In the news: Airlines take the limelight this week.

Malaysia Airlines strengthens its Asian footprints

Malaysia’s national carrier, Malaysia Airlines, is in an expansion mode, ramping up capacity and frequencies to Singapore, Bandar Seri Begawan, Medan, Sydney and Melbourne, while putting Darwin back on its network map in November. (The carrier suspended flights to Darwin in February 2002)..

Bandar Seri Begawan, Brunei, saw an 11% increase in capacity, operating with the bigger 160-seater B737-800 aircraft, effective August 15 this year.

Medan in Indonesia added a third daily frequency from Kuala Lumpur from September 15, increasing seat capacity to 6,720 weekly in and out of the city.

Singapore will have new daily flights from Kuala Lumpur for Singapore and vice versa, offering more seamless travel and good connections to popular destinations such as Delhi and Beijing.

In Australia, Sydney will see its double daily operations increased with four additional weekly flights, bringing it to 18 flights per week from November 21, and this will increase to 21 from February 5, 2014. Melbourne will have triple daily flights from Kuala Lumpur into Melbourne November 21, up from the current double daily service.

MAS group chief executive officer, Ahmad Jauhari Yahya, said in recent weeks MAS had also launched flights to Dubai in UAE, and Kochi.in india.

The carrier has seen a steady increase in passenger traffic since the start of 2013, while matching the added capacity. Seat loads have also improved, registering 83.3% in July 2013, a 9.1% increase from the previous year.

IATA trims airlines’ 2013 profit forecast, foresees strong 2014

The International Air Transport Association (IATA) has revised its 2013 global industry outlook downward to US$11.7 billion on revenues of US$708 billion, which still exceeds the US$7.4 billion net profit last year.

Tony Tyler, IATA director general and CEO (pictured left), foresees a more optimistic end to the year, with 2014 shaping up to see profit more than double compared to 2012.

Next year airlines are expected to return a net profit of US$16.4 billion on revenues totalling US$743 billion, making 2014 the second strongest year this century, after the record breaking US$19.2 billion profit reported in 2010.

“Airline performance continued to improve in the second quarter although at a slower pace than was expected with the previous projection (in June) of US$12.7 billion. This reflects the impact on demand of the oil price spike associated with the Syrian crisis and disappointing growth in several key 
emerging markets.” said Tyler.

“Overall, the story is largely positive. Profitability continues on an improving trajectory but we have run into a few speed bumps, including cargo growth has not materialised, emerging markets have slowed and the oil price spike has had a dampening effect.”

This year, airlines are expected to post the same operating margin of 3.2% as in 2006, even with a 54% hike in jet fuel prices.

Tyler said the industry has been able to absorb the enormous cost increase as a result of changes in the industry structure (through consolidation and joint ventures), increased ancillary sales, and reduced new entry due to tight financial markets.

NOC nod for AirAsia India

Budget airline, AirAsia India, is one step nearer to its taking off to the skies as it has received the No Objection Certificate (NOC) from India’s Civil Aviation Ministry.

AirAsia group chief executive officer Tan Sri Tony Fernandes in a tweet said, “I am thrilled to announce that AirAsia India has received the NOC approval from the government of India. Very exciting and hugely profitable.”

The approval comes close on the heels of a deal between Singapore Airlines and India’s Tata Sons to start a new full-service carrier based in New Delhi, which the two firms announce on September 19. (Tata Sons will own 51%, SIA 49%). This came as a surprise to many as Tata Sons also has equity in AirAsia India with a 30% stake, wotj AirAsia holding a 40% stake and Arun Bhatia of Telestra Tradeplace Pvt. Ltd 21%. (read story here)

The latest development, however, did not seem to faze the carrier as it is going full steam with its plans to take off by end of the year or January 2014, with initial focus in South India.

With the NOC approval AirAsia India will now be able to import aircraft into its base in Chennai in Tamil Nadu. Its next move is to apply for the Air Operating Permit (AOP) with the Indian Directorate General of Civil Aviation. Once that is approved the airline can take off.

Mittu Chandilya, CEO of AirAsia India, said the airline was looking at getting the licence in about a month. It currently has a fleet of three Airbus A320 aircraft and over 200 staff.

The formation of AirAsia India is made possible after the Indian government changed its policy in September 2012, allowing international carriers to invest in existing airlines in the country and to form greenfield airlines.

transavia.com participates in Travelport Merchandising Platform

transavia.com, a fast growing European low cost airline based in the Netherlands and France, is the latest carrier to sign up for Travelport Aggregated Shopping in a new distribution deal with Travelport.

The agreement will also see Travelport provide transavia.com customers with the ability to pre-book baggage via its ancillary services, ensuring a seamless booking process for its agencies.

Travelport Aggregated Shopping, an industry first, consolidates within the same screen shopping results from traditional carriers that connect through ATPCO with those from low cost carriers, and others who prefer to connect with Travelport via an API connection.

The new technology negates the need to shop and compare across several screens, and allows travel agents to book both types of carriers in the same booking flow. Airlines can thus distribute their content in the way they choose to, and travel agents are able to sell this through a consistent, efficient workflow.

Travelport Aggregated Shopping, which forms part of Travelport Merchandising Platform, was unveiled last April with launch carrier, easyJet. Since then, Jet2.com, a leisure low cost carrier operating based in the UK, and Norwegian, the second largest airline in Scandinavia, have also become Aggregated Shopping participants.

The second solution on the merchandising platform, Travelport Ancillary Services, is also live with airlines including Air France, Alitalia, Aegean, Air New Zealand and KLM. This component allows travel agents to sell airline ancillaries such as lounge passes, seats, and bags within their existing workflow rather than by booking on an airline website.

The platform’s final component, Travelport Rich Content and Branding, is scheduled to be launched over the coming months. Currently in development with several partner airlines, this solution will allow airlines to market and retail their products more effectively by controlling how their product is visually presented and described to travel agents.