Qantas tops the list for three years in a row. In selecting Qantas as the world’s safest airline, AirlineRatings.com editors noted that over its 95-year history the world’s oldest continuously operating airline has amassed an extraordinary record of firsts in operations and safety and is now accepted as the industry’s most experienced carrier.
When it comes to filling seats on international airline routes, not all carriers are equal.
Budget carrier Cebu Pacific managed to sell just 50.4 per cent of its seats on its new route between Sydney and Manila in the Philippines last year, making it the third-worst performing route by load factor. But on the same route, full-service Qantas filled 88.7 per cent of the seats on its planes, which was the best performance of any carrier on an international route.
Data compiled by aviation consultancy Aspire Aviation based on government filings and analysis of global distribution systems shows routes to Pacific Islands and Papua New Guinea are consistently the lowest performers in terms of load factors. There are, however, reasons why airlines keep those going. They are often used heavily by government and corporate clients and are also used to ferry large amounts of freight between Australia and remote areas.
Thai Airways, which faced political instability in its home market last year, managed to fill only 66.3 per cent of its flights to and from Australia, making it one of the worst performers. Garuda Indonesia was close behind, filling just 67 per cent of its seats from Australia to Bali and Jakarta.
Those poor performances contrasted with US carrier Delta Air Lines filling 86.9 per cent of the seats on its daily flights between Sydney and Los Angeles, which was ahead of the 81.2 per cent filled by its partner Virgin Australia on flights between Australia and Los Angeles.
Cathay Pacific, which has been pushing unsuccessfully to date for more air access to Australia, filled 86.9 per cent of the capacity to its Hong Kong hub last year. Just this week, the airline announced it would upgrade a second of its four daily flights between Sydney and Hong Kong to a larger Boeing 777 from a smaller Airbus A330 from October. It is prevented from adding more flights to the main Australian gateways of Sydney, Melbourne, Brisbane and Perth under the terms of its bilateral air services agreement, but it can add capacity by using bigger planes.
Etihad Airways, which is expanding capacity by placing an Airbus A380 on its Sydney route from June, was also a top performer. The Virgin partner filled 86.7 per cent of its seats between Australia and Abu Dhabi last year. That was much better than the 73.8 per cent of seats Virgin filled on its own flights between Sydney and Abu Dhabi.
Overall, Virgin filled 74.7 per cent of its seats across its entire international operations, which compared with the 79.7 per cent filled by Qantas.
In the period between July and December, Virgin reported a loss from its international operations, while Qantas reported a profit. Virgin has faced particular pressure on flights between Australia and Bali, where it filled 68.3 per cent of its seats, while Qantas’ budget arm Jetstar filled 75 per cent.
That route will become even more competitive from next month, when Indonesia AirAsia X launches direct flights from Melbourne to Bali. Those flights had been delayed from an initial planned start date of December pending approvals from the Civil Aviation Safety Authority which were granted last week.
Virgin plans to deploy its budget arm Tigerair Australia on international flights in the future, with speculation the low-cost-carrier could take over some Bali flights from Virgin.
Budget has been the travel buzz but when all you’ve got is low prices, where do you go when Plan A doesn’t work?
That’s a dilemma the budget travel sector is facing right now.
Being cheap is proving to be a fatal flaw and begs the question: could investors have been looking in the wrong direction – is luxury travel the better long business model?
Think about the advantages – lots of room to move on prices, up or down, plenty of opportunity to value-add, and high barriers to competitor entry.
Add to that strong growing demand among travellers from all income brackets and backgrounds for a luxury experience.
An interesting argument, don’t you think.
Let’s pause, let’s take a step back and look at the pros and cons of each sector.
Low Cost Carriers hit the travel industry like a slap in the face. Not just innovative – revolutionary.
Ryanair led by provocative CEO Michael O’Leary got the party started by slashing airline operating costs and airfares while expanding at breakneck speed.
It was a spark that lit a fire.
Millions of people who previously could not afford to travel due to high prices charged by the so-called legacy carriers were now able to do so.
Other airlines followed before branded budget hotels got in on the act quicker than you could say “ancillary charges”.
Budget – the travel business model of the future!
This line of thinking was further bolstered by the 2008 Global Financial Crisis.
However time has proved that budget travel businesses have severe limitations.
Exhibit one are low cost carriers.
They were once considered innovative but are now looking short of ideas, while their aspirations in terms of product delivery are low.
For example, Cebu Pacific flew into Australia for the first time this week and created some media buzz, but not in a good way.
Coverage focussed on Cebu’s main claim to fame, which is that it crams more passengers into its A330-300 aircraft than any other airline.
– 436 economy seats compared with 255 (plus 30 business) for Singapore Airlines.
To do this Cebu has reduced seat size and pitch, enabling it to stuff nine passengers abreast rather than the standard eight across configuration.
Sustainable idea – I’m not so sure.
- $99 flight for those who like to be tight (Daily Telegraph)
- ‘Most cramped’ aircraft takes to our skies (The Australian)
Not the kind of coverage to build a long-term, sustainable business.
Interesting to note the change in how low cost carriers are covered.
Media is now focussing on the discomfort endured by passengers rather than just a low price.
The speed of change within the low cost carrier environment is hard to comprehend.
The Centre for Asia Pacific Aviation (CAPA) estimates there are 47 low cost carriers in Asia-Pacific with up to another 12 on the way.
It says low cost carriers now have 58% of the Asia-Pacific aviation market, up from 0% only a few years ago
This has created a brutal hyper-competitive operating environment where carriers like Jetstar, Tiger Airways and Air Asia X are losing money.
Of course, legacy carriers are probably doing worse – witness the recent dreadful Qantas result – but the point here is that low cost carriers were supposed to be the solution.
Instead, they have become a major part of the problem, forcing down prices to uneconomic levels for all players, at the same time operating costs for everyone are increasing.
Meanwhile, some budget hotel brands have also run into problems for many of the same reasons.
The big one of course is over-supply. As with budget carriers, there are simply too many operators in key markets.
For developers, the cost of entry is low with smaller rooms and lower operating costs, so they opt for that rather than a more upmarket brand.
Indonesia is a prime example of what’s happening now. Investors have been attracted by its large population and growing middle class.
As with aviation, the budget branded hotel sector has come from nowhere in just a few years and there are now 45 budget hotel brands in Indonesia.
Will they all last? Probably not.
Analyst Matt Gebbie from Horwath believes that there will be attrition, call it consolidation, and that those with the deepest pockets will survive.
One of the survivors will surely be Pop!, operated by Tauzia Hotels.
Irene Lin, Brand Director of Pop! Hotels, said competition has been intense, particularly in Indonesia’s major tourism market of Bali with heavy discounting from an already low base.
None of the budget operators are making money in Bali and operators have found that if price is your only selling tool there’s nowhere else to go.
Luxury, on the other hand, can go anywhere – even to the moon – and there’s no limit to either aspiration or expense.
That’s always been the case but the world was supposed to be entering a period of prolonged austerity following the GFC.
Yet that turned out to be only partly true.
Markets like China continued to pump, fuelling the never-ending Asian boom, while the rich of Europe and North America kept spending but with their heads down.
And so luxury is travel has been doing surprisingly well, proving incredibly resilient.
It’s also being propelled by a new breed of global consumer who may not be wealthy but is determined to experience the high-life.
Hang the expense, and exclusivity, all you need is money, which is leading to a redefinition (or definitions), of what luxury is in today’s world.
As Ross A. Kelin wrote on the Huffington Post, “What does luxury mean in a world where almost every other person at airport security is toting Louis Vuitton or Gucci?”
He says “accessible luxury” is the new buzzword.
“Luxury as we know it is becoming the possession of the middle classes.
“Whether it be some extra-ply loo roll, some red-soled stilettos or ostentatiously priced smart-phone, the exclusivity aspect is becoming redundant thanks to our own evolution as consumers.
“We’re moving away from conspicuous consumption towards consumption with a consciousness; and as a result the balance of power is shifting away from the luxury houses who previously dictated to us what products defined extravagance year-by-year.”
How does this apply to travel? For Singapore Airlines it means space. The carrier has just launched private Suites on some of its aircraft and by all accounts the product is doing well.
Ask an hotelier and they struggle with a straight answer, even though luxury is a defined accommodation category, and one is growing very quickly.
Accor for example plans on opening a luxury hotel in Asia-Pacific every month for the next five years.
The company has moved the headquarters of its luxury brands to Singapore and believes the region will soon become the world leader in luxury consumption.
Rick Harvey Lam, Senior Vice-President Global Marketing Luxury & Upscale Brands – Accor Group says that luxury is in the eye of the beholder.
“There is no standard definition of Luxury, as it depends on the person experiencing it,” he said.
“Ask ten people about their definition and most probably you will receive at least seven different answers, across a wide range of specifics.
“Within Accor we refer to Luxury according to the 4 E’s: Experience, Exclusive, Emotion and Engagement.”
The big one seems to be experience – something people are prepared to pay extra for.
European cruise operators for example are finding that they are selling “from the top down”, while prices for high-end properties have been hitting new highs over the past few years.
Don’t believe me? Just try booking a top hotel in an iconic tourism destination and you’ll find the price of entry starts at USD500 a night and up.
Clearly demand is outstripping supply for these luxury products while for low cost travel and accommodation the reverse is true, there are more seats and beds than customers.
Yet everyone’s still trying to get on the budget bandwagon.
It seems strange when you consider the present set of circumstances which suggests the real long-term future for travellers and industry investors is luxury.
Quality not quantity…
Source: Martin Kelly, http://www.traveltrends.biz
World’s Top 10 Airlines
1. Cathay Pacific Airways
2. Qatar Airways
3. Singapore Airlines
5. Turkish Airlines
6. ANA All Nippon Airways
7. Garuda Indonesia
8. Asiana Airlines
9. Etihad Airways
Best Inflight Entertainment
2. Singapore Airlines
3. Turkish Airlines
5. Cathay Pacific Airways
6. Virgin Atlantic
7. Qatar Airways
8. Air New Zealand
9. Virgin Australia
10. Etihad Airways
Best Cabin Crew
1. Garuda Indonesia
2. Cathay Pacific
3. Singapore Airlines
4. Asiana Airlines
5. Malaysia Airlines
6. Qatar Airways
7. EVA Air
8. ANA All Nippon Airways
9. Thai Airways
10. Hainan Airlines
Best Low Cost Carrier
2. Jetstar Airways
3. Virgin America
4. AirAsia X
7. Jetstar Asia
10. Azul Airlines
Philippine Airlines is under renewed pressure to stop transporting shark fins to Hong Kong after a local green group found what it described as a “suspected illegal” shipment in Sheung Wan.
About 100 groups and individuals have given their support to an open letter sent to senior executives of the airline, urging them to publicly commit to ending the trade.
Overall imports of shark fins to Hong Kong fell 35 per cent last year compared with 2012, WWF-Hong Kong says.
The fall comes amid a crackdown by the central government on extravagance and corruption, and pressure by environmental groups to stamp out the trade.
The letter says the airline “directly contradicts” its commitment to sustainable development by allowing carriage of shark fins and related products on flights from Manila to Hong Kong.
It was written after a Wildlife Risk, a Hong Kong conservation group, and Fins Attached, an ocean-advocacy group based in the United States, discovered what they suspected was an illegal shipment of shark fins sent from Dubai by Philippine Airlines.
“Simply put, the tonnes of shark fins transported as cargo into Hong Kong on Philippine Airlines flights are directly leading to the endangerment of shark species and the marine environment in Asia and beyond,” the letter says.
“We need the airline’s help in cutting the supply chain of shark fin to Hong Kong,” it said, demanding that the company to set an “aggressive timetable” to stop carrying shark fins and post as pledge on its website.
The 136 bags of fins with an estimated weight of 6.5 tonnes, were delivered to dried seafood trader Global Marine in Sheung Wan. The company, which also has an office in Tsim Sha Tsui, denied the shipment was illegal.
“We have documents like import or export permits. There is nothing illegal and we have nothing to hide,” said a spokesman who identified himself as Ahamed.
However, Alex Hofford, from WildlifeRisk, said there was “a low chance” the shipment was legal.
He said Dubai was a trans-shipment centre for fins harvested from regions in Africa where enforcement of fishing regulations was ineffective.
He said Philippines Airlines was still active in transporting shark fins from the Middle East, although Emirates stopped such shipments on its route to Hong Kong last June.
“Philippine Airlines fly a lot of migrant workers, such as domestic helpers and nurses to Dubai, and often [the planes] come back empty,” Hofford said.
At least five airlines have followed Cathay Pacific’s example to ban shark fin cargoes on its flights. Korean, Asiana, Qantas and Air New Zealand enforce a blanket ban, while Fiji carrier Air Pacific allows only fins from sustainable and verified sources.
Hofford said Greenpeace activists in Philippines were furious over the shipment to Hong Kong, regarding it as a breach of trust after they met the airline’s executives in March.
Ahamed said Global Marine received regular shipments, usually two to three tonnes each, from Dubai and had used Philippine Airlines from time to time.
He said he was just a wholesaler of shark fins and the imports would be re-sold to anybody who paid for them.
Ahamed said he had no idea what shark species the fins came from.
Alex Anotoniou of FinsAttached said that the fins could be from any of three species — hammerhead, reef or silky sharks. He suspected the shipment could be small tail fins of baby sharks and it was possible that they might be mixed with scallop hammerhead which was listed as a regulated species in international trade.
Last night, the airline could not be reached to comment on the matter.
Source: Cheung Chi-fai, firstname.lastname@example.org, South China Morning Post
Anyone with a fear of flying should consider this before boarding their next flight: 2013 was, by far, the safest year for air travel since the dawn of the jet age, according to new data from the Aviation Safety Network, or ASN, an independent organization based in the Netherlands.
Some 29 fatal airliner accidents resulted in a total of just 265 fatalities last year, making 2013 the safest year for number of fatalities and second-safest year for number of accidents. By comparison, the 10-year average for accidents and fatalities is 32 and 720, respectively.
“Since 1997, the average number of airliner accidents has shown a steady and persistent decline, probably for a great deal thanks to the continuing safety-driven efforts by international aviation organizations such as ICAO, IATA, Flight Safety Foundation and the aviation industry,” ASN president Harro Ranter noted.
The worst accident of 2013 occurred on Nov. 17 when a Tatarstan Airlines Boeing 737 crashed on approach to Kazan, Russia, killing 50. Beyond Russia, the entire continent of Africa remained the least safe for air travel in 2013, containing one-fifth of all fatal airliner accidents and just 3 percent of all world aircraft departures.
Europe and North America remained exceedingly safe last year, despite the fact that only one of the two continents’ carriers, Virgin Atlantic, earned seven stars for safety and in-flight product in a new ranking of the world’s safest airlines by safety and product ranking website AirlineRatings.com.
With a fatality-free record in the jet era (since 1951), Australian flag-carrier Qantas once again beat out 447 global airlines to top the AirlineRatings.com list. Website editor Geoffrey Thomas noted that Qantas had amassed an “extraordinary record of firsts in safety and operations” and had been a leader in introducing a host of technologies in the cockpit. “There is no question that Qantas stands alone in its safety achievements and is an industry benchmark for best practices,” he said.
Qantas was the first international airline to operate around the world service in 1958 with its Lockheed Super Constellations and the first to take delivery of the Boeing 707 outside the U.S. in 1959. Thomas said the Australian carrier was also among the first to pioneer long-range operations for twin-engine planes, use a flight data recorder to monitor performance and implement real-time monitoring of its engines using satellite communications.
Air New Zealand joined Qantas on top of the list, as did fellow Asian airlines All Nippon, Cathay Pacific, Eva Air and Singapore Airlines. Middle Eastern carriers Emirates, Etihad Airways and Royal Jordanian also received seven stars for safety and in-flight product, rounding out the top 10.
In creating its list, AirlineRatings.com took into account a number of different factors, including audits from aviation governing bodies and lead associations, as well as government audits and the airline’s fatality record. Some 137 of the 448 airlines surveyed received the top seven-star safety ranking — a testament to the industry’s stellar safety record. Yet, there remains a stark divide between the top-tier carriers and their underperforming counterparts.
Nearly 50 airlines received safety rankings of just three stars or less. Afghan Airways (Afghanistan), Daallo Airlines (UAE), Eritrean Airlines (Eritrea), Lion Air (Indonesia), Merpati Airlines (Indonesia), Susi Air (Indonesia) and Air Bagan (Myanmar) all received just two stars, while Kam Air (Afghanistan), Scat Airlines (Kazakhstan) and Blue Wing Airlines (Suriname) earned the dubious title of world’s least-safe airlines with just one star apiece.
All three one-star carriers are banned from flying within the EU. While the U.S. doesn’t blacklist individual airlines, it does issue a public list of nations that it judges to fall short of international aviation safety standards. That list includes Indonesia, Serbia and the Philippines, among others.
Source: Mark Johanson, http://www.ibtimes.com/worlds-safest-airlines-2013-found-asia-pacific-middle-east-1534348