Airlines India, Indian Airlines

Delta AirElite Business Jets has joined with Bombardier Inc. to offer more flexibility for customers booking trips.

The Flexjet 25 jet card allows members of the Flexjet Membership program to charter jets without a long-term commitment or capital investment, Delta AirElite said in a news release.

Under the Flexjet program, members can request specific aircraft which are part of Bombardier’s dedicated Flexjet fleet. With the Flexjet 25 card, they can schedule blocks of time and days on Learjet 45, Learjet 60 or Challenger 604 aircraft.

Cincinnati-based Delta AirElite provides aircraft charter and aircraft management services. It is a subsidiary of Atlanta-based Delta Air Lines (Pink Sheets: DALRQ). Delta Air Lines is the largest carrier flying out of Dayton International Airport.

Air China, the country’s largest overseas carrier, said Monday that it would cut the size of its domestic share sale by about 40 percent after demand from investors failed to meet expectations.

Air China will sell as many as 1.64 billion shares at about 2.80 yuan each to raise 4.5 billion yuan, or $563 million, the company said in a statement to the Shanghai stock exchange. The carrier, which is based in Beijing, said last week that it hoped to sell 2.7 billion shares.

Air China raised about $1.2 billion in 2004 by selling 3.2 billion shares in Hong Kong.

“Air China should set its domestic share sale at a greater discount to Hong Kong shares,” said Charlie Chen, head of portfolio management at Fortis in Shanghai. “The airline industry has little growth potential, as competition will heat up and the jet fuel price keeps rising.”

Losses among Chinese carriers, including Air China, widened by 23 percent to 430 million yuan in the second quarter because of rising fuel costs and constraints against raising fares, adding routes and hedging costs. Initial public offers are also losing their appeal to investors: The premium from trading debuts narrowed to 12 percent for Daqin Railway last Tuesday, compared with a fourfold increase by China CAMC Engineering in June.

“The offer price is too expensive, leaving little room for any gains for investors,” said Li Haipeng, who does not own airline shares among the assets he manages at China Southern Fund Management in Shenzhen. “Air China is not a growth stock, and it’s certainly not a top pick for us.”

Air China said last week that it planned to raise as much as 7.97 billion yuan with the sale of 2.7 billion shares to finance aircraft purchases. It plans to buy 25 planes from Boeing and 20 Airbus A330-200s. The carrier set a price range of 2.75 yuan to 2.95 yuan for the share sale, according to its previous statement.

An Air China official said

that the carrier would announce details of the share sale in two days.

Losses in the airline industry widened as the price of jet fuel rose 13 percent in the first half to 5,480 yuan per metric ton, compared with 4,836 yuan last year. Jet fuel, the biggest expense for Asia’s airlines, made up 39 percent of Air China’s 2005 operating costs, compared with 33.4 percent in 2004, the carrier said in its share sale document.

Japan Airlines reduces loss

Japan Airlines, the largest Asian carrier by sales, narrowed its first-quarter loss by 30 percent, it reported Monday, after increasing surcharges and cutting wages in response to a surge in the price of jet fuel.

The loss totaled ¥26.8 billion, or $234 million, in the three months that ended June 30, compared with a loss of ¥38.4 billion, or ¥19.38 a share, in the same period last year, the company, which is based in Tokyo, said in a statement. Sales rose 3.7 percent to ¥522.2 billion.

The company’s president, Haruka Nishimatsu, who took his job June 28, is trying to regain profitability this fiscal year by cutting wages and passing on increased fuel costs to passengers. In addition to record fuel prices, JAL has suffered from safety problems that have prompted customers to defect to All Nippon Airways.

British Airways in Singapore has launched its Early Bird Offer with return flights to London from just Sin$898 return, or flights to some of the best cities in Europe from just S$998. With over 30 cities available, from Munich to Madrid, British Airways has added a free stopover in London. Customers can also book their hotel accommodation starting from Sin$79 per night and car-hire starting from as little as Sin$50 per day on ba.com.

Rob McDonald, regional marketing manager for British Airways South East Asia said, “British Airways is rewarding travellers who plan early by giving them the most competitive fares to London and Europe for their year-end holidays. The year-round fare for London is already Sin$998, the lowest in town for a direct flight to London, but we have gone one step further with a Sin$898 fare to London. Travellers can also combine a trip to London with a visit to some of the most popular European cities such as Barcelona and Paris from just Sin$998 return.”

The Early Bird Offer is valid for departures from Singapore between 4 October and 11 November 2006 and bookings must be made by 31 August 2006.

Centre for Asia Pacific Aviation predicts the LCC market share in India will reach 70% by 2010, making it one of the world’s leading LCC markets in terms of total market penetration. Given the growth potential of the market and penetration levels already achieved by LCCs, the Centre predicts that within the next five years, India could see the establishment of a home-grown LCC with the size and scale approaching that of easyJet or Ryanair today.

The prediction comes as the Centre prepares to hold its third annual India and Middle East LCC Symposium in Mumbai on 29/30 September 2006.

“The launch of IndiGo in the past few days will keep the market growing strongly in the months ahead”, stated the Centre’s CEO Indian Subcontinent & Middle East, Kapil Kaul.

“Full service carriers are, on average, bleeding a remarkable 1.5 percentage points of market share every month to LCCs. We do not expect this rate to slow in the short term, given the profile of current fleet orders. LCCs could therefore control over 35% of the domestic market by the end of 2006 and pass 50% some time in 2H07. The Indian domestic market has been growing at almost 50% so far this year. The emerging untapped leisure/VFR sector will drive the domestic market to more than double over the next five years (growing at 25% annually) to around 60 million passengers by 2010 – and LCCs will gobble up most of the new traffic growth”, said Mr Kaul.

“But high fuel costs, low yields and congested airport infrastructure pose major risks to the sector going forward and have the potential to place a major strain on airline finances. While we are not predicting a bloodbath, airlines will need to be careful with capacity and ensure they are well funded”, concluded Mr Kaul.

The Symposium will cover issues including international and domestic market prospects, as well as the potential viability of long-haul low cost models serving the Indian Subcontinent region.

ICICI Lombard General Insurance, a leading private sector general insurance company, today said it has tied up with Air India to offer special discounts to students traveling abroad for higher education.

This tie-up would enable students having a valid ticket of Air India to avail of the university compliant Student Medical Insurance at a special discount.

“Close to 1.2 lakh students travel to foreign universities each year, of which sixty per cent of the students travel to the US. Of these, only nine per cent avail of medical insurance,” ICICI Lombard General Insurance Head (Travel and Worksite) Sudhir Menon said.

He said though medical insurance is now made mandatory by universities abroad, most students are usually unaware of comparable medical insurance offered in India at a relatively lower cost, offering higher benefits.

ICICI Lombard issues students a medical insurance cover keeping in mind the specific requirements of individual universities at considerably lower cost and cover medical treatment, medical aid and therapies, he said.

The policy covers the student from India; to the time he comes back home thus offering a worldwide coverage. The policy also offers cashless hospitalisation services worldwide.

In addition to the medical coverage, it also offers non-medical covers like passport loss, baggage loss, personal accident cover, bail bond, compassionate visit, sponsor protection, study interruption and personal liability.

The policy is extendable to the second year, and thus covers the student for the entire period of study.