Airlines Deals

Since the first helicopter flight started to operate between Gozo and Malta in 1990, there has been an ongoing discussion on whether Gozo should have an airfield available also for fixed-wing aircraft.

For many governments this has always been a hot issue with the main opposition coming from the environmental camp. It has now become very clear that the helicopter link between Gozo and Malta is not providing the desired service for Gozo and its economy.

The time has now come for the government of the day to give this matter some serious thought.

We have to think outside the box and try to solve what is becoming a nightmare decision for the government to open up to low-cost airlines. One way this problem can be solved is for a small airport to be constructed on Gozo which could serve as a regional airport for these types of airlines.

It would not be a Herculean task for such an airport to be built on reclaimed land on a part of the island where the water is not too deep and where it would be feasible from an environmental point of view.

Obviously, the necessary environmental impact assessments would need to be carried out.

If such an airfield is realised it would solve the government’s problem on the problematic issue of these airlines. It would also create job opportunities for the Gozitans as there could be a higher number of tourists who would decide to take their holiday in Gozo. We all know of the low room occupancy that the Gozitan hotelier experiences throughout the year. (The latest rumour is that another established hotel will be closing down soon).

The positive effects of such a venture will also be felt in the catering and services industry. Gozo Channel would become a more sustainable enterprise since people opting for a low-cost flight and deciding to take their holiday in Malta will need to hop on a ferry to reach their destination.

These same travellers could also provide extra revenue to the company operating the helicopter service should they take that travel option.

One other issue which would also be of benefit to all in Gozo is new ways of disposing of construction waste. Currently construction waste is either being thrown into an old quarry or dumped illegally in the countryside. At the going rate of development it will not be long before the quarry being used is full.

Has anyone ever come up with at least a feasibility study for such a project? The European Union provides help in the setting up of regional airports so the Maltese government can surely tap into the available funds for such a venture and in the process kill more than two birds with one stone.

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The airport authority said Friday a separate terminal for low-cost airlines will be built at the new Bangkok international airport at a cost of 600 million baht (15.8 million dollars).
Chotisak Asapaviriya, president of Airports of Thailand Plc, said construction of the low-cost terminal should be completed within 16 months of the project’s approval.
“The design of the new terminal is completed and the plan will be proposed to the board for approval next month,” he said.
The move is…

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Before founding Gol Linhas Aereas Inteligentes SA five years ago, Brazilian businessman Constantino de Oliveira Jr examined how low-cost, low-fare airlines Ryanair Holdings Plc and Southwest Airlines Co operated. Oliveira adopted most of their cost-cutting practices, including reducing the time airplanes spend on the tarmac and providing a no-frills cabin service. One policy he doesn’t follow is to always offer low fares.
“It doesn’t make sense to charge 100 reais ($46) for a flight if there are people willing buy a ticket for 250 reais,” Oliveira, 37, says. Expense paring and a pricing policy that reflects ticket demand have made Gol one of the world’s most profitable low-cost airlines. Gol plans to expand market share by filling gaps in services left by Varig, Brazil’s bankrupt former flagship carrier, and two other airlines that have closed since Gol started.

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Varig shrinks as it runs out of funds to pay leasing companies, airport fees and salaries. Its bankruptcy follows the closing of Transbrasil Linhas Aereas SA in December 2001 and Viacao Aerea Sao Paulo SA in January 2005. Varig may face liquidation after creditors on July 17 rejected a bankruptcy reorganisation plan to sell someof its assets to its former cargo unit.

“Gol has been very aggressive in getting Varig airport slots,” says Gilberto Nagai, 30, who helps manage $1.5 billion in Latin American stocks at ABN Amro Holding NV in Sao Paulo. “They will profit from Varig’s shrinking.” Gol’s share of Brazil’s domestic market jumped to 35% in June from 27% in January. Gol’s growth has been accompanied by an increase in its share price. Since its initial public offering in June 2004, the company’s shares have soared 222% in US dollar terms as compaed to 139% gain in Brazil’s benchmark index, taking the value of the Oliveira family’s 74% stake to 9.2 billion reais.

The increase in demand for Gol’s services has prompted the company to plan to expand its fleet of Boeing 737 aircraft to 81 by the end of 2008 from the current 50. While most of the company’s flights are within Brazil, it also has service to Argentina, Bolivia, Uruguay and Paraguay.

Initially, Gol’s aim was to persuade Brazilians who travelled in long-distance buses to use its services by offering to fly them for about the same price. The reduction in the number of carriers offering more expensive services allowed Gol to move into a higher-fare market, enabling it to increase profit margins. Says Lazzarini, who specialises in the airline industry. “In Brazil, air travel is still very concentrated on business travel, and individuals who travel have very high income.’’ urrently 61% of Gol’s passengers are business travellers, letting the airline charge almost as much as non-discount airlines on some routes.

For every dollar in revenue, Gol squeezed 19 US cents of operating income in 2005, according to company data. That compares with 11 cents for Dallas-based Southwest, the biggest US domestic carrier, in the same period, and 22 cents for Dublin-based Ryanair. Its labor costs stand at 13% less than the 40% for Dallas-based Southwest. Further savings are achieved by selling most tickets over the internet and by having no frequent-flyer awards program. Gol also gets more reve nue from operating a number of night flights. On average, Gol’s aircraft are in the air 14 hours a day, highest in the industry, Oliveira says.

On Brazil’s busiest route, the 60-minute flight betweencity-center airports in Rio de Janeiro and Sao Paulo, Gol passengers may pay as much as 638 reais for a round-trip ticket bought a month in advance. That’s less than the 799 reais TAM charges. On average, Gol charges 25% less on domestic flights, Oliveira says. Passengers flying with Dublin-based Ryanair pay as much as 22.98 pounds ($42.38) for a round trip booked one month in advance between London and Dublin, according to the company’s web site. The 75-minute flight leaves from Gatwick airport and arrives at Dublin airport. That is 79% less than a ticket on British Airways Plc, which charges as much as 110 pounds, according to its web site. “Basically Gol is an airline that has low costs but high fares,’’ says Nagai.

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With the tourist season in full swing, Malta has missed the opportunity to increase visitor numbers for this summer.

With official figures showing worrying signs that the number of tourists for 2006 visiting Malta could be stagnant, or perhaps even down from 2005, the opportunity for the island to have low cost flights operating from the UK appears to have slipped by for the all important summer season.

The island’s official airline, Air Malta, reported a drop of over two per cent in the number of passengers it carried in the year from March 2005 to March 2006.

The hope among hoteliers and others involved in Malta’s tourist trade is that at least one of the low cost airlines will start operating from the UK and perhaps other parts of Europe in the near future to boost visitor numbers.

‘With the holiday market vital to the Malta economy,’ comment local travel guide YourMalta.com, ‘potentially millions in lost revenue will be lost this year because of delays in agreeing to allow the low cost airlines to fly into Malta. In today’s world Malta has to compete with new destinations in Europe as well as Spain and her islands. Cheap Malta flights aren’t in themselves enough to sustain tourism at reasonable levels anymore, although this will be welcome, but the trick of sustained tourism is to have repeat business, and unless Malta attracts new first time visitors then repeat business is an impossibility’.

Holidays in Malta and the related tourist sector are a major source of employment in Malta, and with unemployment running at over 8 per cent any fall in tourists could spell long term damage to the island’s economy.

Another sector of the economy that could suffer with the Malta holidays market is real estate.
Malta Property

Real estate in Malta has risen in price in recent years, and 2004 saw Malta achieving the highest increase among the EU countries, with speculators buying property in Malta in the hope that joining the EU would see Malta real estate increase in value in the short and medium term.

Tribune Properties, who specialise in Malta Real Estate, view the potential downgrading of holidays in Malta as a double edged sword.

Managing Director Michael Johnson says that many Malta property buyers do so after visiting the island on holiday, and liking it so much they want to move to the island full time, while others who normally stay in hotels in Malta want to buy a property they can buy for their own and family holidays in Malta, and see buying a property in Malta as an investment for the future that they can enjoy too.

With less people taking holidays in Malta, the number of potential buyers will fall too.

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Auto parts maker Dana Corp. told creditors it may seek cuts on retiree benefits as part of its restructuring under federal bankruptcy protection.

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Thailand’s airport authority said a separate terminal for low-cost airlines will be built at the new Bangkok international airport at a cost of 600 mln baht.

Chotisak Asapaviriya, president of Airports of Thailand Plc, said construction of the low-cost terminal should be completed within 16 months of the project’s approval.

‘The design of the new terminal is completed and the plan will be proposed to the board for approval next month,’ he was quoted by Agence France-Presse as saying.

The move is designed to compete with dedicated budget terminals that opened earlier this year in Kuala Lumpur and Singapore, and to ease concerns among low-cost carriers about increased operating expenses at the new Suvarnabhumi Airport.

The number of passengers on low-cost airlines flying through Bangkok is expected to more than double to 15 mln within two years.

Thailand’s government has told all airlines to move their operations to the new airport by late September. The new budget terminal will help low-cost carriers reduce their expenses by simplifying check-in procedures.

Low-cost travelers currently account for 7.0 mln of the 37 mln passengers arriving every year at the existing Don Muang Airport, straining it past capacity.

The government plans for Suvarnabhumi to open for commercial use on September 28 although some airline officials have said the actual date could be later in the year.

Prime Minister Thaksin Shinawatra reassured the public that the airport is ready and will open for commercial flights on September 28.

‘By 3.00 am on September 28, Don Muang airport will officially close down for commercial flights. It will be used for only military, VIP, charter flights, light aircraft and as an aircraft maintenance center,’ he told reporters.

A low-cost subsidiary of Thai Airways International, Nok Air, said the separate terminal is the best solution for budget airlines. All three local low-cost carrier have backed the new terminal, saying the main airport was designed before their airlines existed.

‘We need something simple that minimizes costs and is convenient for our passengers,’ Nok Air executive vice president Sehapan Chumsai told AFP.

The new airport is expected to have an initial capacity of 45 mln passengers annually.

Suvarnabhumi will stage domestic test flights on July 29 and international flights on September 1.

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Low-cost airlines are doing a booming trade,
but is there a hidden cost to fleeing Britain for foreign shores? John Hayes reports.
With summer finally upon us, the dream of jetting off to distant shores is set to become a reality for millions of British holidaymakers. And thanks to the growth of low-cost airlines operating from the UK’s numerous and ever-expanding regional airports, the cost of taking the family away for a week or two has never been more affordable.
However, while the financial impact of foreign travel on the average household budget has decreased, there is perhaps a greater price to pay.
According to environmental campaigners Friends of the Earth, aviation is Britain’s fastest growing contributor to climate change. Domestic and international flights departing from the UK account for about six per cent of the country’s total carbon dioxide emissions. And as the low-cost airline industry continues to boom, the problem is set to get worse.
The number of passengers using UK airports rose by eight per cent in 2004 to 217 million per year. With the Government estimating that this figure will increase to 500 million by 2030, the organisation is concerned that aviation will soon account for a quarter of the UK’s carbon dioxide emissions.
“If the predicted growth in air travel is allowed to happen it will have a devastating impact on climate change, local communities and the wider environment,” says Friends of the Earth aviation campaigner Richard Dyer. “The Government must keep its promise of tackling climate change and urgently rethink its aviation strategy. Plans to expand UK airports should be scrapped. And the Government must end the multi-billion pounds worth of effective subsidies given to the aviation industry by UK tax-payers every year.
Environmental campaigners suggest that UK taxpayers effectively subsidise the airline industry by £9.2bn a year because airlines pay no tax on fuel used, virtually no VAT and benefit from duty free sales.
But with summer holidays considered the highlight of many families’ year, the call to abandon the annual migration south is likely to largely fall on deaf ears.
Thankfully, according to Jim Peacock, communications manager with the CarbonNeutral Company, redressing the environmental damage caused by flying can be a fairly simple and relatively cheap process.
The company encourages businesses and individuals to understand the impact their activities have on the environment and then offset the damage caused by planting sustainable forests and investing in projects designed to reduce carbon emissions throughout the developing world. The projects include a hydro-electric run-of-river (meaning no dams have to be built) scheme in Bulgaria, which will reduce the reliance on coal burning power stations, and solar lighting systems which replace the need for kerosene lamps in parts of India and Sri Lanka.
“We try to encourage people to travel lightly without leaving a ‘footprint’,” says Jim.
“We are seeing a resurgence in slow travel. People are taking the train and actually enjoying the journey as part of the holiday. But if they must fly, people should understand their responsibilities.
“The cost of offsetting the carbon emissions from a typical Mediterranean or Greek holiday would be less than £5.”
The CarbonNeutral Company does not believe offsetting carbon emissions should be used as a substitute for eliminating emissions at source, but offers
the service as the “next best” solution.
Ultimately Jim would like to see the airlines take more responsibility for their passengers by perhaps offering an opt-out fee in the price of an airline ticket which would offset their flights’ carbon emissions, believing that most passengers would welcome the additional and somewhat negligible cost.
“We are now seeing between 100 and 150 people coming to our website every week to offset their flights’ carbon emissions,” he adds.
Meanwhile, low-cost airlines are keen to emphasize their green credentials and point the finger of blame at their “full service” rivals who, they claim, operate smaller, older and less fuel-efficient aircraft. Low-cost carrier Ryanair claims its Boeing 737-800 “next generation” aircraft “have less emissions, lower fuel burn, greater seat density and quieter engines which significantly reduce the impact on the environment and, at 70 per cent capacity, uses less fuel per passenger kilometre than a car with just one occupant.”
Similarly Thomsonfly, the largest operator at Doncaster’s Robin Hood Airport, recognises that in conducting its business it has a responsibility for the environment and the communities in which it operates.
The airline has a Sustainable Tourism Steering Committee which reports annually to the main board on topics such as reducing pollution, noise and waste, as well as promoting positive, neighbourly relations with destination countries.
“Contrary to common misconception, aviation is not a major emitter,” says Jan Skeels, secretary general for the European Low Fares Airline Association, which represents the interests of low-cost airlines such as Ryanair, easyJet and Wizz, and which has previously called for “an end to sloppy thinking and hysterical persecution”.
“This shows that too much of the debate thus far has been based upon inaccurate and one-sided information. The result is that some of Europe’s biggest offenders in terms of emissions, in particular road transport, are getting off lightly and aviation is being characterised as a major problem.”
The ELFAA claims that the airline industry has cut carbon emissions by 64 per cent over the past 30 years and by investing in new technology and more modern fleets this figure will continue to drop. It also suggests the aviation industry could further reduce carbon emissions if improvements were made to Europe’s air traffic management system.
“Our airlines have made huge investments in the latest technology aircraft and have been at the cutting edge of reducing fuel burn and increasing efficiency,” adds Jan. “They will continue to do their utmost to minimise fuel burn as it is a major and growing cost item.”
There are many other aspects of travel and tourism that damage the environment. But as the industry employs about 12 per cent of the world’s population and accounts for 11 per cent of global GDP it would be foolish to suggest we all stay at home. But we can all take steps to reduce the damage we do.
Mr Peacock of the CarbonNeutral Company suggests not hiring a car and utilizing public transport, turning down your hotel’s air conditioning and not throwing your towels on the floor to be washed unnecessarily.
With a little thought and a few small actions, we can perhaps all enjoy our holidays with a little less guilt.

Reducing your ‘footprint’
n Resist the temptation to buy holiday homes. While more and more people are opting for a permanent escape to sunnier climes, it has a huge knock-on effect for local economies, particularly in rural areas where many farmers are forced to sell-up.
n Buy The Good Alternative Travel Guide for inspiration or a copy of The Green Holiday Guide for Great Britain and Ireland which gives details of about 180 places to stay, including many organic farms. The accommodation varies from the highly luxurious to basic camp sites with outdoor compost toilets and a cold water tap.
n Ask for your towels to be washed every other day, or less, instead of every day (only 17 per cent of people do this when on holiday).
n Switch off your air conditioning when you leave your hotel room. According to latest figures if just half of all holidaymakers did this, it is estimated that it would prevent 5m tonnes of CO2 emissions each year.
n Use water sparingly. The average tourist uses as much water in 24 hours as a villager in the developing world uses in 100 days.
n Contacts:
www.greenglobe21.com gives details of which airlines, hotels and travel agents met the World Travel and Tourism Council’s environmental standards.
www.carbonneutral.com allows holidaymakers to offset the environmental damage of their holiday by investing in eco-friendly project.

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The sky’s the limit as more and more low cost airlines add new routes and destinations to their flight schedules. With so many exotic, far-flung destinations to choose from, the intrepid traveller is spoilt for choice and can expect to bag a bargain.

If it’s mystical adventure, colourful culture and breathtaking beauty you crave, Morocco is the perfect place to go. With numerous leading UK airlines offering incredibly low fares to Marrakech, Casablanca and Agadir, there’s never been a better time to explore the magical bazaars of Morocco.

Location
Nestled on the north-western tip of Africa and separated from the rest of the continent by the towering Atlas Mountains and the formidable Sahara desert, Morocco is spectacularly diverse. The coastline fronts onto both the Mediterranean and the Atlantic and you will be able to find sunshine, sand and snow in Morocco all year round.

Climate
Because of its lush greenery and beautiful scenery, Morocco has been dubbed “North Africa’s garden”. The Mediterranean climate in the north is cooler than the more southerly, subtropical inland temperatures that can reach uncomfortable highs during July and August. Generally speaking, March to June and September to November are the best times to enjoy Morocco in warm and pleasant temperatures.

Attractions
The imperial city of Rabat on the Atlantic coast is the country’s capital, home to the King of Morocco and famous for its historical monuments, dating back to the 7th century. Casablanca, also on the Atlantic coast, is Morocco’s main commercial city with a distinct southern European flavour. Here stands the Hassan II Mosque, the worlds largest mosque, with one of the tallest minarets imaginable.

Perhaps most popular with holidaymakers is the magnificent city of Marrakech. Set against the backdrop of the Atlas Mountains, tourists enjoy exploring the labyrinth of alleyways, secluded palaces, museums, mosques and markets.

Other favourite Moroccan destinations include Fez, the country’s spiritual and cultural centre, Agadir, a spectacular sea resort in the south coast and Tangier, a northern port city with popular beaches and a stylish café culture.

Getting there
The following airlines offer low cost fares to Morocco:

- easyJet has recently started daily flights from Gatwick to Marrakech. A return flight in March 2007, from Gatwick to Marrakech, is currently only £66. For more information on the route, see the story: EasyJet begins Marrakech link.

- British Airways has routes to several Moroccan airports including Agadir, Casablanca, and Marrakech. Currently, the best deals on return fares include flights from Gatwick to Marrakech in November from £88 return and from Gatwick to Agadir in February 2007 from £128. These prices include all taxes and charges.

- Atlas-blue.com offers one-way fares to Morocco from just £19, excluding taxes and charges. The best price for a return flight, including all taxes and charges, is currently £101 flying from Gatwick to Marrakech in October.

- Hot off the presses: Ryanair has just announced the completion of a five year agreement with the Government of Morocco to develop low-cost air access and tourism to the country from Ryanair’s bases throughout Europe. You will be able to fly from Stansted to Frankfurt and on to Marrakech in January 2007 for £105 including both air fares, taxes and charges. A direct route from the UK to Morocco is expected to be announced soon.

- Thomsonfly has flights from London Luton to Marrakech from as little as £6.49 one-way, excluding taxes, for departure dates in November. Return flights with taxes and charges will set you back a mere £71. The airline also flies to Agadir from Manchester and London Gatwick.

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Low-cost airlines will “never” fly long-distance routes to China nor short hops to smaller cities because those flights don’t fit with their economic model, said United Airlines Chief Executive Glenn Tilton.

The only domestic airlines that can offer such comprehensive service, Tilton said in a speech at a Chicago aviation conference Thursday, are the majors, such as United, American Airlines and Delta Air Lines.

“The simple Southwest [Airlines] model, although compelling from a cost perspective, will never serve Shanghai nor will it ever serve Springfield, Ill.,” he said, referring to the leader of the low-cost carriers.

Southwest and other discount airlines use a single-type of plane to offer frequent flights to smaller airports in major cities, while United and other large carriers generally fly around the world using multiple types of planes.

Some in the aviation industry beg to differ with Tilton. They cite examples of low-cost carriers in other countries eyeing international routes.

Virgin Blue Airlines, partly owned by English billionaire Richard Branson, recently secured permission from the Australian government to introduce flights from Sydney to Los Angeles. The airline has said it could be ready to offer the flight by next year.

Australia’s national carrier, Qantas, could be vulnerable if that occurs. The L.A.-Sydney route reportedly accounts for as much as 20 percent of the airline’s profit.

On the heavily traveled New York-London route, two new airlines, Maxjet Airways and Eos Airlines, provide all-business-class flights at lower prices than British Airways.

“I think it’s very misleading for anyone to assume that United has an advantage on long-haul routes over low-cost carriers,” said Matthew Andersson, senior aviation consultant at CRA International in Chicago. “Their long-haul routes are not immune from more competition.”

Southwest has said it may expand to international routes in a few years. The Dallas-based carrier gained knowledge about long-haul flights through a partnership with ATA Airlines, cemented in a 2004 deal to acquire gates at Midway Airport. ATA flies to Hawaii and Mexico.

Long-haul flights are more of a possibility for low-cost carriers thanks to new, more fuel-efficient aircraft expected to be arriving soon.

The Boeing 787 Dreamliner, which is scheduled to enter service in 2008, promises to fly across the oceans using 20 percent less fuel than similar midsize planes

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The Government will be issuing a call for proposals from low cost airlines to operate new and underserved routes to Malta.

The call, will be appearing tomorrow on-line on the website of the Department of Information and it will open up the possibility for low cost airlines to operate to Malta from Luton, the Republic of Ireland, Pisa and Mulhouse-Basel.

In line with European Commission Guidelines, financial aid will be provided for start-up costs incurred in operating these routes and will be provided for a maximum period of five years. The financial aid will be awarded subject to the approval of the European Commission of the whole initiative.

The call for proposals will also be published in the Malta Government Gazette of Tuesday 25th July 2006 and will be advertised in international airline magazines and websites. The call is open until the 25th August 2006.

Similar calls will be made in the future for additional routes.

In the recent monthys the government has been intensify its efforts to determine the way forward on the matter of low cost airlines, which has been at the centre of controversy.

Last September, Ryanair chief Mr. Michael Cawley has stated that he has tired of discussions to bring the low-cost airline to Malta leading nowhere.

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