US pilot scope: Here to stay?

By Lori Ranson

While the economics of operating 50-seat jets has put those aircraft at a disadvantage to larger 70 and 90-seat aircraft, the fundamentals of their emergence late in the last decade remain intact: namely US pilot scope clauses.

Scope caps the number of regional jets operated by carriers on behalf of their partners, and also limits the number of seats per aircraft. United, Delta, Northwest and US Airways all got some relief on the 50-seat cap during their respective stints in Chapter 11 during the early 2000s. But American and Continental are still largely constrained to operating 50-seat aircraft.

As Bombardier works to secure orders for its 100-seat CRJ1000 and CSeries aircraft and Embraer’s orderbook tilts towards the larger end of its 170/190 E-Jet family, it appears that aircraft with roughly 76-to 86-seats are becoming the new dividing point between regional and mainline aircraft. A few regional carriers operate aircraft in the 86-seat range, but most of the larger regional jets are constrained to the 76-seat category.

Some airline executives are taking a sober view of any further loosening of scope restrictions as Delta Connection senior vice president Don Bornhorst recently told Regional Airline Association convention attendees he was not optimistic about scope relief for Delta or the industry. He predicts the CSeries and E-195 are destined to become mainline aircraft.

United seems less cynical than Delta as it begins contract talks with its pilots. Through its four-year restructuring that ended in 2006 United ultimately struck a deal with pilots that currently allows for an unlimited number of 70-seat jets with an 80,000lb weight limit. Certain limitations are associated with that somewhat unfettered access including fewer regional block hours than mainline. There are also some restrictions on nonstop 70-plus seat operations between United hubs and specific larger markets such as New York and Washington, DC, based unless those operations are cost-effective, according to data from F&H Solutions Group.

Carrier vice president operations and planning for United Express Cindy Szadokierski told convention attendees that in current pilot contract talks “obviously scope is an issue we need to work our way through. In this environment with capacity reductions we see opportunities on both sides to move forward and meet both our needs”.

United Express E-170

© AGP Photography

While acknowledging the challenge of predicting with any clarity the outcome of those labour talks Bombardier Commercial Aircraft president Gary Scott does offer that he “has no doubt majors would like to increase the number and size of aircraft they operate in those [regional environments]. Both small CSeries and larger CRJs would fill the requirement should scope be relaxed”.

But mainline pilot resistance to scope remains steadfast as evidenced by the roughly 32-month long contract talks between American Airlines and its pilots.

Seeking to get on a level footing with its US mainline counterparts American aims to secure relief to operate 76-seat jets with a maximum takeoff weight of 89,000lbs. In a recent round of negotiations with pilots American management compared the 25 single-class CRJ700s flown by its subsidiary American Eagle to 209 larger 70-plus seat regional jets flown by Delta Connection carriers, with 149 of those aircraft featuring a two-class configuration. United, says American, operates 112 larger regional jets configured with a two-class offering.

American pilots scoffed at the presentation, dismissing it as a “pitch for APA [the Allied Pilots Association] to allow a scope exception permitting Eagle to fly a 76-seat Embraer in a two-class configuration”.

The reaction by American pilots appears to be consistent with a theory posed by industry analyst Michael Boyd to attendees at the RAA convention that US pilots are “adamant” of not letting go of scope and “not loosening those strings”.

Pratt & Whitney selects Canadian supplier for F135

By Stephen Trimble

Ottawa-based Gastops is to supply fan eddy current sensors for the Pratt & Whitney F135, the first engine selected to power Lockheed Martin’s F-35 Joint Strike Fighter.

Valued at $48 million over the life of the F135’s production phase, the deal seals the company’s role as a permanent member of the JSF’s supply chain, company officials said during a signing ceremony at the CANSEC defence and security exhibition in Ottawa on 27 May.

Gastops’ selection comes as both the F135 and the rival General Electric/Rolls-Royce F136 teams step up their efforts in Canada to pursue future business. The F136 is the alternate engine programme funded under the JSF programme.

Canada is participating in the F-35 programme, and is considering the fighter to replace its Boeing CF-188 (F/A-18A/B) fleet after 2017. Each JSF buyer will have the option of choosing between the F135 and F136 propulsion systems.

The newly selected fan eddy current system monitors the structural health of the first-stage fan blades on the F135.

Gastops has previously supplied oil debris detection sensors for P&W F119 engines that power the Lockheed F-22 fighter, and for the PW1000G engine selected for the Bombardier CSeries small airliner.

Air Berlin starts to evaluate large regional jets

By Andrew Doyle

Air Berlin is in the early stages of evaluating large regional jets but has yet to scope out the size of any requirement or set a deadline for making a selection.

Germany’s second-largest carrier introduced 76-seat Bombardier Q400s to its fleet last year but is looking at 100-seat jets that could be used to launch new routes, plugging the gap between the turboprop type and the low-fare carrier’s smallest mainline jets, which are the 136-seat Boeing 737-300 and 144-seat Airbus A319.

“We are looking at several [regional jet types],” said Air Berlin chief executive Joachim Hunold, speaking in Vienna on 26 May at an event to mark the entry into service of the first Niki 104-seat Embraer 190.

Air Berlin holds a 24% stake in Niki, established by former racing driver Niki Lauda in 2004. “We went to Moscow two weeks ago to look at the Superjet 100,” says Hunold. “It looks to be a very good aircraft.” With regard to the E-190, he adds: “We are anticipating data from Niki – we’ll see what the best choice is.”

Andrew Doyle/Flight International
© Andrew Doyle/Flight International

Canada cancels unmanned air system industry day on eve of defence and security show

By Stephen Trimble

Canada’s Department of National Defence abruptly cancelled an industry day scheduled for 26 May for a major new contract for high-end unmanned air systems.

The event for the joint unmanned surveillance and target acquisition system (JUSTAS), to be held on the eve of the CANSEC defence and security exhibition in Ottawa, was cancelled at the last moment and without explanation, according to industry sources.

The meeting, which had been intended to inform potential bidders of the DND’s acquisition strategy and capability requirements, was not immediately rescheduled.

The C$750 million ($669 million) JUSTAS contract has attracted interest from several contractors. These include Elbit Systems, offering the Hermes 1500; a General Dynamics Canada/General Atomics Aeronautical Systems team offering the Predator B; and MacDonald, Dettwiler and Associates/Israel Aerospace Industries (MDA/IAI) with the latter’s Heron system.

Last year, the DND selected the MDA/IAI team to provide the Heron to meet an urgent requirement to provide surveillance support for Canadian troops serving with the NATO International Security Assistance Force in Afghanistan. Operated from Kandahar airfield, the medium-altitude, long-endurance Heron system (below) has replaced Canadian use of Sagem’s Sperwer.

© Cpl Andrew Saunders/Canadian Forces

The interim contract, called Project Noctua, had also been pursued by General Atomics, but the company withdrew citing concerns about the DND’s acquisition strategy.

Flybe disputes BA’s writedown of shareholding

By David Kaminski-Morrow

UK operator Flybe is disputing British Airways‘ opinion over its prospects after the flag-carrier wrote down its investment in the regional airline.

In notes to its recently-released full-year results, British Airways includes a £13 million ($20.7 million) impairment on its investment in Flybe. BA took a 15% share of the regional carrier in 2006 as part of its sale to Flybe of its BA Connect regional operation.

BA had already recognised a £6 million impairment of its Flybe investment, the result of a “significant and prolonged” decline in fair value following fuel-price rises.

But in its 2008-09 fiscal notes it says a further review of Flybe has revealed a “lower rate of forecast revenue and earnings growth than previously expected”. This, it says, has resulted in a “further decline” of fair value, and BA has posted an additional £13 million impairment of Flybe, valuing the investment at £30 million.

Flybe has responded with “surprise” to the impairment and “disagrees” with BA’s conclusions. It says the impairment is “inappropriate”, claiming that the flag-carrier is “undervaluing” the regional airline and has “failed to take into account” several important considerations.

“We believe that the decision is principally based on BA’s view of their own performance and prospects rather than an analytical view of Flybe’s track record and future prospects,” it states.

Flybe states that its turnover in the year to 31 March was up 7%, with cash reserves of £57 million, and that it expects to post a pre-tax profit. It also says it is “one of a handful” of European carriers forecasting a profit for 2009-10.

Its business model, it says, is aligned more with that of low-cost carriers which have performed better than the network airlines. Flybe also claims to have reduced capacity without affecting its core route structure.

“Flybe has carefully positioned itself during these difficult times,” it says. “It has managed to strongly increase market share in its core domestic operations, positioning itself well for further profit growth when the current recession ends.”

Star Alliance to absorb regional partners as full members

By David Kaminski-Morrow

Star Alliance is to adopt its regional partner airlines as full members as part of a change in the way the increasingly-broad airline group is managed.

Three carriers – Croatia Airlines, Adria Airways and Blue1 – were given ‘regional’ membership status by Star when the alliance introduced the concept five years ago.

But a spokesman for Star says: “There are currently plans to look into the governance of the alliance, to put us into a better position for future growth.”

He says that, as a result, the regional carriers will effectively be promoted to full partners.

Star has not given a time-frame in which the changes will occur and the alliance has yet to explain in detail the effect on its management structure.

The alliance has 21 full members and another five – Brussels Airlines, TAM, Continental Airlines, Air India and Aegean Airlines – are in the process of joining.

Aegean Airlines became the latest to submit its formal application this week, and its acceptance would bring the alliance to nearly 30 members, counting the regional partners. Other carriers, among them Ethiopian Airlines, have expressed an intention to join Star.

SkyTeam has a similar two-tier structure whereby its 10 full members are complemented by three associates. Continental is in the process of moving to Star, while Vietnam Airlines and Tarom are respectively lined up as a future full and associate members.

Oneworld has just taken its own prospective membership to 12 carriers, with the acceptance of Russia’s S7 Airlines and Mexicana as new members. While the group is single-tier, it extends to the subsidiary carriers of its partners.

Boeing, Eurofighter bid to usurp F-35 for Canadian fighter deal

By Stephen Trimble

Boeing and Eurofighter have launched a public challenge to Lockheed Martin’s widely presumed control of a next-generation fighter contract in Canada.

Both challengers unveiled the outlines of a new push to respectively market the F/A-18E/F Super Hornet and Typhoon to Ottawa as replacements for the Canadian air force’s Boeing CF-18 (F/A-18A/B) Hornets by the end of the next decade.

As a member of the nine-nation Joint Strike Fighter programme since 2002, Lockheed executives have described Canada as a likely buyer for up to 80 F-35s, although the Department of National Defence has released a revised requirement for 65 jets.

Canada has invested $150 million to participate in the F-35’s system development and demonstration phase, and has signed for a follow-on production and sustainment phase.

Lockheed Martin
© Lockheed Martin

But despite this track record and a $9 billion stake over the life of the programme for Canadian industry, Lockheed acknowledges that the DND has not committed to buy F-35s, says Keith Knotts, business development director for Canada and the UK. Ottawa plans to begin receiving new fighters in 2017.

Lockheed believes that Canadian industry will pressure DND officials to make a decision soon to buy the JSF, as many suppliers are facing imminent decisions on making major capital investments for new tooling to support their role in the programme, Knotts says.

Boeing’s sales pitch to Ottawa is also focused on economic gains. Buying new Super Hornets could generate $8 billion in economic benefit for Canadian industry over 25 years, and provide access to offset work across the whole of Boeing and the Hornet Industry Team’s portfolio of contract work, says Glenn Erutti, its director of new international Super Hornet business development.

Similarly, the four-nation Eurofighter consortium has touted “job creation and sustainment”, as well as the ability to transfer “full sovereignty” over the Typhoon’s operational technology, says Ian Malin, head of Typhoon exports business development for BAE Systems. BAE is leading Eurofighter’s marketing campaign in Canada.

Canadian Forces
© Canadian Forces

DND officials have not publicly defined how the F-35’s challengers will be considered in their decision-making.

Boeing officials say they expect Ottawa to decide within a year on whether to recommend a selected fighter or invite competitive bids for its next-generation fighter requirement.

A final decision is needed by no later than 2014 to meet Canada’s 2017 in-service deadline.

Air New Zealand touts positive results in biofuel testing

By Megan Kuhn

Scientific testing of the alternative fuel used by Air New Zealand (ANZ) during a demonstration flight has found that a Boeing 747-400 using the 50:50 biofuel blend of Jet A1 and jatropha oil could improve fuel burn by 1.2% during a 12-hour flight covering 5,800 nautical miles.

The results come from analysing data collected during a 2h trial in which a biofuel blend powered one Rolls-Royce RB211 engine on an ANZ 747-400 from Auckland International airport on 30 December 2008. More than a dozen performance tests were conducted during the demonstration at various altitudes and under a variety of operating conditions. During the tests, the biofuel’s performance through the engine and fuel systems demonstrated that the blend has the potential to work as a drop in replacement for Jet A1.

Testing also found that using the blend could save 1.4 tonnes of fuel and trim greenhouse gas emissions between 60% and 65% in a 12-hour flight, ANZ general manager airline operations and chief pilot, Capt. David Morgan said today at the Air Transport World Eco-Aviation conference in Washington.

Roughly 4.5 tonnes of carbon dioxide (CO2) could also be saved and the biofuel blend could also improve fuel burn by 1% on shorter range flights.

Air New Zealand last year declared it aims to meet 10% of its annual fuel needs through sustainable alternative sources by 2013.

In that quest, it is unlikely the carrier will rely solely on oils derived from jatropha as the plant does not grow effectively in New Zealand, and transporting the feedstock is problematic when considering lifecycle issues, Morgan says.

ANZ used jatropha since that alternative fuel was available at the time, he says, adding he is pleased to have demonstrated that it is a viable feedstock.

The airline will also consider raw materials such as halophytes, cellulose and, in the long run, algae, Morgan says, noting there are hundreds of potential feedstocks.

In addition to researching other feedstocks, ANZ is also encouraging other airlines to deal with climate change issues despite the economic downturn as environmental pressures will exist even when then economy recovers.

“We’ve got to keep pushing industry along. We’re concerned because [with] airlines facing difficult economic times, the pace and sense of urgency will be lost,” he says.

To that end, ANZ will submit its findings to certificating body ASTM International, which will meet next month to discuss specifications for non petroleum-based fuels.

Stakeholders such as the US Commercial Aviation Alternative Fuels Initiative (CAAFI) expect ASTM to approve fuel specifications for 50:50 biofuel blends next year.

ANZ was one of three carriers to conduct biofuel demonstrations in the past six months following the first-ever part-biofuel flight by Virgin Atlantic Airways in February 2008.

Continental Airlines and Japan Airlines (JAL) conducted separate biofuels demonstrations in January of this year.

Thailand’s PB Air replaces ERJ-145s with ATR 72s

Thai carrier PB Air indicates it could stay with ATR 72-500 turboprops after the dry lease of its two Bangkok Airways ATR 72-500s expires in October.

Heribert Gaksch, director of marketing and business development PB Air, which operates two aircraft on mainly domestic Thailand routes, says the company’s CEO is currently involved in planning for the airline’s future fleet.

“If it goes well, yes, we’ll probably stick with the ATR 72s,” he says. “It will probably be a dry lease.”

The airline currently operates ten flights a day from Bangkok to the Thai towns of Lampang, Nan, Nakhon, Phanom, Sakhon Nakhon, Buri Ram, and Roi-Et. It will launch a Bangkok-Mae Sot service on June 5, and hopes to launch flights to the southern town of Chumphon in the coming months.

In February PB Air substituted the two ATR 72-500s for its Brazilian-made Embraer ERJ-145LR jets. The ATR 72-500 has 70 seats, versus 50 for ERJ-145LR. In April, PB Air returned the Embraer aircraft to GE Commercial Aviation Services (GECAS) after seven years of service.

While Gaksch says PB Air was happy with the ERJ-145LRs, he also says the ATR 72-500 has more suitable performance characteristics.

The majority of PB Air’s routes are of one hour or less, and the ATR 72-500 is capable of landing on shorter runways, he adds.

Nineteen year old PB Air has also bolstered its marketing efforts.

It plans to participate in more travel exhibitions, has stepped up call centre hours and created sales counters at Krungthai Card branches.