AFP - Friday, June 25
WASHINGTON, USA (AFP) - – President Barack Obama on Thursday said that Russia was buying 50 Boeing aircraft valued at four billion dollars that could create 44,000 jobs in the struggling US economy.
Obama, speaking after White House talks with Russian President Dmitry Medvedev, said the order was part of a broad array of trade and investment deals between the two countries.
"Consistent with my administration's national export initiative, this includes the sale of 50 Boeing aircraft worth four billion dollars that could add up to 44,000 new jobs in the American aerospace industry," Obama said.
In a statement released after Obama's comment, Boeing said that it had signed a document with the Russian state corporation Rostechnologii "confirming the decision by Rostechnologii to place an order for 50 Boeing Next-Generation 737 airplanes."
The document was signed during Medvedev's official visit to the United States, the aerospace giant said, without providing further details.
"Rostechnologii's selection of Boeing airplanes demonstrates its commitment to deploying the optimal solution for the market needs," the Chicago-based company said.
Touting "the economic benefits and operating efficiencies" of the Next-Generation 737, Boeing said the planes would "directly support Rostechnologii's plan to provide Russian airlines with efficient and reliable airplanes that will help them to consolidate and grow their domestic and international operations."
"We look forward to continuing our long-term partnership with Rostechnologii and finalizing the contract," the company said.
Jim Proulx, spokesman for Boeing Commercial Airplanes, said in an interview with AFP that the 50 Next-Generation 737s were worth "3.6 billion dollars at current list price."
Commercial aircraft are often sold below list value.
Proulx noted the agreement signed was for the Russian state firm to purchase the planes, but further details needed to be worked out for a firm contract, such as which airlines would be taking the planes, delivery dates and deposit amounts.
The US company briefly announced at the end of May that the Russian state firm had selected the Next-Generation 737 for its aviation business development.
Boeing currently has an order backlog of 2,000 for the planes.
Last week Boeing announced a second production rate increase on the Next-Generation 737 program, taking the rate from the rate of 34 airplanes per month, previously announced in May, to 35 planes in early 2012, citing continued strong demand.
Thursday, June 24, 2010
Spending Spree by Emirates Shakes Up Airline Business
By STEVE ROTHWELL and ANDREA ROTHMAN
Published: June 23, 2010
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LONDON — Emirates, the international airline, is rattling rivals in Europe and Asia with a growth splurge that may be as game-changing for long-distance carriers as the expansion of Ryanair and Southwest Airlines was over shorter routes.
Emirates, a 25-year-old company, is building up a fleet of 90 Airbus A380 superjumbo aircraft with a total of 45,000 seats and operating costs that the manufacturer says are 12 percent lower than those for Boeing’s latest 747.
That is a threat to European carriers that specialize in the same long-distance transfer traffic, the chief executive of British Airways, Willie Walsh, said during an interview.
Emirates’ latest order, for 32 A380s worth $11 billion, was announced this month. It will give the airline 70 more superjumbos than any other airline, funneling price-sensitive passengers through its Dubai hub in a challenge to network carriers including Lufthansa, Air France-KLM and Singapore Airlines. Competitors say that the company is benefiting from government ownership and that they cannot compete with its purchasing power.
“It’s a miracle that Emirates already has more intercontinental seats than Air France and British Airways combined,” said Wolfgang Mayrhuber, the chief executive of Lufthansa. “It took us 40 years to get 30 747s in the air in one of the biggest global economies, so one must assume that this is an investment for the world.”
Emirates ranked only 24th among international airlines as recently as 2000, putting it on a par with Sabena, the state-owned Belgian carrier that failed a year later. In the intervening period the Gulf carrier has increased traffic sixfold, overtaking Lufthansa last year to become the biggest carrier for international flights. British Airways, ranked No.1 in 2000, now is fourth.
“We always planned to grow,” Maurice Flanagan, the founding chief of Emirates and current executive vice chairman, said during an interview. “We were just never able to put our finger on how quickly. Now we’re short of capacity all the time.”
Rivals should follow the Emirates example in buying more large planes to reduce expenses per head, he said.
“I can’t understand why other airlines have been so slow to pick up on the A380,” Mr. Flanagan said. “The economics are fantastic.”
Emirates, which reported net income of $964 million for the year ended March 31, has reached the top spot while remaining outside the three main airline groupings, choosing instead to build Dubai into a transfer hub to compete with alliance bases in London, Frankfurt, Amsterdam, Paris, Singapore and Hong Kong.
Chris Tarry, an independent analyst who has followed the airline industry for two decades, said the model was largely the result of improved jetliner range and Dubai’s fortuitous location midway between Europe and Asia.
“First, there’s now the technological capability to join any two places on the globe with just one stop,” Mr. Tarry said from London. “Second, Dubai is very well placed to capture those intercontinental traffic flows from North America to Asia and Europe to Asia and Australia and so on.”
Emirates has 14 daily routes from six British airports, including five from Heathrow, the busiest European hub, and three from London Gatwick. Starting in September, one of two daily flights from Manchester in northern England will handle the A380, the plane’s first service to a secondary city.
Weight reductions and improved fuel loads should allow the superjumbo to reach the West Coast of the United States from Dubai by 2014, Mr. Flanagan said. The chief salesman for Airbus, John Leahy, predicted that more airlines would buy the plane to defend market share from Europe to Asia and across the Pacific.
While Mr. Flanagan estimates that 40 percent of traffic from Britain connects to other cities via Dubai, Mr. Walsh, the British Airways chief, says that the Gulf carrier is a bigger threat to Lufthansa and Air France-KLM because of the greater proportion of transfer passengers who travel through Frankfurt, Paris and Amsterdam.
“It’s definitely going to have an impact on the business,” Mr. Walsh said last week. “It’s challenging a segment of the market that is important for B.A. But there are other European hubs where the reliance on transfers is bigger.”
The British carrier’s Oneworld alliance partner, Cathay Pacific, will aim to counter the expansion of Emirates with “enhanced connectivity” from its own hub in Hong Kong, a spokeswoman said in an e-mail message.
The Emirates model is eroding network carriers’ long-distance traffic in the same way that discount airlines have eaten into short-haul operations.
The effect could be even greater, since much of the success of Ryanair, which has increased revenue eightfold, to €3 billion, or $3.7 billion, in a decade to become the biggest European low-cost airline, came from linking cities with no air service, whereas Emirates is confronting established carriers more directly on some of their most profitable routes.
Basic to the strategy is the use of so-called sixth-freedom treaties that permit flights between two nations by an airline from a third via its home country. The model works best on long-distance routes requiring refueling, on which Emirates does not lose out to competitors by stopping in Dubai, and for passengers who care more about ticket prices than the duration of a journey.
Andrea Rothman reported from Paris.
Bloomberg News
Published: June 23, 2010
Recommend
LONDON — Emirates, the international airline, is rattling rivals in Europe and Asia with a growth splurge that may be as game-changing for long-distance carriers as the expansion of Ryanair and Southwest Airlines was over shorter routes.
Emirates, a 25-year-old company, is building up a fleet of 90 Airbus A380 superjumbo aircraft with a total of 45,000 seats and operating costs that the manufacturer says are 12 percent lower than those for Boeing’s latest 747.
That is a threat to European carriers that specialize in the same long-distance transfer traffic, the chief executive of British Airways, Willie Walsh, said during an interview.
Emirates’ latest order, for 32 A380s worth $11 billion, was announced this month. It will give the airline 70 more superjumbos than any other airline, funneling price-sensitive passengers through its Dubai hub in a challenge to network carriers including Lufthansa, Air France-KLM and Singapore Airlines. Competitors say that the company is benefiting from government ownership and that they cannot compete with its purchasing power.
“It’s a miracle that Emirates already has more intercontinental seats than Air France and British Airways combined,” said Wolfgang Mayrhuber, the chief executive of Lufthansa. “It took us 40 years to get 30 747s in the air in one of the biggest global economies, so one must assume that this is an investment for the world.”
Emirates ranked only 24th among international airlines as recently as 2000, putting it on a par with Sabena, the state-owned Belgian carrier that failed a year later. In the intervening period the Gulf carrier has increased traffic sixfold, overtaking Lufthansa last year to become the biggest carrier for international flights. British Airways, ranked No.1 in 2000, now is fourth.
“We always planned to grow,” Maurice Flanagan, the founding chief of Emirates and current executive vice chairman, said during an interview. “We were just never able to put our finger on how quickly. Now we’re short of capacity all the time.”
Rivals should follow the Emirates example in buying more large planes to reduce expenses per head, he said.
“I can’t understand why other airlines have been so slow to pick up on the A380,” Mr. Flanagan said. “The economics are fantastic.”
Emirates, which reported net income of $964 million for the year ended March 31, has reached the top spot while remaining outside the three main airline groupings, choosing instead to build Dubai into a transfer hub to compete with alliance bases in London, Frankfurt, Amsterdam, Paris, Singapore and Hong Kong.
Chris Tarry, an independent analyst who has followed the airline industry for two decades, said the model was largely the result of improved jetliner range and Dubai’s fortuitous location midway between Europe and Asia.
“First, there’s now the technological capability to join any two places on the globe with just one stop,” Mr. Tarry said from London. “Second, Dubai is very well placed to capture those intercontinental traffic flows from North America to Asia and Europe to Asia and Australia and so on.”
Emirates has 14 daily routes from six British airports, including five from Heathrow, the busiest European hub, and three from London Gatwick. Starting in September, one of two daily flights from Manchester in northern England will handle the A380, the plane’s first service to a secondary city.
Weight reductions and improved fuel loads should allow the superjumbo to reach the West Coast of the United States from Dubai by 2014, Mr. Flanagan said. The chief salesman for Airbus, John Leahy, predicted that more airlines would buy the plane to defend market share from Europe to Asia and across the Pacific.
While Mr. Flanagan estimates that 40 percent of traffic from Britain connects to other cities via Dubai, Mr. Walsh, the British Airways chief, says that the Gulf carrier is a bigger threat to Lufthansa and Air France-KLM because of the greater proportion of transfer passengers who travel through Frankfurt, Paris and Amsterdam.
“It’s definitely going to have an impact on the business,” Mr. Walsh said last week. “It’s challenging a segment of the market that is important for B.A. But there are other European hubs where the reliance on transfers is bigger.”
The British carrier’s Oneworld alliance partner, Cathay Pacific, will aim to counter the expansion of Emirates with “enhanced connectivity” from its own hub in Hong Kong, a spokeswoman said in an e-mail message.
The Emirates model is eroding network carriers’ long-distance traffic in the same way that discount airlines have eaten into short-haul operations.
The effect could be even greater, since much of the success of Ryanair, which has increased revenue eightfold, to €3 billion, or $3.7 billion, in a decade to become the biggest European low-cost airline, came from linking cities with no air service, whereas Emirates is confronting established carriers more directly on some of their most profitable routes.
Basic to the strategy is the use of so-called sixth-freedom treaties that permit flights between two nations by an airline from a third via its home country. The model works best on long-distance routes requiring refueling, on which Emirates does not lose out to competitors by stopping in Dubai, and for passengers who care more about ticket prices than the duration of a journey.
Andrea Rothman reported from Paris.
Bloomberg News
Wednesday, June 9, 2010
Berlin Air Show takes off with record 'superjumbo' order
AFP - Wednesday, June 9
BERLIN (AFP) - –
The 100th edition of the Berlin Air Show took off with a roar Tuesday as Dubai-based airline Emirates snapped up 32 Airbus A380 superjumbos, hailed as the largest order ever for commercial aircraft.
In the year's first order for the massive A380 plane, Emirates splashed out 11.5 billion dollars, providing a much-needed boost to Airbus and a headline-grabbing start to the Show.
"It's the largest order ever placed for civil aircraft by dollar value based on catalogue prices in aviation history," said a delighted John Leahy, chief commercial officer at Airbus.
Airbus also announced that TAM Airlines of Brazil had ordered 20 A320 planes and five of its new long-haul A350-900 aircraft, with the deal worth around 2.9 billion dollars (2.43 billion euros) at catalogue prices.
And in another boost for Airbus, France, Germany and Spain pledged cash to help the firm develop the A350 XWB wide-bodied aircraft.
Paris would stump up 1.4 billion euros, Berlin 1.0 billion euros and Madrid 350 million euros, representatives of the various governments said at the Show.
Running until June 13, the Berlin Air Show (ILA) was set to attract about 1,150 exhibitors from nearly 50 countries presenting all manner of planes, helicopters, rotors, motors and other technology to around 200,000 visitors.
The ILA this year was opened by Chancellor Angela Merkel who hailed the special role played by the aviation industry in Germany's economy.
"Aviation is, as it has always been, an area of the economy that pushes forward the development of technology in general," she said.
"Therefore, for a business location such as Germany, aviation technology has an influence that goes far beyond its own domain," added the chancellor.
With the annual gathering of the International Air Transport Association (IATA) also taking part in Berlin at the same time, almost all of the high-fliers in the aviation world were to be found in the German capital.
However, while the aircraft suppliers were feting Merkel at the ILA, on the other side of town, their main customers at the IATA meeting were attacking her after she announced Monday a new tax on passengers leaving German airports.
The tax, which Merkel outlined Monday as part of a multi-billion package of belt-tightening measures, is set to run until the carbon-emissions trading scheme that has already been agreed comes into effect for air travel in 2012.
It is expected to bring in about one billion euros annually.
IATA's director general, Giovanni Bisignani, called for the tax to be scrapped immediately, saying it threatened to bring airlines down just when they were starting to see a recovery after several years of massive losses.
"This is the worst kind of short-sighted policy irresponsibility. It's a cash-grab by a cash-strapped government," he told reporters in Berlin.
"If this is related to the environment ... I would like the chancellor to say to us, where is the investment? How many trees is she planting with this one billion?" he said.
"This is not the time to burden the aviation industry with more taxes ... this tax is a body blow to the weak economy and a fragile industry," he added.
IATA had earlier revised up its forecasts for this year, projecting the industry's first profit since 2007.
BERLIN (AFP) - –
The 100th edition of the Berlin Air Show took off with a roar Tuesday as Dubai-based airline Emirates snapped up 32 Airbus A380 superjumbos, hailed as the largest order ever for commercial aircraft.
In the year's first order for the massive A380 plane, Emirates splashed out 11.5 billion dollars, providing a much-needed boost to Airbus and a headline-grabbing start to the Show.
"It's the largest order ever placed for civil aircraft by dollar value based on catalogue prices in aviation history," said a delighted John Leahy, chief commercial officer at Airbus.
Airbus also announced that TAM Airlines of Brazil had ordered 20 A320 planes and five of its new long-haul A350-900 aircraft, with the deal worth around 2.9 billion dollars (2.43 billion euros) at catalogue prices.
And in another boost for Airbus, France, Germany and Spain pledged cash to help the firm develop the A350 XWB wide-bodied aircraft.
Paris would stump up 1.4 billion euros, Berlin 1.0 billion euros and Madrid 350 million euros, representatives of the various governments said at the Show.
Running until June 13, the Berlin Air Show (ILA) was set to attract about 1,150 exhibitors from nearly 50 countries presenting all manner of planes, helicopters, rotors, motors and other technology to around 200,000 visitors.
The ILA this year was opened by Chancellor Angela Merkel who hailed the special role played by the aviation industry in Germany's economy.
"Aviation is, as it has always been, an area of the economy that pushes forward the development of technology in general," she said.
"Therefore, for a business location such as Germany, aviation technology has an influence that goes far beyond its own domain," added the chancellor.
With the annual gathering of the International Air Transport Association (IATA) also taking part in Berlin at the same time, almost all of the high-fliers in the aviation world were to be found in the German capital.
However, while the aircraft suppliers were feting Merkel at the ILA, on the other side of town, their main customers at the IATA meeting were attacking her after she announced Monday a new tax on passengers leaving German airports.
The tax, which Merkel outlined Monday as part of a multi-billion package of belt-tightening measures, is set to run until the carbon-emissions trading scheme that has already been agreed comes into effect for air travel in 2012.
It is expected to bring in about one billion euros annually.
IATA's director general, Giovanni Bisignani, called for the tax to be scrapped immediately, saying it threatened to bring airlines down just when they were starting to see a recovery after several years of massive losses.
"This is the worst kind of short-sighted policy irresponsibility. It's a cash-grab by a cash-strapped government," he told reporters in Berlin.
"If this is related to the environment ... I would like the chancellor to say to us, where is the investment? How many trees is she planting with this one billion?" he said.
"This is not the time to burden the aviation industry with more taxes ... this tax is a body blow to the weak economy and a fragile industry," he added.
IATA had earlier revised up its forecasts for this year, projecting the industry's first profit since 2007.
Saturday, May 29, 2010
Thousands flee Ecuador, Guatemala volcanos
GUATEMALA CITY : Thousands of people were evacuated and airports were closed as two volcanos erupted in Guatemala and Ecuador Friday, choking major cities with ash, and leaving two dead, officials said.
Guatemalan President Alvaro Colom declared a 15-day state of emergency around the Pacaya volcano, 50 kilometres (31 miles) south of the capital.
The volcano erupted again Friday after first bursting back to life Wednesday, killing two people, including a television reporter covering the event.
In Ecuador, the Tungurahua volcano exploded into action Friday, forcing the evacuation of at least seven villages and closing down the airport and public schools in Guayaquil, the country's largest and most populated city.
As the 2,552 metres (8,372 feet) Pacaya volcano exploded anew on Friday, with billowing clouds of ash and dust, Colom said La Aurora International Airport, in Guatemala City, would remain closed until Saturday "because we've got to clean the runways and surrounding areas" of ash.
The airport closures were reminiscent of the massive blanket of ash Iceland's Eyjafjoell volcano spewed out last month causing the biggest aerial shutdown in Europe since World War II, affecting more than 100,000 flights and eight million passengers.
President Colom said the eruptions of Pacaya since Wednesday had killed two people, injured 59, left three children missing and destroyed 100 homes.
The Emergency Management Coordinator said between 1,700-1,900 people have been evacuated from their homes to nearby shelters in three departments affected by the emergency decree.
The education ministry also suspended classes in the emergency area.
On Friday, the volcano was rocked by constant explosions and spewed bright-colored plumes into the air.
Guatemala City was covered in a blanket of ash and dust, as people evacuated from the danger zone wandered the streets darkened by the ash cloud and the city's two million inhabitants tried to cope with the catastrophe.
The head of the national seismological institute warned more eruptions could take place "in the coming days" at the most active volcano in Central America.
The Pacaya volcano has been active for 49 years and has experienced six large eruptions.
The head of the national seismological institute Eddy Sanchez said the volcano had accumulated a lot of energy over several years. "Like a pressure cooker, it will release the pressure violently," he told reporters.
He warned that lava would continue to spew out at high altitudes.
The charred body of television journalist Anibal Archila was found near the volcano by a colleague, who said the victim could not escape the raining rocks and other projectiles thrown out when the volcano exploded late Thursday.
"We decided to stay a few minutes longer taking more photographs. Suddenly, we heard rumblings and rocks began falling all around so we had to get out running," a driver for one of the reporters covering the scene with Archila told the Nuestro Diario newspaper.
The second eruption-related fatality was that of a 22-year-old man who fell to his death as he cleaned volcano ash from the roof of a school.
Colom vowed government action to clean up the gray mess.
"The people must feel confident that the state is responding," the president said as he announced he would travel to the most affected municipalities to work with emergency committees.
Within a 100-kilometre (62-mile) radius of the volcano, locals armed with brooms and shovels scrambled to remove sand and ash from the roofs and courtyards of their homes.
"We've only cleaned the backyard so far and we've already filled a large garbage bag," Isabel Estevez told AFP. She and her husband began cleaning the sediment dumped by the volcano, up to five centimetres (two inches) thick in some places.
In Ecuador, meanwhile, the Tungurahua volcano experienced one of its biggest eruptions Friday, spewing columns of ash and rock prompting evacuations of at least seven surrounding villages.
"Certain measures have been taken, including the closure of Guayaquil airport until further notice and the suspension of classes in Guayas province, as we make a new assessment" of the situation, said Yuri De Janon, regional coordinator of risk management.
He said the ash fallout from the volcano was affecting Guayaquil and four other towns in Guayas.
Hugo Yepes, director of Ecuador's Geophysical Institute, noted that the volcano was at one point spewing molten rocks and large clouds of ash and gas 10 kilometres (33,000 feet) into the sky. But he said the volcanic activity had since decreased. - AFP/jy
Guatemalan President Alvaro Colom declared a 15-day state of emergency around the Pacaya volcano, 50 kilometres (31 miles) south of the capital.
The volcano erupted again Friday after first bursting back to life Wednesday, killing two people, including a television reporter covering the event.
In Ecuador, the Tungurahua volcano exploded into action Friday, forcing the evacuation of at least seven villages and closing down the airport and public schools in Guayaquil, the country's largest and most populated city.
As the 2,552 metres (8,372 feet) Pacaya volcano exploded anew on Friday, with billowing clouds of ash and dust, Colom said La Aurora International Airport, in Guatemala City, would remain closed until Saturday "because we've got to clean the runways and surrounding areas" of ash.
The airport closures were reminiscent of the massive blanket of ash Iceland's Eyjafjoell volcano spewed out last month causing the biggest aerial shutdown in Europe since World War II, affecting more than 100,000 flights and eight million passengers.
President Colom said the eruptions of Pacaya since Wednesday had killed two people, injured 59, left three children missing and destroyed 100 homes.
The Emergency Management Coordinator said between 1,700-1,900 people have been evacuated from their homes to nearby shelters in three departments affected by the emergency decree.
The education ministry also suspended classes in the emergency area.
On Friday, the volcano was rocked by constant explosions and spewed bright-colored plumes into the air.
Guatemala City was covered in a blanket of ash and dust, as people evacuated from the danger zone wandered the streets darkened by the ash cloud and the city's two million inhabitants tried to cope with the catastrophe.
The head of the national seismological institute warned more eruptions could take place "in the coming days" at the most active volcano in Central America.
The Pacaya volcano has been active for 49 years and has experienced six large eruptions.
The head of the national seismological institute Eddy Sanchez said the volcano had accumulated a lot of energy over several years. "Like a pressure cooker, it will release the pressure violently," he told reporters.
He warned that lava would continue to spew out at high altitudes.
The charred body of television journalist Anibal Archila was found near the volcano by a colleague, who said the victim could not escape the raining rocks and other projectiles thrown out when the volcano exploded late Thursday.
"We decided to stay a few minutes longer taking more photographs. Suddenly, we heard rumblings and rocks began falling all around so we had to get out running," a driver for one of the reporters covering the scene with Archila told the Nuestro Diario newspaper.
The second eruption-related fatality was that of a 22-year-old man who fell to his death as he cleaned volcano ash from the roof of a school.
Colom vowed government action to clean up the gray mess.
"The people must feel confident that the state is responding," the president said as he announced he would travel to the most affected municipalities to work with emergency committees.
Within a 100-kilometre (62-mile) radius of the volcano, locals armed with brooms and shovels scrambled to remove sand and ash from the roofs and courtyards of their homes.
"We've only cleaned the backyard so far and we've already filled a large garbage bag," Isabel Estevez told AFP. She and her husband began cleaning the sediment dumped by the volcano, up to five centimetres (two inches) thick in some places.
In Ecuador, meanwhile, the Tungurahua volcano experienced one of its biggest eruptions Friday, spewing columns of ash and rock prompting evacuations of at least seven surrounding villages.
"Certain measures have been taken, including the closure of Guayaquil airport until further notice and the suspension of classes in Guayas province, as we make a new assessment" of the situation, said Yuri De Janon, regional coordinator of risk management.
He said the ash fallout from the volcano was affecting Guayaquil and four other towns in Guayas.
Hugo Yepes, director of Ecuador's Geophysical Institute, noted that the volcano was at one point spewing molten rocks and large clouds of ash and gas 10 kilometres (33,000 feet) into the sky. But he said the volcanic activity had since decreased. - AFP/jy
Friday, May 28, 2010
Guatemala volcano forces airport closure, kills one
GUATEMALA CITY : Guatemalan President Alvaro Colom has declared a state of emergency after a powerful eruption at the southern Pacaya volcano killed one person and forced the international airport to close.
Ash blanketed the region as rocks and lava spewed from the volcano 50 kilometers (31 miles) south of the capital, as Colom late Thursday issued the emergency decree lasting at least 15 days for the three departments nearest the eruption, which began Wednesday night and has since built in intensity.
The La Aurora International Airport was closed to ensure planes were not flying through the volcano's hazardous ash cloud or landing on the ash-strewn runway, said spokeswoman Monica Monge. Incoming flights were being diverted to airports in other parts of the country, she told reporters.
Some 1,600 people were evacuated from the slopes of the volcano, which rises 2,552 meters (8,372 feet) above sea level in the tropical Central American nation.
The burnt body of Guatemalan television journalist Anibal Archila was found near the volcano by a colleague, who said the reporter had been unable to escape the raining rocks and other projectiles thrown out in the eruption.
Three children aged seven, nine and 10 are also missing in the area, officials said.
There are 288 volcanoes in Guatemala, eight of which are active.
- AFP /ls
Ash blanketed the region as rocks and lava spewed from the volcano 50 kilometers (31 miles) south of the capital, as Colom late Thursday issued the emergency decree lasting at least 15 days for the three departments nearest the eruption, which began Wednesday night and has since built in intensity.
The La Aurora International Airport was closed to ensure planes were not flying through the volcano's hazardous ash cloud or landing on the ash-strewn runway, said spokeswoman Monica Monge. Incoming flights were being diverted to airports in other parts of the country, she told reporters.
Some 1,600 people were evacuated from the slopes of the volcano, which rises 2,552 meters (8,372 feet) above sea level in the tropical Central American nation.
The burnt body of Guatemalan television journalist Anibal Archila was found near the volcano by a colleague, who said the reporter had been unable to escape the raining rocks and other projectiles thrown out in the eruption.
Three children aged seven, nine and 10 are also missing in the area, officials said.
There are 288 volcanoes in Guatemala, eight of which are active.
- AFP /ls
Sunday, May 23, 2010
Confessions of a frequent-flier program skeptic
Christopher Elliott, Tribune Media Services
May 18, 2010 -- Updated 1637 GMT (0037 HKT)
(Tribune Media Services) -- Call me a frequent-flier program skeptic.
I take a dim view of any scheme that promises you the world in exchange for all your business. Not that I don't like sitting in first class, staying in a suite or being treated like a movie star. I mean, who doesn't?
Having covered the travel industry for most of my career, I just don't believe in "win-win" propositions. I think there's a steep and often hidden price to be paid when you collect miles. The game can easily turn into an obsession that disables your common sense, compelling you to make completely irrational purchasing decisions.
Fact is, offers of "free" products, perks and preferred status in exchange for racking up points through travel or credit card purchases aren't for everyone. They probably aren't for you.
I won't suggest that loyalty programs are morally wrong and that they divide travelers into haves (the ones who get to board anytime on the red carpet) and have-nots (the unlucky schlubs wedged into the middle seats), even though I could probably write an entire column on that topic.
When I say I don't believe in "win-wins" I'm not even referring to the recent precipitous devaluations in mileage programs. For example, at the beginning of this year, Hilton "updated" its award levels for free stays, increasing the number of points you need. An exasperated reader in Philadelphia sent me the notice with the following advice for his fellow frequent guests: "Use your points -- now!"
Nor am I talking about the onerous "co-pays" that some airlines recently added for mileage redemption, like the one Perry Bird had to shell out when he recently tried to book an upgrade on a flight from Dulles International Airport to St. Martin. It used to cost 60,000 miles for a bump to business class on United Airlines. "Now, United wants my 60,000 miles and an additional $1,400 for the same upgrade," he told me. "Puhleese!"
I don't even have a problem with the maddening terms and conditions that stipulate that the points and miles don't belong to you and that companies reserve the right to change the rules anytime without notice. I'm not making this up. Here's an excerpt from American Airlines' terms and conditions: "Accrued mileage credit and award tickets do not constitute property of the member. . . . American Airlines may, in its discretion, change the AAdvantage program rules, regulations, travel awards and special offers at any time with or without notice."
No, in my view, the winners obviously are the travel companies that have seduced their best customers with creature comforts that they probably ought to be giving everyone, and the losers are the elite-level lemmings, who have become blindly brand-loyal.
Don't bother sending me hate mail. When word got around that I -- a loyalty-program atheist -- was working on a story about the value of reward programs, it didn't take long for the true believers to offer me a piece of their mind.
"Of course they're worth it," snapped Charles Owen, a college professor in East Lansing, Michigan. "You look at the costs and the benefits. The only cost associated with collecting miles is our decision to have a SkyMiles American Express with the associated fee. Other than that, they just accumulate, and every now and then we use them."
And use them he has, to visit Europe and the Caribbean. Owen said he takes two "free" flights a year, thanks to a credit card that allows him to collect miles, which is also known as an affinity card. Apart from the annual fee on a card, these programs appear to have no downside. Sure, there are blackout dates and restrictions, and award seats aren't always available. But it's a free ticket, right?
Not right. There's more to loyalty programs than meets the eye, according to consumer advocate Jo Anne Shumard. "Cards that offer perks to consumers often do so at a premium interest rate," she warned. "I even have one for airline miles, but it's almost three times the interest rate of my lowest credit card interest rate."
Who should participate in a loyalty program?
If you're a managed frequent business traveler, you have my blessing. By "managed" I mean that your company works with preferred vendors, and you fly, drive and stay with a set of companies whether you want to or not.
Your loyalty isn't for sale. Your points are just a byproduct of your business trips, and you're far less likely to participate in irrational point-collecting or making silly mileage runs at the end of the year to qualify for coveted elite status, which entitles you to extra-special treatment when you're on the road.
For instance, "Chairman's Preferred"-level frequent fliers on US Airways get priority check-in, security lanes and early boarding, unlimited free upgrades in the United States, up to three free checked bags and complimentary airport club membership. Alas, to reach that level, you have to fly 100,000 miles within a calendar year (other terms also apply).
Christina Pappas, a Boston-based marketing consultant and frequent traveler, thinks it's important that you control the miles, not the other way around. "All things being equal, I'll try to remain loyal when possible," she told me. "But there are times when it doesn't make sense for me to make two connections just to get my points."
If you're an unmanaged frequent business traveler, and you want to collect points, you're playing a dangerous game. Falling in with the wrong crowd on FlyerTalk, a popular hangout for frequent travelers, isn't the biggest risk to you. It is, instead, making purchasing decisions that are in the interests of your program, but not you.
Bernard Pollack, a frequent traveler and loyalty program member who lives in Dakar, Senegal, and is an elite-level frequent traveler with US Airways, United, Hilton and Starwood, thinks that programs warp your perspective, often enticing you to spend more on travel or ignore better prices with a competitor.
"I don't believe people should choose, and certainly not pay more for, certain airlines, hotels and cars because of the loyalty programs," he said.
What if you're traveling for pleasure? If your trips are infrequent, you should stay on the sidelines, says Allison Danziger, director of TripAdvisor Flights. "One specific case is where a traveler would fly less often than the frequent flier mile expiration window for their program," she added.
"Frequent flier miles on most carriers expire after one to three years of inactivity." In other words, your miles would expire before you could use them, obviously negating any benefit.
If you're a frequent leisure traveler, then sure, go for it, but with the same caveat I offered the unmanaged business travelers: Don't get addicted and don't let it control you.
Look, I could spend a couple of paragraphs talking up loyalty programs in an effort to convince you that I can be balanced on this subject. And while it's true that these schemes aren't without benefit, I figure that they have enough apologists already. Besides, that's not my department; I handle the complaints.
Speaking of complaints, here's a cautionary tale for anyone thinking of offering their loyalty to a travel company. It comes to us by way of Robin Forman, a retired librarian in Miami and a frequent leisure traveler.
She used some of the American Airlines miles that she'd collected by flying and making purchases with a Citibank MasterCard to upgrade on a flight from Brussels to Chicago. But when the flight was canceled after the recent volcanic eruption, the carrier pocketed a $350 "service charge" for using the miles.
Forman asked for a refund. "Service charges are necessary to help offset the costs associated with these transactions," an airline representative told her in an e-mail rejecting her request. "I'm sorry my response couldn't be more positive."
Yeah, me too.
Mileage addicts may argue that people like Forman should double down and focus their loyalty on a single company. After all, top-tier elites don't have to pay a lot of the fees that garden-variety frequent travelers do. But I see her story as a reason to reconsider loyalty programs entirely. Not to pick on American Airlines -- a lot of the legacy airlines have these annoying fees for ticket awards -- but if this is loyalty, what's the point?
And that's the thing: The harder you look at so-called "rewards" programs in travel, the harder it is to believe in them. They successfully entice travelers to drive, fly and stay with a particular company, giving them a level of service the companies should offer every customer.
But more often than not, the loyalty goes only one way.
(Christopher Elliott is the ombudsman for National Geographic Traveler magazine. You can read more travel tips on his blog, elliott.org or e-mail him at celliott@ngs.org).
May 18, 2010 -- Updated 1637 GMT (0037 HKT)
(Tribune Media Services) -- Call me a frequent-flier program skeptic.
I take a dim view of any scheme that promises you the world in exchange for all your business. Not that I don't like sitting in first class, staying in a suite or being treated like a movie star. I mean, who doesn't?
Having covered the travel industry for most of my career, I just don't believe in "win-win" propositions. I think there's a steep and often hidden price to be paid when you collect miles. The game can easily turn into an obsession that disables your common sense, compelling you to make completely irrational purchasing decisions.
Fact is, offers of "free" products, perks and preferred status in exchange for racking up points through travel or credit card purchases aren't for everyone. They probably aren't for you.
I won't suggest that loyalty programs are morally wrong and that they divide travelers into haves (the ones who get to board anytime on the red carpet) and have-nots (the unlucky schlubs wedged into the middle seats), even though I could probably write an entire column on that topic.
When I say I don't believe in "win-wins" I'm not even referring to the recent precipitous devaluations in mileage programs. For example, at the beginning of this year, Hilton "updated" its award levels for free stays, increasing the number of points you need. An exasperated reader in Philadelphia sent me the notice with the following advice for his fellow frequent guests: "Use your points -- now!"
Nor am I talking about the onerous "co-pays" that some airlines recently added for mileage redemption, like the one Perry Bird had to shell out when he recently tried to book an upgrade on a flight from Dulles International Airport to St. Martin. It used to cost 60,000 miles for a bump to business class on United Airlines. "Now, United wants my 60,000 miles and an additional $1,400 for the same upgrade," he told me. "Puhleese!"
I don't even have a problem with the maddening terms and conditions that stipulate that the points and miles don't belong to you and that companies reserve the right to change the rules anytime without notice. I'm not making this up. Here's an excerpt from American Airlines' terms and conditions: "Accrued mileage credit and award tickets do not constitute property of the member. . . . American Airlines may, in its discretion, change the AAdvantage program rules, regulations, travel awards and special offers at any time with or without notice."
No, in my view, the winners obviously are the travel companies that have seduced their best customers with creature comforts that they probably ought to be giving everyone, and the losers are the elite-level lemmings, who have become blindly brand-loyal.
Don't bother sending me hate mail. When word got around that I -- a loyalty-program atheist -- was working on a story about the value of reward programs, it didn't take long for the true believers to offer me a piece of their mind.
"Of course they're worth it," snapped Charles Owen, a college professor in East Lansing, Michigan. "You look at the costs and the benefits. The only cost associated with collecting miles is our decision to have a SkyMiles American Express with the associated fee. Other than that, they just accumulate, and every now and then we use them."
And use them he has, to visit Europe and the Caribbean. Owen said he takes two "free" flights a year, thanks to a credit card that allows him to collect miles, which is also known as an affinity card. Apart from the annual fee on a card, these programs appear to have no downside. Sure, there are blackout dates and restrictions, and award seats aren't always available. But it's a free ticket, right?
Not right. There's more to loyalty programs than meets the eye, according to consumer advocate Jo Anne Shumard. "Cards that offer perks to consumers often do so at a premium interest rate," she warned. "I even have one for airline miles, but it's almost three times the interest rate of my lowest credit card interest rate."
Who should participate in a loyalty program?
If you're a managed frequent business traveler, you have my blessing. By "managed" I mean that your company works with preferred vendors, and you fly, drive and stay with a set of companies whether you want to or not.
Your loyalty isn't for sale. Your points are just a byproduct of your business trips, and you're far less likely to participate in irrational point-collecting or making silly mileage runs at the end of the year to qualify for coveted elite status, which entitles you to extra-special treatment when you're on the road.
For instance, "Chairman's Preferred"-level frequent fliers on US Airways get priority check-in, security lanes and early boarding, unlimited free upgrades in the United States, up to three free checked bags and complimentary airport club membership. Alas, to reach that level, you have to fly 100,000 miles within a calendar year (other terms also apply).
Christina Pappas, a Boston-based marketing consultant and frequent traveler, thinks it's important that you control the miles, not the other way around. "All things being equal, I'll try to remain loyal when possible," she told me. "But there are times when it doesn't make sense for me to make two connections just to get my points."
If you're an unmanaged frequent business traveler, and you want to collect points, you're playing a dangerous game. Falling in with the wrong crowd on FlyerTalk, a popular hangout for frequent travelers, isn't the biggest risk to you. It is, instead, making purchasing decisions that are in the interests of your program, but not you.
Bernard Pollack, a frequent traveler and loyalty program member who lives in Dakar, Senegal, and is an elite-level frequent traveler with US Airways, United, Hilton and Starwood, thinks that programs warp your perspective, often enticing you to spend more on travel or ignore better prices with a competitor.
"I don't believe people should choose, and certainly not pay more for, certain airlines, hotels and cars because of the loyalty programs," he said.
What if you're traveling for pleasure? If your trips are infrequent, you should stay on the sidelines, says Allison Danziger, director of TripAdvisor Flights. "One specific case is where a traveler would fly less often than the frequent flier mile expiration window for their program," she added.
"Frequent flier miles on most carriers expire after one to three years of inactivity." In other words, your miles would expire before you could use them, obviously negating any benefit.
If you're a frequent leisure traveler, then sure, go for it, but with the same caveat I offered the unmanaged business travelers: Don't get addicted and don't let it control you.
Look, I could spend a couple of paragraphs talking up loyalty programs in an effort to convince you that I can be balanced on this subject. And while it's true that these schemes aren't without benefit, I figure that they have enough apologists already. Besides, that's not my department; I handle the complaints.
Speaking of complaints, here's a cautionary tale for anyone thinking of offering their loyalty to a travel company. It comes to us by way of Robin Forman, a retired librarian in Miami and a frequent leisure traveler.
She used some of the American Airlines miles that she'd collected by flying and making purchases with a Citibank MasterCard to upgrade on a flight from Brussels to Chicago. But when the flight was canceled after the recent volcanic eruption, the carrier pocketed a $350 "service charge" for using the miles.
Forman asked for a refund. "Service charges are necessary to help offset the costs associated with these transactions," an airline representative told her in an e-mail rejecting her request. "I'm sorry my response couldn't be more positive."
Yeah, me too.
Mileage addicts may argue that people like Forman should double down and focus their loyalty on a single company. After all, top-tier elites don't have to pay a lot of the fees that garden-variety frequent travelers do. But I see her story as a reason to reconsider loyalty programs entirely. Not to pick on American Airlines -- a lot of the legacy airlines have these annoying fees for ticket awards -- but if this is loyalty, what's the point?
And that's the thing: The harder you look at so-called "rewards" programs in travel, the harder it is to believe in them. They successfully entice travelers to drive, fly and stay with a particular company, giving them a level of service the companies should offer every customer.
But more often than not, the loyalty goes only one way.
(Christopher Elliott is the ombudsman for National Geographic Traveler magazine. You can read more travel tips on his blog, elliott.org or e-mail him at celliott@ngs.org).
Saturday, May 22, 2010
British Airways reports record annual loss of 531m
LONDON (AFP) - – British Airways on Friday posted a record annual pre-tax loss of 531 million pounds (609 million euros, 765 million dollars) on slumping sales but forecast it would break even this year.
BA, which faces a cabin crew strike next week, said its net loss widened to 425 million pounds in the 12 months to March from 358 million pounds in the previous year. Revenues tumbled 11.1 percent to 7.99 billion pounds.
"This is our second consecutive year of record losses but we take heart from the fact that, while our revenue has fallen by one billion pounds, so have our costs," Chairman Martin Broughton said in a statement.
Market expectations had been for a larger pre-tax loss of 600 million pounds after the group had a smaller shortfall of 401 million pounds in the previous 2008/2009 financial year.
The airline, which is slashing costs and merging with Spanish rival Iberia in a bid to return to profitability, has been hammered by the global economic downturn which has hurt demand for air travel.
Other airlines have also suffered badly, with peer Air France-KLM earlier this week announced record losses of 1.55 billion euros in its year to March.
BA said Friday that it cut almost 3,800 jobs, or about 9.4 percent of its total workforce, during the 2009/2010 financial year. Since September 2008, it has axed more than 6,000 positions in total.
British Airways said it was aiming to break even in the current 2010/2011 financial year.
"Market conditions are showing improvement from the depressed levels in 2009/10," the company said.
"Cargo is showing significant signs of improvement. Passenger revenue is recovering, with increased corporate activity, particularly across the Atlantic.
"On the basis of these market improvements, we are targeting revenue growth of some six percent and breakeven at the profit before tax level."
BA cabin crew plan to go ahead with a five-day strike next week after a court upheld their right to stage the action on Thursday, according to officials at the Unite trade union.
The strike is set to begin Monday. Two further five-day strikes, starting on May 30 and June 5, will also go ahead if the dispute is not settled.
Unite won an appeal on Thursday against a court injunction which had blocked a planned stoppage in the long-running row over pay and conditions.
Group chief executive Willie Walsh lashed out at Unite.
"Returning the business to profitability requires permanent change across the company and it's disappointing that our cabin crew union fails to recognise that," he said in the results statement.
"Structural change has been achieved in many parts of the business and our engineers and pilots have voted for permanent change."
But joint Unite leader Derek Simpson fought back, telling BBC radio on Friday that there was a "total lack of confidence" in BA management.
Cabin crew staged walkouts in March which were marked by sharp disagreements between the union and BA over the impact of the industrial action.
Walsh added Friday that the Iberia merger was on track to complete in late 2010 and would lead to annual cost savings of 400 million euros after five years.
The combined company will be known as International Airlines Group, with both BA and Iberia retaining their separate operations and brands.
The results did not show the impact of the volcano ash chaos which occurred after the end of BA's financial year.
BA said earlier this month that passenger numbers fell by almost one quarter in April as a result of travel chaos sparked by a huge ash cloud from an Icelandic volcano.
"The current financial year could hardly have had a worse start with the unprecedented closures of UK airspace following the eruption of the volcano in Iceland," Walsh said.
"This added to the aviation industry's current financial woes while highlighting its crucial contribution to the economy.
"We are pleased that the European Commission has agreed that national governments can compensate airlines for the losses incurred."
Airspace across Europe was closed for up to a week last month after Iceland's Eyjafjoell volcano began spewing a cloud of ash on April 14. The shutdown was the biggest in Europe since World War II.
BA, which faces a cabin crew strike next week, said its net loss widened to 425 million pounds in the 12 months to March from 358 million pounds in the previous year. Revenues tumbled 11.1 percent to 7.99 billion pounds.
"This is our second consecutive year of record losses but we take heart from the fact that, while our revenue has fallen by one billion pounds, so have our costs," Chairman Martin Broughton said in a statement.
Market expectations had been for a larger pre-tax loss of 600 million pounds after the group had a smaller shortfall of 401 million pounds in the previous 2008/2009 financial year.
The airline, which is slashing costs and merging with Spanish rival Iberia in a bid to return to profitability, has been hammered by the global economic downturn which has hurt demand for air travel.
Other airlines have also suffered badly, with peer Air France-KLM earlier this week announced record losses of 1.55 billion euros in its year to March.
BA said Friday that it cut almost 3,800 jobs, or about 9.4 percent of its total workforce, during the 2009/2010 financial year. Since September 2008, it has axed more than 6,000 positions in total.
British Airways said it was aiming to break even in the current 2010/2011 financial year.
"Market conditions are showing improvement from the depressed levels in 2009/10," the company said.
"Cargo is showing significant signs of improvement. Passenger revenue is recovering, with increased corporate activity, particularly across the Atlantic.
"On the basis of these market improvements, we are targeting revenue growth of some six percent and breakeven at the profit before tax level."
BA cabin crew plan to go ahead with a five-day strike next week after a court upheld their right to stage the action on Thursday, according to officials at the Unite trade union.
The strike is set to begin Monday. Two further five-day strikes, starting on May 30 and June 5, will also go ahead if the dispute is not settled.
Unite won an appeal on Thursday against a court injunction which had blocked a planned stoppage in the long-running row over pay and conditions.
Group chief executive Willie Walsh lashed out at Unite.
"Returning the business to profitability requires permanent change across the company and it's disappointing that our cabin crew union fails to recognise that," he said in the results statement.
"Structural change has been achieved in many parts of the business and our engineers and pilots have voted for permanent change."
But joint Unite leader Derek Simpson fought back, telling BBC radio on Friday that there was a "total lack of confidence" in BA management.
Cabin crew staged walkouts in March which were marked by sharp disagreements between the union and BA over the impact of the industrial action.
Walsh added Friday that the Iberia merger was on track to complete in late 2010 and would lead to annual cost savings of 400 million euros after five years.
The combined company will be known as International Airlines Group, with both BA and Iberia retaining their separate operations and brands.
The results did not show the impact of the volcano ash chaos which occurred after the end of BA's financial year.
BA said earlier this month that passenger numbers fell by almost one quarter in April as a result of travel chaos sparked by a huge ash cloud from an Icelandic volcano.
"The current financial year could hardly have had a worse start with the unprecedented closures of UK airspace following the eruption of the volcano in Iceland," Walsh said.
"This added to the aviation industry's current financial woes while highlighting its crucial contribution to the economy.
"We are pleased that the European Commission has agreed that national governments can compensate airlines for the losses incurred."
Airspace across Europe was closed for up to a week last month after Iceland's Eyjafjoell volcano began spewing a cloud of ash on April 14. The shutdown was the biggest in Europe since World War II.
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