Aviation International News senior correspondent Ian Goold has been involved in aerospace since 1964 and in aviation media for more than 40 years. He enjoyed a 20-year career at Flight International magazine, where he was latterly air-transport editor before turning freelance in 1993. A winner of the European Regions Airline Association Hank McGonagle award for excellence in aerospace journalism and a Royal Aeronautical Society Aerospace Journalist of the Year global&nbsp;award, he has edited or contributed to aerospace and aviation magazines, special publications, and websites in Africa, Asia/Pacific, Europe, the Middle East, and North and South America. Ian entered aerospace as an apprentice at the British Aircraft Corporation at Brooklands (Weybridge), where he worked on production and final assembly lines of the Vickers Super VC10, and BAC One-Eleven , and manufacture of Concorde major sub-assemblies. He subsequently graduated from the BAC Design Training School to work in the airframe structures drawing office (including design of international future projects, such as the Panavia Tornado multi-role combat aircraft) before joining Flight International in 1973. Apart from years of reading aircraft magazines and books, his first direct contact with aviation media had come during the early 1970s when he was involved at Brooklands with the Weybridge Man-powered Aircraft Group, which designed and built the tenth aircraft to fly under purely human power. As an aviation journalist, he has worked at more than&nbsp; 50 of the major biennial&nbsp;global and regional international aerospace industry shows at Le Bourget, Farnborough, Singapore, and Dubai (having missed attending only one "Farnborough" since 1960), plus innumerable NBAA, HAI, (U.S.) AOPA, and EBACE Conventions and ERA Assemblies. His favourite aircraft is the Hawker Hunter, of which – as a schoolboy – he heard hundreds make their first flights from Dunsfold, where also on September 24, 2013, he saw the penultimate landing of the VC10 (happily involving an example of which he had witnessed the maiden takeoff in 1970) a day before the last example made the design's final flight (unless, of course....).

Senior correspondent

Ian Goold

A steady rise in traffic and load factors might seem like good news for the airline delegates gathered at the European Regions Airline Association (ERA) general assembly in Vienna from September 29 to October 1. But as airlines turn to “fierce cost cutting” to attract passengers, reality muted any calls for celebration during the three-day event.
ERA airlines saw a 4.3-percent increase in passenger throughput and a 4.4-percent jump in traffic (revenue passenger miles) through the first six months of this year. But declining yields remain a concern as fares averaged about a third lower than those collected in 2001. At very close to 60 percent, passenger load factors rose almost two percentage points over last year and analysts expect them to keep climbing. ERA attributes the gains to lower growth in seating capacity than in traffic.
Lower costs and new business models have sustained passenger growth in a trend ERA officials believe places regional carriers in a strong position to address new opportunities in Eastern Europe. Director general Mike Ambrose remains upbeat about members’ prospects, but continues to draw stark contrasts between regionals and low-cost carriers: “Passengers want low fares [and] to fly directly to destinations–as opposed to [secondary airports] 100 kilometers (60+ miles) away–in reasonable comfort and with booking flexibility,” said Ambrose. “[They] are willing to ‘trade up’ for better conditions and, in the right regulatory environment, this market will continue to grow.”
ERA departure punctuality stood unchanged, at 85 percent “on time” and 97 percent within an hour of schedule. Delayed flights fell one percentage point to 13.5 percent in the first half of last year. Members now operate 1,084 aircraft, of which 509 are turboprops. Aircraft age averages nine years.
Meanwhile, the 64-strong ERA airline membership has fallen to its lowest level since 1996, according to outgoing president João Ribeiro da Fonseca. Overall membership, including manufacturers, airports and other parties, has declined from 260 in 2001 to 221 this year.
Da Fonseca said most members face continuing economic hardship from falling yields, but that higher passenger volume–this year expected to exceed 82 million (slightly down from 2002’s record volume)–has laid a foundation for a recovery. The ERA estimates its activity has saved intra-European operators some E420 million ($517 million) in the past 12 months.
European regional aircraft continue to grow in size, typically accommodating 68 passengers, accompanied by a reduction in numbers to 1,124 machines from 2002’s high of 1,379. Although regional jets remain popular, their portion of the overall fleet has actually fallen by one percentage point from last year’s share, to 53 percent, according to da Fonseca.
Although an intriguing development, decelerating RJ growth in Europe didn’t seem to phase Aegean Airways COO and incoming ERA president Antonis Simigdalas one way or the other. “Differing local markets and regulation environments mean it is very difficult to judge between and among aircraft on offer,” he said. “The type, and even size, of aircraft is not a make-or-break factor in how we do [financially].” ATR commercial senior vice president John Moore sees markets merging as regional operators extend capacity and range to overlap with those of low-cost carriers, as questions persist about how long unprofitable majors can promise to pay departure fees that guarantee margins to regional affiliates.
Moore said the best growth opportunities for 50- to 90-seat regional jets continue to fall within mainline complementary and replacement roles, as well as in new long-haul or point-to-point service. For turboprop-equipped regionals, opportunities lie in upgrading to larger machines, operating niche services or providing point-to-point flights for short-haul low-fare sectors or hub extension services.
Considering the future 15- to 99-seat turboprop fleet, Moore predicted a 42-percent reduction from 3,845 to 2,200 aircraft by 2023. The proportion of 60- to 99-seaters will triple to 37 percent (or 790 units, compared with 455 today), while those carrying fewer than 40 passengers will decline proportionately to 34 percent (760 machines against 2,595), he added. The present 795 aircraft carrying 40 to 60 seats will fall to 650 machines, said Moore. 
Meanwhile, General Electric small commercial engine marketing general manager Ron Hutter predicted that small regional jets (carrying fewer than 61 seats) will decline from more than 150 this year to some 90 in 2014, but shipment of aircraft with 90 or more seats would approach 150 compared with fewer than 20 in 2004. In yet another forecast, Boeing sees Europe accounting for only 14 percent (about 985 aircraft) of 7,042 regional jets needed by 2023. Regional airlines will retain 10 percent of intra-European capacity throughout the period, which will see a big increase in discount-fare capacity from 9 percent this year to some 35 percent in 2023, said Boeing 717 sales program director Terry McGauaghan.
While the manufacturers spent their time evaluating future hardware needs, airline executives turned their attention to more immediate concerns during the second session of the September 30 general assembly. “We do not fly aircraft [but] passengers,” said Swiss International Air Lines chairman Pieter Bouw. “The worst thing any service provider can do is to think he knows what customers want without asking them.” 
Transport consultant Brian Simpson, a former European Parliament regional-transport and tourism-policy committee member, amplified Bouw’s call to pay more attention to customer concerns than short-term profits. “People recognize things go wrong: what they don’t like is not being told,” he said. Simpson acknowledged that low-cost carriers (LCCs) had “put bums on seats” and introduced flights from secondary airports, but he lamented a decline in service. “Communications break down when consumer relationships are hit by service problems,” he said.
Simpson warned that airlines must accept European rules regarding the carriage of passengers with reduced mobility, and to resist knee-jerk opposition based on a perceived lack of fairness. “You must provide what is required,” he said, much to the dismay of ERA members who repeatedly criticize the legislation for its unequal application to other modes of transport.
But while rail transport, for example, relies heavily on government subsidies, airlines must react quickly to wider economic changes, making them particularly sensitive to increased regulatory costs. Data and forecasting consultant Frederico Avierinos said European economies can sustain recovery, although annual European growth of 2.5 percent remains below that of emerging countries, especially new European Union (EU) member states whose economies continue to grow at a rate of 4 percent a year. He added that rising oil prices will not prove “too damaging,” and predicted that the U.S. dollar would fall further in value, “but not crash,” against the Euro–from about $1.25 to around $1.35 by 2008. Rising Euro values will increase local labor costs, but employment will remain high, predicted Avierinos. 
Such trends appear to encourage ERA officials. “Now that intra-European airlines have rekindled growth through new business models and fierce cost-cutting, they are ready to decide how to invest for the future,” declared Ambrose. Despite falling yields, consistently rising passenger numbers have allowed carriers to begin “to consider how to apply future margins.”
But with economic recovery will come more pressure to address infrastructure deficiencies, according to Ben Van Houtte, head of European Commission energy and transport directorate air-traffic management (ATM) and airports. Van Houtte pointed out that air-transport growth always exceeds economic trends; economic recovery will increase stress on aviation infrastructure, which eased during the recession. “Airlines pay [an average of] E7 million to E8 million ($8.6 million to $9.8 million) a year for ATM, but service does not work as efficiently as in other regions,” he admitted.
With greater sensitivities surrounding the airport environment, Van Houtte asked airlines to move away from “grandfather rights to something more sophisticated, [including] a rationing system.”

Traffic gains scant comfort for Euro assembly delegates

A steady rise in traffic and load factors might seem like good news for the airline delegates gathered at the European Regions Airline Association (ERA) ge

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