Monthly Archives: October 2009

Lufthansa Brings Back Wi-Fi, Phone Service

Germany’s largest airline, Lufthansa, announced plans to bring back WiFi and phone services. Within forthcoming months, the carrier said they would bring back the service, beginning with flights between the United States and Europe. The service will likely be fleet-wide by mid 2010.

You might recall Lufthansa offering WiFi three years, however the airline removed the service citing weak demand. The price of WiFi used to be $10 per hour, or $27 for the entire flight; in-flight calls tended to be a costly $3 a minute. Yet this time, more carriers have adopted WiFi, making the public more aware of the service, and the cost of the service will likely be much cheaper.

Additionally, the carrier aims to allow passengers on international flights to make calls, and use their high-speed internet. The carrier wants to gain a competitive advantage by being the first carrier to offer high-speed connections for multiple devices.

The new system will utilize Panasonic’s FlyNet, a satellite-based technology, on-board the carrier’s aircraft.  With this, Lufthansa will not only be on the carriers-that-offer-WiFi list, but this will likely bring in a good amount of revenue for the airline.

Based off of USA Today and WSJ

Airlines and Social Media: Interview with American Airlines

Online social networking quickly became the primary way we communicate and stay-in-touch with others. Through status updates, “tweets”, or blogs, we’re readily updated on friends, family, co-workers, and now… airlines too are on-board with social media.

In the past few years, many airlines launched blogs, Twitter accounts, and Facebook fan pages aimed at keeping consumers in-the-loop of airline news, sales, and general day-to-day flying information.

Just recently, I spoke with Mr. Christopher Vary, a vice president at Weber Shandwick – the world’s largest public relations firm. Mr. Vary, along with other Weber Shandwick employees, work together with American Airlines’s corporate communications team on social media development and content for the airline.

The airline’s social media efforts are paying off. On April 13, 2009, Mr. Vary’s team launched American’s use of social media to new heights, with the debut of American’s Twitter and YouTube accounts. Just six months since the account’s inception, the Twitter account has over 15 thousand followers, and Facebook boasts 30 thousand. Through social media, American can “improve to support the brand and connect with new customers like never before,” said Mr. Vary.

Whether there is a weather delay, fare sale, or new aircraft in the fleet, the social media team posts / tweets it. “The whole goal is to really provide customers and consumers with the first touch point of information,” said Vary. Travelers are truly getting “one-to-one” information about the company, as well as day-to-day information directly related to travelers.

Just months ago, during the closing of New York’s LaGuardia airport due to a bomb scare, the airline’s Twitter account provided minute-to-minute tweets, updating passengers on the status of the airport. As social media is at the fingertips of many travelers, tweets helped passengers get information quicker than ever before.

Through online social media and networking tools, airline information flows faster and more directly to consumers. Fare sales and free trials for on-board Wi-Fi use have appeared on American Airlines’s social media platforms. According to Mr. Vary, promotions and offers draw in millions of impressions and thousands of “re-tweets” for the airline.

Social media platforms are always evolving and improving, and as consumers evolve with them, airlines will follow. Mr. Vary says American Airlines is exploring new fields of social media and is evaluating all the technologies available.  “We’ve only scratched the surface.”

Links:

American Airlines: Twitter, Facebook, and YouTube.

Images from stock.xchng

United’s Traffic Falls, Debt Offering

Chicago based United Airlines said traffic for the month of September fell by 1.1 percent, primarily due to the declining number of passengers in North America. Additionally, United priced $659 million worth of debt, most of which will be used to pay off remaining debt from 2001.

For the month of September, paying customers flew 9.25 billion miles, down from 9.35 billion miles in Septbember 2008. The carrier reported that North American traffic fell 6.1 percent to 4.48 billion RPMs (revenue passenger miles). International traffic increases slightly by 0.4 percent to 3.61 billion RPMs. Load factor for the carrier rose 2.1 percentage points to 81.2 percent – not shocking, as fewer flights usually attributes to higher load factor.

As the first nine months of the year are complete, it’s time to measure traffic. Traffic has decreased 8.4 percent to 86.74 billion RPMs.

As for the debt offering, United is borrowing against 31 aircraft. The debt offering interest rate is 10.4 percent and will mature November 1, 2016. The carrier said they were refinancing the aircraft side of debt to reduce their debt payment obligations – taking advantage of current market conditions. The proceeds of the debt will go towards repaying the $548 million in existing debt. United said that the funds left over will likely be used for corporate purposes.

United has some work to do, but this is a step forward – financially. United needs to start looking at employee satisfaction and customer satisfaction. United Breaks Guitars, a song by Dave Carroll, drew public awareness of United’s unwillingness to compensate Carroll for damaging his beloved Taylor guitar – creating a PR nightmare for United. On the employee side, it’s not a good sign that employees are happy with you when they start create a website about the chief executive of the airline. This is fixable, but unfortunately most airlines don’t have the cash to launch massive advertising campaigns – but it might be worth it for United.

Mitsubishi Gets 100-Plane Order for MRJ

Japan’s first ever passenger jet, the Mitsubishi Regional Jet (MRJ), received a 100-plane order from U.S. regional airline Trans States. Mitsubishi Heavy Industries, a outsourced supplier for the Boeing 787, is still continuing development on the 70-90 seat airliner. The company declined to say how much the order was worth, but the catalogue price for the order is valued around $2 billion – $4 billion total if the 50 options go through.

In 2008, the MRJ received an order from launch customer ANA (All Nippon Airways) for up to 25 planes. Deliveries for the new airliner are expected to begin in early 2014.

“This is a very proud moment for us. The world has high expectations for the MRJ. This is especially true in the U.S.”

- Hideo Egawa, president of Mitsubishi aircraft division.

Compared to jets in the same seat category, the plane is expected to cut fuel burn by 20-30 percent per hour. Trans States said that fuel costs are “very important.”

The aircraft uses a geared turbofan engine developed by Pratt & Whitney. The new technology is referred to as a fuel sipper, as the engine’s fans can operate at a different speed to the turbine. This same type engine is also used on Bombardier airplanes.

This is only the second Japanese made plane since the end of World War II – the first was the YS-11, but had very limited success.

Mitsubishi plans to build the aircraft at Mitsubishi Heavy’s factory in central Nagoya. They plan on producing 24 aircraft per year initially, but expect to increase the amount of 72.

Mitsubishi recently delayed the delivery date to revamp the design by increasing cabin / cargo space. Additionally, they switched from carbon-fiber to aluminum wings. Mitsubishi is advised by Boeing.

Image: http://www.mrj-japan.com/