About those change fees: Last week we reported from the US Airways Media Day and among the topics was that of change fees. US Airways matched United Airlines to charge $200 if you change your ticket. Here’s an article about how to deal with these fees.
Here’s another article about change fees, and how they’ve soared in recent times. If you think fees in the US are bad, look at the table and note in particular Ryanair’s fees–this carrier is notorious for charge for everything, and at steep prices, something subject to this funny video:
Why are fees becoming so prevalent? Because this is where airlines are largely making their profits. US Airways said last week it expects to earn $600m from fees this year. This is more than its entire profit from 2012. This means airline operations lose money and profits come from the fees.
Also on US Airways: we also reported last week about some outstanding labor issues between the IAM at US Air and the TWU and American Airlines. An agreement over the weekend was reached about merging these two workforces under one union banner, according to Terry Maxon at the Dallas Morning News.
Ex-Members Rap FAA, NTSB: We bet they won’t be invited to a reunion. James Hall and John Goglia, former members of the National Transportation Safety Board, had harsh words to say about the FAA, Boeing and the NTSB over the certification of the Boeing 787 and the subsequent fix. Hall said the FAA needed to recertify the airplane, not just the battery.
Ethiopian Airlines resumed service with the 787 over the weekend, while Japan’s ANA engaged in a proving flight. This Wall Street Journal article (via Google News, so everyone should be able to read it) references additional measures required by Japan.
Cost of 787 fix: It will cost nearly $500,000 per aircraft to install the battery fix in the Boeing 787, documents released by the Federal Aviation Administration indicate. The actual math is $466,666. Analysts believe the 787 grounding cost Boeing about $600m, which the CEO said yesterday was absorbed in the R&D budget. Jim McNerney also said there are no contractual obligations to compensate customers for the grounding, but something will likely be worked out.
LOT will resume flying the 787 June 5, it was reported today.
China’s Airbus Order: It appears China is satisfied with the European Union’s about face on carbon taxes. Readers may recall China opposed the EU’s attempt to levy taxes on foreign airlines over carbon emissions. China vowed not to buy any Airbus aircraft–particularly the A330–in retaliation. Several other countries opposed the tax, though these didn’t go so far as to boycott Airbus. Today an $8bn order for Airbuses, including the A330, was announced by China.
You can follow the NTSB hearing on the Japan Air Lines battery fire on the web here. It starts at 9am Eastern Time. Mobile phone access is also available.
Odds and Ends: Boeing’s presence in Seattle; 747-8 future; Japan awaits 787 NTSB hearings; Airport delays
Boeing’s presence in Seattle: Bill Virgin, a respected local journalist and observer of aerospace and manufacturing, wrote this column for the Tacoma News-Tribune looking at Boeing’s future presence in the Seattle area.
The points Virgin raise are valid, and in total have been discussed for years here. We raised some of these points as far back as April 2009 in a speech to a local economic development group.
Parochially, of course, we want to see Boeing stay here. Putting on our business hat, we can make a solid argument for Boeing’s diversification. We see Charleston becoming to Everett what Hamburg is to Toulouse: a major, major manufacturing center and aerospace cluster.
We are firmly convinced that when the day comes Boeing designs an all-new airplane to replace the 737, South Carolina will be its assembly home and Renton’s facility will close, to be given over to mixed use development along the lines of what’s called Renton Landing. Boeing’s “move to the lake” has been years in the planning and years in the making. We don’t believe it is over.
What about Everett? We see the future of Everett solid for at least a generation and probably a lot longer, at least until the 787 production begins to wind down. Local politicians fear Boeing will assemble the forthcoming 777X somewhere else. We don’t think so. The 777 tooling is here, the skilled workforce is here and it wouldn’t make sense to build a derivative elsewhere, just as it didn’t make sense to build the 737 MAX anywhere but Renton. Furthermore, we firmly believe the 777X will kill off the nearly morbid 747-8I. This will free up space to build the 777X here.
747-8 Future: The Puget Sound Business Journal last week published a long story about the inter-relationship between the 777X and the 747-8I, an its impact on the struggling program. On the same day the story was published (Friday), Boeing announced a production rate cut in the program from 2/mo to 1.75/mo. We had expected a deeper cut. One consultant we spoke with on Friday suggests Boeing will do what it can to keep the 747-8 alive pending recapitalization of the 747 at the USAF–in other words for Air Force One and the Doomsday aircraft. We’ve been saying the former for quite a while but had not thought about the latter. But there are only four aircraft. Still, the prestige of having the 747 as Air Force One is worth a lot.
The PSBJ article is here: PSBJ 747 041913
Japan Awaits Hearings: Japanese regulators are waiting for the Boeing 787/Japan Air Lines hearings by the National Transportation Safety Board this week before deciding whether to approve a return-to-service by the aircraft, according to this news report.
Airport Delays: You can track airport delays resulting from controller layoffs here.
Boeing held a tele-web press conference at 2pm PDT today about the FAA’s approval of the battery fix and authorization to return the 787 to service.
As we prepared to get underway, Boeing clarified some Tweets that referenced 100,000 of engineering work on the battery solutions. At a previous press conference a figure of 200,000 hours was mentioned.
Marc Birtel, a Boeing spokesman, provided this clarification:
The team spent more than 100,000 hours developing test plans, building test rigs, conducting tests and analyzing the results to ensure the proposed solutions met all requirements.
The team spent more than 200,000 engineering hours in all of the work that went into the battery solution.
Mike Sinnett, VP and chief project engineer for the 787 program, provided today’s update. Go below the jump.