Tui puts contingency plans in place for Dreamliner

Tui puts contingency plans in place for Dreamliner

By Phil Davies

Tui puts contingency plans in place for DreamlinerTui Travel has no plans to cancel its order for 13 Boeing 787 Dreamliners.

But the travel group is having to make contingency plans in case deliveries are delayed following trouble with batteries on 787s flown by Japan Airlines and All Nippon Airways

Chief executive Peter Long said: “Our view is that this is the right airplane for us and we do not intend to change our order for the aircraft.

“We wait to see that these short-term issues are resolved with the regulatory authorities … but we don’t have visibility around how long that will take.”

He spoke ahead of the US Federal Aviation Administration granting Boeing the go-ahead to carry out 787 test flights.

Tui hopes to introduce the aircraft in May and plans to operate the aircraft on long-haul routes from Manchester, Gatwick, Glasgow and East Midlands to destinations including Florida, Mexico, Barbados, Cuba, Kenya and Thailand.

Long said: “Our priority is running our own programme and we will have to determine whether this is going to happen in May. We are building contingency plans because we have to.”

Regulators around the world grounded the new generation 787 in mid-January after a battery fire in Boston and a second incident involving a battery on a flight in Japan.

The FAA said the test flights will help collect data about battery performance “while the aircraft is airborne”.

A Boeing spokesman said the information will “support the continuing investigations into the cause of the recent 787 battery incidents”.

“We are confident that the 787 is safe to operate for this flight test activity,” he added.

The FAA said it had asked Boeing to conduct extensive pre-flight testing and inspections and that the flights would be conducted “in defined airspace over unpopulated areas”.

But the US National Transportation Safety Board said tests carried out by Boeing on Dreamliner batteries, when they were first certified, missed the high risk of fire.

The tests underestimated the frequency of “smoke events” in the lithium ion batteries.

NTSB chairman Deborah Hersman said that Boeing’s safety checks suggested that a smoke event would occur less than once every 10 million flight hours.

However, 787s have only clocked up 100,000 hours of flight-time since entering commercial services, and have experienced two battery fires.

Hersman said that “the failure rate was higher than predicted as part of the certification process and the possibility that a short circuit in a single cell could propagate to adjacent cells and result in smoke and fire must be reconsidered”.

Tui reduces losses and grows share in Q1

Tui reduces losses and grows share in Q1

By Phil Davies

Tui reduces losses and grows share in Q1Tui Travel’s underlying operating loss was cut by 15% in the three months to December as the group’s ‘unique’ holidays continue to drive increases in UK market share.The operating loss reduced by £16 million to £93 million to give an underlying first quarter operating loss of £116 million.Issuing first quarter results for the period ending December 31, Tui Travel reported “significant” continued growth in UK cumulative market share with summer 2013 up 4% and the key January booking period up 2%, gaining on the 7% increase in the same period last year.

Unique holiday bookings in the UK, Nordics and Germany increased by 15%, 10% and 6% year-on-year respectively for summer 2013.

Direct distribution sales in the UK for summer 2013 grew to 90% from 89% with online sales accounting for 37%, up by 1% over the same period a year earlier.

Tui claims its accommodation wholesaler business “continues to build a global leadership position” with total transaction value up by 9% for this summer, driven by Latin America and Asia where TTV is up by 23%.

The group reported strong current trading with winter 2012/13 83% sold with higher margins and average selling prices in key source markets.

Summer 2013 bookings in the UK and Nordics are up 9% and 10% respectively with margins ahead of the prior year in key source markets.

Chief executive Peter Long said: “We are pleased to report that our strong trading momentum has continued with particularly encouraging growth in the UK and Nordics.

“Our leading position in the UK has further benefited from increased market share as a result of higher demand for our unique holidays. Across all our key markets demand for the overseas holiday remains strong, despite the overall economic environment.

“We are confident that our customer focused strategy is driving performance and based on current trading we expect to be towards the top end of our roadmap guidance of 7 to 10% underlying operating profit growth for the 2013 financial year.”

Tui said: “Positive trading momentum continues for summer, with a third of mainstream summer holidays sold to date.

“Customer demand for our unique holidays has allowed us to increase capacity in the UK, Nordics and Germany. In the UK we have again increased our market share year on year as a result of increased demand for our unique holidays.”

Tui Travel will issue a pre-close trading update on March 27.

Boeing vows to continue production of Dreamliner

Boeing vows to continue production of Dreamliner

By Ian Taylor

 

Boeing vows to continue production of DreamlinerBoeing intends to deliver more than 60 Dreamliners to airlines this year despite the aircraft being grounded since mid-January by the US Federal Aviation Administration (FAA).

That may offer little comfort to Thomson Airways as it awaits delivery of its first 787 next month.

The FAA grounded the aircraft following a fire on a Japan Airlines 787 at Boston and an emergency landing by an All Nippon Airways (ANA) 787 in Japan.

Boeing has suspended deliveries while investigations proceed in the US and Japan, focused on the lithium-ion batteries used as part of the 787’s power system.

However, Boeing chairman and chief executive Jim McNerney said yesterday: “Production of the 787 continues as planned. We remain confident in the integrity of the programme and the safety of the aircraft.”

He told analysts: “We will get to the bottom of this and restore confidence.”

McNerney was speaking as Boeing presented full year results and guidance for 2013, with the company reporting 2012 was its second-best year ever for orders and deliveries.

However, he did so as the two Japanese carriers involved revealed they had repeatedly changed the 787 batteries which are the focus of investigation.

ANA said it had changed the batteries 10 times because of problems in advance of the emergency landing this month.

McNerney refused to comment on speculation the aircraft could be grounded for an extended period as investigators have so far failed to identify the cause of the problem.

He said: “We can’t predict the outcome. We are making progress. We have every expert in the world looking at this issue. Our plan is to continue production of the 787.

“I can’t talk about particulars of the investigation. But I am confident we will identify the root cause of these incidents. When we have the answer we will act on it.”

Thomson Airways, part of Tui Travel, is awaiting news of the investigation with special interest. It is set to be the first UK airline to operate the 787 and was due to take delivery of its first Dreamliner in late February.

Boeing declined to comment on deliveries to specific customers, but a February delivery appears highly unlikely.

McNerney said: “We are limited in what we can say. We deeply regret the impact on customers.”

Thomson has also declined to comment on the delivery date until it receives notification of any changes from Boeing.

However, McNerney revealed Boeing plans to increase production of the 787 from the current five a month to seven a month by mid-2013 and to 10 a month by the end of the year.