jebel Ali to train local pilots.

The Emirates Flight Training Academy will be able to train up to 400 students at a time, helping to address the shortage of pilots — a major concern for the global aviation industry.

The academy will incorporate its own Flight Training Organisation (FTO) which will allow Emirates, for the first time, to train its UAE national cadet pilots in Dubai.

"The aviation industry is growing at a phenomenal rate and a critical element in this growth is trained pilots. As well as training our own UAE national cadets the academy will have the capacity to train a large number of ab-initio pilots from other carriers and will set the benchmark for training excellence in the region," said Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates airline and Group.

Construction of the academy is scheduled to start in the first quarter of 2012 and completion is targeted for the third quarter of 2013. The fully integrated facility will comprise classrooms, student accommodation, ground-based simulators and flight training.

Tough position

"The aviation industry is facing an unprecedented challenge," William Voss, President and CEO of the US-based Flight Safety Foundation, said in a keynote address at the Gulf Aviation Training Event conference at the Dubai Airshow.

"We have upgraded technologies while neglecting the development of the people who need to use them. That leaves us in a very tough position as we struggle to develop a massive new generation of aviation," he added.

Emirates said it was working closely with industry leaders to ensure the facility has state-of-the-art equipment and trainers, in order to meet worldwide aviation training best practice.

"As an industry leader it is incredibly important to us that the cadets trained at our facility meet the high standard set by the industry. Emirates has a strong relationship with our current cadet training providers, however we feel the time is right to introduce our own cadet pilot training facility. The Middle East has become a major international hub for aviation and this Dubai-based training centre will play an important role in fuelling the region's pilot requirements," added Shaikh Ahmad

http://gulfnews.com

EasyJet to start allocating seats – and charging for some of them

• EasyJet to make seat reservations mandatory on trial flights next year
• Move will help attract more business travellers, say experts

EasyJet is tearing up the rulebook for budget airlines – and ending the stampede for the emergency exit row – by introducing mandatory seat reservations.

The Luton-based carrier has gone one step further than arch-rival Ryanair, which charges for front row berths already, by allocating a specific seat for each passenger in trials beginning next year. It stressed that a "large" number of passengers on trial flights will not have to pay, but admitted it will charge for choice spots, such as the first few rows and seats over the wing.

EasyJet's chief executive, Carolyn McCall, would not be drawn on the cost of the best seats. "We are trialling how we can board in the most efficient, simple way," she said. EasyJet's speedy boarding programme, where in exchange for a £13 payment passengers can jump the queue, provides some clues as to the likely cost for premium seats.

An easyJet spokesman said the airline would allocate blocks of seats to family bookings "wherever possible", although the airline must give its booking system a multi-million-pound overhaul first.

"A family that books together will sit together where we can arrange it," he said. He said there would be a "band" of prices for the routes that are selected for the trial. "We will work out what seats are most attractive and at what price level."

EasyJet's largest shareholder, Sir Stelios Haji-Ioannou, continued his war of words with the easyJet board when in a critique of the results he warned that pre-allocated seating would "destroy shareholder value."

The trial is a significant shift for an industry that prides itself on keeping things simple. Even for a business as cutthroat as the low-cost airline industry some principles are sacrosanct and they include having unallocated seating because it allows planes to load and disgorge their passengers more rapidly.

If an Airbus A320 jet costs easyJet $85m (£54m), the airline believes it is wasting that considerable investment if the aircraft is not deployed as much as possible. Hence the quick turnaround times at uncrowded airports favoured by the likes of Ryanair.

But airlines such as easyJet and Ryanair are under constant pressure to try new ruses that cover rising fuel costs, while avoiding the PR pitfall of simply raising ticket prices and tarnishing the "low fares" reputation that is the cornerstone of their business models.

EasyJet underlined the impact of fuel costs in annual results, as the cost of flying a passenger rose 3% to £51.30 per journey. Over the same period revenue from add-ons such as baggage check-in fees and speedy boarding rose from £571m to £719m and now accounts more than a quarter of turnover. Pre-tax profits rose by £60m to £248m.

One former budget airline executive said the seating move underlined how the brash former upstarts of the aviation world were becoming mainstream players by targeting business travellers.

John Strickland, an industry consultant and a former employee of the now-defunct Buzz carrier, said: "By offering free seating you don't have people clogging up the aisles wanting to find a particular seat. But if easyJet wants to get more business customers and improve its reputation for service, this is certainly something that business customers have been asking for." Nearly 20% of easyJet's passengers, or 9.5 million people a year, use the airline for business trips.

The announcement is a rare example of low-cost airlines reverting to the behaviour of the legacy carriers that they have supplanted on many routes. EasyJet and Ryanair are the progeny of Herb Kelleher, the founder of no-frills air travel and former chief executive of Dallas's Southwest Airlines, who ran his airline on four cardinal rules: fly one type of plane to cut engineering costs; keep overheads down; turn around aircraft quickly; abandon air miles schemes. There have been signs of a shift away from those principles in recent years, with Ryanair announcing that it is talking to Russian and Chinese manufacturers about adding more planes to its Boeing-dominated fleet, while both airlines use expensive airports such as Madrid Barajas that were previously the preserve of traditional carriers.

A Ryanair spokesman said the airline had no plans to extend its reserved seating programme to the entire plane, but it expects to offer bookable seats on a wider number of routes from next year. Under the Ryanair regime, some routes such as Dublin to London Stansted charge passengers £10 each for the right to reserve seats in the front two rows or emergency exit rows. "It looks like we will extend it further within the next few weeks because we are happy with how it has gone."

http://www.guardian.co.uk

Emirates expects its fleet size to reach around 280 by 2020. All superjumbos to be operational in the next five years, Ahmad says

Dubai: Emirates expects its fleet size to reach more than 250 aircraft by 2020, according to Shaikh Ahmad Bin Saeed Al Maktoum, President of Dubai Civil Aviation and Chairman and Chief Executive of Emirates airline and Group.

"We will be over 250 aircraft… maybe around 280 aircraft by 2020," he told Gulf News in an interview yesterday. The Arab world's biggest carrier currently has 162 planes, including 18 Airbus A380 superjumbos.

Shaikh Ahmad spoke shortly after Emirates announced a $26 billion (Dh95.5 billion) deal for 70 Boeing 777-300 ER (Extended Range) aircraft (including options for 20 of the aircraft type) on the opening day of the Dubai Airshow.

Some of the future deliveries would be used to replace the airline's previous fleet, according to Shaikh Ahmad. "Some of them [the 777s] will go into retiring old planes… I don't know how many," he said.

Hunger for growth

"And as we speak today, maybe we will have to extend some of the leases for aircraft that we were supposed to return. But the business was good and so we kept them. So within a year or so from now, you will perhaps see some of the older aircraft going out and being replaced by newer versions," he added.

Meanwhile, Emirates' hunger for growth will see the carrier expanding manifold in the future, Shaikh Ahmad said. Asked if Emirates was ever going to stop growing, he said: "Some of the carriers in the world have been in business for 50-60 years. Did they stop? Our growth should be forever."

Emirates has recently expressed intentions to increase its order for Airbus A380s to 120 planes from the current 90 it has on order as a long-term plan. Shaikh Ahmad said: "I hope [we will have] more. Today we have a huge firm order for 90 A380s, of which 18 are operational in our fleet today. We should have all of the 90 superjumbos operational between now and the next five years."

He said the new Concourse 3 coming up at Dubai International's Terminal 1 would be geared towards accommodating growth.

http://gulfnews.com

French Pilots Union Calls for Independent Crash Investigation

The French pilots union called for a more independent inquiry into the Air France 447 crash in 2009, saying that modified portions of a BEA report raised questions about the investigation bureau’s impartiality, the SNPL union said today in a statement.

The crash of the flight from Rio de Janeiro to Paris killed all 228 people on board.

The plane crashed after ice-blocked speed sensors shut down the autopilot and the crew incorrectly reacted by pulling the jet into a steep climb until it slowed to an aerodynamic stall, the BEA said in May. 

Qatar Air CEO Ridicules Airbus After Shelving Aircraft Order

Nov. 15 (Bloomberg) -- Qatar Airways Ltd. Chief Executive Officer Akbar Al Baker ridiculed Airbus SAS after walking away from aircraft purchases at the Dubai Air show, saying the manufacturer is “still learning how to build airplanes.”

Al Baker said he had planned to make a “very large” announcement today with Airbus, the industry leader in the civil aviation industry. Minutes earlier, Airbus was forced to abort a press conference, saying the deal was “too hot” to be signed on time. Al Baker declined to give a reason for the hold-up, saying only price isn’t necessarily the sticking point.

“We have reached an impasse with them,” Al Baker told the conference when asked why the Airbus deal fell through. “We thought we would conclude an agreement. Airbus is still learning how to make airplanes.”

The Qatar Air CEO, who markets his airline as a five-star luxury carrier, has built a reputation for riling aircraft manufacturers, slamming them for what he considers sub-par products and delays. Boeing Co. was forced to postpone the inaugural delivery in September of its jumbo 747-8 freighter to Cargolux Airlines International SA, in which Qatar Air holds a 35 percent stake, after Al Baker said the jet didn’t meet fuel- efficiency guarantees.

Public Humiliation

Qatar Airways and Boeing have overcome their differences, Al Baker said today, adding that “friends always have ups and downs in relationships, but it doesn’t mean you end your relationship.”

The Middle East carrier is the first customer to take the Airbus A350-900 wide-body aircraft, which Airbus is in the process of manufacturing. The company said last week that entry into service would slip to the first half of 2014, a delay Al Baker said today is “insignificant” on civil jet programs.

However, the company would not accept any additional delay on the new wide-body aircraft, as Qatar has used up its buffer on the A350, he said. Al Baker said he’s “not happy” with the design changes on the larger A350-1000 variant, which Airbus announced four months ago at the Paris Air show and which aims to add more thrust.

Al Baker said he’s “pessimistic” that he will be able to announce an accord with Airbus at the Dubai Air show, which wraps up tomorrow. Any deal would be “the icing on the cake” for the show, he sa

‘Pessimistic’

Airbus was exposed to public humiliation at the hand of Qatar Air as the airline leverages its clout as a growing global carrier. Qatar Airways doubled its fleet from 51 all-Airbus aircraft flying to 70 destinations in 2006, and now serves 109 destinations across Europe, Middle East, Africa, Asia, Australia, North America and South America. The carrier has orders for more than 200 jets valued in excess of $40 billion.

Boeing has so far dominated the Dubai show, winning its biggest order in history from Emirates, for 50 777-300ER wide- body aircraft, as well as options for 20 more. Al Baker urged Boeing to upgrade its 777, the company’s best-selling jet, and Qatar Air would consider a “large” number of an improved variant.

Qatar has ordered 20 of the largest A350 variant, 40 of the mid-sized version and 20 of the shortest member of the family. The airline has an agreement with Airbus to cover the delay on the A350-900, Al Baker said, after Airbus announced last week the hold-up would lead to a 200 million-euro charge.

“Everyone knows that Qatar Airways will not wait indefinitely,” Al Baker said if the A350 model. “Six months for a new program is insignificant but further delays will concern us.”

The airline CEO slammed Airbus as he announced that Qatar Air will buy two additional Boeing Co. 777 freighter aircraft, which Al Baker said is the “best freighter aircraft” in the world today. Still, his appearance was dominated by his diatribe against Airbus. Qatar will no longer convert its A330 passenger aircraft into freighter versions and may opt for older Boeing 767 aircraft instead, Al Baker said.

http://www.businessweek.com