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Open Skies
- confusing anywhere, last updated 2019 For main airlines’ development see the chapter Air Traffic ‘Open Skies’ pushed forward the airline industry in an unprecedented way. Of course the idea had come from democratic USA. The Chicago Conference in late 1944 has laid the foundation for the International Civil Aviation Organization, the I.C.O.A. Historian R.E.G. Davies listed (in ‘Airlines of the Jet Age’) “The Five Freedoms of the Air” for airlines – to overfly a foreign country, to provide service to and from a foreign country and, on a continuing flight, service between two foreign countries. Airlines founded in 1945 additionally its independent International Air Transport Association, the IATA. Airlines in the United States have always been private enterprises. In 1994 the U.S. Government had rejected the idea of an official “All American Flag Line”. Davies reported: “Then the Americans (…), tried to obtain world agreement on the principle of Fifth Freedom Rights, that is the right of any airline to carry traffic between any two other foreign countries. Naturally enough, the other airlines of the world refused”. Bilateral agreements between governments and airlines were the rule for international traffic. Outside America, the big carriers were state-owned for many years, apart from some famous exceptions such as KLM, SAS or JAL. Remarkably late the privatization attempts of some flag carriers started: In 1987 British Airways, 1988 Aeromexico, 1989 Aerolineas Argentinas, Air Canada, Air New Zealand, 1991 TAP, 1994 Aeroflot, 1996 Kenya Airways as the first in Africa, 1997 Lufthansa, 1999 Air France, South African, 2000 Iberia, 2003 El Al, Thai Airways International, 2004 Air China and in 2009 Alitalia and Saudi Arabian Airlines. But not all the initiatives were successful – and in the new century some ones among these airlines were still state-owned.
North America and North Atlantic Fixed ticket prices always were an obstacle to air traffic’s growth. Even in the United States the fares had been strictly regulated by the Civil Aeronautics Authority (CAA) and the Civil Aeronautics Board (CAB). The Air Transport Association was criticized as a “lobbying group” and The International Air Transport Association (IATA), as a “rate-fixing organization”. In the USA the fixed tariffs led to another way of competition by operating at uneconomic high speeds or by offering ridiculous gimmicks, such as a piano bar aboard an aircraft. It was president Carter’s new liberal policy, which opened up the skies. In October 1978 the president signed the Airline Deregulation Act. Airlines could choose routes and set fares, rather than the CAB, which went out of action in 1984. ‘Deregulation Knockouts’ by Tom W. Norwood listed no less than 89 airlines of the USA having ended between 1978 and 1989. Remarkable for appearance in Europe were Air National, National Airlines (successor of ONA, in 1980 integrated into Pan American), Transamerica (the successor of TIA and Saturn) and Metro International, in 1983 changing into Tower Air, in 2000 insolvent. The CRAF (Civil Reserve Air Fleet) has proven being an obstacle to ‘Open Skies’. Civil aircraft may be used by CRAF for military transport activities. Employing foreign aircraft was opposed, nevertheless during ‘Desert Storm’ also KLM and Martinair planes were used, and CRAF was no longer a convincing argument against foreign-owned airlines to be based in the USA. Finally, in 2007 Virgin America received its operating license, being owned by the Virgin Group only with a 25% share. According to IATA president Giovanni Bisignani, between 2001 and 2003 the industry global suffered around 30 billion dollar losses. In America, the worst net-losses in 2001 had employee-owned United Airlines, loosing more than $2 billion, followed by US Airways, American, Delta, Alitalia and Air Canada. Prominent enterprises of the USA have gone through a phase of ‘Chapter 11’ insolvency protection. “In 2006 over half the industry’s seating capacity was on airlines that were in Chapter 11”, was a statement via Wikipedia, continuing: “These airlines were able to stop making debt payments, break their previously agreed labor union contracts, freeing up cash to expand routes or weather a price war against competitors – all with the bankruptcy court’s approval.” For United Airlines, having filed in 2002, a total pre-filing asset of $25 billion and an asset adjusted to 2012 of $33 billion was reported - moderate compared to Lehman Brothers Holdings’ pre-filing asset of $639 billion in 2008, according to that report. Arrangements between the four largest airlines within the USA concerning the capacity have come on the agenda of the U.S. Justice Department. Around 2018 the Scope Clauses limited transfer of full-size aircraft to regional subsidiaries. Canada had privatized its state carrier Air Canada already in 1989. In 1995 an open-skies agreement was signed between Canada and the USA. The new age had spread also to Mexico, where flag carrier Aeromexico was privatized in 1988. The most important intercontinental route was always the North Atlantic – a symbol of the commercial ties between the USA and Europe. Started with World War II, the North Atlantic route was entered in the 1940s and 50s by leading carriers also of Europe. In independent Iceland, pilots have started Loftleidir in 1944. Following an initiative of the country’s president Eliasson, it opened a New York service at cheap fares in 1948. In 1953 Braathens of Norway entered cooperation, with fares cheaper than IATA’s tourist class. Once Loftleidir had a subsidiary International Air Bahamas, and Islandsflug operated for Air Guadeloupe. In 1979 Loftleidir was integrated into flag carrier Icelandair. New activities arose. In 2019 Icelandair expanded after the Wow Air insolvency. And (according to LJ) Cabo Verde Airlines, 50% owned by Loftleidir, connected Brazil and intended Washington flights with the B.757. In Germany, the TUI predecessor Touropa had engaged Atlantis for North Atlantic charter flights, but in 1973 Atlantis was ‘killed’ by authorities. North Atlantic routes from Eastern Europe to the USA were opened after the collapse of the Soviet Union in 1991. Pan American had some cooperation with LOT of Poland. After restructured Olympic Air of Greece has given up North Atlantic flights, around 2011 ‘Jumbos’ reappeared with regular Athens – New York services by Air Universal of Jordan, which had created Hellenic Imperial Airways, thus circumventing an EU ban, but soon the planes were parked. In 2015 appeared SkyGreece Airlines, founded by Greek Canadians for North Atlantic services, and after a few months it disappeared. As any foreign carrier was refused the right to fly within the USA, KLM gave up its 20% stake in Northwest. In 2003 officials close to EU’s transport commissioner Ms Loyola de Palacio tackled also ownership restrictions, which limited foreign ownership to 25% in the USA and 49% in the EU. In 2007 the Express (March23) could report: “The European Union approved an aviation deal with the U.S. that opens up restricted trans-Atlantic routes to new rivals … The ‘Open Skies’ deal will allow airlines to fly from anywhere in the EU to any point in the U.S. …”. Still two weeks before, Financial Times (March06) had informed that “British Airways and Virgin Atlantic (…) joined forces yesterday in a last-ditch effort to try to block the proposed treaty…” British Airways had announced a subsidiary OpenSkies to start trans-Atlantic flights from Amsterdam, Frankfurt and Milan in competition to European carriers. On the other hand, Lufthansa participated in low fare carrier JetBlue, operating domestic flights from New York JFK, but in 2012 Lufthansa offered to get rid of its 16% share. In 2019 JetBlue announced its own North Atlantic flights for 2021. The decade-long dream of a Baltia Airlines, flying from the USA to St. Petersburg, has not ended in 2016 when its initiator Igor Dmitrowsky died.
Europe European governments had not immediately followed Jimmy Carter’s “Open Skies” politics. Fares were regulated by bilateral government agreements and before the Open Sky agreement was signed, Europeans had to pay higher fares than Americans on transatlantic flights. For the national icons, mainly British Airways, Air France, Lufthansa, Alitalia, Iberia, TAP, see the chapter Air Traffic/ Mega groups. British Airways has replaced in 1971 loss-making BOAC and BEA, and in 1984 Margaret Thatcher has ceased British Airways to be a national corporation. Staff numbers had to be reduced by about 15,000, almost one-third of the work-force. In Austria the start of Montana by Captain J. Stoeckl in 1976 was remarkable, serving New York and ending in 1981. A private initiative for regular flights in Germany was German Wings of 1986, bankrupt in 1990. The most remarkable private initiative had been the start of Olympic Airways of Greece in 1957 by famous shipowner Onassis. After his son has died by an accident in 1973, the father gave it away to the Greek state. Overstaffed by nepotism (as the Chamber of Commerce chairman confirmed it), it had to be saved, but there were EU arguments against subsidies. “In 2003 Olympic Airways was dissolved in favor of a fusion with (daughter) Macedonian Airlines and Olympic Aviation. The trick was that Macedonian before had been renamed into Olympic Airlines” (so reported by B.I. Hengi). And Olympic Air shrank into a regional carrier. In late 2013 Aegean Airlines (officially started in 1999) became the new private owner. In Cyprus, flag carrier Cyprus Airways had started in 1948 with assistance by BEA and was stopped in 2015. Immediately low-fare Blue Air of Romania connected Athens with the Republic of Cyprus, once a paradise for Russian tax evaders. In 2016 Cobalt Air of Cyprus started with Chinese investment, it dreamt of routes to the USA, Asia and Africa, and in Oct 2018 it was stopped (according to Carsten Hoeppner). This LJ report mentioned that the label Cyprus Airways was acquired via a “Charlie Airlines” with A319s of S7 from Russia. In 2018 Cyprus Airways appeared, taking over the important route Athens - Larnaca. In Malta, another once-British outpost, the state started Air Malta in 1974. In Portugal an attempt towards privatization of TAP was reported in 2015 – see the chapter Mega Groups. Deregulation has become official with creation of the EU in 1993. Financial Times (Sept30, 2003) has written: “The European Commission starts a global campaign aimed at persuading foreign governments to accept a European Union nationality clause” – but the EU was not a state.
In Eastern Europe the economy was paralyzed by communism and airlines had to use uneconomic Soviet-built planes. In the Soviets’ German “DDR”, preparations for foundation of a new Deutsche Lufthansa were started in May 1954, in 1955 published by minister of the interior Willi Stoph (according to J. Michels, J. Werner: Luftfahrt Ost). It started its first flight with the IL-14P in September 1955 from Berlin-Schoenefeld, months after its western rival Deutsche Lufthansa AG had its start at Hamburg. It changed into Interflug in 1963. “Before this change, international routes to the west were operated by a subsidiary (of 1960), called Interflug GmbH …” (Observer’s Airlines Directory). In 1957 the “Six Pool” between Euope’s eastern airlines was signed, in 1965 followed by an agreement of Interflug, LOT of Poland, CSA of Czechoslovakia, Malev of Hungary, Tarom of Romania and TABSO of Bulgaria with Aeroflot and Mongolia (according to Davies). In 1968 Interflug got the Tu-134 jet and in 1970 the IL-62, of course to connect Castro’s Havana and Ho Chi Minh’s Hanoi. In 1989 Interflug took the Airbus A310, LOT got the B.767 and Malev the B.737. Only Tarom had dared already in 1973 to use the Boeing 707. After opening the border, Lufthansa concluded a takeover of Interflug in 1990, but a monopolies commission interdicted it. British Airways’ attempt to acquire the remains of Interflug was rumored. After Interflug ended in 1991, a Berline tried to take up some remains, but banks refused credits and it collapsed in 1994.
With the end of the Soviet Union in late 1991, the Baltic states had separated. Estonian Air started in 1991 and was stopped in Nov 2015, after the EU had discovered illegal subsidies. Immediately Nordic Aviation took over flights, starting Nordica in 2016, 46% taken over by LOT. And in 2017 LOT reserved the title MaLOT for entering Hungary. Latvian Airlines started in 1991 with CCCP-registered Tupolevs. Baltic International, under foreign participation founded in 1992, was united with Latvian in 1995 as Air Baltic, temporarily entered by SAS, renationalized in 2011 (information by B.I. Hengi). Lithuanian Airlines started in 1991 with CCCP-Tupolevs. Changed to Boeings, it was privatized in 2005 with the FlyLAL Group, in 2010 restructured as Small Planet Airlines, then starting adventurous subsidiaries and insolvency procedures were reported in 2018 (by LJ). Smart Lynx of Latvia even dared a Russian daughter WeGo Air. In Poland on the touristic sector, Enter Air started after the end of Central Wings in 2009. In Hungary the re-nationalized Malev was stopped in 2012 and then Arabian investors targeted to start a Solyom Hungarian Airlines, in vain. So the EuroCity train Munich – Budapest had some longer life. For Wizz Air, registered with Hungary, see the chapter Low-Cost Pioneers. LOT, Tarom and CSA have remained more or less in state ownership. After the break-up of Czechoslovakia, CSA Ceskoslovenske Statni Aerolinie adopted the name CSA Czech Airlines in 1955. But then Travel Service, emerged out of government’s SLU, entered CSA, in 2013 Korean Airlines participated with 44% in CSA and in 2017 Travel Service took almost 100%. Smartwings of the Czech Republic started multi-national subsidiaries. Air Slovakia of 1993, then Slovenske Aerolinie of 1998, ended. Yugoslavia was communist, but independent and flag carrier JAT used exclusively the ‘western’ B.707, B.727, DC-9, DC-10 and even the B.747. Yugoslavia was split up with civil war in 1991-92, compare the chapter The Flight/ Conflicts. The new states were marked by existing Adria Airways of Slovenia, Croatia Airlines of 1991 and Air Bosna of 1994. After insolvency it restarted in 2005 as B&H Airlines, temporarily rescued by Turkish Airlines, stopped in 2015, in 2019 succeeded by Fly Bosnia. Montenegro Airlines started in 1997 (“frozen accounts” have been reported in 2016) and Macedonian Airlines existed from 1994 to 2009. In 2019 the state changed name into North Macedonia. JAT, the flag carrier of former Yugoslavia, hoped in 2010 for rescue by Turkish Airlines, in vain. In 2013 Etihad entered with a 49% share and in 2014 JAT was renamed Air Serbia. When in 2019 Sukhoi Superjets were transferred from Italy to Serbia after Putin’s state visit there, mysterious rumors emerged. The proposal of an EU-sponsored pan-Balkan airline was forgotten long ago. After Balkan Airlines of Bulgaria ended in 2001, Bulgaria Air started in 2002, in 2006 saved by the Balkan Hemus Group. An additional Air Via started in 1990. For Albania under ultra-communist Enver Hoxha, no airline had been listed. An Albanian Airlines of 1995 was helped by the Kuwaiti Kharafi Group, but it ended. In the 21st century emerged Belle Air, operating from 2006 until 2013. In 2018 a new Air Albania appeared with a Turkish Airlines A319, then parked.
Russia In the Soviet Union, Stalin had abolished in 1928 a sort of liberal trade, air traffic came under control of a chief directorate and in 1932 the official label Aeroflot was adapted. In 1989 the Soviet Union with its strangled market suffered its final economic collapse. In Russia and in the independent CIS countries, 34 Aeroflot successors were listed (by R.E.G. Davies). In 1994 a share of 49% in Aeroflot was given away to employees (according to the World Airlines Directory), 51% owned by the government. From the Russian Federation during the early ‘90s the existence of roughly 400 airlines, big and small, was reported, considered doubtful if they really operated. For the steadily expanding Aeroflot and Rossiya mainly under president Putin see the chapter Mega Groups. After the end of the Soviet Union, all the existing 109 international air service treaties were reserved by the Russian Federation (Die Zeit, Sep11, 1992). Foreign airlines were forced to pay high fees for using Siberian routes (KLM reportedly paid $1.2 million annually). For the EU “the estimated 250 million euro in Siberian overflight charges controversially paid to Aeroflot” (Flight Intl, March29, 2005) became an issue. In 2006, Oct25, Oasis Hong Kong Airlines’ inaugural B.747 flight Hong Kong – London had to be canceled in the last minute, for a permission was not given. Why? Still under Gorbachev two new airlines have prepared to start in 1990, Transaero and Volga-Dnepr, the latter specializing mainly in cargo. Then the joint-stock company Transaero started in 1991 and it became Russia’s second-largest airline. In 1997 it acquired a 30% share in RiAir, founded in 1992 as Riga Airlines in Latvia, which disappeared in 1999. In late 2015 came the shocking news that Transaero went bankrupt. LJ (Jan 2016) reported that among the surprising 4 orders for the A380, three were transferred to an Air Accord of Latin America, assuming that they had to be financed by Russian banks or their foreign branches – “possibly in Panama?” Vnukovo Airlines, established in 1993 out of an Aeroflot division, was taken over by Sibir, an Aeroflot West Siberian CAD, started in 1992 to become number two in Russia and around the turn of the century number 106 global. It has swallowed Baikal Airlines and in 2001 Vnukovo Airlines, ranging among the largest. In 2002 Sibir participated in Armavia of Armenia, for two years only. In 2006 it changed name into S7 Airlines and then it ordered the B.787, like also Aeroflot. Kras Air had emerged in 1993 out of Aeroflot’s Krasnoyarsk CADs, privatized becoming a main carrier. Also Tyumenaviatrans was an Aeroflot heir, becoming UTair in 2002, listed (by R.E.G. Davies) among Russia’s ‘Big Six’, comprising Transaero, Sibir, Domodedovo, Kras Air, UTair, Pulkovo and later also charter carrier Azur Air, later also with a foothold in Ukraine (according to LJ). Kras Air under Boris Abramovich, Domodedovo Airlines and Omskavia had formed the AirBridge marketing group. Entered by investors from Hungary, they tried in vain to save its Malev. A marketing alliance AiRUnion was reported in 2008, consisting of Kras Air, Domodedovo Airlines, Samara Airlines, Omskavia and Sibaviatrans, the main share being held by a state-owned holding. In 2010 Flight Intl reported liquidation of Sibaviatrans as the last among the partners of the failed AiRUnion. Ural Airlines, founded in Dec 1993 out of an Aeroflot’s CAD, showed modern ambitions. A different matter was Atlant-Soyuz of Moscow. After Moscow’s lord mayor Lushkov had to retreat, it changed name to Moscow Airlines and after bankruptcy in 2011 its remains were taken over by UTair. Another initiative was Red Wings, the former Avialinii 400, in 2007 bought by the National Reserve Corp. (NRC) of Alexander Lebedev. In 2013 LJ has reported that Red Wings was temporarily stopped, whereupon Lebedev was “raging against the Kremlin.” In 2017 the intention of a fusion with Nordavia was reported, which then became SmartAvia, but sister Red Wings remained red.  Transaero, B.777, Salzburg 2015 (WS)
Russia’s Neighbors All over the CIS, most of Aeroflot’s airplanes “were appropriated in classic Russian style by anyone in a position to take them” (so reported by Air&Space, August 1994). In the CIS countries, 11 flag carriers were listed (by Davies) being an Aeroflot heritage. Ukraine government has named it Air Ukraine, in 2002 dissolved. In 1992 the government had founded Air Ukraine International, leasing Boeings, renamed Ukraine International Airlines in 1995. In 1996 Austrian Airlines and Swissair had entered Ukraine International, but in 2010 the last shares by Austrian were sold and in the same moment landing at Dnepropetrovsk was forbidden, as LJ reported: “… unofficially as an oligarch connected to Dniproavia wanted to buy the share.” It was reported that privatized Dniproavia, AeroSvit, Donbassaero and Windrose were more or less connected with the Ukrainean Aviation Group of Igor Kolomoysky, who was close to president Yulia Tymoshenko, ousted in 2011. AeroSvit was stopped, but Windrose could have been watched at Dubai in 2015. UTair of Russia has started in 2009 even a subsidiary UTair-Ukraine. Ukraine International Airlines continued international services, but banned by Russia, it reduced the fleet. For the troubles in Ukraine compare the chapter The Flight/ Conflicts. Belarus maintained its state-owned Aeroflot-successor Belair as Belavia. Air Moldova has been taken back by the government of Moldova in 2002. Privatization was reported and in 2018 Blue Air of Romania took a 49% share. State-owned Air Georgia, successor of ORBI of 1992, was in 1999 merged with Airzena, in 2004 it became Georgian Airlines, privately-owned, then listed as Airzena and in 2017 Georgian Airways appeared, still with some Air Zena labels. Armenian International Airways was followed by Armavia, then Air Armenia. In Kazakhstan the government lost patience with its Air Kazakhstan, successor of Kazakhstan Airlines, closed it in 2004 and transferred its services to Air Astana, owned by BAE Systems and a Sovereign Wealth Fund. The capital Astana was renamed Nursultan in honor of the long-term ruler. Kyrgisztan Airlines was (in 2010) still 81% government-owned, then reported as Altyn Air, then as Kyrgisztan, but in 2015 it was not listed by Hengi. Fully state-owned were still around 2010 Azerbaijan Airlines, Turkmenistan Airlines, Tajik Air of Tajikistan and Uzbekistan Airways.
Asia and Pacific More and more, IATA’s fare regulations were erased. R.E.G. Davies pointed out the advantage of Japan’s second main carrier behind Japan Airlines, the All Nippon Airways (ANA), created in 1950, initially being not an IATA member. China had been united under Mao Zedong, but for decades it suffered under stagnation. Under Deng Xiaoping, economic reforms had been initiated. In 1988 the state carrier CAAC (Civil Aviation Administration of China) was split up tentatively. For the emerging giants Air China, China Southern, China Eastern Airlines and also for the Hainan group see the chapter Air Traffic/ Mega Groups. A private initiative was the start of Juneyao Airlines in 2006, its roots going back to the first charter activities by Wang Yunyao and Wang Junjin in 1991. A route to Helsinki was announced in 2018 with the B.787-9. For Asia outside China, mainly for split-up Korea, for the troubled countries around Vietnam and for Indonesia see the chapter The Flight/ Conflicts. In 2019 (according to LJ) Eastar Jet of South Korea founded Thai Eastar Jet. An early example of opening up the skies in Asia and the Pacific region had been the pooling of BOAC, Air India and Qantas flights with Fifth Freedom Rights in 1960. With the new liberal policy under Manmohan Singh, India opened up the skies. His politics stimulated entrepreneur Naresh Goyal to start Jet Airways in 1993, then swallowing Air Sahara in 2007. Jet Airways was described as India’s biggest international airline, 24% owned by Etihad - for its fate see the chapter Mega Groups. A spectacular setback has been the collapse of Kingfisher Airlines in 2012, created by the heir of United Breweries in 2005, placing orders even for the A380. Vistara was described (in 2018) as a joint venture between India’s powerful Tata group and Singapore Airlines. Low-cost pioneer IndiGo was started in 2006 by InterGlobe Enterprises. State-owned flag carrier Air India has been proclaimed to be subsidized further on. Nevertheless India and other nations in Asia and on the Pacific Rim have opened up the skies, also with newcomers going international – see the chapter Air Traffic/ Low-Cost Pioneers. The Virgin Group of the UK got famous not only with Virgin Atlantic Airways, but also with participation in Virgin Blue Airlines of Australia and its subsidiaries. Astonishing became the success of the AirAsia and Jetstar groups.
Mideast and Maghreb The United Arab Emirates opened up the skies in an unprecedented way – see the chapter Mega Groups. Not only Emirates and Etihad conquered international routes, but also other airlines tried it. The first foreign company to get domestic traffic rights in Saudi Arabia had been Qatar Airways, permitted to place there a fleet under the label Al Maha Airlines. Gulf News (March17, 2015) reported that the US’ largest airlines Delta, United and American “are calling on the US government to change its open skies agreement with the UAE and Qatar over the alleged subsidies”, reminding that the three Gulf carriers are huge costumers for Boeing, purchasing 477 long-haul aircraft over the period they are alleged to have taken over $40 billion in state subsidies.” For Mideast problems compare the chapter The Flight/ Conflicts. For important EgyptAir or Egyptair see the chapter Air Traffic. Libya is a matter of conflicts. Royal Air Maroc has started in 1957 when the kingdom took over the majority from steamship enterprise ‘French Line’. Air Algerie emerged in 1953 out of CAT of Air France and ‘French Line’ (according to Jane’s). Tunis Air started in 1949, founded by Air France. South Atlantic – South America Around 1980, when there was an early fare war on the North Atlantic, the South Atlantic stayed “sober”. It meant that tariffs were prohibitive. In 1993 American and United Airlines started an offensive, but only Avensa answered immediately with cheap flights from Colombia to Miami. Argentines had to pay higher fares for flights to Europe than Europeans flying to Argentina, and the end of many among the South American state carriers is well known. Cubana, nationalized in 1959 under Fidel Castro, Conviasa of Venezuela, established in 2004 by President Chavez, renationalized Aerolineas Argentinas and a new Boliviana continued the tradition of loss-making state carriers at least for a while. But when Venezuela tumbled into hyper inflation, 80% of Conviasa’s pilots quit the job, as Wikipedia reported it in 2016. For the amalgamations in Latin America, leading to Avianca-TACA and LATAM, see the chapter Air Traffic/ Mega Groups.
Africa Colonial powers have built up common flag carriers: East African, West African and Central African Airways by the British and Air Afrique by the French – see the chapter Air Traffic. Concerning Africa, the Economic Commission (ECA) of the United Nations distributed already in 1978 a “Global Strategy” proposal, stating that the real part of air traffic must be seen in a “common carrier service”, not a luxury transport, essential to development. Even at the turn of the century however, national protectionism and bi-lateral frameworks hampered that prospect. In 2004 the Airline Association of Southern Africa asked for a liberal economic policy to be adopted by the South African Development Community, the Common Market for Eastern and Southern Africa and the Economic Community of West African States. An Air Cemac was proposed as a multi-national carrier of Chad, Cameroon, Central African Republic, Gabon, Congo and Equatorial Guinea, but in 2006 the progress stagnated. Kenya Airways was described being the first partially privatized African flag carrier. Privatization process had started in 1996, with KLM as a 26% shareholder. At the meeting of the African Airlines Association (AFRAA) in 2004, deregulation was demanded, but also a good outlook was given: “Airbus predicts that the intra-regional growth will increase by 4.4% per annum over the next 20 years” (Namibia Economist, Feb27, 2004). And courageous private initiatives emerged, e.g. by low-cost pioneer Stelios Haji-Ioannou or by the Aga Khan Fund, which in 2001 took over the majority share in Air Burkina, in 2006 helped to start the Cie. Aerienne du Mali or in 2007 by trying a new Air Uganda after bankruptcy in 2001. In 2016 Financial Times (July08) could inform: “East Africa’s skies are set to become busier after Uganda floated plans to revive its national airline, and carriers in Tanzania and Rwanda proceed to expand their fleet.” Kenya Airways, only 26% state-owned, started restructuring. State-controlled Air Tanzania was reported owning only one aircraft in that year. Fastjet appeared in Tanzania and Zimbabwe. RwandAir planned “flights to Asia and Europe as a part of a government strategy to become a regional trade hub.” RwandAir announced for 2019 flights Kigali – New York with leased A330-900neos. Among the formerly French Saharan countries, Senegal and Mali had disputed unification, in vain. But later the train, dubbed “le Mistral du Senegal”, connected both countries. Air Senegal of 1971 flew only regional planes, in 2010 a startup Senegal Airlines with the A320 was an interlude, in 2018 Air Senegal appeared and in 2019 it announced flights Dakar – Paris with leased A330s. For the most important airlines South African, Egyptair, Ethiopian, Royal Air Maroc and Arik Air of Nigeria see the chapter Air Traffic/ Airlines’ History. Nigeria has the largest population in Africa and the Congo region had most troubles – compare the chapter Economy Global and, sadly, also the chapter Conflicts. But Angola calmed down and TAAG Linhas Aereas de Angola appeared in Europe with the B.747 and in South America, then sporting the Angola Airlines label. Also Air Namibia, since 1993 successor of Namib Air of 1978, appeared in Europe, initially with the B.747SP. Globalization and Suspicions Bilateral “open skies” agreements involved in the first decade of the 21st century already more than 100 states. The WTO reviewed extending the “General Agreement on Trade in Service” (GATS) annex. According to ICAO, “some 16 states adopted ‘open skies’ policies which liberalizes foreign airlines’ market access to their territories, in whole or in part on a unilateral basis”. But deregulation had been suspicious not only by rate-fixing, but also by safety arguments. Controls by the Federal Aviation Agency (FAA) of the USA and initiatives by ICAO and by the European transport commission tried to close those loopholes. The ICAO of the UN had been anticipated at government (not airline) level by the Chicago Conference in 1944, first under the designation PICAO, in 1947 becoming ICAO. In the United States the FAA focused rather on countries than on airlines, what may be considered an unfair deal. The EU excluded airlines, not countries, from entering Europe. In 2006 no less than 51 companies from Congo Kinshasa were concerned, followed by 13 from Sierra Leone, 11 from Equatorial Guinea, 6 with Swaziland registration and 3 from Liberia. But there were unsafe carriers elsewhere and disputes emerged e.g. over Hewa Bora of Congo Kinshasa, then ‘out’. Authorities have allowed them to enter Belgium, while the UK banned every Congolese carrier. “Heavily exposed to the African air travel market, SN Brussels has still to resume its Brussels – Kigali service after the Rwandan authorities grounded one of the Belgian carrier’s Airbus A330s in Kigali”, wrote Flight Intl (April04, 2006), reporting Belgium’s decision of banning Rwandan carrier Silverback. As an “unfair deal” may be considered media reports (e.g. by WDR, Jan31, 2011) about pre-war Deutsche Lufthansa, which was involved in bad Nazi actions. Misunderstanding the report would bring it into connection with nowadays’ Lufthansa, which is a completely new enterprise. Nevertheless Lufthansa (and also German railways) made voluntary payments. Another obstacle to free economy anywhere is corruption. The Japanese “Lockheed case” of 1977 has not been the only scandal. Strike and Losses In the USA the leading airlines were saved from bankruptcy by Chapter 11. ‘Deregulation Knockouts’ commented: “By 1980, airlines were struggling (…). The following year, a strike by PATCO union in the USA crippled airlines large and small, old or new, and restricted airport and airways capacity.” The story of large Eastern Airlines, killed by strike in 1991, had become a warning. Italy’s flag carrier Alitalia has needed since 1991 around 3 billion euro financial aid by the government and in return it was hit by strikes. In 2005 the EU accepted a 1.2 billion euro bailout by the Italian government and by Deutsche Bank. Lufthansa and British Airways protested while Air France prepared for a participation in Alitalia, which did not come true. In 2014 Alitalia was entered by Etihad, sponsored by Sheikh Khalifa – see the chapter Air Traffic/ Mega Groups. In February 2010, thousands of Lufthansa passengers stranded when the union Vereinigung Cockpit (VC) started a strike, demanding (according to Frankfurter Allgemeine, Feb23): “Anywhere under the Lufthansa label, payment should be in accordance with Lufthansa wages (and) a foreign airline, participated by Lufthansa, would no longer be allowed to enter Germany”. In the early 90s Lufthansa was rescued by Juergen Weber, but generous concessions had to be made. In July 2013 Lufthansa transferred flights connecting secondary airports to its daughter Germanwings. In 2014 Lufthansa passengers once again were hit by strike, and a 20% fall in the stock was reported. Der Spiegel (29/2015) quoted the trust’s CEO Carsten Spohr, a former pilot, stating that Lufthansa can survive with a cost cut up to 40 percent and a fleet reduction from 320 to 250 aircraft has become evaluated. In August 2015 an additional subsidiary Eurowings Europe GmbH was founded. It marked itself by low-cost ticket prices, e.g. 39euro99cent. And in 2019 its passengers were hit by strike. Lufthansa’s affiliate Austrian Airlines transferred in 2012 its services formally to its regional Tyrolean subsidiary, which temporarily was Austrian Arrows. It got rid of more than 300 staff members and in April 2015 it became once again officially Austrian Airlines (see B.I. Hengi: Fluggesellschaften Weltweit). Is it by chance that Austria interrupted the competing EuroCity train Berlin – Vienna? In 2017 Lufthansa had concluded an agreement with labor unions and Handelsblatt (March16, 2017) announced to maintain Lufthansa’s fleet size of 325 aircraft. In 2018 Swiss Global was integrated into Swiss after an agreement with the crews was achieved. And in late 2019 strike against Lufthansa revived.
Air France has combined regional subsidiaries in 2013 under the label Hop and it strengthened its KLM daughter Transavia. In 2014 Air France became menaced heavily by strike and a 22% drop in share was reported. And in 2015 flight controllers threatened to take over the part of striking. On Oct05, 2015 violence at the Roissy headquarters became a sensation. And France-Actualites (April06, 2015) reported that boss Alexandre de Juniac will leave Air France in favor of IATA. Neither his successor Jean-Marc Janaillac could calm the labor unions, and he retreated. Then Air France-KLM became led by a committee, including KLM boss Pieter Elbers. In the first quarter of 2018, Air France made losses of 178 million euro (so reported by Jens Flottau in Sueddeutsche Zeitung) and then strikes had cost 335 million euro. In 2017 Joon was founded as a low-cost subsidiary. In order to bring the labor unions to their senses, at that time a sale of the state-hold 14% stake has come on the agenda, pushed back by the finance minister. In September 2018 Benjamin Smith of Air Canada became the Air France boss, enraging the labor unions. He smashed Joon and Hop got an Air France paint. The IAG had staff costs of 21.5% in 2015, compared to Lufthansa’s 25.2% (according to Handelsblatt), but in 2019 British Airways was menaced by a pilots’ strike. Another problem is cyber criminality, which had hit rationalized British Airways, reported by Financial Times (Sept14, 2018): “The airline’s global IT system crashed in May 2017, grounding more than 700 flights…” The actions threatening Qantas in 2011 were noticed worldwide. “The union has staged a series of strikes over the past six weeks as it fights the airline over pay and work conditions”, reported the International Herald Tribune in October 2011. Strikes have caused losses of $20 billion and in order to save icon Qantas, fleet and route network had to be reduced. European flights were confined to London, and passengers for other destinations had to change to Emirates at Dubai. In 2016 a headline of Financial Times proclaimed success: “Qantas pays first dividend for 7 years” and the report (of August25) informed that Alan Joyce, chief executive since 2008, “briefly grounded Qantas’ entire fleet in 2011 and locked out workers after they went on strike…” In Africa, once leading South African Airways was almost bankrupt when it became hit by strike in 2019. Paralyzing airports is another way of hitting passengers. In February 2012 a small group of 200 ground staff members paralyzed Frankfurt airport, the working-place of 71,000 persons, causing the cancellation of 1,200 flights. According to Fraport AG they demanded a wage increase of 48 to 73%, whereupon the (not involved) big labor union Verdi logically announced a similar wage claim for all the other employees. The problem is the unlimited freedom of strike, granted by law also to a tiny minority, and strikes continued in Europe anywhere. In April 2019 SAS was hit by strike, terminated by an agreement. Strikes should be announced at least in advance, but in Feb 2012 flight controllers paralyzed Air France exactly in order to prevent such a law. In comparison with Lufthansa’s Eurowings or Air France’s Transavia, Air Canada Rouge emerged as a copy by Air Canada. So the national iconic trade-marks had to be split up - while United Airlines could terminate splitting by uniting with “Ted”. El Al of Israel suffered another problem: The prohibition of flying on Holy Sabbath forced to operate flights temporarily as Sun Air. For passengers, bankruptcy of an airline can create disappointing losses. When Monarch ended, the British government has organized evacuation flights. Connecting airports to high-speed railways could be a relief for stranded passengers. Fares In the first decade of the jet age, a flight from Europe to the USA was as expensive as a new motorcar. While the prices for motorcars, rail tickets and hotel accommodation did rise further with the wages, prices for air tickets then have fallen during decades. Around 1973 the voyage e.g. from England to Sri Lanka aboard one of the last P&O ocean liners did cost $422, while Air India offered flights from Amsterdam to India at $250. In the communist East, the working class enjoyed touristic journeys at subsidized fares (of course not beyond the ‘Iron Curtain’), but a round-trip e.g. from Berlin to Yerevan at 600 mark was still expensive in consideration of a 400-mark wage. Western tourists with much higher wages profited from tariffs below IATA level by Aeroflot and other carriers, such as Egyptair – in Europe insulted by some press as “gray market”. In poorer countries, businessmen traveled at reduced tariffs also with student cards and in Bangkok those cards were sold together with the ticket. With the “miles and more” programs it got still more complicated and mysterious deals and propaganda emerged. Online check-in reduced labor cost, but helpful staff is an advantage of renowned airlines. Just in time for the new jet age, IATA defined the “Economy Class” in 1958. Because of the competitive pressure, started by deregulation and non-IATA fare structures, the airline fares declined further. The true revolution came with the economy ‘special’ fares, one third or less in comparison to the IATA economy standard fares, granted in connection with advanced booking. With competition by new low-cost carriers, economy class fares in the USA on average had become 6 times cheaper than business class. In Europe, for 60% of passengers the ticket price is most important (according to the German magazine Capital) and not service and comfort. Surely in other regions it’s not different. With the 1980s did come the three-class system, offering a new business class. Owing to lack of demand for still higher fares, some classic airlines, such as KLM, Northwest, Delta and Alitalia, have lost interest in first-class. Nevertheless some business class travelers prefer to say “I traveled first class.” Truly, with introduction of ‘flat-bed’ seats on long-haul flights, the business class became almost equal to first. In 2004 Boeing had found out that more than 40% of business travelers on Asia routes did choose economy. Some enterprises discovered that economy plus an additional stay in a four-star hotel is much cheaper than a business class flight – and their employees arrived less tired at a conference. They became targeted by a new “premium economy” class. But Handelsblatt whispered that some employees did choose a longer flight only for getting paid business class. When the success of the economy class became evident, some press had not yet understood the new age. In Germany a paper denounced economy class travelers as rabble passengers (“Huckepack-Passagiere”). Newspapers wrote that premium classes represent 20% of airline traffic and create 80% of the profits, but it would require premium class fares theoretically 16x higher than economy tariffs. A tv report (in 2017 by N24) pointed out Qantas’ profit from business class with fares up to 11-fold the economy fares. At least from Africa it was reported (by R.E.G. Davies) that certain airlines gave a high proportion of seats to government personnel and favored non-paying passengers, thus producing losses at taxpayers’ expense. About renowned British Airways, Newsweek (June05, 2000) has reported: “Last year BA boss Bob Ayling moved to cut capacity by 12% and concentrate on the top end of the market. Bad idea. ‘We care about all our customers, including the 85% of our passengers who travel in the economy cabin’, BA’s new CEO Rod Eddington told staff…” Indeed, if a big airline would carry only 1st and business class, it must give away most of its fleet and staff and it would no longer be ‘big’. Of course, first class means ‘first’ when boarding. For economy class, some renowned airlines have introduced the ‘Window-Middle-Aisle’ order. The airliner should not be stormed like a tramway… Selling tickets for bribes has been a business in some countries during decades. A German, working in Jeddah during the 1970s, wanted to return the next day with Lufthansa, whereupon the lady of the agency could only laugh – the planes were fully booked for months. Then he went to an agency for Korean Airlines, paid some hundred dollars extra and got a ticket immediately. When in 1975 the author wanted to return from India by Egyptair with an o.k.-booked ticket, the responsible lady said that no seat is available, but on the remark “government employee” finally there was a seat. The word “government employee” worked also with Sudan Airways. Worse has become the situation in war-ridden Yemen, when the last 3 planes of Yemenia served only Aden. Every day hundreds of passengers stormed the ticket office and Neue Zurcher Zeitung reported (on Nov08, 2017): “Only who has a good contact (…) may enter the director’s office for begging him for an early booking.” Exclusive In 1968 Pan American has dreamt of an eight-passenger jet for vertical take-off, flying from New York to Los Angeles – of course unrealistic. Always there had been a few airlines exclusively for premium class passengers. Surely most famous was MGM Grand Air of billionaire Kirk Kerkorian. Its failure seemed just typical for the deluxe business. After Air_1 and Primaris, Silverjet was the third premium class carrier on London – New York flights which ceased operations. In 2002 Lufthansa sourced out exclusive North Atlantic flights to PrivatAir of Switzerland, at their own risk, cooperating also with Swiss, KLM, SAS, Saudia, later British Airways and others. PrivatAir had emerged out of Petrolair, established in 1977 by the Latsis shipowner group. In 2019 several insolvency protection procedures were reported (by LJ). British Airways added in 2008 exclusive premium class flights from London City Airport to New York with the A318, necessitating a refueling stop at Shannon. OpenSkies of British Airways started all-business class flights Paris – New York, then combined with L’Avion, followed by La Compagnie, and in 2017 Open Skies was stopped. About Russian newcomers, Air&Space wrote in 1994: “One of them is Shans, a deluxe airline that operates three flights a week from Moscow to Tbilisi. Begun by Nana Shavgulidze, a Georgian art dealer and the only female airline president in the former Soviet Union, Shans consists of a single Tu-154 leased from a subsidiary of Aeroflot.” It failed in the same year (obviously it is not identical with Shans Air, which much later offered Tu-134 executive services). Rusjet failed and Aeroflot Plus as well as Transaero Express were other attempts. Yukosavia carried oligarchs and oilfield workers until 1988, still before president Putin arrested its tycoon Khodorkovskiy, and Yukos as well es Gazprom was subordinated to Kremlin control. Also in China an “upper class” emerged and in 2012 Hongkong Airlines started all-business class flights to London, which ended soon. Chongqing Airlines, 60% owned by China Southern, started premium class flights in 2007. Of course in oil-rich countries there must be a demand for exclusive flights. NAS Air and Kayala Airline of Saudi Arabia and Arabjet of Dubai tried it. Wataniya Airways of Kuwait was described (by Flight Intl. 2010) as a “startup premium service”, then insolvent (according to LJ, Nov 2018). In South Africa, Sun Air went bankrupt, in Australia Ozjet failed. In 2013 Emirates Executives’ ACJ319 targeted Chinese billionaires and Russian oligarchs. Rohan Vos, the renowned de-luxe tourist train owner in South Africa, had started Rovos Air for his clients. “There’s a new way to fly in private-jet style: pay by the seat”, informed Newsweek in 2005. “Rather than charge upwards of $60,000 to charter a plane, two companies are now offering per-seat prices on luxury flights (…). Membership costs $12,500 a year (…). Members include superstar architect Frank Gehry and producers Norman Lear and Steve Tisch, as well as those you see on the cover of celebrity magazines…”
Migrant Workers, Pilgrims, Refugees The contrast to migrant workers’ flights could not be sharper. The Philippines and Mexico are among the largest sources of labor force and most migrants headed from there to the United States. In Germany, two million people of Turkish origin are living and it always was a destination for a variety of Turkish carriers. Saudi Arabia employs 6 million migrant workers, most of them coming from the Asia-Pacific region. For migrant workers in the Emirates, there had been another type of flights, short trips abroad, required by visa regulations. The rule was dropped after such a plane of Kish Air had crashed. Reportedly 80% of the expatriates in the Emirates get a paid flight home every year. Another matter is the growing number of flights for the Haj pilgrimage: Wide-bodies of many Islamic countries arrived every year at Jeddah, together with worn-down planes with Sierra Leone or Swaziland registrations. But also standard carriers appeared there, for example Turkish Airlines or Garuda of Indonesia, and it’s the base of Saudi Arabian Airlines. Various chartered planes were coming, e.g. Air Atlanta B.747s of Iceland flying for Bangladesh Biman, Air Senegal or Air Ivoire. Kabo Air of 1981, Nigeria’s first privately-owned airline, undertook Haj flights with B.747s. Then MaxAir, es Mangal of 2006, collected B.747s from Japan Airlines, Qantas and Korean for Haj flights. And in 2018 Malaysian planned to relocate its A380s to a daughter for pilgrims flights. So the airport of Jeddah surpassed at the turn of the century 10 million passengers per annum, ahead of Riyadh. After civil war has started in Libya, Die Tageszeitung (March07, 2011) quoted an UNDAG official stating that every day 50 flights left Djerba, carrying mainly Egyptian migrant workers to their home country. Thousands of Christians migrated from Egypt and in 2013 refugees from Syria were flown out from Beirut. The USA was described being the country with the highest immigration rate since WWII. During the years of the Vietnam War, 200,000 refugees arriving in the USA were listed (by Frankfurter Allgemeine, 2015). For refugees from Syria, the first flight to Canada with two government planes in 2015 was reported. Flights from Amman to Toronto by Transat started and for 2016 the transport of 35,000 refugees also by other carriers was reported. In Feb 2016 Germany concluded with Afghanistan’s president help for returning refugees. Charter flights for return had already taken place. Wikipedia reported: “As of Feb 2016, the UN has identified 13.5 million Syrians requiring assistance”, 4.8 million being refugees outside of Syria. Turkey, the host of 2.6 million Syrian refugees, “has spent more than 8 billion euro on direct assistance”. Refugees arrived in Greece by sea and an exit by train or road was blocked by neighboring countries. On account of the agreement, refugees were transported from Greece back to Turkey by leased Turkish ferries, while other ones were transferred from Turkey to Hannover by plane, as the Tagesrundschau reported it in April 2016. Another travel was reported by Financial Times on Whitsun 2017: “Hours after Gulf states dramatically announced they were cutting off transport links with Qatar, residents and tourists joined a mad scramble to catch the last Qatar Airways flight out of Dubai.” Tourism In advanced societies, a nicer way of traveling arose – tourism. At the turn of the century it represented c.10% of the global gross domestic product. For 2012 the World Trade Organization (WTO) had considered France, the USA and, on rank three, China being the main destinations. On North Atlantic flights already in the seventies 70% of passengers were tourists, as estimated by the WTO. People from North America, Europe and Japan are traveling to the south and Australians to the north, towards the sun. And US citizens had found even a way to Cuba when it was forbidden – flying via Canada. When in 2017 Miami Air appeared at Athens – could it have been a result of Donald Trump’s ban on US tourism to Cuba? In the Andes, the proposed new airport Chinchero would support tourism to Machu Picchu. A special form of tourism are the flights to sports events. LJ reported about the Euroleague final in 2017 in Stockholm that the team of Manchester United (worth 1 billion dollar?) arrived by an Aeroflot A330 – why Aeroflot? After the political change, dozens of Russian aircraft on orthodox New Year’s weekend had made Salzburg airport looking like a “little Moscow”. Lots of Russian planes should have come to former Karlsbad, but Karlovy Vary disliked to become a “Russian” spa. Instead, Russian planes chose Pardubice, a former Soviet military base. But then the former Karlsbad became a domicile of wealthy Russians, CSA connected it with Moscow and the sleeping-car from Moscow disappeared. In Turkey, aircraft from Russia, Israel, Iran and Europe had arrived every year, peacefully united at Antalya. Nordwind Airlines, founded in 2008 by Russian-Turkish Pegas Tours (according to Hengi) appeared in various countries. Migration from Russia to Israel with falsified marriages, and from there with “clean” papers to Europe, had been a matter of a TV report. But also tourists, who found the cheapest way for cruising in the Caribbean may be transported from Germany to America via Russia or at least via Istanbul, as fellow travelers reported it. Russian carriers never seen before appeared in touristic resorts in Asia and elsewhere. After in 2015 President Putin had interrupted touristic flights to Turkey and Egypt, VIM Avia was reported buying B.777s for flights to the Russian Far East, in 2017 it applied for traffic rights to the USA, but it collapsed and LJ (Nov 2017) reported that owner Mursekayev had transferred a 99% share to his wife, both fled and his CEO together with his secretary were arrested. With the ruble decline, Russian touristic flights e.g. to Salzburg or to Athens had become rare. The WTO predicted that China would join Europe, North America and Japan among the top tourist exporters. On the Maldives, planes of China Eastern, China Southern and Sichuan Airlines could be watched. The WTO estimated 100 million Chinese on foreign travel by 2020. In the beginning of the new century, already 300 million Indians traveled every year within the country, only 4.5 million abroad. A matter of its own are some astonishing flag carriers of exotic islands, built up for supporting tourism with their long-distance flights. Air Mauritius was reported temporarily also with the B.747SP. With flights to Europe, Johannesburg and Singapore it showed the vision of “leveraging its strategic position between Africa and Asia (…). A MoU was signed (in 2017) with Ghana with the objective of assisting the country in setting up a home base carrier.” Air Reunion’s successor Air Austral of 1990, entered by Air France, connected Europe and Australia and it ordered even the Airbus A380, then “postponed”. In 2017 it acquired a 49% share in Air Madagascar, which had built up a route network reaching Europe and Asia. Air Seychelles emerged as a national flag carrier out of predecessors since 1978, entered by Etihad in 2012. The Maldives showed a steady coming and going of touristic charter airlines. In the Pacific, Air Tahiti Nui started in 1998, flying to Los Angeles, Sydney and to its mother country France with the few A340s, then acquiring the B.787-9. Air New Zealand’s B.747 on Los Angeles flights landed at Rarotonga of Cook Islands and at Honolulu. And at Guadalcanal, Solomon Islands, the U.S. Navy airstrip Henderson Field of World War II became envisioned as a new airport. In the Sultanate of Brunei, Royal Brunei Airlines lost tourist traffic after publication of a new penal code for stoning homosexuals, and soon the code was abandoned.
In wealthy countries, the business-class travelers may be joined by the jet-setters. Author Julia Chaplin reminded us (in her book ‘Gypset Style’) that “the jet-set created exclusive spots around the world, such as Gstaad, Sardinia, Saint-Tropez and Acapulco, moving back and forth between them with Pucci dresses and carrying Louis Vuitton luggage.” And who was the ‘Queen’ of the jet set? Maria Callas, of course, La Primadonna Assolutissima, though she favored ship and train. Julia Chaplin wrote: “Rock stars could have easily lived out the jet-set lifestyle, but instead, they rejected it in favor of something more spiritually satisfying … In opposition to the jet-set, they sought out destinations such as India, Greece, Morocco and Spain, which were still off the glamour trail…” What will come next?
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