What is Icelandair up to with Easyjet? 25 Oct 2004 Speculation is rife that the country s flag carrier could launch a full bid for the UK budget carrier. It s not clear whether it could afford to. And even if it could, Stelios looks an unlikely seller. But it is a wakeup call for management.
US airlines suffer from government interference 20 Oct 2004 Operating in bankruptcy, expensive pensions and high subsidies it sounds almost like Europe. But the US government is causing the trouble. The economics are not that complicated. Supply should be cut to match demand. The US government could help keep planes on the ground.
Airbus provocation looks gratuitous 15 Oct 2004 The European aircraft maker is asking for more subsidies smack in the middle of the biggest transatlantic trade war ever. Airbus boss may take pleasure in tweaking rival Boeing s tail. But this isn t the best way to cool tempers.
High oil price has silver lining for European airlines 7 Oct 2004 A sustained $40plus oil price will squeeze the flag carriers hard. But it should make them think twice about expanding in a crowded market. For the likes of Easyjet and Ryanair, soaring oil prices reinforce barriers to entry and should weed out competitors.
Alitalia reaches deal to split itself in two 24 Sep 2004 This looks like a case of sneakily injecting state aid into Alitalia. The EU should be on guard. A deal with the unions has cleared the way for the airline to split its flight and ground service units, leaving its debts with the latter.
Two down, one to go for Alitalia 16 Sep 2004 After beating its pilots and ground staff into submission, the Italian airline has only to reach an agreement with its flight attendants. That wins Alitalia some breathing space. But come Easter, the airline will be staring another liquidity crunch in the face.
US Airways shouldn’t come back from the brink 14 Sep 2004 Its departure would help the industry to consolidate. The subsidies Washington dished out postSeptember 11 have delayed this process. US Airways may try to reinvent itself as a budget carrier. But it is better to leave that to the professionals and let it disappear.
BA cashes in on £438m Qantas stake 8 Sep 2004 The sale makes sense. There was little point in having that much capital tied up in an Australian airline. That doesn't mean the UK airline will now go on a spending spree. BA is much better off cutting its debt mountain and fixing its business.
Air France-KLM profit doubles 2 Sep 2004 That's no small feat, considering the oil price. But it is probably more to do with KLM s own cost cutting efforts than any real synergies. With average fares still falling and more capacity coming through, it is hard to see shares continuing to outshine peers.
Alitalia’s unions drive it towards bankruptcy 31 Aug 2004 This may not be as topsyturvy as it sounds. The unions calculate the Italian government still hasn t the stomach for largescale job cuts. But if Alitalia is to avoid going bust, the government needs to persuade the unions this won t be the case.
Sickies are part of the airline crisis 27 Aug 2004 Absenteeism is running at absurd levels at many European carriers. That s bad news in a service business. Alitalia s boss blames the ethics of his employees. But airlines need to sharpen up on people management.
BA still has more fat to cut 25 Aug 2004 The latest airport chaos is down to poor management, not too much costcutting. In fact, more is needed. But BA can't afford to lose its reputation either. Cuts mustn t lead to poor quality service.
Alitalia crisis lurches from desperate to absurd 9 Aug 2004 The Italian government is threatening rivals such as British Airways with legal action unless they increase their fares on certain flights. When Blair meets Berlusconi at the latter's Sardinian villa, he should make clear this is an unacceptable way to treat holidaymakers.
Rising oil price spooks airline investors 4 Aug 2004 That may sound obvious. Oil is a big cost for airlines. But they don t always underperform when the oil price rises. What really matters is whether the economy is picking up. With a recovery looking less certain, expect airlines to underperform.
Ryanair overpunished for BAA row 22 Jul 2004 Even if Ryanair loses its case it is fighting against the airport operator, the cost will be small. What s more, there is an incentive for both sides to kiss and make up rather than slug it out.
Airbus too bullish about aviation recovery. 21 Jul 2004 The announcement of a big Middle Eastern order may appear to give credence to its argument that things are on the mend. But it doesn t change the fact that there is still too much capacity around. Airbus s plans to crank up production look foolhardy.
Low-cost poster child runs into problems 16 Jul 2004 Ryanair and Easyjet love comparing themselves to Southwest. But the US carrier is being hit by rising labour costs and competition. These problems may be coming to Europe sooner than people think.
Stelios would struggle to buy Easyjet back 5 Jul 2004 Easyjet s founder would be making a cheeky move if he tried to buy back the airline on the cheap. But who will back him? He himself warned that entrepreneurs shouldn't hang on to their creations too long.
Are airlines due another rally? 2 Jul 2004 There are signs that airlines are gaining pricing power on the longhaul routes. That tends to kick off a bull run in the sector. But talk of a rally sounds premature. Capacity is on the increase, interest rates are rising, and oil is still a risk.
Italy goes the wrong way about saving Alitalia 23 Jun 2004 What is needed is a crisis at the airline to bring the unions to their senses. Instead, the government keeps writing cheques. Sadly, while this is gutless, it has a certain opportunistic logic. It allows Rome to blame Alitalia's collapse on Brussels.