Archive for December, 2008

Rail workers had been staging a strike which has reached its 6th day. The strike is in support of higher wages. The strike initially caused delays but brought almost all trains to a halt on Monday (December 15th 2008).

There are separate strikes at the airport too – “Separately, a strike by two unions at Budapest Airport, a
unit of Germany’s Hochtief entered its sixth day on
Monday and was expected to cause delays on most departing
flights, the airport operator said”. (from here)

So, overall the whole transportation system at Budpapest is in “utter chaos“.

Airlines at Budapest and their status –
Malev Airlines
“Hungarian airline Malev said it had scrapped 12
of its flights scheduled for Monday”

“Cancelled a morning flight scheduled for Rome”

Wizz Air
“it considered legal action against Budapest
Airport for the damages it had incurred during the strike,
called on unions on Monday to stop the action”

Advice from Airlines –
It advised passengers to arrive at the airport three hours
before departure.


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Volatility of fuel prices is still an issue with the crude oil taking the highs of around $150 per barrel to the current lows of $42 per barrel. The scare of very expensive oil has caused airlines about alternative fuel and hopefully with current lows, the effort will not fade.

On January 7th 2009, Continental Airlines will test the use of a biofuel blend (derived from Algae and jatropha plants) on a Boeing 737-800 with nobody on board except for the test pilots. The test pilots “plan to run one engine on the biofuel blend and take it through power
accelerations and slowdowns, in-flight engine shutdown and restart and
other maneuvers. The airline said it expected a post-flight analysis
would show that the lower-emission biofuel plan can substitute for
regular fuel without loss of performance or safety.

The test is in partnership with airplane manufacturer Boeing, airplance engine
maker GE, Snecma, Honeywell technology and oil producers Sapphire
Energy and Terrasol.


An average Continental flight burns 18 gallons of fuel to fly one passenger 1,000 miles.
Alternative fuels for aircraft have been studied for years, but the
push got new urgency this year when jet-fuel prices hit record highs in
July. Fuel is one of the largest expenses for an airline.
Some fuels such as hydrogen lack the acceleration of traditional
kerosene-based jet fuel and would require planes be outfitted with
massive fuel tanks.
Airlines in South Africa use a coal-based fuel blend developed by
petrochemicals group Sasol that doesn’t require altering aircraft
engines or other parts. Air New Zealand is testing jatropha fuel in a
747 jetliner.

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Jessica Cox (25 year old from Tucson, Az) was born without arms but that did not stop her from flying an aircraft. She recently became the first pilot licensed to fly with only her feet. She used one foot to man the controls and the other to guide the steering column. She got her Sport Pilot Certificate that qualifies her to fly a light-sport aircraft to altitudes of 10,000 feet.

Her flight instructor is Parrish Traweek (from San Manuel’s Ray Blair Airport).

From Fox News

“When she came up here driving a car,” Traweek recalled, “I knew she’d have no problem flying a plane.”
Finding a plane that was
compatible with her abilities was a task within itself. She found it in
the Ercoupe, a plane manufactured in the mid-1940s. Locating one took
her to Florida and California, although she finally find one less than
70 miles away in San Manuel.

“Once you’re with Jessica for
about 20 minutes, you don’t even notice she doesn’t have arms,” Traweek
said from the one of the airport’s hangars.

Cox, unwrapping a piece of
chewing gum with her toes nearby, was clad in a yellow T-shirt sporting
a stick figure with truncated arms beneath the phrase: “Look Ma, No

“Jessica’s showing people there are no limits,” he said. “Jessica’s incredible. She really is.”

That slate is now covered with achievements from a bachelor’s degree in psychology from the University of Arizona to two black belts in tae kwon do. She’s also seeking a publisher for her life story. She keeps even more active with swimming and walking.

Bravo Jessica! All of us need to be a little inspired from her. It does remind me of Jim Carrey’s new movie Yes Man 🙂

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Yesterday, Deutsche Lufthansa AG‘s advisory board approved the acquisition of Austrian Airlines Group. The key details are as follows (mostly from ATW and WSJ) –

  • Luftansa will start with the purchase of state holding company OIAG’s share of 41.56% for $463,000 (€366,000).
  • For the remaining share it will make a “€215 million bid for Austrian’s remaining shares at €4.44 per share,
    subject to approval from Austrian competition authorities. The
    per-share price equals the average weighted market price over the past
    six months.
  • It will also issue a debtor warrant potentially worth up to
    €163 million, “depending on Austrian Airlines’ economic performance and
    the Lufthansa share outperforming its competitors.”
  • Lufthansa also plans to launch a tender to buy out private shareholders for a further €215 million.
  • The offer is contingent on the Austrain government assuming “€500 million of AAG’s approximately €900 million debt“. WSJ reports, “deal would require regulatory approval, in part because the Austrian
    government plans to spend €500 million helping to restructure the

Details about Austrian Airlines (from here)

  • Founded – September 30th 1957
  • First maiden flight – March 31st 1958 (Vickers Viscount 779 took off from Vienna for London, England via Zurich. Austrian Airlines was formed through the merger of Air Austria and Austrian Airways)
  • Headquarters – Vienna, Austria
  • Alliance – Star Alliance
  • Frequent Fliers Program – Miles and More
  • Hub – Vienna International Airport
  • Fleet – 41 (7 Airbus A319, 8 Airbus A320, 6 Airbus A321, 1 Boeing 737-600, 2 Boeing 737-700, 7 Boeing 737-800, 6 Boeing 737-300ER, 4 Boeing 777-200ER)
  • Misc – The armed monitoring of Austrian flights by Cobra
    (police anti-terrorist-squad of Austrian Federal Ministry of interior)
    began in 1981. During each accompanied flight at least two undercover
    armed air marshals are onboard.

A lot of people are a critical about Lufthansa’s buying binge.

Some analysts are worried –  “We are concerned that Lufthansa could be involved in too many deals,”
which could cause it to dilute current shareholders by issuing new
equity, Citigroup analysts wrote in August. Other outsiders worry that
Lufthansa’s management could get stretched too thin.”

I personally believe that it is a good time to buy and increase the network, esp. when the airlines are so cheap (post $150 a barrel and current recession period). Though, airline acquisitions are touch due to fleet differences, union issues, different work cultures and just different cultures.

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