Thomas Cook UK transformation on track says Fankhauser

Thomas Cook UK transformation on track says FankhauserBy Ian Taylor

Thomas Cook pledged its UK business transformation will “continue at pace” after the group announced its first full-year operating profit in three years today.However, UK and Continental Europe chief executive Peter Fankhauser insisted: “This is not about job cuts.”

He said there are no plans for further shop closures other than as part of a “normal” cycle of reviewing outlets as leases come up for renewal – after shutting about one in five UK stores this year.

Thomas Cook revealed a UK operating profit of £66 million in the year to September after “virtually no profit” a year ago.

Fankhauser said: “We expect the same amount of improvements [still to come], but this is not just about cuts. It is about improving our business systems, improving our margins. It is not about any job cuts.

“Cost out is all about better operating and how we transform the business. We are increasing our costs out but it does not mean we are having further cuts.”

He added: “We are further on in our cost out [programme] than we expected.

“We reduced our [UK] shops by 204. A lot of stores will be under review in coming years where leases are running out, but to review whether we keep stores open is business as usual.

“We are consolidating our retail network as it makes business sense.”

Fankhauser suggested Cook’s retail joint venture with The Cooperative Travel could continue beyond the minimum five-year agreement signed off in 2011. He said: “There is no indication we will not run the joint venture beyond [the five years].”

He also suggested third-party distribution would remain important. Fankhauser said: “Third-party agents love us since we introduced price parity in distribution.”

The group has targeted online distribution of 50% across the business by 2015 in line with a previously announced target for the UK.

UK online distribution reached 36% in the year to September, up from 33% a year ago and on a par with the group-wide percentage.

Fankhauser said: “We targeted 50% on the web. It’s an ambitious target and we are well on the way. We have seen an improvement in the UK and in all our markets.”

He described the UK figures as “a notable first step to our target margin of 5% by 2015”. In Germany, he said: “We continue to produce industry-leading profits.”

Sourced from Travel Weekly


Middle East aviation growth will continue to set the pace

Middle East aviation growth will continue to set the paceBy Phil Davies
International airline traffic growth in the Middle East will continue to outpace the rest of the world, according to the latest forecast from Boeing.The region will need 2,610 new aircraft worth $550 billion over the next 20 years.

A third of that demand – 900 aircraft – will be replacements but 66% is expected to be driven by rapid fleet expansion in the region, the manufacturer says.

Long-range, twin-aisle aircraft, such as the 777 and 787 Dreamliner, will continue to dominate order books in the Gulf region, reflecting the global network priorities and emerging alliances and partnerships of the region’s carriers.

Boeing Commercial Airplanes marketing vice president Randy Tinseth said: “The Gulf region benefits from a unique geographic position that enables one-stop connectivity between Europe, Africa, Asia and Australasia.

“Additionally, over the last decade, we’ve seen a rise in low-cost carriers that have benefitted from a large youthful population, large migrant workforce and trends toward market liberalisation.”

Twin-aisle aircraft will account for more than half of the region’s new deliveries over the next two decades against 24% globally.

Single-aisle aircraft will make up 47% of regional deliveries through to 2032, while large aircraft will account for 10% of forecast demand.

Globally, Boeing has forecast a long-term demand for 35,280 new aircraft, valued at $4.8 trillion. These new aircraft will replace older, less efficient types.

Sourced from Travel Weekly

Osborne ignores industry’s plea on aviation tax

By Rob Gill

Air Passenger Duty is to continue rising despite the travel industry’s pleas for chancellor George Osborne to scrap the aviation tax.

Osborne did not mention APD during today’s budget presentation in the House of Commons but documents released after the speech show that APD will rise “in line with inflation” from April 2014 on top of the already scheduled increase of 2.5 per cent from next month.

Groups such as the Fair Tax on Flying alliance and the UK’s leading airlines have been calling for APD to scrapped but this has fallen on deaf ears with Osborne.

While the lowest rates of APD for journeys of less than 2,000 miles will remain flat at £13 per passenger for economy and £26 for all other classes of travel over the next two years, all of the other three bands will go up both in April 2013 and April 2014. The increases in next year’s APD will be by an average of 2.8 per cent across these classes.

Here are the full details of the APD rises:

Band A (0-2,000 miles from UK, includes Europe)

From April 1 2013
Economy: £13
All other cabins: £26

From April 1, 2014
Economy: £13
All other cabins: £26

Band B (2,001-4,000 miles, includes North America and Middle East)

From April 1 2013
Economy: £67 (up by £2 year-on-year)
All other cabins: £134 (up by £4)

From April 1, 2014
Economy: £69 (up by £2 year-on-year)
All other cabins: £138 (up by £4)

Band C (4,001-6,000 miles, ncludes South America, China and India)

From April 1 2013
Economy: £83 (up by £2)
All other cabins: £166 (up by £4)

From April 1 2014
Economy: £85 (up by £2)
All other cabins: £170 (up by £4)

Band D (over 6,000 miles,  includes Australasia, Malaysia and Indonesia)

From April 1 2013
Economy: £94 (up by £2)
All other cabins: £188 (up by £4)

From April 1 2014
Economy: £97 (up by £3)
All other cabins: £194 (up by £4)

Sourced by bbt

Snow and ice continue to disrupt travel

Snow and ice continue to disrupt travel

By Phil Davies

Much of the UK is braced for a fourth day of travel disruption due to snow and ice – and forecasters say little improvement to the weather can be expected this week.

Heathrow has reduced its schedule for Monday by about 10% – cutting around 130 flights – in anticipation of low visibility due to the severe weather.

“It is possible that weather conditions at other European airports will increase the number of cancellations,” the London airport warned.

British Airways said today: “Poor weather in the UK and parts of Europe continues to cause disruption to our flights.

“Like other airlines at Heathrow we have complied with a request to reduce our schedule by 10%. We strongly recommend you check the status of your flight and only go to the airport if your flight is operating.”

Heathrow cancelled 300 flights yesterday as weather conditions also forced temporary closures of Birmingham and Belfast City airports to allow snow to be cleared, and led to more than 40 cancellations at London City Airport.

A number of British Airways flights to Heathrow Terminal 5 were diverted to other UK airports last night after the airline was unable to de-ice aircraft on the ground quickly enough to clear the stands, according to the BBC.

This follows more than 110 flights being cancelled at Heathrow on Saturday and 440 on Friday leaving thousands of passengers sleeping in terminals overnight.

Passengers due to fly from Heathrow today are being urged to check the status of their flight with their airline

Flights to and from Norwich airport were suspended this morning with passengers advised check in as normal but to expect delays.

Disruption is possible to flights from Gatwick, Birmingham, Leeds/Bradford Newcastle and Aberdeen airports, while there was a warning of delays at Luton.

Some domestic flights from Glasgow airport were also likely to be affected today due to the adverse weather.

Stansted flights were operating as normal but five Ryanair flights to Ireland were cancelled and four into Stansted. The airline blamed a “shortage of deicing fluid” at the Essex airport.

EasyJet said: “Airports across the UK are experiencing significant disruption due to wintry weather.” The airline was taking “proactive measures” to minimise the disruption.

Gatwick said it was operating as normal this morning although there may be some delays due to weather disruption across Europe.

Two Eurostar services to Brussels and Paris were cancelled this morning together with three inbound trains from Brussels and one from the French capital.

All trains face delays of up to an hour throughout the day due to speed restrictions being imposed due because of snow and ice in the UK and northern France

Eurostar said: “Passengers with tickets for one of the cancelled services are advised to change their travel plans for another day. However if you have to travel today, please contact a member of staff at your departure station where you will be given a seat on a later service.

“Please note that you may have a long wait for the next available train. All customers due to travel on Monday 21st January may exchange their ticket, regardless of ticket type, to another available service on any available date.”

Sourced from Travel Weekly

Iata predicts tough times will continue for airlines

A tough second half of the year has been predicted for airlines due to declining passenger demand and rising fuel prices.

The warning came from Iata against a backdrop of economic uncertainties which saw demand fall in July across the globe with the exception of Africa, the Middle East and domestic services in China.

The slowdown in travel growth is being driven largely by the recent fall in business confidence in many economies.

Director general and chief executive Tony Tyler said: “The uncertain economic outlook is having a negative impact on demand for air transport.

“The cargo business is 3.2% smaller than it was a year ago. And passenger markets—with the exception of Africa, China-domestic and the Middle East—saw demand fall from June to July.

“Overall passenger demand is still up 3.4% on the previous July. But the growth trend is clearly slowing. This, along with rising fuel prices is likely to make it a tough second half of the year.”

Airlines have responded by reducing capacity added to markets, a move which has stabilised load factors at relatively high levels and provided some support for profitability in the face of high fuel prices, Iata said.

In July passenger capacity rose 3.6%, in line with the expansion of traffic, keeping the load factor at a relatively high 83.1%.

European carriers recorded growth on international services of 4.8% in July, down from 7.3% the previous month, with an average load factor of 85.7%.

“Despite the recession in many European home markets, airlines from the region have been able to sustain growth on long-haul markets to regions where economic growth is strong,” Iata said.

Tyler added: “The huge success of the London Olympics was also an important reminder of the vital role that international aviation plays in bringing the world together and facilitating global mega-events.

“Now all eyes are on Brazil which will host the 2014 World Cup and the 2016 Olympics. And aviation will play a key role there as well.

“It will take a team effort to ensure that Brazil’s aviation infrastructure is up for the challenge,” he added.

Sourced from Travel Weekly