Peeking into British Airways’ chic new A380

British Airways’ new video gives a sneak peek into the onboard refinement of their chic new A380. BA has twelve A380s on order to be delivered by 2016, and will receive with the first three aircraft to be delivered in July, September and November. Configured in a four class 469 seat layout with , BA’s A380 will be deployed between London – Los Angeles from 15 October and daily London – Hong Kong services from 15 November.

British Airways is likely to deploy its A380 to other destinations in Asia including Beijing, Shanghai and Singapore; in line with strategic moves to increase its presence throughout Asia, particularly mainland China. In support of this, BA has signed a codeshare agreement with Cathay Pacific to take affect from 31 March, the final day of the Qantas/BA Joint Service Agreement (JSA). BA will initially place it’s flight code on Cathay Pacific’s services from Hong Kong to Cairns, Sydney, Melbourne and Perth.

“The best refinements are those you hardly notice. Deceptive in their simplicity, you may not notice them at all. Truly great design steps aside, leaving you with a sensation, a feeling. This was our ambition when designing the interiors for our next generation aircraft. Soon, our A380s will fly between London Heathrow, Los Angeles and Hong Kong. We hope, when you step on board, you can’t put your finger on exactly what makes flying in them so pleasurable.

More than 90 years of experience has taught us how to get things right and our intention is to make sure – on every second of every flight – you realise how flying with us makes you feel.” – British Airways

Tally ho!

Will Singapore’s next generation of cabin products re-establish an industry benchmark?

Oh the delicious drama of the airline industry. It puts the Bold and the Beautiful to shame with its endless alliances and divorces, avant-garde product design, cheap gauche relatives and a whole lot of money.

Today’s twist? Singapore Airlines has announced it has engaged the BMW Group subsidiary DesignworksUSA, and UK and Singapore-based James Park Associates (JPA), to develop the next generation of in-flight cabin products that will be rolled out from the second half of 2013.

Singapore Airlines has always been known for its superior innovative product, but has come under criticism for failing to maintain its edge in recent years, as other major Asian carriers Cathay Pacific and Korean Air have invested significantly in their on-board products. With this announcement Singapore is stepping up to match or outdo its competitors.

The press release is coy about the products and designs to be implemented or whether older aircraft will be refurbished, only confirming the new cabins will be rolled out on the airline’s to-be-delivered Boeing 777-300ER aircraft.

Will we see Singapore’s sceptical executives introduce premium economy? Will we see upgraded lounges or new ticketing and ancillary revenue initiatives? Will its new products allow it to maintain its industry leading cost per available seat kilometer (ASK) of 4.58 cents? Time will tell.

Competing carriers have been given an easy ride as Singapore has focused its attentions on averting an airline disaster with Tiger Airways, maintaining profitability, and launching Scoot. Now Singapore is rearming. Gird your loins players, in 2013 the game is back on.

The full SQ statement can be found here.

Cathay Pacific engages Qantas-Jetstar in airline weiqi.

 

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Cathay Pacific has used a submission to the Australian Competition and Consumer Commission (ACCC) to publicly reveal its stance to the Qantas/China Eastern establishment of a Jetstar Hong Kong subsidiary.

Cathay has been biding its time in indicating its position toward the establishment of Jetstar Hong Kong. Rather than publically lambaste the opposition, Cathay has veiled its opposition in a response to Qantas’ application for greater pan-Asian cooperation with subsidiary Jetstar.

Cathay Pacific and sister carrier Dragonair, have spent decades developing a formidable operation at their HK hub carried on the back of Hong Kong and China’s booming economies.

Supported by an unquestionably good product, multiple daily services to almost every destination they serve, and significant versatility in the way they use their fleet. Cathay CEO Slosar makes it clear “we compete with multiple low cost brands every day,” and any challenge to this dominance is not taken lightly.

While still undetermined, Cathay’s submission gently reminds the ACCC of the potential restrictions any Jetstar HK operation may/will be subject to, if the carrier is granted permission fly at all:

It is also possible that conditions may be imposed on any approval given in Hong Kong. Accordingly, it may be difficult for the ACCC to authorise the proposed conduct in relation to Hong Kong if it is unclear whether Jetstar will be give approval to operate flights within Hong Kong.

The statement highlights the sway over relationships that Cathay has spent years developing right up to the top levels of the Hong Kong Government, and indeed, throughout Asia. Any Jetstar operation in Hong Kong will require a change of Hong Kong’s constitution, and Cathay also knows full well that a decision on regulatory approval for Jetstar HK is unlikely to be made “made until some way through 2013”.

 

Why did Cathay make its move?

In late June, Qantas’ applied to the ACCC to cooperate more closely with Jetstar in the Japan, Singapore and Vietnam markets. Qantas is requesting to coordinate various business and operational functions between Qantas and all Jetstar Airways carriers; and also between Japan Airlines, Vietnam Airlines and China Eastern and their respective Jetstar subsidiaries. Without approval of the the agreement, Qantas says its pan-Asian expansion will be under threat.

The carriers have never had what one would described as a close relationship, and Australian anti-competition laws forbid them from cooperating on services between Australia and Hong Kong. Slosar, denies that a Jetstar HK subsidiary will strain the carrier’s relationship with parent Qantas. His recent referral to the fact that “alliances always have certain overlaps” was certainly an attempt to smooth the waters, although Cathay’s subsequent strategic play has reinforced the limits of any relationship.

Qantas’ applies and Cathay responds

Qantas’ original application suggested that “When a LCC enters a market, all competitors (FSAs and LCCs) are forced to innovate in order to remain competitive. That is, LCCs force FSAs to re-think long standing business practices and competitive responses”. In the case of Hong Kong, why is Qantas forcing other carriers to innovate while its own “long standing business practices” remain the same?

Cathay has responded by focusing on consumer interests alluding to the anti-competitive nature of the Jetstar Qantas relationship. Questioning the necessity of Qantas and Jetstar to cooperate anymore closely, as other airlines can provide the “stimulatory effect of Low-cost Carriers (LCCs), including the competitive reaction they may elicit from Full Service Airlines (FSAs)”. There is a sense of effrontery in Qantas’ suggestion that it isn’t anti-competitive for it to operate a Jetstar subsidiary in Hong Kong, and other Asian countries, in addition to closer relations with the Jetstar group as a whole.

A320NEO range from Hong Kong. Source: Airbus

Jetstar’s fleet plan

Leveraging the opportunity to force Jetstar to reveal its long-term fleet plans and allocation of aircraft across the Jetstar group, Cathay asks, “could Jetstar Hong Kong or Jetstar Japan buy or lease planes that could reach Australia? Does the Jetstar group have, or have on order, aircraft capable of reaching Australia that could be allocated?”.

Seemingly unaware of the capabilities of the fleet of 15 787-8s (delivery from 2013), and over 70 A320NEOs (delivery from 2016/17) Jetstar has on order. Qantas asserts that “Jetstar Japan and Jetstar Hong Kong cannot offer services to or from Australia because they do not have the aircraft that is necessary to make travel over such distances economically or practically viable”. The 787-8′s 14,000km range puts all of Australia well within range, and the A320NEO is capable of reaching almost one-third of Australia including Jetstar’s Darwin hub, and Perth.

Henry Kissinger enthuses that in war “Chinese ideals have long stressed subtlety, indirection, and the patient accumulation of relative advantage”. In what is likely to become a patient contest of relative gain and long-range encirclement, Cathay has made its first very deliberate and subtle move.

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