Arik Air orders 2 Boeing 747-8 Intercontinental

Boeing and Nigeria's Arik Air today announced a deal for two 747-8 Intercontinental airplanes. The order is valued at $635 million at list prices and was previously attributed to an unidentified customer on Boeing's website. The order was announced during a signing ceremony at the Corporate Council for Africa's 8th Biennial U.S.-Africa Business Summit in Washington, D.C. "Air travel within the region continues to grow at a rapid pace and we must prepare our fleet to accommodate that growth," said Sir JIA Arumemi-Johnson, owner and chairman of Arik Air. "Boeing's new 747-8 fits perfectly into our long-term planning. It brings the best operating economics for its size, which is important with the increase in fuel prices."

Arik Air is Nigeria's fastest-growing privately owned airline operating a large fleet of Boeing Next-Generation 737s and serves more than 22 domestic, six regional and three long-haul routes. The airline plans to use the 747-8 on its key long-haul routes. "Arik Air is growing to become a leader in aviation in Africa and Boeing is happy Arik will use the 747-8 as a cornerstone of their future growth," said Van Rex Gallard, vice president of Sales for Africa, Latin America, and Caribbean, Boeing Commercial Airplanes. "With its unmatched operating costs and economics, the 747-8 is the right airplane to help Arik Air meet growing demand." The new 747-8 Intercontinental features a new wing design and an upgraded flight deck. The airplane interior incorporates features from the 787 Dreamliner including a new curved, upswept architecture that will give passengers a greater sense of space and comfort.

Using General Electric's GEnx-2B engines, the airplane will be quieter, produce lower emissions and achieve better fuel economy than any competing jetliner. It also increases cargo volume by 26 percent. "As we look into the future, the 747-8 Intercontinental is a must have for Arik Air," said Sir Arumemi-Johnson. "Our airline strives to bring the best, most efficient and most modern products to our customers and that is exactly what this airplane is."

Passenger Jet crashes in Congo

An airliner plowed into dense forest as it tried to land during a rainstorm in the Democratic Republic of Congo on Friday, killing 127 people on board, the Congolese transport ministry said.  There were 51 survivors, a ministry statement said. The chief executive of the airline involved in the crash told Reuters earlier that there had been 110 people on board the plane, of whom 53 had died and 57 survived. But a spokesman for the transport ministry, Gudile Bualya, accused the airline of underestimating the number of passengers.

The accident at the international airport of Kisangani, a commercial center and river port town in the east, is the latest in a string of disasters in the vast central African country which has saddled it with one of the worst air safety records in the world. "The pilot tried to land but apparently they didn't touch the runway," Stavros Papaioannou, chief executive of Hewa Bora airline, told Reuters by telephone. Hewa Bora is on a European Union list of airlines banned due to security concerns, as are all carriers certified in Congo. It is the second fatal accident involving the airline in three years, after its DC-9 airliner plowed into a suburb of the eastern Congolese city of Goma, killing 44, in 2008.

Earlier, government spokesman Lambert Mende said rescue services had pulled 40 survivors from the Boeing 727. Jean-Paul Bongisa, a local reporter for Congolese state television at the scene of the crash, told Reuters the rescue was being hampered by difficulties in reaching the wreckage, some 200 meters (yards) from the runway in dense equatorial forest. Congo is roughly the same size as Western Europe but rail and road links through its jungles are few, so air and river travel are usually the only viable options for long distance journeys. In April, 32 people were killed when a U.N. plane crashed as it tried to land at the airport serving Congo's capital Kinshasa. The operator of the plane was Georgian flag carrier Airzena Georgian Airways. According to Hewa Bora's website, the airline has two Boeing 727s, both configured as passenger planes with 137 economy seats and 12 business class seats. They fly purely within Congo. Once the world's best-selling airliner, the Boeing 727 first flew in 1963 and was designed for short- and medium-haul routes. The last aircraft was delivered in 1984.

Airlines are slowly gaining from the global economic recovery - IATA

The International Air Transport Association (IATA) said on Thursday the global economy was recovering more slowly than expected, but was inching upward based on air traffic data, a key barometer of growth. High oil prices, the crisis in the Middle East and Japan's earthquake and tsunami dented growth, but the global economy appeared to be slowly overcoming the effects, said Giovanni Bisignani, director general of the global air industry body.

"From the numbers, the recovery is moving," he told a news conference in Singapore. "It is moving slower than expected because the recovery this year has been affected by many, many different situations (such as) the situation in the Middle East and the situation with the oil price. "What got spoilt in the situation is the price of fuel, because the record (average) price of USD$110 per barrel is not just affecting the profitability of aviation, but it’s affecting the profitability of the entire system."

According to the latest IATA figures, passenger traffic in April grew 11.9 percent year-on-year while freight traffic grew 3.3 percent. But these numbers were distorted because April 2010 was hit by severe air traffic disruptions following the volcanic ash eruption in Iceland. Air freight, which accounts for about one-third of global trade by value, was down 6 percent from a post-recession peak in May last year.

"The speed-up of last year was because you have to build the inventories," Bisignani said. "Once you have rebuilt your inventories, you have to sell your stuff. Now we have slowed down because of that reason." The airline industry itself will remain profitable, but IATA plans to revise its estimates from the latest forecast of USD$8.6 billion and will likely lower that estimate.

"Since (the last forecast), much has happened to make us less optimistic," Bisignani said. "Eliminating all distortions (passenger traffic) is growing at 3-4 percent. Unfortunately, two things are spoiling the party, demand shocks and high jet fuel prices." IATA has 230 member airlines and will hold its annual general meeting in Singapore next week and will announce its latest forecasts at that time.

When the group made the industry-wide profit forecast of USD$8.6 billion in March, it assumed an average oil price of USD$96 per barrel for Brent crude, but the year-to-date average of the oil price now has reached USD$110 per barrel. Load factors, or the amount freight or passenger capacity used, are key to airline profitability. In April, the overall passenger load factor was 77.4 percent, but the freight load factor was only 46.5 percent.

"Maintaining the high load factors needed to support profitable growth will be difficult given the ongoing challenge of matching capacity to volatile demand," Bisignani said. Disrupted supply chains after the Japan earthquake and tsunami disaster, slower growth in China and political unrest in Africa contributed to the slow take-up of freight space, IATA said.

Bisignani said airlines had built up freight capacity last year believing a strong recovery was imminent. "That was slowed down because of the cost of fuel, the Middle East, and all those kind of things. And it takes some time to adjust capacity to the new reality," he said.

Kenyan Airways domestic traffic upbeat

Passengers carried by Kenyan Airways on its domestic routes rose 35 percent during the past holiday season on the back of increased flights and a new route, the airline said on Friday. The carrier, which is 26 percent owned by Air France-KLM, in October estimated it would carry 3 million passengers in the year to March 2011, up from 2.7 million a year earlier. It said cargo hauled would rise to 60,000 tonnes in the same period from 57,700 in 2009. Although the airline's strategy hinges on linking Africa to the world through its Nairobi hub, domestic passengers are an important part of its business. It serves the western city of Kisumu and the coast. Soaring demand for travel to the coastal city of Mombasa by holiday-makers led to an increase in the frequency of daily flights to 10 from seven, rising to 16 flights in the run-up to Christmas, Kenya Airways said. Total domestics flights during the period jumped 84 percent, the airline said in a statement, adding a new service to the resort town of Malindi on the north coast had also contributed to the rise in passengers flown.