AIRLINE NEWS

Long haul…short stretch

A Virgin Atlantic steward was last week found guilty of stealing duty free goods from the airline's inflight duty free programme worth some $123,000 (?65,000) over two years and sentenced to nine months in prison.
The steward, Karl Faulkner (34), was said to have stolen watches, cameras, camcorders and other goods over a two-year period and subsequently sold them on eBay. Isleworth Crown Court in Middlesex, UK found Faulkner guilty after it was told that the steward's penchant for selling electronic goods bought in downtown New York through eBay UK got out of hand.
Faulkner then begun supplementing this ‘income’ by stealing from the inflight duty free trolley.
He was caught after being search challenged coming off a flight from Delhi to Heathrow whereupon several items were found deposited inside the lining of his coat.
ED's Note/Correction: Tourvest Duty Free operates the inflight duty free concession for Virgin Atlantic and not AELIA-owned Aeroboutique Inflight Retail (AIR) as our earlier report suggested. Apologies for any confusion.

SIA takes profit hit

Singapore Airlines (SIA) has reported a 15% drop in quarterly profit due to higher fuel costs and indicated that fuel costs are likely to remain a problem for the foreseeable future. SIA said that it spent S$.1.33bn ($853m) on fuel in the second quarter of its 2006/07 fiscal year, a rise of 27% compared with a year ago.
The airline said it believes that fuel prices will remain their current levels for the next 12 to 18 months. But more encouragingly it added that it expects demand for air travel to remain strong thanks to economic growth in Europe and Asia. SIA said July-September profit fell to S$.293m ($188m) from S$.343m ($220m) a year ago.
Meanwhile, SIA has also confirmed that it will be looking for meaningful compensation from Airbus for the delayed arrival of the launch aircraft A380 for which it will now have await delivery until late 2007.

Emirates weighs concern

Emirates Airlines has made it known that while it is obviously unhappy about the two year delay on the Airbus A380, it is also concerned that the aircraft may be as much as 5.5 tonnes heavier than in the original specifications.
The latter concern was voiced by Emirates President Tim Clark in comments attributed to him last week when he visited a new lounge at London's Heathrow Airport designed to handle Emirates' A380s.
Such concern is understandable considering that Emirates is the lead customer for the A380, with 43 of the $300m aircraft on order. The Airbus delay of two years for Emirates now means that it will be forced to lease other aircraft in the interim and Clark has already said that this delay will cost the airline hundreds of millions of dollars in lost revenues.
Certainly Emirates is in a powerful negotiating position with Airbus over the A380 delays and what position it takes may depend on how convinced it is that Airbus will not delay deliveries any further.

Aer Lingus doubts Ryanair

Aer Lingus was highly critical of Ryanair last week saying that its unwanted suitor had made several incorrect statements about Aer Lingus, at the same time that its own share price had underperformed.
Ryanair launched its E.1.48bn ($1.87bn) hostile bid to take over Aer Lingus earlier this month and Europe's largest low-cost airline said that members of Aer Lingus's Employee Share Ownership Trust (ESOT), which has a 12.6% stake in the airline could at least expect to receive E.60,000 ($76,000) each by selling their shares to Ryanair.
But Aer Lingus has countered saying that the E.186m ($235.7m) it would receive if it were to accept Ryanair's offer would not stretch that far, given borrowing costs of E.35m ($44.4m) after the exercise of an option to buy extra shares.
Unlike the government, which has said it will not sell its 25.35% stake, and a number of smaller Aer Lingus shareholders opposed to the bid, ESOT has yet to say whether it will accept it.

Virgin puts back A380

Virgin Atlantic Airways has put the boot on the other foot by telling Airbus that if it can't deliver its A380 on time then the airline doesn't want it for another four years until it has sorted out its technical problems with the aircraft.
Virgin said it was still committed to taking six A380s, but would now wait until 2013 for delivery of its first aircraft. Virgin is 49% owned by Singapore Airlines (SIA), which is due to be the launch airline for the A380 in late 2007, SIA has promised to hold tough negotiations with Airbus over the delays (see separate story).

Some good news for Airbus

In a month where it has been besieged with bad news, Airbus managed some positive spin late last week when it formally agreed to sell 150 narrow-bodied A320 aircraft to China for $10bn and set up a manufacturing plant in the country.
Airbus finalized the deal to build the A320 assembly plant in Tianjin, near Beijing, its first such factory outside Europe. The deal was informally agreed last year when Chinese Prime Minister Wen Jiabao visited Airbus headquarters in Toulouse, France.

Hong Kong's first LCC

Hong Kong's first low-cost carrier (LCC) Oasis began operations last week after a minor delay caused by Russia's initial refusal to allow the airline to use Russian airspace.
Oasis Hong Kong's Boeing 747-400 flew from Hong Kong to London Gatwick last Thursday with economy passengers paying HK$1,000 ($129) for their one-way economy-class seats and business-class passengers paying $6,600 ($849) for theirs.

Qantas orders more
Australian carrier Qantas is now expecting delivery of 20 A380s between 2008 and 2015 after ordering a further eight of the planes. Qantas Ceo Geoff Dixon said the decision to raise the order had been made after an ‘extensive review’ of recent problems at Airbus.