Wednesday, January 28, 2015
Irish flag carrier Aer Lingus has been the subject of repeated takeover attempts by both Ryanair and I.A.G., but I.A.G.'s most recent proposal is one step closer to success as the Aer Lingus board has recommended that the airline's shareholders accept the offer. There has been some speculation that this could be the first in a series of acquisitions for I.A.G., but first the offer will need to be accepted by Aer Lingus' two largest shareholders, Ryanair and the Irish government, and the deal will have to be approved by the EU's competition authority.
Tuesday, January 27, 2015
Following the revelation that a remotely piloted quadcopter landed on the White House lawn, the question everyone is asking today is what the ramifications will be for unmanned vehicle usage in the United States. It's possible that such a high-profile incident will hasten integration as the FAA and Congress recognize the urgent need for clear, meaningful guidelines as well as legislative action to address those security and privacy concerns that are beyond the FAA's scope of authority. Conversely, a scare such as this could have freeze progress on integration as concerns about security predominate and blanket prohibitions are implemented until all security questions have been answered.
Thursday, January 22, 2015
News broke this afternoon that Ralph Pirker, the drone operator whose initial challenge to the FAA's authority to regulate unmanned aircraft was successful before being overturned in November, has settled with the agency. Pirker reportedly has agreed to pay a fine of $1,100.
Thursday, January 15, 2015
The Court of Justice for the European Union (CJEU) has issued a judgment in Case C-573/13. The case was referred to the court for the purpose of resolving two questions concerning the proper interpretation of Article 23(1) of Regulation EC No 1008/2008 as that article applies to the computerized booking system used by Air Berlin. The court concluded that a computerized booking system needs to display the final price to be paid at any time prices are listed, and to display the final price for all flights performing a particular service, and not merely the specific flight selected by the customer.
Wednesday, January 14, 2015
In a post last week we took a skeptical view of Indonesia's plans to introduce a price floor for air fares. An analysis out today from CAPA shares our criticism and includes alternative suggestions for how to fix Indonesia's air transport sector, beginning with upgrades to infrastructure and improving the safety oversight apparatus which carries a Category 2 rating from the United States Federal Aviation Administration. Promisingly, there have been reports that the Indonesian government is aware of the need for reforms to the State's transport bureaucracy.
Tuesday, January 13, 2015
Japan is reportedly on the verge of completing bilateral air services agreements with both Cambodia and Laos. The agreements will presumably be similar to those between Japan and the other eight Association of Southeast Asian Nations (ASEAN) Member States. Once these agreements are in place, Japanese airlines will be able to serve all ten ASEAN members directly.
Friday, January 9, 2015
Cyprus Airways has suspended operations effective today in response to an earlier announcement by the European Commission that the restructuring package provided the carrier by the Cypriot government was in violation of EU state aid rules and would have to be repaid. Cyprus was deemed to be in violation of numerous conditions of EU rules, including the "one time, last time" principle which restricts companies to one restructuring package per ten-year period. Cyprus Airways was the recipient of government aid in 2007, 2012, and 2013. Additionally, the Commission concluded the restructuring proposal would not render the airline commercially viable absent future state aid.
Wednesday, January 7, 2015
According to a report, Indonesia's Transport Ministry is considering prohibiting carriers from offering cut-rate fares as a policy response to the AirAsia Flight QZ 8501 crash. The purported reasoning is to ensure carriers have sufficient revenue to fund safe operations. If true, this would be a needlessly inefficient mechanism by which to raise the safety standards of Indonesian carriers. The more straight-forward method, of course, would be to directly increase the safety standards required by the Indonesian government and to penalize carriers that fail to meet those standards. This would likely lead to an increase in fare prices, but only as a byproduct of efforts to increase safety, which is the primary objective. By contrast there is no guarantee that the elimination of ultra-low fares will lead to increased spending on safety measures, as opposed to either greater carrier profits or fewer passengers being served. The only reason I can think of for addressing the issue in this way is that monitoring compliance with restrictions on ticket prices is likely easier and less expensive than inspecting and assessing compliance with operational standards. But ease of monitoring cannot justify a decision to monitor behavior that is only tangentially related to the problem in question. It reminds one of the parable about the man looking for his keys under the lamp post instead of where he lost them because it's easier to see in the light.