Friday, October 31, 2008

Tiger Airways news

Reuters - Saturday, November 1SINGAPORE, Oct 31 - Tiger Airways, a budget carrier partly owned by Singapore Airlines , said on Friday it is sticking to its growth plans despite financial market turmoil, with seven additional planes expected within the next two years.

CEO Tony Davis said that despite the global economic slowdown he still saw good passenger demand, but said airfares would come under pressure.

"I still want to travel, I still want to have my holiday, I still want to see my family, but I'm looking for a cheaper fare," said Davis at an aviation conference in Singapore.

The low-cost carrier expects a total of 60 additional planes by 2016, five times the amount it operates currently.

Weakening consumer sentiment has led regional airlines to cut back routes, layoff staff and post losses. Singapore Air holds a 49 percent stake in Tiger.

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Cathay Pacific news from Reuters

Cathay sheds 5 jets from fleet, sees tough outlook

Reuters - Saturday, November 1* To leave fleet over 2 yrs

* Revenue from passenger services, cargo below targets

* Industry outlook remains very challenging

By Joanne Chiu

HONG KONG, Oct 31 - Cathay Pacific <0293.HK>, scrambling to cut costs in a worsening travel and aviation environment, said it planned to shed five jets from its fleet and warned of slowing bookings.

Asia's fifth-largest airline said the planes would be replaced eventually and it would continue to grow its fleet, although at a slower pace, according to a report posted on Cathay's internal websit on Friday.

Chief Executive Tony Tyler said in the report that cash from a disposal of five Boeing 777-200 aircraft would be useful, but added the airline was not certain a deal could go through in the current climate.

A Cathay spokeswoman confirmed the internal report had been posted on the website.

"The outlook remains very challenging with continued stress on the premium segment and weakening demand in the economy cabin. This means consistently weaker forward bookings for the rest of the year compared to 2007," Tyler said in the report.

Cathay also said that in the week ended Oct. 25, net revenue from passenger services, cargo and mail and excess baggage was 4.4 percent below target. The target was not specified.

Cathay, which owns regional carrier Dragonair and has an 18.1 percent stake in mainland carrier Air China <0753.HK><601111.SS>, posted a January-June net loss of HK$663 million , its first interim loss in five years, on soaring fuel costs.

Despite global oil prices falling more than half to $64 per barrel this week from a record $147 in July, Cathay may not benefit as much as expected.

"First, we will inevitably see a reduction in fuel surcharges soon. Second, the hedging protection we benefit from when prices rise has to be paid for by benefiting less when prices fall," the report said.

Aviation analysts warned this week that Asian airlines will fail as tourism in the region slows and a worsening global economic outlook leads carriers such as Singapore Airlines to cut back flights. [ID:nSIN353347]

The financial crisis is moving into the real economy as layoffs hurt consumer sentiment, leading airlines from China to India to post losses or lay off staff and hoteliers to focus on budget travellers as the luxury market takes a hit.

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Wednesday, October 29, 2008

Delta and NW merger

Delta airline and Northwest Airlines have merged to become the biggest airline in the world

Flying over the coast of the Gulf of Thailand

suvanau is located among aquaculture ponds

Our plane on its way to the runway

Taking off

Sunday, October 19, 2008

Departure hall

Departure gate

Suvanabumi airport Bangkok

Exterior view of Bangkok airport

Saturday, October 11, 2008

Qantas mid-air plunge

About 50 passengers were taken to hospital after a Qantas A330-300 plunged nose down during a Tuesday flight from Singapore to Perth. Investigators from the Australian Transport Safety Bureau (ATSB) were quoted as sayting on Wednesday that instruments aboard flight QF72 had warned pilots of a glitch in the stabilisation system just before the accident. The plane was carrying 303 passengers and 10 crew members when the incident happended at 11,000m. The jet made an emergency landing at Learmonth about 1,100km north east of Perth.

Thursday, October 9, 2008

Airlines brace for credit-card processor demands

Reuters - Tuesday, October 7 By Kyle Peterson

CHICAGO, Oct 6 - U.S. airlines, struggling to find stability in a time of unprecedented economic turbulence, are bracing against possible trauma that could be inflicted by credit-card processors made skittish by the credit crisis.

In recent months, top carriers like AMR Corp's American Airlines and UAL Corp's United Airlines have topped off their cash positions or changed deals with credit-card processors -- defensive moves triggered by fears that processors may demand bigger cash holdbacks.

"People are trying to get out in front of this because they don't want to be in the position that Frontier was," said airline consultant Robert Mann.

Frontier Airlines Holdings Inc filed for bankruptcy in April after its credit-card processor, First Data Corp, surprised the low-cost carrier with higher withholding requirements that put a strain on Frontier's liquidity. Other airlines aim to avoid that fate.

"It's going to continue to be an issue as long as the credit markets are in disarray," Mann said.

Credit-card processors take payment from airline customers who book travel weeks or months before a flight. Processors then pass that money to the carrier. But in doing so, they take on the risk that the airline could go under and fail to reimburse the money for travel not provided. In that event, the card processor would be left with that obligation.

To avoid or limit that risk, processors often require airlines to put a percentage of their advance booking proceeds aside for use should reimbursement be necessary.

Depending on its agreements with airlines, a processor that doubts the ability of an airline to provide travel or repay its debts may require a higher percentage of advance ticket revenue to be withheld.

In Frontier's case, First Data demanded that 50 percent of credit-card funds from advance purchases be withheld.

"Most credit card processing agreements include some kind of minimum liquidity requirement," said Bill Warlick, analyst at Fitch Ratings.

Warlick noted actions by American Airlines parent AMR and United parent UAL.

Last month, AMR said it would draw down its $225 million revolving credit facility to add to its liquidity pool and reduce the amount of potential credit-card holdback reserves. The company has said only one of its agreements gives the processor the right to hold back proceeds.

"t is possible that we could have holdbacks in place by the end of the year to the tune of about $200 million to $300 million," AMR Chief Financial Officer Thomas Horton said in July.

In June, UAL reached a deal with credit-card processors reducing reserves that United is required to maintain under a credit-card processing agreement.

In August, Delta Air Lines Inc borrowed the full amount of its $1 billion revolving credit facility to bolster its cash position. The company also amended its Visa/MasterCard processing agreement, which has no cash holdback requirement.

In June, Continental Airlines Inc amended a card processing deal to remove a minimum earnings-to-fixed-charges ratio as a trigger that could require the airline to post additional collateral. The agreement, however, requires the airline to maintain a minimum level of cash as well as a minimum rating on senior unsecured debt.

Fitch's Warlick said the U.S. airline industry, which in recent years has gone through a massive reorganization, is somewhat insulated from the credit crisis. The companies have restructured their debt and have less need for major purchases as they downsize.

But the risk that they might face higher cash holdback requirements remains a wild card.

"It's definitely one of the key liquidity issues that we're focused on right now," he said.