Newswatch 24th March 2017
We were excited to read of the launch of LEVEL, IAG’s LCLH carrier, this week. At IBA we have struggled with the economics of LCLH, particularly around the constraints that mean utilisation cannot be driven much higher and the fixed costs – but it does appear, in a low fuel environment at least, that an efficient new generation, or well-priced previous generation of widebodies can make the numbers work. Frankly, my personal view is that the low cost angle is primarily related to hitting the crew costs – getting away from legacy style “seniority/higher-than-inflation pay scales” is a prime driver and saves around $5-10KUS per flight.
I was in the Gulf when the laptop ban was announced. Initially there was a degree of speculation around the announcement being as much to do with protectionism as with security. Of course it now looks to be a genuine concern around a shift in terrorist tactics and, given the awful events in London yesterday, the risk must be properly contained. Irrespective of the driver – we do expect it to have a material impact on traffic as business travellers can’t catch up on emails or play Solitaire. For consumer traffic too, there might also be an impact on the shift in IFE vs bring-your-own-devices.
In terms of content, Aircraft Commerce published an excellent article on redelivery management which IBA contributed to, plus we presented a few sessions in Korea this week, again to a very enthusiastic audience. Click here to read the article or access the summary slides, or if you’d prefer the whole deck get in touch at firstname.lastname@example.org.
Finally, don’t forget our webinar next week around investing in aviation. Topics are likely to include the historic performance of aviation, future trends and a look at the key investment stages: pre-transaction, managing the assets and exit/end of life options- March 30th at 8.30am, click here to register.