FAA downgrades Indian aviation safety ratings

In a setback to the Indian aviation sector, the Federal Aviation Administration (FAA) on Friday announced that it had downgraded the country’s aviation safety ranking, bringing it below Pakistan and at par with countries like Ghana, Barbados and Bangladesh, a development that took India by surprise.

Reacting to the downgrade, Civil Aviation Minister, Ajit Singh termed as the step by FAA as "very disappointing and surprising’’ as India had fulfilled 29 out of the 31 issues raised by FAA during inspections last year.

Air passengers to and from the US may have to face the brunt as Indian flights would have to go through more engineering and other safety checks in US. The FAA downgrade means that the Directorate General of Civil Aviation (DGCA) does not meet the safety standards set by UN agency International Civil Aviation Organisation (ICAO). The news of the downgrade was conveyed to DGCA head, Prabhat Kumar.

This would bar Air India and Jet Airways from increasing their flights to US from the current level and would not be able to enter into any new code-sharing relationship with any US airline. The move is unlikely to impact the 28-a-week flights (21 of Air India and 7 of Jet Airways) to the US. At present, Air India operates to Chicago and New York while Jet Airways flies only to New York.

Officials in the Civil Aviation Ministry said that this could also have an impact on Air India’s move to join the Star Alliance.

Mr. Singh said India was now 95 per cent compliant with what the FAA had wanted DGCA and the government to do in terms of taking corrective measures. "The remaining five per cent, that is recruitment and training of senior technical personnel in the DGCA, would be completed by March. DGCA will remain in constant touch with FAA which will hopefully hold another review thereafter to revert India to Category I from the downgraded Category II,’’ he added.

FAA conducts the International Aviation Safety Assessment Program (IASA) to assess the civil aviation authorities of each country that has carriers operating to the US. As per the FAA's IASA Programme of November 22 last year, the countries in Category II include Bangladesh, Barbados, Indonesia, Ghana, Serbia and the Philippines. Pakistan is placed in Category I.

Asked whether the US regulator's decision was part of the diplomatic face-off between the two countries over the issue concerning Indian diplomat Devyani Khobragade, Mr. Singh said: "I don't believe this. There is no connection between the two.’’

Amber Dubey, partner and head (Aerospace and Defence) with global consultancy KPMG said the FAA downgrade is unfortunate but not unexpected. ``Many in the industry had seen it coming. It can have disastrous consequences for both Indian aviation and US based suppliers of aviation and defence equipment. The timing is unfortunate given that India’s Ministry of Civil Aviation is bringing in far-changing policy reforms,’’ he added.

DGCA penalises IndiGo, GoAir and Jet Airways, 6 prime landing slots withdrawn

NEW DELHI: Acting tough, aviation regulator DGCA today took penal action against three airlines by taking away six landing slots at the Delhi airport for not using pilots trained to land in foggy conditions and not equipping aircraft with mandatory devices to negate the effect of fog, resulting in diversion of flights.

The six slots -- two each of IndiGo, GoAir and Jet AirwaysBSE -1.97 % --were withdrawn after an equal number of flights of these airlines were diverted due to fog since last evening till the wee hours today, DGCA sources told PTI, adding that the withdrawal of slots has been done with "immediate effect". 

The Directorate General of Civil Aviation (DGCA) had earlier this month issued a stern warning to airlines to deploy pilots trained to fly under foggy conditions and aircraft fitted with devices to match CAT-III Instrument Landing System (ILS) in Delhi or face severe action. 

DGCA's meeting with the airlines and airport operators was held on January 7, two days after 53 flights were diverted out of fog-hit Delhi to nearby destinations.

The largescale diversion was caused mainly due to the airlines operating planes with pilots not trained to land in foggy conditions or the aircraft not fitted with CAT-III ILS-matching devices. 

Yesterday, visibility at the IGI Airport had started dropping after 1730 hours and the Runway Visual Range started reducing around 2030 hours, the sources said, adding that this trend was brought to the notice of all the airlines. 

However, in spite of repeated efforts, two flights each of Jet Airways, Go Air and IndiGo were diverted from Delhi to Jaipur, they said, adding that by not adhering to DGCA directives, the airlines had violated several sections of the Civil Aviation Regulations (CARs) leading to the penal action.

DGCA sources said the Airports Authority of India's Operational Control had informed that crew or the aircraft of these three airlines were not CAT-III-compliant and therefore were diverted to Jaipur.

After the warnings, the diversions had come down from 53 on January 7 to only five the next day and not a single cancellation for a week thereafter. As many as 1,841 flights had operated in low visibility conditions during that period. 

DGCA had warned the airlines that they would be stopped from operating in and out of Delhi during foggy season if they did not deploy CAT-III trained crew to operate flights in and out of the national capital in case CAT-III weather predictions were made by the Met department. 

Among several steps decided at the meeting, the regulator had fixed the responsibility of the airlines to get the latest weather updates and ensure that CAT-III trained cockpit crew were deployed accordingly. 

DGCA chief Prabhat Kumar also set up a committee headed by Joint Director General Lalit Gupta to examine and recommend steps to make Delhi airport "zero diversionary" by December.

The 10-member panel, which has been asked to submit its report by March 31, would also prepare a manual to deal with low visibility operations, containing dos and don'ts for all stakeholders. 

It would take cognisance of global practices in such situations, including evacuation of passengers to the departure lounge in case a plane gets stranded due to low visibility conditions. 

DGCA has also set up a special cell called SUGAM and a dedicated mail ID 'sugam@dgca.nic.in' to enable harried air travellers lodge their complaint on any problem they face relating to flights or airport facilities due to delays caused by fog or other reasons, promising to take speedy action. 

The committee has been tasked to first acknowledge the complaint electronically and direct the airline or airport operator concerned to address the issues expeditiously 

No order to private airlines to treat MPs as VIPs: Aviation Ministry

New Delhi: Even as the debate over the VIP culture of Parliamentarians raises more heat, Union Civil Aviation Minister Ajit Singh on Wednesday clarified that neither the Ministry nor the Directorate General of Civil Aviations has issued any order directing private airlines to provide special privileges to MPs.

"No guidelines have been issued by Civil Aviation Ministry or DGCA and there is no such plan too," Singh told IBN7. He rebuffed reports of DGCA issuing guidelines calling them baseless.

Congress leader Rajeev Shukla echoed Singh's reactions. He said, "No government directive has been issued. It is upto the airlines. For the last ten years a lot of demands have been made. Only a few of them have been accepted."

However, the DGCA letter issued to private airlines dated December 16, 2013 tell a different story. CNN-IBN accessed the letter that reads, "The committee on violation of protocol norms & contemptuous behaviour of government officers with member of Lok Sabha has raised the issue with Ministry of Civil Aviation where aiports & airlines are not adhering to guidelines on protocol norms and courtesy to be extended to MPs. It was decided in the meeting the list of nodal officers/protocol officers of all scheduled domestic airlines is to be provided to the Ministry. In compliance to the decision you are requested to submit the list of nodal/protocol officers in respect of your airlines positively by today. The matter is to be treated on urgent basis."

Shukla, however, added, "Lot of MPs come from rural areas. What's wrong if they are being helped out. Lot of them don't understand civil aviation rules."

Communist Party of India leader Sitaram Yechury strongly condemned the move saying that no more privileges should be provided to the MPs.

Senior Supreme Court lawyer Harish Salve, too, tweeted against the proposed move. "The irony is that there are a lot of MPs who live a life of simplicity. Travel by bus to Parliament. Use trains. Work for their constituents," he tweeted.

Shukla hit out at Yechury over his reactions to providing extra perks to MPs by private airlines. He said, "Issue of austerity doesn't fit in here. MPs travel in business class. Same courtesies are extended to MPs as other business class passengers. I must tell you Mr Sitaram Yechury has himself got a lot many facilities extended to MPs."

Former Air India executive director Jitender Bhargava reacted to the entire incident saying that the private airlines must gather enough guts to protest against DGCA guidelines. He also noted that the DGCA did not have the power to direct such orders.

He added that the facilities being enjoyed by MPs in Air India too must be withdrawn. "Let Air India be also allowed to function as a commercial airline," he said.

DGCA has reportedly asked private airlines to offer special privileges to MPs including advance notice of flight delays, escorts, priority check-in, security, immigration clearances, lounge access and complimentary refreshments. All airports and airlines in the country have been asked to put in place the protocols.

Currently, only Air India is following these guidelines.

The directive came after the MPs complained that they should be treated like VIPs at all airports and by all airlines. The DGCA held a meeting to discuss the issue and sent a letter to all on the protocol to be followed.

All airlines are also expected to give a list of nodal/protocol officers for the same.

Aviation Ministry allows operation of Airbus A-380s at four airports

After demands by some major foreign carriers for several years, Civil Aviation Ministry on Monday approved the operations of Airbus A-380s in India at four airports currently equipped to handle these super jumbos.

The restrictions on the fully double-decker planes were lifted after weeks of consultation between Directorate General of Civil Aviation, Air India and Airports Authority of India. An A-380 can seat 850 passengers in an all-economy configuration, but those having a three-class configuration can accommodate between 550-600 passengers.

The operations of the A-380s would be subject to overall traffic entitlements within the bilateral Air Service Agreements (ASAs) with different countries, an official spokesperson said. Singapore Airlines, Emirates and Lufthansa have been pressing the government for several years to allow them fly these super jumbos into India.

Aviation Ministry allows Operation of Airbus A-380s at Four Airports

The A-380s would now be allowed to airports at Delhi, Mumbai, Hyderabad and Bangalore, which are equipped to handle them and have the required infrastructure. It has also been decided that wherever the entitlements were not expressed in terms of seats per week, these would be rationalised and converted into seats per week before allowing A-380 operations to India from these countries.

This exercise would be carried through mutual negotiations between India and other countries through Memorandums of Understanding, the spokesperson said. The ASAs, which specifically prohibit A-380 operations to India, would be amended before the operations of these airplanes from any country are allowed.

All the four airports would also have to get DGCA certification and make adequate preparation in terms of various services required, he added. Nine of the 10 international airlines that currently fly the A-380s have scheduled flights into India. There are over 110 A-380s currently flying worldwide.

Airports see no flight disturbances on 25 Jan: Minister of Civil Aviation

Flights at all Egyptian airports went as scheduled on 25 January, said Minister of Civil Aviation Abdul Aziz Fadel with all feeder roads also functioning normally.

Cairo International Airport is expected to witness 198 take-offs and has already had 201 landings, while regional airports have seen 401 flights in the past 24 hours, he said.

Fadel added that security measures are in place for all airport entrances, in cooperation with the armed forces and the Ministry of Interior, following a week of emergency planning.

The statement came after four bombings in Greater Cairo left six dead on Friday in the lead-up to Saturday’s third anniversary of the 25 January Revolution.

The ministry also announced that EgyptAir would be providing a 25% discount on all plane tickets purchased on 25 January, valid until 25 April, in an attempt to boost flights during the current period of unrest.

Industry leaders to gather in Dubai for Second Aviation Safety Culture Summit

Under the Patronage of His Highness Sheikh Ahmed bin Saeed Al Maktoum, President of Dubai Civil Aviation Authority, Chairman of Dubai Airports, Chairman and Chief Executive Officer of The Emirates Group, security, safety and operations leaders of industry organisations worldwide will come together in Dubai for the second Aviation Safety Culture Summit to be held next month.

Hosted by the Dubai Civil Aviation Authority and organised by Streamline Marketing Group, the summit will run from 3-4 February 2014 at Park Hyatt in Dubai. The event will attract more than 300 local and international stakeholders from regulatory authorities, airlines, airport operators, aircraft manufacturers, pilot associations, safety organisations and air traffic control service providers to discuss key strategies and challenges in improving safety culture across the industry.

The two-day summit will comprise panel discussions covering a range of topics, including initiatives that are currently in place to improve aviation safety. The sessions will focus on how to develop a global aviation safety plan, how to improve co-operation between partners in the industry and the importance of developing the necessary human capital and creating training programmes to create a safety culture among the workforce.

“Safety is the number one priority for air transport and aviation is the safest means of transport,” said H.E. Mohammed Abdulla Ahli, Director General at the Dubai Civil Aviation Authority. “To continue this lead and ensure air transport continues to play a major role in driving sustainable economic and social development, collaboration and sharing of best practice, is required among all partners of the industry.’‘

“The first edition of The Aviation Safety Culture Summit proved its success as a strategic global platform for industry leaders to discuss safety issues and find ways of collaboration. The agenda for the upcoming event has been built around the results from the first edition,” he added.

The summit will also comprise four sessions focusing on areas including adapting and implementing international safety culture best practices for local workforces and implementing systems to manage human error effectively and to avoid future accidents. Applying diverse perspectives on culture in an aviation environment and understanding the benefit of technology as a catalyst for improving safety in the aviation industry will also be areas for discussion.

The event is sponsored by Honeywell, Boeing, AAL Group, dnata, Maximus Air, Chevron and Abu Dhabi Aircraft Technologies and supported by AviAssist Foundation.

Varadkar to launch new aviation policy

Transport minister, Leo Varadkar, will launch a new civil aviation policy for the Republic later this year that he says will cover everything from airports to the €19 billion aircraft finance sector.

Mr Varadkar told the Global Airfinance Conference in Dublin yesterday that he will publish a draft document – based on submissions from interested parties – outlining the new policy in coming weeks and will produce a final paper based on further consultation by the end of the year.

His office has already received over 100 submissions from various organisations, including airports, trade unions, pilot colleges and businesses involved in supplying the industry.

Speaking afterwards, the minister said that it will cover everything from State and regional airports, education and training and the aircraft maintenance business to promoting the Republic’s aviation finance sector, which is responsible for around €19 billion in transactions every year.


Predicted
He also predicted that new legislation designed to underpin the Republic’s position in the leasing industry should become law before the Dáil takes its summer holidays in July.

Last year Mr Varadkar published a draft bill that will adopt part of the Cape Town Convention into Irish law.

The section provides that, in the case of an airline insolvency, the company has 60 days to pay any liabilities due on leased aircraft and engines, or it must return them to the lessor.

It gives added security to aircraft leasing companies, many of which are based here, against airlines defaulting on their debts. This in turn reduces their risks and makes it easier for lessors to raise money.

Mr Varadkar said that the bill should be published in the next couple of weeks and will then go before the Dáil and Seanad.

He added that he hoped both houses would pass it by the time that the Dáil rises for its summer recess.

The minister told the conference, organised by trade publication, Airfinance Journal, that the Government was well aware that other jurisdictions were keen to supplant the Republic as a centre for aircraft finance, but had not intention of letting them “eat our lunch”.

Boeing, UAE Join To Produce Aviation Biofuel From Desert Plants

U.S. aircraft maker Boeing has partnered with the UAE to develop sustainable aviation biofuel, it was announced on Wednesday during the on-going World Future Energy Summit in Abu Dhabi.

The research partnership follows findings that desert plants fed by seawater will produce biofuel more efficiently than other well-known feedstocks.

The Sustainable Bioenergy Research Consortium (SBRC), an affiliate of Masdar, will now test these findings in a project that could support biofuel crop production in arid countries, such as the UAE.

“Plants called halophytes show even more promise than we expected as a source of renewable fuel for jets and other vehicles,” said Dr. Alejandro Rios, director of the SBRC.

“The UAE has become a leader in using desert land and seawater to grow sustainable biofuel feedstocks, which has potential applications in other parts of the world.”

The SRBC has been working towards development and commercialisation of sustainable aviation biofuel, which emits 50 to 80 per cent less carbon during its lifecycle compared to fossil fuel.

Scientists will create a test ecosystem next year in Abu Dhabi that will examine the viability of producing aviation biofuel, according to the SRBC.

Boeing, Etihad Airways and Honeywell UOP are funding the venture, a statement said.

“Boeing is committed to finding ways to reduce aviation’s carbon emissions, and sustainable aviation biofuels is a key component of our strategy,” said Jeffrey Johnson, president, Boeing Middle East.

“Masdar Institute’s biofuel research is showing tremendous potential, and we applaud Abu Dhabi’s leadership and innovation in this critical area.”

Boeing, Etihad and Masdar recently launched Biojet Abu Dhabi, which is an initiative to advance biofuel research, feedstock production and refining capability.

Etihad also announced this week that it is joining hands with French energy giant Total along with Boeing to develop biofuel in the emirate.

Despite access to cheap jet fuel, the emirate said that it wanted to develop sustainable energy sources in order to diversify its economy.

Abu Dhabi carrier Etihad also expects its commercial flights to run on biojet fuel in five years’ time, Etihad’s chief operations officer Richard Hill told reporters.

BOC Aviation likely to supply Airbus A320 planes to Tata-SIA

Singapore-based BOC Aviation looks poised to supply Airbus A320 aircraft to Tata SIA
 Airlines Ltd. The move is an important step in plans by Tata Sons and Singapore Airlines to set up a full-service airline, according to a Reuters report. The fleet of 20 planes would initially be sourced from leasing companies, rather than purchased directly from Airbus.

The decision by the airline to opt for Airbus A320 triggered a race for the lucrative mandate between aircraft leasing companies gathering in Dublin for annual industry meetings this week. Industry sources said the deal, or a significant part of it, was expected to go to BOC Aviation, the aircraft leasing subsidiary of Bank of China.

Plane-makers frequently rely on lessors to supply spare capacity and establish their brand with new airlines, hoping to sell future batches of planes directly if the carrier expands.

Leasing companies are often able to supply aircraft from their own speculative inventories at shorter notice than the manufacturers, whose production lines are sold out years ahead.

BOC to lease Airbus jets to new Indian airline - sources

Singapore-based BOC Aviation looks poised to supply aircraft to India's latest airline as new players jostle to capture growth in Asia's third-biggest economy, two industry sources said.

The move is an important step in plans by Tata Sons and Singapore Airlines to set up a full-service airline to compete forbusiness amid India's crowded low-cost market.

Reuters first reported last week that the new Tata-SIA venture had opted to use Airbus A320 jets in preference to Boeing's 737.

The fleet of 20 planes would initially be sourced from leasing companies, rather than purchased direct from Airbus.

That decision triggered a race for the lucrative mandate between aircraft leasing companies gathering in Dublin for annual industry meetings this week.

Industry sources who asked not to be named said the deal, or a significant part of it, was expected to go to BOC Aviation, the aircraft leasing subsidiary of Bank of China.

BOC Aviation and Airbus declined to comment.

"At this moment all that we can confirm is that Tata-SIA will be taking 20 A320 Airbus aircraft on a lease basis," a spokesman for the airline said by email.

"The leasing company and terms can't be disclosed at the moment as commercial discussions are on and may take a few weeks more."

Planemakers frequently rely on lessors to supply spare capacity and establish their brand with new airlines, hoping to sell future batches of planes directly if the carrier expands.

Leasing companies are often able to supply aircraft from their own speculative inventories at shorter notice than the manufacturers, whose production lines are sold out years ahead.

India is seen as a promising market due to the relatively low proportion of people already flying, but is also one of the world's riskiest due to aggressive price competition.

However, analysts say price-cutting has eased since the collapse of Kingfisher Airlines.

Based on current expectations, Tata-SIA will start flying in the second half of 2014, as will an AirAsia-Tata joint venture in the low-cost market, another Airbus operator.

The two airline launches have extended Airbus's dominance of the Indian market for small passenger jets.

Boeing operator Jet Airways is however still in negotiations to buy around 50 737 jets, industry sources said.

The airline, which has been the subject of speculation about the order for over a year, did not respond to requests for comment. A spokesman for Boeing declined to comment.

Low-cost carrier SpiceJet has meanwhile re-ordered 42 Boeing jets.

Civil Aviation Ministry may take time to decide on pending proposals

MUMBAI/DELHI: The Civil Aviation Ministry is going slow on several pending proposals, including a revision of airport charges and enhancement of bilateral flying rights, as civil servants are reluctant to take decisions close to the upcoming general elections in April-May.

Even granting a permit to Air Asia — which has entered into a joint venture with Tata Sons — may take more time than anticipated, say officials involved in the decision-making process.

"There are several proposals pending. At this time, you need to fasttrack decisions to clear some of them. None of that is happening," said a government official who didn't want to be named. The officials said there was a widespread feeling that contentious decisions should be left to the next government.

Further, the government is reluctant to take unpopular decisions such as raising airport charges, which could hit the Congress-led UPA government's prospects in the elections.

MUMBAI AIRPORT CHARGES

One of the proposals facing delays is an application from GVK-controlled Mumbai International Airport seeking to increase airport charges. The proposal was submitted in December, 2013 and GVK wants the tariffs to be revised from April 1 this year.

"Typically, the process (of fixing tariffs) takes many months. They had sent the first proposal in October 2013 and the revised proposal was finalised by mid-November after which stakeholder consultations were held. Stakeholder consultations itself is a lengthy process. So there's no chance that the tariff at Mumbai airport will be revised before the (general) elections," said a senior official at the Airports Economic Regulatory Authority.

Mumbai airport opened its new terminal on January 10. The terminal, which cost Rs 5,500 crore, will open to passengers on February 12. GVK has cited higher depreciation costs on the new terminal to back its case for higher tariffs.

AERA's decision last year to let Mumbai and Delhi airports increase charges by 154 per cent and 346 per cent, respectively, earned it considerable flak from global airlines as well as the International Air Transport Association (IATA). They claimed it would depress demand for air travel.

"The government's proposal would land it in a sticky situation at the elections as it would increase the burden for the air traveller," said Kapil Kaul, CEO, South Asia at Sydneybased CAPA-Centre for Aviation.

APPROVAL TO AIR ASIA 

Two Indian joint ventures from two global airlines—AirAsia and Singapore Airlines—which are at various stages of clearances, may also experience some regulatory turbulence. Both have tied up with Tata Sons. While Tata-SIA is awaiting a no-objection certificate from the aviation ministry, AirAsia is waiting for an air operator's permit from the Directorate General of Civil Aviation, the last stage before it starts flying in India.

Industry insiders said the ministry is "unnecessarily delaying" the clearance process. The DGCA recently put up a notice on its website seeking public views and objections on the AirAsia proposal. On February 19 last year, AirAsia announced it will set up an airline in India. It got a nod from the foreign investment promotion board, which clears overseas investment proposals, on April 5 and an NOC from the ministry on September 26. 

"The airline isn't new. It has units in several countries. It fulfils all the prerequisites required for an airline to fly in India. The public notice should have come at the beginning of the government's scrutiny process, not now," said the insider. 

Another potential impediment for AirAsia is a court case filed on July 25 by BJP leader Subramanian Swamy saying FDI is only permitted in existing airlines and no new company can be floated. The government eased rules in September 2012 to allow foreign carriers to purchase up to 49 per cent in India's airlines. 

BILATERAL RIGHTS 

Officials also say that India will go slow in enhancing bilateral rights between India and United Arab Emirates, Qatar and China. Close to the easing of FDI rules, the government trebled the weekly seat allocations between India and Abu Dhabi. That appears to be one of the key factors behind a deal where Jet sold 24 per cent stake to Etihad Airways for $379 million. 

The enhancement led to Swamy filing a PIL in the Supreme Court accusing the government of diverting Indian international traffic to foreign carriers. Meanwhile, Emirates, which uses all of the 54,000 weekly allocated seats between India and Dubai has proposed enhancing the rights by another 10,000 seats. Qatar has sought to enhance its weekly quota of seats to 72,600 from the current 24,800.

The enhancements sought are linked to a separate proposal — that of allowing the Airbus A380 plane into Indian airports. Unless more seats are allowed, it would be pointless for foreign carriers such as Emirates to bring in jumbo planes to India. This proposal awaits a final clearance from civil aviation minister Ajit Singh.

The model code of conduct for the elections kicks in by end of February. However, ministry officials say that there are no legal or regulatory hurdles to clearing these proposals. "Most of the proposals, including AirAsia and revised airport tariffs can be cleared even while the code of conduct is on," said a joint secretary at the aviation ministry.

Officials say the ministry is keenest at this point in time to change a rule that requires airlines to fly domestic for five years and own a fleet of 20 planes before it can fly international. The ministry is currently drafting a Cabinet note on this. The minister has said he is confident of having the rule changed by end of February. But even in this, not everyone is confident. 

"The only airline which currently doesn't have international flying rights is Go Air, but it will anyway get them in July when it has a fleet of 20 planes since it has already completed more than five years. Among the new ones only Tata-SIA would be keen to fly international so the rule may be construed as favouring the airline," said an industry expert.

DGCA seeks views on AirAsia permit

The Directorate General of Civil Aviation on Monday updated its public notice inviting comments, suggestions and objections if any against the grant of an Air Operator's Permit to AirAsia India. The updated notice clearly specifies that work on processing the application is happening alongside collection of public views. 

It also tells the public to send in comments/suggestions/ objections giving specific grounds of objections with a certificate of authenticity. The timeline for sending the comments remains the same, thirty days from the date of the first issue of the public notice on January 13. Air Asia got an NOC from the ministry on September 26. 

Boeing, Etihad to develop aviation biofuels

Aircraft maker Boeing Co., Etihad Airways, the oil company Total and others say they will work together on a program to develop an aviation biofuel industry in the United Arab Emirates.

Boeing says in a news release on Sunday that the program will involve research and development and investments in production of fuels derived from plants that can power aircraft.

Etihad is based in Abu Dhabi, the capital of the United Arab Emirates. The other participants are Takreer, a subsidiary of Abu Dhabi National Oil Co., and the Masdar Institute of Science and Technology, located in Abu Dhabi.

Boeing says Etihad ran a 45-minute demonstration flight on Saturday in a Boeing 777 partially powered by aviation biofuel produced in the UAE.

Boeing also has aviation biofuels programs with U.S. and other airlines.

Aviation security institute to be launched at CIAL on February 1

Kochi: The Cochin International Airport Limited is set to take flight to new horizons by launching the Aviation Security Training Institute next month at a cost of Rs 2 crore, to train personnel of all stakeholders covering security areas at airports.

The institute which will be launched on February 1, will function on the premises of the Cochin International Aviation Services Limited (CIASL), a subsidiary of CIAL situated near Nedumbassery airport.  The institute has been set up after two years of persistent efforts by CIAL to create infrastructure like computer-based training, explosive model section, x-ray simulator training section and library.

“Each individual in the security departments of airports, various airlines that are operating, CISF and ground handling agencies have to qualify after doing the 12-day basic course of aviation security and one-week screening test.

This is a mandatory requirement. Currently, these personnel are sent to the Bureau of Civil Aviation Security (BCAS) regional offices like Chennai, Mumbai, Kolkata and Delhi and also to Hyderabad and these centres are not able to meet the demand. It is mandatory to get 80 percent marks to pass these examinations and due to this, the chances of reappearance are more,” said A.C.K. Nair, CIAL director.

Those working in airports like Mangalore, Calicut, Coimbatore, Trichy, Madurai and Thiruvanan-thapuram apart from Cochin will benefit from the Cochin centre. Currently they have to go to distant places.

The x-ray simulators are meant to train the personnel for mapping images to help the screener interpret the images. Weakness in identifying explosive devices are also monitored and rectified. BCAS sets the exam calendar and conducts the exam.

Airlines stare at losses, new players to fuel price war

The airline industry in India will continue to incur losses, with four out of the five airlines e expected to report annual loss, as business environment continues to remain challenging.

The entry of new airlines during this year will make it more difficult for the incumbent airlines, whose finances have weakened further, said aviation consultancy Centre for Asia Pacific Aviation (CAPA) in a report.

As per CAPA, all airlines from India collectively lost over $500 million in the September, 2013, quarter. And despite the strong December quarter, the airlines are expected to report collective loss of $175-250 million, excluding one-off adjustments.

“In financial year 2013, Indian carriers lost an average of Rs. 1,500 ($24.40) on every passenger carried. And this is even before the entry of several planned start-ups in 2014. Every carrier is expected to post losses in the current fourth quarter based on current trends and a fare war is not ruled out, which will likely result in Jet Airways and SpiceJet reporting record full year losses,” CAPA said .

The report also said that Jet is expected to burn almost the entire capital generated from the sale of 24 per cent stake to Etihad.

It is possible that the Jet Airways Group’s financial year 2014 losses could be close to 70-80 per cent of the total combined losses since 2007, which stand at $460 million,” CAPA said. “SpiceJet is expected to report a record full year loss in financial year 2014 which could be equivalent to its entire combined losses since 2007, which stand at $193 million,” it added.

Air India’s losses could exceed $750-800 million in financial year 2014. IndiGo and GoAir are the only airlines likely to be profitable in financial year 2014, although IndiGo’s result could fall short of earlier expectations of $100 to $110 million, CAPA said, adding that IndoGo had reported net profit of $145 million last year.

GoAir has almost undone the record quarterly result achieved in the first quarter with heavy losses in the second quarter and a near breakeven situation in the third quarter. “The high yields at the beginning of the year have declined significantly such that we do not rule out a modest loss of GoAir for the full year,” CAPA said.

The think-tank also said there is no imminent sign of relief on the cost front as the Reserve Bank of India seems to be comfortable with the current dollar-rupee exchange rate of Rs.61-62. Airport charges will also continue to increase, adding more problems for airlines.

Several new entrants, including AirAsia India, Tata-SIA and Air One are expected to add around 20 aircraft to the domestic market in the coming financial year. Apart from these, Easy Air and Air Pegasus are also looking at launching this year. A further one or two new LCC start-ups are also likely, according to CAPA.

“Inexperience and the drive to generate cash can lead to irrational pricing and capacity that destabilises the entire market. A further one or two similar quarters could test the holding power of some airlines,” CAPA added.

Boeing goes green with new aviation fuel

"green diesel" as potential commercial biofuel

Boeing says it has identified a new type of biofuel that could slash the aviation industry’s carbon emissions.

The US planemaker believes that “green diesel”, a renewable fuel used in ground transportation, could provide the best source of sustainable aviation biofuel. Made from oil and fats, green diesel emits 50% less carbon emissions than traditional fossil fuels over its lifecycle, and according to Boeing’s research, it is chemically similar to today’s aviation biofuel.

The company said it is now working with the US Federal Aviation Administration (FAA) and other stakeholders to gain approval to test green diesel in aircraft engines. It would be mixed with traditional jet fuel.

“Green diesel approval would be a major breakthrough in the availability of competitively priced, sustainable aviation fuel,” said Dr James Kinder, a technical fellow in Boeing’s propulsion systems division. “We are collaborating with our industry partners and the aviation community to move this innovative solution forward and reduce the industry’s reliance on fossil fuel.”

One of the challenges facing the development of biofuel is that it is expensive to produce and not commercially viable. But according to Boeing, significant green diesel production capacity already exists in the US, Europe and Singapore, which could supply as much as 1% – about 600 million gallons (2.27 billion litres) – of global jet fuel demand.

The wholesale cost of US$3 per gallon with US government incentives is also relatively competitive with petroleum-based jet fuel. Boeing will now compile a research report with a view to getting approval to test the fuel.

Green diesel becomes the latest in a series of potential new aviation biofuels to be tested by the industry. Since 2008, both Airbus and Boeing, along with their airline and technical partners, have conducted flights tests using fuels derived from sources ranging from cooking oil and animal fats to algae and plant matter. Up until now however, no single biofuel has been identified as the solution to the industry’s global fuel requirements.

The global aviation industry has committed to reducing its carbon emissions by 50% by 2050, compared to 2005, and biofuel is expected to play a major role in this initiative.

$1.1T FAA Budget Includes Key Genav Initiatives

A $1.1 trillion spending plan easily passed the House of Representatives yesterday and is awaiting action by the Senate, expected no later than tomorrow. Congress then departs Washington for a week of vacation anchored by Martin Luther King, Jr. Day on Monday.

The omnibus appropriations bill ensures there will be no government shutdown for the foreseeable future. It designates $7.3 billion to maintain the FAA’s air traffic controller and safety inspector workforces, ensuring no budget-related furloughs. It also recommends funding for two key general aviation priorities: the FAA’s aircraft certification service and the transition to unleaded aviation fuel for piston aircraft.

House Appropriations Committee members expressed concern that “delays in FAAcertification of new aircraft and related technologies could negatively affect aviation safety, as well as the economic health and competitiveness of U.S. manufacturers.” The Senate Appropriations Committee report to its original bill expanded upon this, and noted that strengthening a system approach to aviation safety will allow the FAAworkforce to conduct its oversight effectively without constraining the growth and innovation of the aviation industry.

“Enabling the FAA’s aircraft certification service to operate in a more streamlined, efficient manner will allow our manufacturers to bring needed safety-enhancing products to the market more quickly and easily,” said GAMA president and CEOPete Bunce.

Another CEO quits. Is India aviation sector too turbulent for expats?

Jet Airways informed the stock exchanges of the change in its top management on Thursday and said that Ravishankar Gopalakrishnan, its Chief Financial Officer will be the 'acting CEO' till such time as Jet Airways board is able to get a new person for the job.

FALLOUT WITH GOYAL?

Sources at Jet Airways provide different reasons for the exit of the 59 year old Australian, who previously worked at several global airlines. 

While some at Jet claim Toomey was homesick as his wife and children had stayed behind in Australia, others say the reasons are more complex. They maintain Toomey was finding it difficult to fathom the Indian aviation market and his relationship with Jet's promoter and Chairman, Naresh Goyal, had been affected by this.

"It is tough to work with Naresh Goyal. The style of functioning in India is different from elsewhere and more so at Jet," an insider said. "On a day-to day basis, it becomes a challenge taking decisions in an environment that is not too congenial. For Toomey, who is nearing 60, the cumulative impact was to question why, at this age and with so much experience behind him, he was putting up with it all."

But Toomey is not the first expat to depart after an all-too-brief stint in India. 

Last year SpiceJet's CEO, South African Neil Mills too left the carrier suddenly and one of the reasons attributed to his leaving an airline which he helped turned around was a difficult working relationship with the SpiceJet owners, the Marans (who also own Sun TV). The budget carrier is still struggling to find a replacement for Mills. Stories of Kalanithi Maran's  high-handedness with his employees are well known, and are a factor head hunting firms assigned the job of finding a new CEO are well aware of.

Earlier in 2010, the high profile exits of two expats from Air India, Gustav Baldauf who had been appointed Chief Operating Officer and Stephan Sukumar who was Chief Training Officer, also showed that foreign executives find the random nature of decision making in the country difficult to understand. 

One expat aviation official, when he was leaving India in a huff, even told this reporter that this country was a "banana republic". 

"I'm not too sure foreigners can operate effectively in the Indian market. There are a hundred challenges here like labour issues, getting approvals from the government, etc, which are less elsewhere and when these are combined with the high operating costs and the constant pressure to rein in costs, foreign aviation executive can find it difficult to cope and this results in differences developing with their promoters," said an aviation industry official and ex-employee of Jet who did not want to be identified.

WRONG SIGNAL

Observers feel that Toomey quitting the airline will send wrong signals to the airline employees who as it is are seeing a lot of other changes around them following the stake sale to Etihad.

Jet has a history of hiring expats as CEOs. Some call it Goyal's 'foreign fixation'. But most of the others, barring Toomey, served for a reasonable amount of time. However, there was also Maunu von Lueders, now with IATA, who was CEO at Jet's hybrid JetLite for a very brief while.

"If new guys keep walking in every now and then, it is difficult to work," says a Jet employee.

Jet is currently going through a difficult phase. Its Rs 2,058 crore deal with Etihad, in which the latter acquired a 24 per cent stake, is still facing regulatory challenges. Jet announced its worst-ever (quarterly) loss of Rs 998 crore (consolidated) in the second quarter of 2013/14.

Aviation sector changes delaying Kuala Lumpur International Airport 2 (KLIA2)

Various changes in the aviation industry, especially demands from the low-cost travel sector, are among key reasons for the delay in completion of Kuala Lumpur International Airport 2 (KLIA2).

Parliamentary Public Accounts Committee (PAC) chairman Datuk Nur Jazlan Mohamed said demands from the aviation industry caused several changes in plans, especially on the size of terminals for KLIA2.

"The aviation industry is constantly changing and because of that, the plans have been revised several times," said Nur Jazlan after a three-hour meeting with Transport Ministry officials on the matter today.

He said the forecast on low-cost travel given by the International Air Transport Association (IATA) to the owner and developer of the KLIA2 project, Malaysia Airports Holdings Berhad (MAHB), had forced them to make changes to the original plans.

"IATA said the (volume) of passengers is forecast to increase from 25 million to 45 million and that caused the size of the terminals to be increased and when that happens, other (sections) will also increase, such as the aerobridge and baggage handling systems," explained Nur Jazlan.

Restrictions on local carriers flying abroad set to ease

New Delhi:  India could ease restrictions that prevent some of its domestic airlines from flying on international services within a month, potentially benefiting start-ups set up by Singapore Airlines and Malaysia's AirAsia that aim to begin operations in 2014.

New Delhi is also considering a proposal to allow Airbus's A380 planes to land at local airports, Aviation Minister Ajit Singh said on Tuesday.

India's ban on A380s is mainly due to concerns that foreign carriers may further hurt state-run Air India by grabbing a larger share of international traffic.

Under existing rules, Indian carriers are also required to be in operation for at least five years and have 20 aircraft to be eligible to fly international routes.

Singh told reporters that New Delhi would seek the cabinet's approval by next month to "scrap this rule".

"At a macro level, this restores credibility to the Indian aviation sector," said Amber Dubey, an aviation expert at consultancy KPMG, of the Indian government's plans.

"It shows that the policy direction is always towards greater competition, the respect for logic, and being more aligned to global best practices," he said.

Conglomerate Tata Sons has formed a joint venture with SIA to start up a full service carrier, which is expected to begin operations in the second half of 2014.

Tata is also an investor in AirAsia India, which is expected to compete in the low-cost market from the second half of the year. Low-cost carrier GoAir, which began operations in 2005 but has fewer than 20 aircraft, could also be a beneficiary.

India's overall air passenger traffic is expected to triple from 2010-20 to 452 million annually, as rising income levels help more people fly in the country of 1.25 billion. 

BIG PLANS FOR BIG PLANES

Dubey said opening up the market to A380s could push down international fares as one aircraft can accommodate more passengers, keeping costs lower.

He said major airports in New Delhi and Mumbai were already in position to receive the super-jumbos, but smaller airports would need to be assessed to see if they can handle the planes.

"We have asked for comments from ground handling and immigration, security basically. Because this is the infrastructure which will be affected because one plane will have up to 500-600 passengers at a time. So we are awaiting their comments," said Aviation Minister Singh.

A change could benefit carriers like Singapore Airlines, Emirates, Lufthansa and British Airways that operate the super-jumbo and fly to India, as well A380 customers like Etihad and Qatar Airways who have not taken delivery of the aircraft.

Kingfisher Airlines was the only Indian A380 customer, but Airbus said on Monday that it had revoked that order. The Indian carrier, which had ordered five A380s, stopped operations in October 2012 after several years of losses.