Airlines likely to be slapped 12.5% ATF tax

Thiruvananthapuram: State Governments are likely to slap a common 12.5% tax on the ATF (aviation turbine fuel) drawn by airlines. This would mean ATF prices would rise at Cochin and Hyderabad airports, while it would come down at Mumbai and Delhi. A consensus on this has emerged as many states, who tried offering a lower tax rate, are annoyed that the tax benevolence was not reciprocated by air fare cuts in that sector.
It is understood that Asim Dasgupta, Chairman, Empowered Committee of States on VAT, is under tremendous pressure from airlines operators to advise paring down of the rates. Their plea is that ATF should be included in the list of declared goods, in view of the Rs 2,000-crore collective losses that the aviation industry is weathering. The centre has been pushing states to reduce ATF prices to make international airlines use India as a refuelling base and therefore a hub for their operations.
However, the mood voiced at the meeting of the panel was that States should stop competing among themselves for better aviation facilities and leave the airline operators to their fate, a State Minister, who attended at the meeting told FE.
08/05/08 M Sarita Varma/Financial Express

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New policy on aeronautical charges on the cards

The traditional revenue model for airport development may be tweaked for new airports, especially the ones expected to come up in 35 non-metros over the next few years.
Speaking to DNA Money, a senior ministry official indicated that the government may soon come out with a policy on cross-subsidisation of aeronautical charges at non-metro airports.
"We are going to make a policy that at least 30% of non-aeronautical revenues should be ploughed back to the aeronautical side," he said.
Simply put, this allows private developers of non-metro airports to offer some of the unused land for development of hotels, conference halls, shopping malls etc and use the revenue so generated for cross-subsidising aeronautical charges airlines pay at present.
Not only would such a model help the development of more profitable airport ventures, it would also ultimately lower user development fee (UDF) for passengers - an issue new airports at Hyderabad and Bangalore are already grappling with.
The official said that, for the first time, such a model would be implemented in Amritsar and Udaipur.
31/03/08 Sindhu Bhattacharya/ DNA MONEY/Sify

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Airlines bracing for challenging times

With major predictions of a deceleration in domestic air traffic, airlines are lowering seat capacity by reducing the number of flights or dropping fares in order to fill up their seats.
They have also begun the process of reducing the number of aircraft that they were planning to to induct in their fleet as part of their expansion plans.
Management consultancy firm Ernst & Young recently estimated that domestic traffic would grow by 24.16 per cent this year compared to 32.51 per cent last year.
According to the Centre for Asia Pacific Aviation (CAPA), domestic traffic growth for 2008-09 will be 22 per cent compared to 31 per cent last year.
30/03/08 Business Standard

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Legacy carriers regain some ground in Feb

Bangalore: In a minor trend reversal, legacy carriers Indian, Jet Airways and JetLite (formerly Air Sahara) regained some of their lost market share in February even as the challenger airlines (except for Deccan and SpiceJet) saw their share in the aviation pie shrink.
Not long ago — between 2005 and 2007 — the new entrants had challenged legacy carriers by growing their market at a furious pace. This had diminished the legacy carriers’ dominant position in the market even though they were flying more passengers than before.
It may be a flash in the pan, but February, which is traditionally a lean month for air traffic, saw the incumbents regain some lost ground.
Analysts attribute the trend to the ongoing consolidation in the market.
State-owned Indian’s share in the aviation pie grew 50 basis points (bps) at 14.40% from 13.90% in January. However, this was still down 160 bps from 16% in February last year.
Naresh Goyal’s airlines - Jet and JetLite - also bit off bigger pieces of the market in February at 23.20% and 7.40%, up 50 bps and 57 bps, respectively over January.
29/03/08 Praveena Sharma/Daily News & Analysis

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IBS acquires major stake in HBSi

Thiruvananthapuram: IBS Software Solutions, a leading provider of IT solutions to the global Travel, Transportation and Logistics industries, based at Technopark here has acquired the majority stake in the Atlanta-based Hotel Booking Solutions Incorporated (HBSi) in a ‘cash and earn out deal’.
Announcing this at a news conference here on Thursday, IBS chairman and CEO V K Mathews told reporters that the acquisition would commence the company’s foray into the hospitality industry. The HBSi comes with more than 30 clients, which includes the who’s who in the hospitality industry in the US and Canada. It is the fourth major acquisition by IBS. The company had acquired TopAir from EDS (Switzerland, 2002), Avient Technologies from Honeywell Corporation (UK, 2003) and Discovery Travel Systems (USA, 2006).
28/03/08 Newindpress

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India's Bharat Petroleum eyes wider Sri Lanka market share

India's Bharat Petroleum says it is looking for opportunities in Sri Lanka's aviation and retail fuel sectors after launching its 'MAK' brand lubricants partnering with a top auto dealer in the island.
"We hope that we will also be given an opportunity to enter the main product market which is the petrol and diesel trade," Bharat Petroleum marketing director S Radhakrishnan, told LBO.
"We are already here in a small way doing some bunkering and now lubricants."
Bharat Petroleum was one of the bidders for a third share in Sri Lanka's retail fuel market but the process was abandoned following a change in the country's economic policy after 2004, which ruled out privatization.
"Aviation, if we are given an opportunity, we would also like to start refueling in Colombo and other air ports," Radhakrishnan said
"We are waiting an opportunity from the government do that."
The aviation fuel market is a monopoly of state-run Ceylon Petroleum Corporation, which is also eyed by the Sri Lanka unit of Indian Oil Corporation, which already has a third share of the retail petroleum business in the island.
Lanka IOC has also asked to supply fuel at the planned second international airport in southern Weerawila.
26/03/08 Charitha Fernando/Lanka Business Online, Sri Lanka

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Boeing logs ambitious business plan for India

New Delhi: Boeing is eyeing commercial aircraft orders worth over $40 billion in the next 20 years and defence sales of another $10 billion to $15 billion over the next ten years from India and has drawn up ambitious plans to source products and services from the country to stay “agile and competitive” in the global marketplace.
In a little over one year, Boeing has inked five agreements with top information technology and engineering companies , which will result in key components for its civilian and military aircraft being manufactured in India.
The most significant of these took place last month when Boeing signed a sourcing deal with TAL Manufacturing Solutions Ltd, a 100 per cent Tata Motors subsidiary, for floor beams made with titanium and composite materials for its 787 Dreamliner.
This will meet a large chunk of the $1.8 billion purchase obligation that Boeing carries for bagging the $11-billion, 67-aircraft deal from Air India.
In addition, Boeing along with Air India will set up a maintenance, repair and overhaul centre at Nagpur and a school for training pilots in Mumbai (the venue could change) at a total cost of $175 million.
24/03/08 Bhupesh Bhandari/Business Standard

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Boeing seeks to make India its global partner

New Delhi: While Boeing is interested in selling airplanes to India, its overall goal is to make a global partner out of India. "This integrated enterprise strategy is what differentiates Boeing from its rivals," says Ian Thomas, head of Boeing India. The US aerospace giant is also investing millions to expand India's R&D capability, civil aviation infrastructure and hi-tech manufacturing base.
At one level, Boeing is certainly still interested in selling its products to clients in India. Boeing has sold $ 25 billion worth of civilian aircraft ranging from Air India airliners to three business jets designed to serve as "the Indian equivalent of Air Force One." The future holds even more promise: Boeing estimates India will buy 911 aircraft worth $ 86 billion over the next 20 years.
Then there is the potential for military sales. Besides the F-18 Super Hornet fighter, Boeing also has its P-3C Orion reconnaissance aircraft, Chinook CH-47 helicopter and Apache attack helicopter to offer.
At another level, Boeing is investing heavily in broadening India's capability.
23/03/08 Pramit Pal Chaudhuri/Hindustan Times/Manufacturing Business Technology, US

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Jet gets China approval to fly to Shanghai

New Delhi: After dragging its feet for over a month, the Chinese government on Thursday altered its stance on giving permission to Naresh Goel-promoted Jet Airways to fly to San Fracisco via Shanghai.
The Chinese and Indian civil aviation authorities met on Wednesday and Thursday to discuss a number of issues, including their differences over fifth freedom rights in their air bilateral agreement.

____________________________
Threatened China signs the agreement
New Delhi: India and China have
finally agreed to allow designated
airlines to fly to each other’s
countries and beyond, but only after
officials here threatened the visiting
civil aviation delegation from Beijing
that India was prepared to cancel
the entire agreement, according to
government officials familiar with the
matter who didn’t want to be
identified. The Indian side told their
counterparts that if Beijing was not
willing to reciprocate the Indian gesture
of allowing the Chinese cargo carrier,
Great Wall Airlines, to fly to Mumbai
and Chennai, it might have to call
off the entire exercise.
21/03/08 Jyoti Malhotra and
Tarun Shukla/Livemint
____________________________

The two sides decided that designated airlines from both countries would be allowed to operate to any three points beyond the destination (beyond points), but not more than two points in one region. However, the intermediate points and beyond points and the exercise of traffic rights, to and from these points, require permission from the aeronautical authorities of the two countries.
The Indian authorities specified the US and Canada as one region, Australia and New Zealand as the second region and Asia as the third region for the three beyond points for Indian carriers.
20/03/08 Financial Express

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MoU signed between India and China on air service matters

The Aeronautical Authorities of the Republic of India and the People’s Republic of China met in New Delhi on 19-20 March, 2008 for consultations on air service matters.
It has been decided by both the sides that the designated airlines of both the countries will be entitled to operate to any 3 beyond points with not more than 2 points in one region. However, the intermediate points and beyond points and the exercise of traffic rights to/from these points shall be agreed upon by the two aeronautical authorities of the two countries.
The Indian delegation has specified the United States of America and Canada as one region, Australia and New Zealand as the second region and Asia as the third region for the three beyond times for the Indian carriers to operate the agreed services. For China, Africa is one region, Middle-East (including Gulf Area) is a second region and Europe the third for the three beyond points for operations of the Chinese carriers.
It has been agreed that the designated airlines of India may operate beyond China to San Francisco with full 5th freedom traffic rights.
The Chinese side shall be allowed to nominate a beyond point in India with full 5th freedom traffic rights, at their discretion at a later date.
Both sides have come to an agreement that the designated airlines of each country shall be entitled to exercise beyond 5th freedom traffic rights on not more than 14 frequencies to all the beyond points put together.
20/03/08 Press Information Bureau

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India for improving air connectivity with Africa

New Delhi: With a view to improving connectivity with Africa, India is considering allowing more than one Indian carrier on the various routes to the continent to facilitate easy movement of people.
"We are looking at amending some of the air services agreements to introduce more than one Indian carrier," Minister of State for External Affairs Anand Sharma told reporters here on Thursday.
Noting that Indian Airlines has a shortage of planes and could not operationalise all the routes, he said what has been proposed is that more than one airline is allowed to operate so that private sector airlines can step in.
20/03/08 PTI/The Hindu

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Sky high! Private jets taking off in India

Mumbai: In the past one month, sensing a big business opportunity, three international business jet firms have entered India to tap the fast-growing market in the country.
US-based Aerion, which is developing a high-end supersonic business jet (SSBJ), has received pre-delivery orders from five Indian customers. The deliveries are to begin from the last quarter of 2014.
Graeme Weston, director of sales of Warren Buffets-promoted NetJets, told IANS: “In India, wealth creation is taking place at a phenomenal pace. We have a potential of over 5,000 customers in India...”
According to an executive from a private jet company, not just the Ambanis and Mallyas, but also many businessmen from Tier II and III towns are enthusiastically looking at these planes.
For instance, Bellary, the mining town in Karnataka, already boasts of a few private helicopter owners.
Robert Dranitzke, director of marketing for NetJets Europe, said every four days an Indian is flying in a NetJets flight. A Gulfstream G550 seats 14 passengers, and, with two bathrooms, is roomier than some apartments.
Tata Group’s Indian Hotels recently bought a stake in Singapore-based Briley Group’s BJETS, which also offers fractional ownership in private jets in India and Southeast Asia.
The venture has ordered 50 jets worth more than $600 million during the recently held Singaopre Airshow. Club One Air CEO Manav Singh had also made ripples at the Singapore air show with orders of 10 Eclipse 500 Very Light Jets (VLJs).
21/03/08 Varada Bhat/IANS/Thaindian.com, Thailand

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Wipro aligns efforts on aerospace target

Delhi: Indian outsourcing company Wipro Ltd. is attempting to fly a handful of design efforts and partnerships into formation to make an assault on the rapidly growing aerospace market in India and around the region.
Wipro has partnered with Lockheed Martin to create demonstration centers in Delhi and the U.K. showing new capabilities for linking multiple control centers, aircraft and vehicles. Wipro hopes to accelerate its understanding of aerospace by working with Lockheed Martin while the US company gains greater access to the India market. In the Delhi center, Wipro is showing applications running across two F-16 flight simulators and a number of kiosk control stations on a local area network.
Separately, Wipro has partnered with Boeing, India aerospace giant HCL and a university in Bangalore to create a virtual research center. It will explore the concept of a single-unified network for civil aircraft than can flexibly and securely handle the work of separate pilot, crew, entertainment and operations networks on a plane.
In another initiative, Wipro is working with BA Systems to explore opportunities in flight control systems. The company is also trying to apply its experience developing computer games to building commercial simulators. Finally, the company is researching the possibility of creating new designs for smart landing gears and brakes as an extension of the company's existing work in hydraulics.
20/03/08 Rick Merritt/EETimes.com

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ATF duty cut set to fuel growth of small airports

Mumbai: In a bid to promote aviation activity in Maharashtra’s Tier-II and Tier-III cities, the state budget has announced a heavy reduction in duty on aviation turbine fuel for aircraft outside Mumbai and Pune. Finance minister Jayant Patil told the legislature that the ATF duty had been reduced from 25% to 4% on fuel supplied to aircraft in places like Nagpur, Aurangabad, Amravati, Akola, Nanded and other smaller cities.
“All these cities are emerging as developing centres of trade and industry. It is necessary to encourage air travel in these places. Purchase of fuel is an important item in the balance sheets of airlines and a reduction in ATF duty should work as an incentive for more air traffic in places other than Mumbai and Pune where the ATF would be charged at the statutory 25%,” Mr Patil said.
Mr Patil said the state has planned to provide impetus to development of more airports to cater to the increase in aviation activity. In fiscal 2008-09, the state government would support development of airports at Shirdi, Solapur, Amravati, Jalgaon, Nanded and Latur.
20/03/08 Economic Times

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Buffett’s NetJets enters Indian market for charters

New Delhi: The world’s largest private jets operator, NetJets Inc., owned by billionaire Warren Buffett’s Berkshire Hathaway Inc. has joined hands with Mumbai-based Shreyans Motors Pvt. Ltd to sell international air charter services in India.
Earlier this year, Club One Air, until then India’s sole fractional ownership firm, saw new competition emerge from the Tata group, which announced its entry into the emerging business jets market through a stake in Singapore-based BJets Pte Ltd.
Fractional aircraft ownership allows multiple people to “own” a single aircraft and share flying time without having to deal with maintenance and related issues. NetJets and Shreyans will initially start with a revenue-sharing model.
As a franchisee, Shreyans Motors will sell NetJets products and services to Indian customers for long-haul sectors such as Mumbai-London.
In addition to owning a piece of the aircraft, customers can also buy flying time, much like international calling cards. A 25-hour flying time, valid for a year on a light jet, can be bought for about Rs1 crore to start with. That will allow the passenger to be picked up from any small city in India where business jets can land and be dropped at an international destination.
19/03/08 Tarun Shukla/Livemint

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Patel urges states to reduce sales tax on aviation fuel

New Delhi: As Maharashtra became the third state in the past month to reduce sales tax on jet fuel to four per cent, Civil Aviation Minister Praful Patel on Wednesday urged other states to consider similar measures.
"It is advisable for other states to look at similar measures ... states like Tamil Nadu, Karnataka, Delhi and West Bengal," he said after laying the foundation stone for the headquarters of Bureau of Civil Aviation Security (BCAS) here.
While Maharashtra reduced state sales tax on aviation turbine fuel (ATF) in its budget on Wednesday, Kerala and Andhra Pradesh are the other states to have cut the rate from a high 33 and 24 per cent respectively to four per cent.
The Maharashtra government slashed sales tax on ATF from 25 to four per cent, but the new rate will not apply to Mumbai and Pune, accounting for most flights operated in the state.
Patel said the move made economic sense as cheaper fuel would lead to cheaper tickets, thereby attracting more air travellers to these states.
19/03/08 PTI/Daily News & Analysis

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India, China meet over air agreement

New Delhi: Civil aviation officials from China and India will meet here later Wednesday to resolve issues related to the air agreement between the two countries.
The two-day talks could prove crucial for India's Jet Airways, which plans to develop Shanghai as its Asia-Pacific hub to fly to San Francisco or Los Angeles in the US.
After Indian Prime Minister Manmohan Singh's visit to Beijing in January, Jet expected to get flying rights to China. But even as India cleared China's Great Wall Airlines to fly to Mumbai, New Delhi and Chennai, Beijing hasn't responded to the Jet.
India operates four flights to Chinese cities. China operates 18 flights to India.
19/03/08 IANS/Sify

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Stake in Indian airlines for foreign carriers unlikely for now

New Delhi: Government is unlikely to allow foreign airlines to invest in their Indian counterparts so long as the domestic aviation industry strengthens itself, a top Civil Aviation Ministry official said on Tuesday.
"We want the (Indian aviation) industry to reach a certain level of comfort before allowing any such investment," Civil Aviation Secretary Ashok Chawla said in reply to questions on whether foreign airlines would be allowed to pick stake in Indian carriers.
The government has been of the opinion that allowing foreign carriers to invest in their Indian counterparts, when they were growing, would not be in the interest of the local aviation industry.
However, it has allowed FDI with a cap of 49 per cent and 100 per cent from NRIs in the domestic scheduled passenger airlines. The FDI component has to be from those who are not directly or indirectly connected with airlines.
18/03/08 PTI/Economic Times

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Ooty, Uttarakhand chopper plans hit roadblock

New Delhi: Attempts by Pawan Hans to connect tourist destinations with helicopter services is encountering roadblocks of a peculiar nature. While at Hemkund Sahib in Uttarakhand it is religious objections that’s holding back the helicopter services, at Ooty it is the dislocation of some 30 animals that has jeopardised Pawan Hans’ plans.
At both the hill stations, the Pawan Hans Helicopters Limited (PHHL) was to start operations from already existing helipads that needed minor upgradation. So, when at the behest of Uttarakhand Government, PHHL started to study possibilities of helicopter services to the picturesque Sikh shrine at Hemkund Sahib, the shrine’s priests objected vociferously. They argued that the helipad is located at an altitude higher than the shrine and it will be disrespect to the shrine to have helicopters land just above it.
At Ooty’s Theetukal helipad, it is the question of dislocating 30 animals that has put on hold a two-year plan proposed by the Tamil Nadu Government to run chopper services between Coimbatore and the Nilgiri hill station.
While the tourism department said it would give the animal husbandry department five acres of land in lieu of the helipad land and will create a separate access to it and ensure that livestock in the area is not disturbed, the latter is not satisfied. The animal husbandry department has demanded that it be given 30 acres of land elsewhere in Ooty. It is next to impossible to fulfil this demand in highly commercialised Ooty.
19/03/08 Anubhuti Vishnoi/Indian Express

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Kale Consultants inks pact with Finnair Cargo

Pune-based, Kale Consultants Limited (KCL) has signed a contract with Finnair Cargo, one of Europe's leading air cargo carriers, for providing complete airmail cargo revenue accounting services.
This service will be carried out at Kale`s Managed Process Services (Kale-MPS) centre in Mumbai, India. In addition, the service will include the full revenue accounting and production of management information for mail operations.
KCL provides software solutions and outsourced services to the travel and transportation industry worldwide.
18/03/08 Sarika Valecha/Stock Watch

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Satyam to beef up auto, aviation services

Coimbatore: While gearing up to commence operations at its campus in Chennai by end September, Satyam Computer Services, according to its Director and Senior Vice-President (Manufacturing and Automotive Business Group), Subu D. Subramanian, is planning to expand into Coimbatore to provide technology service support to the manufacturing sector here.
"In automotive IT services, our revenue during the current years has been close to 12 per cent and the growth in the aerospace service almost doubled. We are looking to provide product engineering services and embedded solutions for the automotive and aviation industry," he told Business Line.
Satyam has tied up with IIT-Madras for setting up an automotive Centre of Excellence. Subramanian hinted at the possibility of initiating something similar here.
"On the avionics side, when we work with aircraft OEMs, we perceive the urgent need for upgrading the avionic systems. The other area where there is a huge global shortage (in the aerospace industry) is the structure. We are looking to partner with universities to develop the requisite skill in this space," Subramanian said.
18/03/08 L.N. Revathy/Business Line/Sify

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Taj SATS to initiate operations in Bengaluru and Goa

Mumbai: Taj SATS Air Catering Ltd, the joint venture of Indian Hotel Company Ltd (IHCL) and Singapore Airport Terminal Services Ltd (SATS), will open flight catering units in Bengaluru and Goa respectively. The Bengaluru unit is scheduled for operations when the Bengaluru International Airport will open on May 11, 2008, while the Goa unit is expected to be operational by April 2008.
After the opening of these units, Taj SATS will have a total of seven flight catering units across India.
The Bengaluru unit is equipped to provide an output of 12,000-14,000 meals per day, and the Goa unit is expected to churn out 5000 meals on a daily basis.
18/03/08 Yashodhan Jadhav/TravelBizMonitor

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Airnetz.com Launches Business Jet Charters and Helicopter Tours

Mumbai: Airnetz.com launched the first of its kind service in India today by launching business jet charter services for small and medium businesses. The service is available for Indian as well as international businesses and locations.
"We are starting an era of affordable, private and exclusive aviation for Small and Medium Businesses. Business executives need exclusivity to attend their business meetings. Meetings are time critical," says Atul Khekade, CEO of Airnetz.com.
Airnetz services all airports nationwide. Besides that it also offers private jet charter service to international locations like UK, Middle East, Singapore, Malaysia and China.
Airnetz also brings aerial joyrides to Mumbai for the first time. Helicopter rides are only available in world-class cities like Las Vegas and San Francisco. But now through Airnetz we bring this service to Mumbai. Fares for the helicopter rides start at as low as Rs. 12,500 per person.
Besides this Airnetz also offers a helicopter tour of forts near Mumbai.
18/03/08 Business Wire India

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Cades to provide engineering services to Dutch company

Bangalore: Leading IT firm Cades will provide engineering services to Fokker Elmo BV, the Netherlands-based specialist in electrical inter-connection systems for aircraft and aero-engines, the company said here Monday. As per the strategic tie-up between the two firms, Cades’ engineering services include design, stress analysis and validation for wire harness system and related structures.
“Dedicated teams will work onsite in Europe and offshore in India to provide a range of services to Fokker, which manufactures electrical systems for aircraft of Boeing, Airbus and other aerospace majors,” Cades chief executive officer Dataram Mishra said in a statement.
Cades’ services will also be eligible for offset credit in India.
City-based Cades has about 50 customers worldwide, including Boeing, Airbus, Eurocopter, MT Aerospace, HAL, DRDO, ISRO, Daimler Chrysler, Nissan and Volvo.
18/03/08 IANS/Thaindian.com, Thailand

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Australian pilot goes missing

New Delhi: An Australian pilot employed with a private civil aviation company in Delhi has reportedly gone missing alongwith several official documents, including a Bureau of Civil Aviation security pass, and some cash for a week now. The police have registered a case against the pilot and are looking for him.
The pilot, identified as Peter Anthony Hanley (35), was employed with SRC Aviation Private Limited, which has a office in Vasant Kunj. For the past one week, Hanley has been allegedly missing along with several documents, following which, one of the officials of the company, Brigadier M K Idnani, filed a complaint with the police. A case has been registered at the Vasant Kunj police station under various sections, including criminal breach of trust, against Hanley.
Hanley, said the police, was employed with the aviation company since December 2007. He had come from Meekatharra in western Australia on a work visa. The police added that the mobile allotted to Hanley is missing and the number can’t be reached. It has come to light through technical surveillance that he flew abroad during the first week of March.
He had a passport issued from Melbourne in Australia, the cops added.
16/03/08 Rahul Tripathi/Times of India

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CAG finds flaws in VVIP jet buys

New Delhi: The much-touted acquisition of the Prime Minister’s Office in the air has received a rap on the knuckles from the comptroller and auditor general (CAG), the country’s premier watchdog agency. The deal, for acquisition of the three Boeing jets for VVIPs to fly around the world, was the one of the UPA government’s first big ticket deals soon after coming to power in 2005.
The CAG said that the deal was flawed as excessive payments had been made and competitors unfairly barred.
“The acquisition process for the VVIP aircraft deviated from laid down procedures and well recognised norms of propriety,” the CAG said in veiled reference that there could be undue tilt towards American aviation major Boeing for the contract.
CAG has said an “inordinate delay” of eight years had been taken to finalise the contract whereby government ended up paying $19.7 million more than the contract amount.
14/03/08 Financial Express

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Rising crude to increase cess for air travellers

New Delhi: With global crude prices hovering around $110 per barrel, Indian airlines are almost certain that aviation turbine fuel (ATF, jet fuel) will become expensive next month. And the burden of this hike will be passed on to passengers in terms of higher fuel surchange, which at present is Rs 1,650. Some airlines are now going to have differential surcharge to stop short-haul passengers from shifting to other cheaper modes of transport.
Kingfisher EVP Hitesh Patel said the higher fuel prices have led US carriers to announce a steep hike in fuel surcharge. ''There is no way any airline can absorb the rising crude price and this burden will have to be shared with passengers in form of higher surcharge,'' he said, while ruling out differential fuel surcharge for Kingfisher-Deccan combine.
SpiceJet executive chairman Siddhantha Sharma feels that current crude prices indicate that ATF will reach a level where surcharge can't remain same for all sectors. GoAir CEO Edgardo Badiali also echoed the need for having different cess for short and medium haul flights.
15/03/08 Saurabh Sinha/Times of India

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Airlines losing Rs 800 on every passenger

New Delhi: The domestic aviation industry is likely to report a loss in excess of $700 million (Rs 2,800 crore) during the fiscal year 2007-08, up from around $500 million (Rs 2,000 crore at current exchange rate) recorded during the previous year, the Centre for Asia Pacific Aviation has estimated.
Addressing the third annual India Air Finance conference, CAPA Chief Executive Officer (India), Mr M. Kapil Kaul, said that the increase in losses was on account of a number of issues including the benefits of consolidation not becoming fully visible, fuel prices firming up and the surcharges being imposed that do not fully compensate the input cost of the airlines.
The Executive Director, Jet Airways, Mr Saroj Dutta, said the airline had recently done an internal survey which showed that the industry was losing around Rs 800 on every passenger being flown.
He was of the opinion that the various acquisitions and mergers that had taken place in the domestic aviation sector had not yet had the desired impact of leading to reduction in capacity and rationalisation of fares.
13/03/08 Business Line

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US aircraft manufacturer signs marketing agreement with Texas aircraft broker

San Antonio, TX: J.P. Murphy, president of Pro Aero Solutions in San Antonio Texas announces that they have been contracted by Interceptor Aircraft Corporation to negotiate the sale of the Meyers Aircraft Company. Murphy says, “The Meyers Aircraft Company is the best kept secret in the aviation industry today”.
Interceptor Aircraft Corporation (formerly Prop-Jets, Inc.), a Texas based company, owns the Meyers Aircraft Company to include the Type Certificate 3A18 for the Meyers 200 series and I-400 series aircraft, all manufacturing tooling, drawings, parts, and the second (and only existing) full production Interceptor 400.
The Meyers 200 series has a 4130 chrome-moly steel frame structure. This consists of what is known as the "bridge" section which extends from one main landing gear, across the underside of the cockpit area, to the other main landing gear. The 4130 also surrounds the cockpit area for unequaled protection. It exceeds 200 kts in cruise, is single piston engine powered, 4 place, and has never had an airworthiness directive (AD) issued against any major components by the FAA. There has never been an in-flight structural failure of a Meyers aircraft.
The Type Certificate also includes the Interceptor 400 (I400) which was the first single- engine prop-jet certified in the U.S. It is a pressurized, air-conditioned, all metal aircraft with 4130 chrome-moly steel frame and a cruising speed of over 300 kts at 24,000 feet. “The I400 is prime for today’s third world defense markets”, says Murphy.
Murphy says, “Although the aircraft industry represents billions of dollars annually it is in fact a small world industry, and we anticipate that the news of Meyers Aircraft Company’s availability will certainly attract global interest”. “We are already receiving interest from corporate and private sectors and currently have a major U.S. manufacturer showing serious interest”.
“With the phenomenal growth of foreign general aviation, especially in India, I feel a number of foreign manufacturers and investors will soon prove to be strong competitors as well”.
“We have also recently been approached by a U.S. Aerospace/Defense engineering firm with overwhelming statistics for replacement of military training aircraft here in the U.S and abroad, and they feel that both of the Meyers aircraft are of consideration to supply those needs” says Murphy.
“So with all this in mind it appears the timing truly is right for a Meyers to return to production. I am personally very excited about the future of Meyers Aircraft Company, as it is thought by many to be one of the best aircraft ever built. Once production begins, the Meyers will certainly be at the top of its class”.
For more information about the Meyers line of aircraft and the company you can visit their web site http://www.meyersaircraft.com/

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Indian Aero charts out Rs 2,000 cr MRO plan

Bangalore: Indian Aero Ventures (IAV), the aviation venture holding company floated by Rajeev Chandrasekhar, has chalked out Rs 2,000 crore future plan.
The company plans to have its presence in the entire lifecycle support system for an aircraft, including training pilots and MRO (maintenance, repair and overhaul) facilities.
Rajeev Chandrasekhar, MP, has shown interest in infrastructure, media and aviation support businesses after selling BPL Mobile for an enterprise valuation of over $1 billion. IAV is planning to raise funds through equity and debt.
EADS, the parent company of Airbus, has invested around $40 million in this venture. The MRO facility being set up by IAV in Delhi in association with National Aviation Company of India (NACIL) is expected to have a captive customer base of NACIL, which was formed after the merger of Air India and Indian Airlines.
13/03/08 Raghuvir Badrinath/Business Standard

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Centre allows 74 per cent DI for non-scheduled airlines

New Delhi: The Centre went ahead on Wednesday to notify liberal foreign direct investment (FDI) norms for aviation, commodity exchanges, credit information companies, titanium mining, industrial parks and petroleum & natural gas.
The Centre allowed FDI up to 74 per cent on the automatic route for non-scheduled airlines, chartered airlines and cargo airlines. However, there will be no direct or indirect participation by foreign carriers in nonscheduled airlines and chartered airlines, but 100 per cent NRI investment would be allowed on the automatic route.
The norms also allowed 74 per cent FDI in ground handling services, while investment by NRIs up to 100 per cent has been allowed on the automatic route.
13/03/08 Newindpress

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India Inc goes supersonic, books five Mach 1.6 jets

Have you ever fancied flying from Mumbai to Singapore in three hours flat (half the time taken by a commercial airliner) or taking off from Dubai to London in five hours or, for that matter, taking a quick trip between Mumbai-Delhi in just nearly half an hour?
That's what Aerion Corporation's supersonic business jet will exactly do for you. It is the speed that has caught the fancy of globe trotting Indian corporates - combining speeds of 1.15 Mach over land and 1.6 Mach over sea, beating the sound barrier of 760 mph(1 Mach). The aircraft seats eight to 12 passengers in stand-up comfort as well.
However, as you might have guessed, it comes at a price. At a cool $80 million (Rs 320 crore), it costs at least $20 million more than the current top-of-the-line business jets, or b-jets, rolled out by Gulfstream or Bombardier in the ultra long-haul range.
That, however, is not a deterrent for India Inc which has already gone ahead and booked at least five orders with Aerion Corporation, the Nevada company headquartered in Zurich, Switzerland.
But it is some more time before the aircraft finally is delivered - in 2016 - as against the roll-out year of 2014.
12/03/08 Business Standard/Rediff

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PE players shun airlines, for now

Mumbai: Global equity companies have no plans to put their money in the Indian aviation industry even though the carriers are seeking $2.5 billion in cash for expansion.
“We certainly would be looking to invest in airlines in India but we would like to wait and watch. The first round of consolidation for the industry is over and now we have three dominant players, which is great. We will wait to see how the benefits of merger, route rationalization and international operations shape up the airlines in India and when they would start showing stronger operational numbers, which is not happening right now,” said TPG Managing Director Puneet Bhatia.
The Group has made investments into Asia-Pacific aviation of late, but Bhatia refused to give the details. He said the group would be looking to invest into large established players.
However, it will be difficult for low-cost carriers to get the funding as only few airlines might end up getting all the investments, according to the head of a leading Mumbai-based equity research firm.
Big investment groups such as Goldman Sachs and Blackstone have stayed away from investing in the sector.
Private equity firm Kotak Investors Advisors, which invested in Paramount Airways a considerable amount (Kotak did not give investment details) to get a board seat said it is not in a mood to invest any further in the sector.
12/03/08 Manisha Singhal/Business Standard

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Airlines refuel in Andhra, Kerala to save tax

New Delhi: A reduction in sales tax on aviation turbine fuel (ATF) by the Kerala and Andhra Pradesh governments is encouraging several air carriers to refuel from airports located in the states.
Several carriers like Air India, Spice Jet, GoAir and IndiGo are now planning to refuel their aircraft at the Hyderabad and Kochi airports to get a benefit on lower ATF prices. Carriers say that they were expecting Karnataka and Tamil Nadu to follow suit — which could encourage carriers to make south India their fuelling hubs.
While Hyderabad airport will start levying the decreased surcharge from the first day of its operations (March 16), the reduced charges will be applicable to all airports at Kerala from April 1.
Spice Jet is planning to add 6 additional flights to Hyderabad to its already operating 13, and increase Kochi flights up to 2 from the current one weekly flight.
ATF currently accounts for more than 47 per cent of an airline’s operating costs.
According to the airlines, the decrease in ATF rates would be very helpful for short-haul routes rather than long-haul ones. Also, fuel tankering or adding extra fuel does not work for all routes since the aircraft cannot be made fuel-heavy.
12/03/08 Anirban Chowdhury/Business Standard

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The Twin Otter flies again

Keen interest for Twin Otter, the rugged, twin-engine bush plane came from airlines and governments in Southeast Asia, Africa, India and the Middle East, participated in Singapore Airshow.
"The Twin Otter is Canada's best-known export," Mr. David Curtis, Viking Air Ltd. chief executive officer said in an interview from Viking's head office and plant near Victoria International Airport.
20 years after manufacturing was halted, now the Victoria plant is gearing up to make Twin Otter components, adding 100 workers over the past year to bring its payroll to 265 people. Final assembly of the plane will be in Calgary, where there are now six employees, but will ramp up to 75 people within a year. The plane's engines will be supplied by Pratt & Whitney Canada Corp.'s plant in Lethbridge, Alta.
Viking will be producing an updated Twin Otter prototype this spring with a more powerful engine and lighter composite materials than the first-generation model, but for the most part, the original design remains intact.
Mr. Curtis reckons that the Twin Otter will sell like hotcakes, at $3.5-million to $4-million each, depending on the specifications.
In India, where the original Twin Otter isn't even flown because of restrictions on importing planes older than 15 years, Viking is fielding unexpected inquiries. Mr. Curtis met recently with aviation officials in Delhi, Bangalore and Mumbai, and he's optimistic of orders from India. But first, India must set rules for seaplanes - the Twin Otter can be fitted with floats, wheels or even skis.
While it could be another five or 10 years away, Mr. Curtis envisages India as a potential site for a second assembly site, to complement the Canadian manufacturing operations.
He acknowledges the challenges of cracking the Indian market, but figures that if either a substantial portion of components come from India's aerospace sector or if final assembly is located on the subcontinent, then Viking stands a better chance of winning government approval for Indian airlines to place orders.
The Twin Otter was first built in Toronto from 1965 at the Downsview plant formerly owned by de Havilland Inc.
Production of the now-famous bush plane stopped in 1988. The Twin Otter is enjoying an international revival as foreign carriers seek a durable aircraft capable of taking off and landing on short runways or water.
10/03/08 Brent Jang/Globe and Mail, Canada

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Flier data to land before flight

New Delhi: Come April 1, Indian immigration authorities will know exactly who they will be welcoming at major airports much before flights land.
India has made it mandatory for all international airlines to provide information about the passengers and crew on board to immigration officials at the destination airport.
The Advance Passenger Information System (Apis) will not only pave the way for “enhanced screening of passengers”, but will “also facilitate expeditious immigration clearance”, junior home minister Sriprakash Jaiswal said.
The name, gender, date of birth, nationality, passport details such as the country of issue and country of permanent residence, and visa details of each passenger and crew member have to be sent within 15 minutes of take-off.
Sources said an Apis pilot project had been implemented at the Indira Gandhi International Airport since July 1, 2006. From April 1, Apis will be in place at airports in Delhi, Chennai, Mumbai, Hyderabad, Bangalore and Kochi. It will be extended to all other international airports later.
10/03/08 Bhavana Vij-Aurora/The Telegraph

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Indian skies to witness Eclipse of new era

New Delhi: There was a new guest last week at the Indira Gandhi International Airport, Delhi, attracting attention of the who’s who of the corporate world and the aviation industry. Civil aviation minister Praful Patel, Deccan Aviation chairman Captain Gopinath, Claridges Group MD Sanjeev Nanda, to name a few, were testing the brand new Eclipse 500 in presence of the host Manav Singh, managing director of Club One Air, a company which sells fractional operation of aircraft.
About the size of a mini bus (excluding the wings), the Eclipse 500 is a very light four-seater jet now making its debut in Indian skies. Manav Singh recently placed orders for 11 Eclipse 500 (of which one will be purchased from open market), a very light jet (VLJ) which will mark it’s debut in Indian skies. Putting the machine, whose operating cost is half of other similar jets and turboprops, to use, Mr Singh will be starting a low-cost air charter company in July this year.
“...This company will operate separately from Club One Air, which caters to the need of the rich,” Singh told ET. The cost of Eclipse 500 is around $2 million. Whereas a bigger jet costs at least $7 million. While the operating cost of a VLJ is around Rs 30,000 per hour that of a Turboprop or jet is almost double.
“...There are around 500 airfields in the country and if these are developed, even remote places can be connected, as more and more companies acquire such jets.” Civil aviation minister Praful Patel says.
“We will be soon placing an order for six jets for the air charter company. Besides Eclipse, we are also looking at Hawker, Cessna and Bombardier,” says Deccan Aviation CMD Captain Gopinath.
10/03/08 Vishakha Talreja/Economic Times

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Industry welcomes tax cut on turbine fuel

Thiruvananthapuram: The budget proposal to reduce the tax on aviation turbine fuel (ATF) to four per cent is the fulfilment of a long-pending demand of the aviation, tourism and hospitality industries in the State.
The high rate of tax was one of the main reasons for the high airfare from major metropolitan cities to the airports in the State. Moreover, it was also a major stumbling block for many domestic carriers, including low-cost ones, to commence services to the airports in the State.
Although the State had emerged as a major tourist destination, the lack of air connectivity and convenient flights were a major concern among stake-holders of these industries. The commencement of flights by low-cost carriers had not helped tourist inflow.The high airfare in the domestic sector forced many to opt for attractive tour packages to visit foreign countries.
Finance Minister T.M. Thomas Isaac said many States had already reduced the tax on ATF to four per cent and that the State government was also doing so. He hoped that the airline companies would pass on the benefits to the passengers.
10/03/08 The Hindu

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Galileo launches Galileo Lotto offer

New Delhi: InterGlobe Technology Quotient (ITQ), the national distributor of Galileo, Global Distribution System (GDS), has launched its Galileo Lotto, promotional offer for multi-GDS travel companies in India. With this promotion, travel agencies can avail of incentives and cash rewards.
Both travel agency owners and users can participate in the Galileo Lotto promotion by registering themselves. This promotion, applicable for all international and domestic bookings, will regularly monitor the average productivity figures of the participant companies and offer performance driven incentives.
09/03/08 TravelBizMonitor

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Kerala cuts tax on aviation fuel

New Delhi: Close on the heels of the huge cut in taxes for aviation turbine fuel (ATF) by the Andhra Pradesh government, the LDF government in Kerala on Thursday decided to cut the tax from 32% to 4%.
Announcing the cut in the state budget for 2008-09, Kerala finance minister TM Thomas Isaac said he expected that airlines would pass on this concession to passengers by reducing fares.
The move, taken by the tourism superbrand state with the maximum number of international airports, is expected to have more than just an impact on travelers and airlines in the state.
Both national and private carriers, of late, have been demanding a reduction in state taxes on aviation fuel as soaring fuel cost had seriously dented their profitability.
Welcoming the decision, civil aviation minister, Praful Patel said, “It will boost tourism and economic activity in the state. I wish other states also take a cue from Andhra Pradesh and Kerala”.
The cut in ATF prices is expected to lead to around Rs 30-50 crore in savings for the airlines, senior officials from Air India and SpiceJet said.
After the Andhra Pradesh government cut the taxes from 31% to 4%, most states have been evaluating the decision to reduce the tax on ATF.
06/03/08 Financial Express

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A call for differential surcharge on air travel

Considering the lean travel season these days, huge discounts are being offered on domestic air tickets. A Bangalore resident, for instance, saw Mumbai airfare advertised at around Rs 500. "But actually, I ended up paying Rs 2,500 for the ticket. So where was the discount?"
Like him, many consumers are dejected when they see that stated discounts do not factor in surcharges tagged along with air tickets.
Sudhakara Reddy, chairman at Air Passengers' Association of India, gives a breakup of these add-ons. "Rs 225 is the passenger service fee which goes to the government; Rs 1,650 is the fuel surcharge; and Rs 150 is the congestion surcharge. This itself comes to Rs 2,025." Importantly, the chunky fuel surcharge—Rs 1,650—is uniform across all domestic airlines and sectors.
Consumer groups, time and again, have called this an unfair practice. "How can you demand the same surcharge for all flights and all sectors? International carriers such as Singapore Airlines have a different surcharge for different sectors," says Reddy.
K K Bajaj of Ahmedabad-based Consumer Education & Research Centre (CERC) agrees. "Surcharge should be based on distance. If you travelling from Ahmedabad to Mumbai or just 100 kilometres from the city to Baroda, the charge remains the same."
CERC recently sounded off the ministry of civil aviation that the surcharge must be based on fuel consumption and distance.
Consumers too are not in favour of governmental control on ticket prices, but expect some logic to the pricing.
07/03/08 Rucha Biju Chitrodia/Times of India

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Rotor space - catalyst for realty boom?

Bangalore: While the City is abuzz with excitement, albeit a little sceptical about the Bangalore International Airport Limited (BIAL), which is slated for take-off this month end, there is one aspect that is slowly gaining momentum in the real estate industry — helipad.
The current trend in Bangalore seems to be rooftop or elevated helipads. Real estate companies are already wooing potential clientele with the option of helicopter services to ensure fast passage to the new airport.
Deccan Aviation recently announced its plans to have four helipads across the City to ferry passengers, and is presently content with grass helipads that would not need too much maintainance. Col Jayanth Poovaiah, Director, Deccan Aviation, said the company would begin helicopter shuttle services from Bangalore city to the upcoming international airport at Devanahalli after its inauguration.
The future of helicopter services along with functional helipads definitely has a bright future in the real estate industry, said V Shashikant, CEO, UB Global.
The Brigade Group is going ahead with an elevated helipad in its new 30-storied Northstar building of the Brigade Gateway project in Malleswaram, according to Ms Indira Sharma, vice president, Marketing, Brigade Group.
While Brigade is awaiting DGCA approval for its two helipads, the helipad at Golden Gate Properties on Tumkur Road in its 13.1 acre-Golden Grand project, marketed by Asipac, is proposed on the tallest building of the project.
07/03/08 Deccan Herald

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Core projects may not need green nod

New Delhi: In an effort to accelerate big-ticket infrastructure projects, the government is considering changes in existing environmental laws including a withdrawal of mandatory environmental clearance ahead of modernization of airports and ports. However, greenfield projects that are developed from scratch (the airport and port projects will largely require redevelopment) will continue to require this clearance.
While companies welcomed this change, environmental activists say it will dilute India’s already weak environmental laws.
The changes being considered also include one that will address a long-time complaint of activists by making it mandatory for environmental consultants to register with the Quality Council of India, an independent body created by the government. This will prevent the recurrence of incidents where some environmental consultants have managed to obtain clearances for projects on the basis of reports that have been subsequently found to be fraudulent.
07/03/08 Padmaparna Ghosh/Livemint

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Global Vectra Helicorp Orders Two Bell 412s

On Thursday, Bell Helicopter announced the recent sale to Global Vectra Helicorp Ltd. (GVHL) in Mumbai of two Bell 412s, increasing their fleet to 22 Bell 412s. GVHL continues to be one of the fastest growing helicopter operating companies in India.
CEO Allan Brown of GVHL, India's largest private helicopter operator, said, "The Bell 412 has a range/payload combination best adaptable to Indian offshore operational requirements. We were the first to introduce the Bell 412 helicopter to the offshore market in India and are today the largest player in offshore air logistics support to the oil and gas industry."
Today, with 20 Bell 412s flying on the east and west coasts of India, GVHL is serving some of the biggest names in India's oil exploration sector and their customers include ONGC, Reliance Industries, British Gas, Trans Ocean and Gujarat State. Brown states the 412 plays an integral part of GVHL strategy of keeping customers satisfied -- adding this high level of customer satisfaction remains one of the major reasons that they continue to add Bell 412s to their fleet.
07/03/08 Aero-News Network, US

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Aviation sector hits Budget airpockets

New Delhi: The Budget 2008-09 has not only avoided providing any significant incentives to the aviation sector, but has also pruned the allocation to the aviation ministry.
The ministry of civil aviation (MoCA) has been allocated only Rs 10,031 crore for coming financial year, compared to Rs 12,347 crore last year.
The finance ministry has also cut the targeted Budget plan outlay for the public sector Air India by around 40% due to the Boeing 787 Dreamliners delivery.
In 2008-09, the National Aviation Company of India Ltd (NACIL), the government-owned company formed after the merger of Air India and Indian Airlines, was supposed to raise Rs 9,572.42 crore from internal resources and external commercial borrowings.
However, with the deliveries of the Boeing Dreamliners getting delayed for this year Rs 3,785.94 crore was deducted from the investment outlay plan. In 2008-09, the investment plan is now being pegged at Rs 5,786.48 crore.
Over and above this the price of ATF has also went up on the day after the budget, but airlines cannot raise prices due to the highly populist railway budget. Aviation turbine fuel (ATF) prices rose by more than Rs 2,300 per kilolitre at the four metro cities. Atf accounts for more than 40% of the airline’s operating cost.
Also the airlines have not cut the fuel surcharge they charge passengers due to variable fuel cost despite the fall in the cost of ATF after December 2007.
05/03/08 Financial Express

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Global legal firms to tap Indian aviation sector

Mumbai: Various global legal firms are keen to serve Indian carriers on matters relating to cross-border aircraft financing.
Joseph M Stefano of the US-based Allen & Overy, a firm that advises customers on cross-border leasing and financing, was recently in Mumbai to meet some Indian airline officials. Said he, “I shall soon meet some of the key officials at Jet Airways and Air India to discuss how our firm can smoothen the loan process in case they want to acquire loans from any bank in the US for financing their aircraft acquisition.”
Representatives of Clyde & Co, who is keen to service Indian airline operators, also are on the lookout for probable clients with whom they can have long term professional relationship. Said Claire Rennilson, solicitor, Clyde & Co, that the firm certainly wanted to offer its professional services to the operators on how procuring corss border loans and other related documentation can be made easier.
05/03/08 Shaheen Mansuri/Financial Expres

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IATA appoints Amitabh Khosla as Country Director for India

The International Air Transport Association (IATA) has appointed Amitabh Khosla as Country Director for India to oversee all of the Association's initiatives in the growing India market.
Khosla joins IATA from the Federation of Indian Airlines (FIA), where he served as Executive Director since its formation. Prior to FIA, Khosla was with the Confederation of Indian Industry (CII), where he held various appointments, including Regional Director for Eastern India and Chief Representative in Singapore.
"Asia will be the world's largest market in 2010. The fast growing, diverse and dynamic Indian aviation market brings opportunities and challenges. The top priority is infrastructure. We need more and better capacity at India's airports and air traffic management. India also needs effective economic regulation for airports to enhance competitiveness. Amitabh joins IATA at a critical juncture. His broad understanding of India's businesses, industry and economy will help drive change and ensure that India enjoys the economic benefits that a successful aviation sector will bring," said Giovanni Bisignani, IATA's Director General and CEO.
05/03/08 Moneycontrol.com

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Patel denies criticisms against private airlines

New Delhi: Union Civil Aviation Minister Praful Patel Tuesday denied charges against private airlines that they did not keep passengers informed about flight delays and cancellations. Speaking in parliament, the minister said domestic airlines generally made requests for a contact phone or mobile number from passengers at the time of booking tickets.
“Passengers of private airlines whose flights were delayed or canceled are being informed through telephone or SMS,” he said.
Patel said in the past three months, Jet Airways canceled 224 flights in November, 181 in December and 165 in January 2008. The number of flights canceled during the same period by SpiceJet was respectively 60, 118 and 55, and of Go Air was 69, 93 and 71.
04/03/08 IANS/Thaindian.com, Thailand

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Indian airlines look at global connectivity with code sharing

Mumbai: India’s domestic airlines, eyeing busy and lucrative international routes as the number of international air passengers flying into and out of India grows at around 20% a year, are busy sewing up what are commonly called code-sharing agreements with global carriers to help expand their reach.
Jet Airways (India) Ltd has recently signed such an agreement with Air Canada and American Airlines, while Kingfisher Airlines Ltd has tied up with Air France, Emirates, Continental Airlines and Delta Air Lines.
The state-run National Aviation Co. of India Ltd, or Nacil, which runs Air India, is in talks with member airlines of Star Alliance, the largest operating grouping of global carriers, for a similar arrangement. The firm joined Star Alliance, which counts Singapore Airlines, Lufthansa, United, US Airways, Air Canada and Air China among its members, last year. Some 30 million passengers flew to and from India in 2007, growing 20% over the previous year.
An analyst with a domestic brokerage, who did not wish to be identified, said code-sharing with an international airline would improve the brand visibility of domestic airlines, apart from improving connectivity.
05/03/08 P.R. Sanjai/Livemint

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Carriers told to fly new routes to tap business opportunities

New Delhi: The government has asked domestic carriers such as Jet Airways and Air India to tap business opportunities in unexplored markets such as Australia and Mauritius instead of operating only on lucrative routes like the Gulf.
The move comes at a time when the market share of domestic carriers is decreasing and nearly 40% bilateral seat entitlements are unutilised. Due to high fuel prices, heavy taxation and several entry barriers, Indian carriers have lost around 6% market share to foreign carriers on the country’s international traffic during the last three years.
Since the government announced opening of Gulf routes for private players, airlines have made a beeline, seeking traffic rights for this lucrative sector. While Jet Airways has already started operating on some of the Gulf routes, JetLite (formerly Air Sahara) and Air Deccan — scheduled to complete five years of operation in the domestic market this summer — have applied for Gulf routes.
04/03/08 Nirbhay Kumar/Economic Times

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No fuel surcharge hike for this month

New Delhi: Domestic carriers have decided against hiking fuel surcharge, that presently is Rs 1,650 per passenger, following the latest increase in jet fuel prices for this month. This move comes as March is anyways a lean travel season when airlines offer attractive schemes like low basic fares or discounts to lure fliers. Secondly, airlines did not reduce this surcharge even as aviation turbine fuel (ATF) witnessed price falls in past two months. So without passing on the benefit of lower prices to passengers, they find it hard to pass on extra cost with the latest hike.
Oil PSUs change ATF prices every month-end depending on global prices of crude as making petrol and diesel dearer is a politically sensitive decision and air travellers have to bear this burden. ATF prices touched a record high last December when airlines raised fuel surcharge to Rs 1,650 and coupled with other cess and taxes, the fixed cost for each ticket became Rs 2,025.
In January and February, ATF prices saw reductions but airlines refsued to react, calling this an 'aberration'. And in March ATF again became dearer - but the price is still below December level.
04/03/08 Times of India

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INCAT-HAL Aerostructures Limited Launched

Mumbai: INCAT, a global leader in engineering services outsourcing (ESO) and product development IT services and Hindustan Aeronautics Limited (HAL), Asia's premier aero structures manufacturer today announced a joint venture creating INCAT-HAL Aerostructures Limited. The new organization is immediately positioned to establish itself as a global leader in the engineering and design of aero structures.
"The objective of this joint venture is to undertake work packages related to engineering design services in aerostructures and also the captive offshore and on-site work load of both partners from aerospace OEMs, including offset programs," said M. Fakruddin, HAL Director - Corporate Planning and Marketing.
The joint venture, based at Bangalore will be the Preferred Delivery Center, for both organizations. The JV agreement was signed between HAL and Tata Technologies, INCAT's parent company. Both HAL and Tata Technologies will contribute 50% to the equity of the JV.
03/03/08 Business Wire India

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SPG may soon acquire aircraft

New Delhi: The Special Protection Group (SPG), which provides proximate security to the PM, former PMs and their family members, will soon have its own aircraft to meet its professional requirements, including aerial evacuation of VVIPs during emergency.
Though the timeframe to procure a specialised aircraft is yet to be spelt out, finance minister P Chidambaram has made a substantial hike of 45% in the SPG's budget, making it possible for the elite force to procure a small aircraft any time during the next financial year.
Currently, the SPG loans aircraft from Aviation Research Centre (ARC) of the Research and Analysis Wing (R&AW) — India's external intelligence agency — to ferry advance security liaison teams ahead of a VVIP visit. Such teams are sent to sanitise the area ahead of high-profile visits.
03/02/08 Times of India

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Domestic flying to become more expensive

New Delhi: Domestic flying could become more expensive in the next few days. With aviation turbine fuel (ATF) prices increasing by more than Rs 2,300 per kilolitre at the four metro cities, some airlines plan to pass on the burden to the passengers.
However, sections in the industry feel that the increase in ATF prices is not toohigh and can be absorbed by the airlines.
On Saturday, Indian Oil announced that the per kilolitre price of ATF in Delhi would be Rs 47,048.86 up from Rs 44,716.49 charged during the previous month. In Chennai oil companies are to charge domestic airlines Rs 51,090.08 per kilolitre during the month up from Rs 48,548.82 charged previously.
At the moment, ATF accounts for between 30 and 35 per cent of the operating cost of most major airlines and with the global prices of oil rising airlines have been passing the increased burden on to the passengers.
02/03/08 Ashwini Phadnis/Business Line

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Budget pushes airlines into dejection zone

Lack of sops in the 2008 Budget has pushed loss-laden airline industry into dejection zone, but civil aviation minister Praful Patel continues to be hopeful of getting them a decent deal by pursuing states to reduce sales tax on aviation turbine fuel (ATF). The civil aviation ministry had sought inclusion of ATF in the list of declared goods so that states cannot levy more than 4% sales tax.
With the 2008 Budget remaining silent on the issue, the airline industry's hopes of lower input costs stands dashed.
Domestic airlines are operating under extreme margin pressure, thanks to stiff competition, leading to low airfare and hence lower yield. The situation is more aggravated on account of high fuel price which is nearly 40% of an airline's total operating cost. In view of the high fuel prices, airlines have been working on uniform fuel surcharge despite their competition.
In a pre-budget communication to the civil aviation ministry, a finance ministry official had said that ATF cannot be added to the list of declared goods without building consensus among state governments.
Civil aviation minister Praful Patel, who had several meetings with finance minister P Chidambaram in the run up to the 2008 Budget, is still hopeful.
02/03/08 Nirbhay Kumar/Economic Times

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Budget: Aviation industry had nothing to cheer about

The contrast could not have been starker. On Tuesday, Lalu Prasad’s Railway Budget had both coolies and passengers breaking into a jig. But when P Chidambaram finished delivering the Union budget on Friday, neither air travellers — who were expecting surging airfares to fall — nor the aviation industry had any thing to cheer about.
For, none of the industry’s expectations had been fulfiled by the Budget. In fact, of the 187 paras in the FM’s speech, there was just one line directly mentioned the sector — helicopter pilot training — and not on the issues that could have helped airfares to fall a bit. This despite the fact the Economic Survey admitted that "profitability of the domestic airline industry is under tremendous pressure as almost all airline operators in the country are reported to be making losses."
Aviation minister Praful Patel said: "We were expecting some relief on ATF pricing. But we will continue pursuing the issue with state governments and the FM."
A fuming Air Deccan founder Captain Gopinath said: "It’s shocking. Aviation does not find a mention as infrastructure while roads, ports and Railway do."
01/03/08 Times of India

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Budget blues strike yet again

In spite of the booming growth in India’s aviation and tourism segments, the Union Finance Minister, P Chidambaram has left both these sectors highly disappointed with his Union Budget for 2008-09. The aviation and tourism industry, which is one of India’s biggest cash-cow, strongly feels that it has been given a step-motherly treatment. The Union Finance Ministry has not only failed to provide any incentives, but it also reduced the budget allocations for both, aviation and tourism. The Ministry of Civil Aviation (MoCA) has received only Rs 10,031 crore for coming financial year, compared to Rs 12,347 crore for 2007-08.
According to Saroj Dutta, Chief Financial Officer (CFO), Jet Airways, the aviation industry had two major demands – rationalisation of taxes on Aviation Turbine Fuel (ATF) and Fringe Benefit Tax (FBT) – but the budget did not address these demands.
“We were expecting that the budget would offer some tax incentives for developing Brownfield airports, which are very difficult to build compared to the Greenfield airports,” stated Sanjay Reddy, Managing Director, Mumbai International Airport Limited.
GoAir on its part was hoping that an exemption from payment of Withholding Tax on aircraft and engines earned by the foreign companies from an Indian company for lease agreements would be announced in the budget.
“The industry has been waiting with bated breath that this might just be the budget where these issues would have been addressed. But, a step-motherly treatment has been meted out to the aviation industry,” lamented Anand Ramachandran, Vice-President (Finance), Deccan.
01/03/08 Mayuresh Pawar/TravelBizMonitor

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