Airlines are starting to hedge against the risk that fuel prices could be driven higher by rules targeting another industry’s environmental performance. Brent crude for 2020 rallied in Q3, a period in which spot prices fell, as some carriers began seeking protection against higher fuel costs caused by rules to cut sulphur emissions from ships. The regulations, set out by the International Maritime Organisation, take effect in Jan 2020. The 2020 rules will force the world’s maritime fleet to use fuel containing less sulphur. The requirement to switch has created a widespread expectation that there will be an initial demand surge for diesel-like products. A critical question for airlines is whether oil refineries will cut output of jet fuel as they try meet the surge in buying from shippers. <br/>
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US carriers began charging passengers to check their luggage about a decade ago, as fuel costs surged. Since then airlines started charging for other things, such as seat selection, which once came with the cost of a ticket, along with add-ons like early boarding. Air travellers paid an estimated US$57b in such add-ons last year , nearly triple the sum airlines collected 5 years earlier, according to airline research firm IdeaWorks Company. Airlines are now shifting their focus on how to generate more from the existing fees and products beyond the base fare of a ticket than coming up with brand-new things to charge for, industry members say. Ancillary revenue is key to airlines' bottom lines they struggle with a profit-crimping rise in fuel costs. Ancillary revenue are close to 11% of airlines' revenue, up from about 5% in 2010. <br/>
Embraer’s E190 E2 regional jet has begun a demonstration tour of Europe and the Commonwealth of Independent States. The 15-nation trip will extend through September and follows similar tours of the US and Africa. The first stop on the European tour is in Warsaw, Poland. “With over 45 customers and over 350 aircraft in region, we are already seeing many of these customers interested in this world-beating aircraft,” Embraer VP Martyn Holmes said. The global launch customer for the E2 range of aircraft was Norway’s Widerøe, which took delivery of its first example in April and now has 3 in service. Embraer says the aircraft have so far clocked up close to 2,000 hours in service and have demonstrated more than 99% schedule reliability. <br/>
The US House of Representatives passed bipartisan legislation to ensure only travellers who have undergone required background and security checks are able to use TSA’s Pre-Check screening lanes. The “Pre-Check is Pre-Check Act" passed by a voice vote Sept 5, and would guarantee only travellers who have enrolled in a designated trusted traveller program can use Pre-Check screening lanes at airports nationwide. The law would allow an exception for passengers younger than age 12 or older than 75 traveling on the same itinerary as a trusted traveller program member. Critics of TSA’s handling of the Pre-Check program allege low enrolment and a growing volume of travellers have led the agency to expand its scope to include many low-risk passengers who are not qualified to use the expedited lanes. <br/>
Dubai Airports CE Paul Griffiths believes aviation growth will be constrained unless airports decentralise and take the pain out of passenger processes. “There’s got to be a complete reimagining of what airports really are,” Griffiths said. The old solution of building more airport capacity no longer works, he said, because it is capital-intensive, space-restricted and controversial. “I think we are going to face a situation where the growth of aviation globally is going to be very challenged from the airport side. I am not convinced it is possible to match growth in the air with the growth of physical facilities on the ground,” he said. Griffiths likened the problem to a gas supply pipe. To handle more volume, you either need to make the pipe bigger, or speed up the flow.. <br/>