Neha Jain: http://newzealandaviationnews.blogspot.com/ 30

1. Qantas to cut routes, aircraft, staff ahead of $140m profit hit
QANTAS Airways today said it will reduce international and domestic flying capacity, retire aircraft and cut management positions in response to natural disasters and higher jet fuel prices.

Australia's flag carrier said its second-half profit was now expected to take a $140 million hit from the cost of natural disasters, including flooding and Cyclone Yasi in Queensland and earthquakes in Japan and New Zealand. That financial impact would come in addition to an expected $25m hole from the grounding of its A380 super-jumbo fleet following an engine explosion last November.

Qantas said it was too early to estimate the likely impact of the events on its result for the 2012 financial year.

Domestic capacity growth in the six months to June 30 will be reduced to 8 per cent from 14 per cent, while growth in international capacity will slip to 7 per cent from 10 per cent, Qantas said.

Up to four weekly Jetstar flights from Australia to Japan will be suspended between April and August, as will a Qantas service between Perth and Tokyo, along with other changes, including the early retirement of two Boeing 767 aircraft.

Chief executive Alan Joyce said today: "We need to act decisively to respond to rising fuel costs and natural disasters, just like we did during the global financial crisis, to ensure the ongoing sustainability of our business."

2. Cathay Pacific to launch direct Abu Dhabi-Hong Kong flights

Abu Dhabi: Cathay Pacific Airways will be flying out of Abu Dhabi four times a week non-stop to Hong Kong beginning June 2, the airline's general manager for the Middle East, India, Africa and Pakistan, Tom Wright announced yesterday in a press conference.
The eight-hour flight which will be serviced by Airbus A330 and A340 aircraft, will also be a connecting flight to a number of countries including mainland China, the Philippines, Korea, Japan, Taiwan, Australia and New Zealand.
Cathay Pacific Airways is now the 52nd airline to have flights flying out of Abu Dhabi, making Hong Kong the capital's 82nd destination, said George Karamanos, Vice-President of Corporate Marketing and Communications, Abu Dhabi Airports Company.
"Northeast Asia is a place that we felt that there is more potential especially with a destination like Hong Kong which was not served by any other airline," Karamanos told Gulf News.
Cathay Pacific Airways also has double daily flights to and from Dubai to Hong Kong, in addition to flying out of Jeddah and Riyadh in Saudi Arabia.
More flights
"People who are used to travelling to Dubai to go to Hong Kong now can go from here [Abu Dhabi]," Wright said.
"I am personally very confident that we should be seeing more flights [out of Abu Dhabi] in the near future," he said. "Looking at our forward bookings at the moment and this flight hasn't even started yet, it's looking really good."
Seat load factor
Cathay Pacific Airways is looking at a seat load factor of 70 to 80 per cent, he added. For the Abu Dhabi Tourism Authority (Adta), the introduction of the new airline brings Abu Dhabi one step closer to "the very important Chinese market with passengers from 17 destinations in mainland China now having easy air access to Abu Dhabi through the network of Cathay Pacific's sister airline, Dragonair," said Dayne Lim, Promotions Director at the Adta.
The Adta has projected a target of 2 million hotel guests for the emirate this year with a growth rate of 10.5 per cent for every region. The first two months of 2011 the Asia Pacific region has already achieved a growth of 14 per cent, Lim said.
By the introduction of these flights, Lim could see the Asia Pacific region reaching a growth rate of around 20 per cent by the end of this year.

3. Disasters cause profits at insurance market Lloyds of London to fall 43 percent in 2010
LONDON — Lloyd’s of London said Wednesday that its profit dropped by 43 percent last year as the insurance market took big losses from earthquakes in Chile and New Zealand and from BP’s oil rig spill in the Gulf of Mexico.
full year pretax profit was 2.2 billion pounds ($3.5 billion), down from 3.9 billion pounds in 2009. Gross premium income rose 3 percent to 22.6 billion pounds.

The market’s combined ratio — the measure of premiums against claims — was 93.3 percent, compared with 86.1 percent for 2009. Any measure below 100 percent indicates an underwriting profit, and a lower number indicates higher profitability.

Peter Levene, chairman of Lloyd’s, said 2011 looks like another difficult year because of unrest in the Middle East, floods in Australia, another earthquake in New Zealand and the earthquake and tsunami in Japan.

While it is too early to accurately gauge losses in Japan, Levene said, “it is, of course, nothing compared to the human cost of the tragedy.”

Chief Executive Richard Ward said he was confident that Lloyds could cover its losses in Japan.

Lloyd’s said it expected to pay out between $300 million and $600 million in claims from the Deepwater Horizon oil rig disaster.

It estimates that claims from the Chilean earthquake in February will be 857 million pounds, and it expects to pay 428 million pounds for claims from the September quake in New Zealand.

The market benefited from a benign year of Atlantic windstorms. Although there were 19 named tropical cyclones, the third-highest number in a century, the storms missed landing in the United States or hitting Gulf of Mexico energy fields.

However, the financial crisis may yet cost the insurance market. “We have not yet seen the full anticipated claims impact of the worldwide recession,” largely through claims on bad loans and losses on investments, Lloyd’s noted.

One of the high points of the past year, Levene said, was gaining a license to operate in China.

Unlike most insurers, Lloyd’s operates as a society of members, which may be insurance companies, specialist investors or individuals. Members underwrite insurance through 85 syndicates which compete for business in many specialty areas including marine, aviation, professional indemnity, catastrophe and motor insurance.

4. Permission to fly with 3 days to takeoff

Budget Malaysian airline AirAsia X has permission to fly in New Zealand airspace, with just three days to spare before its first flight.

The airline will operate between Kuala Lumpur and Christchurch, joining the existing network of about 130 cities around the world. The first flight takes off from Christchurch on Friday.

Airline chief executive Azran Osman-Rani said yesterday the company had been approved by the Civil Aviation Authority and the Ministry of Transport.

"Securing a regulatory licence is a long but important process," he said.

AirAsia X never wavered from its decision to connect to Christchurch after the February quake.

"More so than ever, the South Island deserves our support. Ticket sales following our initial discount fare launch in December last year proved to be the most popular launch in the airline's history.

"We remain 100 per cent committed to the destination and look forward to getting New Zealanders on board."

NEHA JAIN

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