Airline Finance News - Asia / Pacific

AirGuide Business, Sept 8, 2008

Sep 8, 2008

Air China, Air Macau

Air China has noted that it would extend "special aid" to Air Macau, including its support in an effort to secure routes across the Taiwan Strait when CAAC allows scheduled service next July. Air Macau reported a first-half net loss in excess of MOP200 million ($24.4 million). Passenger traffic fell 6.4% year-over-year to 1.38 billion RPKs and boardings were down 11.9% to 1 million. Load factor dropped 5.3 points to 70.5% and cargo volume plummeted 34.9% to 53,000 tons. Sep 4, 2008

Air China, Air Macau

Air China subsidiary Air Macau plans to request a new capital injection from its stakeholders and lease three A320s/A321s to CA this month in order to alleviate its financial crisis, according to the Macau Daily News. The amount of the cash injection will be determined soon by a stakeholders' conference. Air China holds a 51% stake in Air Macau, whose other stakeholders include TAP Portugal's SEAP investment fund (15%), casino company Sociedade de Turismo e Diversoes de Macau (14%), the Macau government and EVA Air. Sep 4, 2008

Air India, Zoom Airlines

Air India will be filling the market gap left by Zoom if, as expected, it confirms the launch of a new London-Toronto service. Air India is rumored to be rerouting its current Amritsar-Toronto service via Heathrow rather than via Birmingham from the end of next month. The carrier has [sup.3]fifth freedom[sup.2] traffic rights - the right for an airline of a third country to carry passengers between two other countries - to fly passengers between the UK and Toronto and visa versa. If the Heathrow service goes ahead, Air India will compete against incumbents British Airways and Air Canada. It[sup.1]s likely Air India would use Heathrow slots vacated by the withdrawal of its London-Chicago fifth freedom service. The change would take effect from the start of the winter schedules on October 26, and would see Air India operating the new route every Tuesday, Friday and Sunday with Boeing 777-200 aircraft. Sep 4, 2008

Kingfisher Airlines

Kingfisher Airlines, which launched international service yesterday with a Bangalore-London Heathrow A330-200 flight, said it plans to raise $400 million through an equity sale, possibly during the first quarter of next year. Chairman Vijay Mallya told reporters that the exact nature of the sale has not been determined. The airline said that the airline could achieve profitability within two years and that he expected the LHR flights to be profitable. The carrier plans to start Bangalore-San Francisco flights in the fourth quarter. Sep 4, 2008

Air France KLM, Iberia, Cathay Pacific and Singapore Airlines are among those who have posted weaker results in past months, while British Airways said the economic slowdown and high fuel costs had created the worst trading conditions it had endured. Japan's All Nippon Airways and Japan Airlines have stopped flights on certain routes and Bisignani said 26 or 27 airlines have suspended operations or shut down in the last year -- more than in the wake of the September 11, 2001 attacks when airlines previously suffered tough conditions. Sep 3, 2008

IATA's Bisignani said, air cargo declined 1.9 percent over July 2007 in a second straight monthly decline. And the Asia-Pacific region, which comprises more than half of the world air cargo market, saw freight traffic drop 6.5 percent year-on-year in the month. "The cargo is a bit of a thermometer of the economy... If cargo goes down, it means that economies are slowing," Bisignani said, stressing that all signs pointed to a turbulent 2009. "Fasten your seatbelts for at least another two years." Sep 3, 2008

Cathay Pacific

Cathay Pacific aims new incentives at small businesses. Small and medium enterprises whose staff travel regularly to Hong Kong and Asia are being targeted by Cathay Pacific with a new incentive scheme. The Cathay Pacific Small Business Solutions programme will be offered to any SME spending a minimum of [pounds sterling]10,000 a year on travel with the airline. Benefits include discounted business and economy fares, reductions on accommodation and free Marco Polo Club frequent flyer membership. SMEs wanting to join the scheme must register at www.cathaypacific.com/uk/sbs. Successful companies will be given a unique username and an online password. Schemes like Cathay[sup.1]s are popular with SMEs because they very often do not qualify for the discounts and perks that are given to bigger corporates. Sep 3, 2008

Air Fiji, Airlines Tonga

Air Fiji and its sister carrier Airlines Tonga are continuing to suspend services with the Fijian carrier involved in a dispute with its workforce and the Tongan carrier involved in protracted negotiations with its fuel supplier. Today's flights have all been canceled and yesterday there were only a few flights using one Britten-Norman Islander, says an official in Air Fiji's headquarters, who wishes to remain anonymous. The official was unable to say when operations will resume to normal again and referred questions on this matter to the airline's head of human resources who was not immediately available for comment. Sep 2, 2008