Annex 1: News AIR TRANSPORT: QUARTERLY REPORT NO.12 3rd QUARTER 2006 (July to September)

A EU/REGULATORY ...... 2 Commission approves public financing for six regional in Ireland...... 2 High- conference discusses future of aviation regulation ...... 2 EU – African Union aviation seminar: meeting the needs of modern aviation...... 2 Commission approves changes to social aid for Martinique...... 2 EU and the Republic of Korea seal their agreement on GALILEO ...... 2 Commission opens formal enquiry into restrictions to air services to Sardinia...... 2 Commission wants to strengthen the Single Market for Aviation ...... 3 Cooperation agreement with the USA on modernising air traffic management...... 3 Proposed Regulation on common rules for air services in the EU...... 3 Passenger Rights & Air Safety - a Commission priority...... 3 European air traffic management systems and a Single European Sky...... 3 B ...... 3 LCC routes announced for next quarter...... 3 Flybe considers charge for offline check-in ...... 4 LCCs main drivers of aviation growth ...... 4 German regulator clears Air Berlin's takeover of DBA...... 4 launch mobile in-flight telephony ...... 4 Ryanair pressing ahead with baggage charges...... 4 EasyJet to charge for extra baggage as restrictions continue ...... 5 TUI outlines expectations from carrier merger...... 5 Online travel makes further inroads into package arena...... 5 Avion to boost traffic with French tour operator deal ...... 5 ATOL failures nearly doubled ...... 5 's Fly Air drops scheduled domestic operations...... 5 MyTravel admits UK business will make £10-£15m loss this year...... 6 Thomas Cook releases trading update ...... 6 Air Plus Comet to restructure as long-haul low-cost carrier ...... 6 Omni to acquire TAP's White charter carrier for $6.5m ...... 6 Royal Caribbean acquires Air Pullmantur from Grupo Marsans ...... 6 FlyNordic turns to charter to counter losses...... 6 Kuoni reports half-year profits amid chairman's resignation...... 6 Internet and budget airlines fuel package holiday decline ...... 7 Ski market sees highest growth in five years ...... 7 Mirpuri Group disposes of Portuguese carrier Air Luxor...... 7 ERA members report growth ...... 7 Actuarial valuation sees BA pensions deficit reaching £2.1b...... 7 board approves order for up to 65 ...... 8 Air axes flights due to new train link ...... 8 's new budget carrier to operate as ''...... 8 patience wears thin as conditions tied to Volare approval...... 8 -KLM to begin RFID baggage-tag trials ...... 8 C CARGO AND INTEGRATORS ...... 8 Italian startup Cargoitalia receives US rights ...... 8 Lufthansa offers $85m to settle cargo cartel civil lawsuits...... 9 Greek carrier Sky Express to start cargo flights ...... 9 Sweden's West Air to launch CRJ200 freighter...... 9 Air Foyle winding down after split from : founder ...... 9 D AIRPORTS ...... 9 EasyJet CEO criticises development...... 9 Expansion at Tallinn airport...... 9 Ferrovial to take over Peruvian airports...... 10 Privatisation at Leeds-Bradford ...... 10 Aena to expand airport...... 10 E AIR TRAFFIC MANAGEMENT...... 10 Balkan region to discuss functional airspace block strategy...... 10 Joint French-Swiss airspace scheme could extend to ...... 10 EC adopts 'Single Sky' ATC interoperability regulations ...... 10 F SAFETY AND SECURITY ...... 11 BA expects £40m hit from August's UK security threat ...... 11 G ENVIRONMENT ...... 11 EasyJet CEO lambastes environmental lobbyists ...... 11 Eurocontrol eyes green tax options ...... 11 Cleaning the sky...... 11 H AIRCRAFT MANUFACTURERS ...... 11 ATR Announces a new contract for four new ATR72-500 aircraft...... 11 Boeing unveils new 737-900ER ...... 12 New Airbus chief to bide time before A350 XWB launch...... 12

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 1 A EU/regulatory

Commission approves public financing for six regional airports in Ireland IP/06/1262 The European Commission decided on the 26th of September to allow the Irish government to finance infrastructure developments at six small regional airports. The measure in the form of capital investment expenditure, will last 5 years (2006-2010) and provides funding of up to €65.5 million to the airports.

High-level conference discusses future of aviation regulation IP/06/1224 Fragmentation of the aviation regulation system still remains a problem. On the 20th of September high level representatives of the national civil aviation administrations, aviation industry and the Commission met in Brussels to find ways to improve the efficiency of the system, cut costs and cover possible gaps in safety.

EU – African Union aviation seminar: meeting the needs of modern aviation IP/06/1203 A European Union – African Union aviation seminar for African States and Regional Economic Communities was held on 13th-14th September in Brussels. The event was organised jointly by the European Commission and the African Union in order to share information on the regulation and functioning of the EU internal aviation market and its relations with third countries. The seminar brought together the aviation authorities from 30 African States, Regional Economic Communities and specialised organisations in the field.

Commission approves changes to social aid for Martinique IP/06/1180 The Commission approved on the 13th of September changes to a social State aid scheme for certain categories of passenger flying from Martinique to metropolitan France. The changes will compensate for the much higher transport costs faced by inhabitants of the island in comparison to the inhabitants of metropolitan France.

EU and the Republic of Korea seal their agreement on GALILEO IP/06/1170 During the EU/South Korea summit held in Helsinki on the 11th of September, the two parties formally signed an agreement on co-operation on the European satellite radio navigation programme GALILEO. The agreement provides for numerous areas of co-operation, including cooperative activities in the areas of scientific research and training, industrial cooperation, trade and market development, standards, certification and regulatory measures.

Commission opens formal enquiry into restrictions to air services to Sardinia IP/06/1067 On 26 July 2006 the Commission decided to open a formal investigation into the rules imposed by Italy on 2 May 2006 on 16 air routes between three Sardinian airports and important airports on the Italian mainland. The Commission has serious doubts as to the conformity of the Italian public service obligations with the aviation market rules and considers that they may close the market to Sardinia. Italy has to react within two months upon receiving the Commission’s notice.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 2

Commission wants to strengthen the Single Market for Aviation IP/06/1010 The European Commission adopted on the 18th of July a proposal to modernise the Single Market legislation for aviation. The proposal will ensure a consistent application of EU legislation in all Member States, thereby creating equal conditions for all airlines. It imposes transparency in fares announced to passengers. It addresses shortcomings in the legal framework for the Single Aviation market in order to enhance its efficient working.

Cooperation agreement with the USA on modernising air traffic management IP/06/1009 Vice-President Jacques Barrot, the Commissioner responsible for transport, and Marion C. Blakey of the US Federal Aviation Administration (FAA), recently signed a cooperation agreement that will ensure coordination between their respective programmes for the modernisation of air traffic control, SESAR on the European side, and NGATS (“ Next Generation Air Transport System”) on the American side.

Proposed Regulation on common rules for air services in the EU MEMO/06/294 The text gives answers for the questions concerning consumer protection, an operating licence and more stringent control over them, consequences for relations with third countries, the rules with regard to the leasing of aircraft and also those with regard to public service obligations (PSO).

Passenger Rights & Air Safety - a Commission priority MEMO/06/293 This memo recalls the initiatives taken by the European Union to protect air passenger rights and ensure high safety standards in aviation. A new element is that since 16th of July passengers have the right to be informed about the identity of the which will operate the flight(s) for which they have made a reservation.

European air traffic management systems and a Single European Sky IP/06/940 The European Commission adopted on the 6th of July two Regulations concerning the interoperability of European air traffic management systems. The two actions aim at modernising air traffic management systems.

B Airlines

B1 Low-cost carriers LCC routes announced for next quarter Air Baltic Zurich to Riga, thrice weekly. BMIbaby closing Durham Tees Valley base (6 routes). Expanding operations at Birmingham. EasyJet Munich to Basel and Geneva. Flybe has shelved plans for a domestic operation in France or . It is to add four weekly services between Inverness and Belfast. Flyglobespan Daily Liverpool - New York service. From November, Manchester to Cape Town and Toronto. Glasgow to Barbados, Las Vegas and Boston from January. Tenerife services from Aberdeen and Durham Tees Valley.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 3 Jet2 Salzburg from Leeds Bradford from December four times weekly. Frequency to Geneva up to eight weekly flights. Adding year-round flights between Manchester and Bergamo Ryanair to axe its Stockholm Vasteras-Luton service, halve its Malmo - Stansted service and reduce Gothenburg-Prestwick frequency following a new environmental tax on departing passengers. Canceling to Humberside and Malta and has suspended Luton to Brest, Nottingham East Midlands to Nimes, and Shannon Nantes for the winter period. Route announcements include:- Prestwick to Derry, Eindhoven, Riga. Hahn to Balaton (Hungary), Billund Biarritz, Nantes and Valencia. Dublin to Oslo, Grenoble, Friedrichshafen, Tampere, Almeria, Rzeszow, Seville, Billund Vittoria, Pula Bologna, Fuerteventura, Tenerife, Alghero and Trapani. Stansted to Perugia Luton to Malta. Pisa to Billund, Seville, and Malta. SkyEurope Paris to of Salzburg, Prague to Turin, Romania and Rome, dropping Innsbruck. to Valencia.

Flybe considers charge for offline check-in 14Sep06, ATI Flybe is considering charging passengers who check-in for flights at the airport rather than through the Internet as a means of boosting ancillary revenues. SkyEurope introduced seat selection during the flight booking process on all it services for a €5 fee.

LCCs main drivers of aviation growth 14Sep06, businesstraveleurope LCCs are still the main drivers of aviation growth according to a new figures from OAG. Capacity on no frills carriers has doubled in the last four years from 22,000,000 seats on 169,000 flights in September 2002 to 46,000,000 seats on 323,000 flights in September 2006 While world air transport grew by 2% last year, the volume of low cost flights worldwide grew by 14%. OAG said LLCs now accounted for 17% of all seat sales and 15% of all flights across the world. It said that about 18% of the flights in Europe and the US were now by LCCs.

German regulator clears Air Berlin's takeover of DBA 06Sep06, ATI German competition regulators have approved Air Berlin’s acquisition of low-fare carrier DBA, stating that the tie-up will help counter Lufthansa’s domination of the market. Air Berlin agreed to acquire Munich-based DBA in August 2006.

Ryanair launch mobile in-flight telephony 4th Sept ABTN RYANAIR has announced that the airline’s entire fleet of Boeing 737 aircraft will be fitted with OnAir's onboard mobile communications solution. The deal means that from mid-2007 (subject to relevant regulatory approval) Ryanair's passengers will be able to call, text and email using their mobile phones, BlackBerrys and Treos at rates which will mirror international roaming charges.

Ryanair pressing ahead with baggage charges 31Aug06, ATI Ryanair remains committed to moving ahead with its quest to reduce the number of passengers checking in bags on its flights, despite recent UK measures temporarily restricting the amount of hand luggage that can be taken on board.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 4 EasyJet to charge for extra baggage as restrictions continue 18Aug06, ATI Budget carrier EasyJet introduced in September a checked baggage charge aimed at expediting the check-in procedure at airports while heightened security restrictions are in place in the UK.

B2 Charter carriers/leisure groups TUI outlines expectations from carrier merger 28Sep06, ATI German tour operator TUI Group plans to generate 60% of its bookings through the low-cost sector once it integrates its charter operator Hapagfly with budget carrier Hapag-Lloyd Express. Combining the fleet will create a single airline with 56 aircraft, primarily Boeing 737s. Hapagfly, the group’s traditional holiday carrier, will form the operational backbone while the combined company will benefit from marketing strengths of Hapag-Lloyd Express.

Online travel makes further inroads into package arena 26Sep06,TravelMole Online travel is seeing high growth, fuelled by dynamic packaging at the expense of the traditional package holiday. Lastminute.com says much of the online sector's forecast growth of 32% this year will come from dynamic packaging booked close to the departure date. The traditional package holiday sector has had a tough year, with the market down by 12%.

Avion to boost traffic with French tour operator deal 19Sep06, ATI Icelandic transport specialist Avion Group has agreed to acquire the French tour operator Vacances Heliades, which it will use to fuel the growth of its French charter carrier Star Airlines. Aix en Provence-headquartered Heliades, which specialises in travel to Greece and Cyprus, was established in 1980. Last year it generated an €80 million turnover, from which it derived €3.3 million in pre-tax profits.

ATOL failures nearly doubled 15Sep06,TravelMole Nearly twice as many ATOL companies failed in the year to March 31 compared with the previous year, according to the 2006 Report and Accounts of the UK Air Travel Trust. A total of 25 ATOL companies failed in the year, 11 more than in 2005 and the highest level for the past 10 years. Eleven failures involved a call on the Trust causing expenditure of £4,643,000, an increase of more than £4 million over the previous year. The Trust has no income and interest charges were £602,000. The year-end deficit increased to almost £16 million.

Turkey's Fly Air drops scheduled domestic operations 14Sep06, ATI Turkish carrier Fly Air is canceling its scheduled domestic services and will concentrate on its charter operations and Hajj flights. It comes three years after Fly Air became the first private Turkish carrier to begin domestic scheduled services after Turkey liberalized the domestic aviation market. , Atlasjet, Pegasus and SunExpress all subsequently followed Fly Air into the domestic scheduled market. But Fly Air has taken only carried 251,000 passengers over the first eight months of this year compared to 1.5 million carried by Onur Air.

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MyTravel admits UK business will make £10-£15m loss this year 13Sep06,TravelMole MyTravel remains on course to make its first profit in five years but the group's UK arm is no longer expected to return to profitability this year. Operating loss at the UK business, which includes Airtours and Going Places, is expected to be between £10-£15 million, against £27 million in 2005. The group said UK winter trading has started slowly and is currently being affected by security concerns.

Thomas Cook releases trading update 12Sep06,TravelMole Thomas Cook performance was stronger in than it was in the UK. In Germany, it increased the number of transported passengers by 2.6% to 2.988 million, while in the UK it fell 0.7% to 1.984 million. Booking figures in Germany after three quarters are just under 8% up on last year, better than the overall market, which is up only 3%.

Air Plus Comet to restructure as long-haul low-cost carrier 12Sep06, ATI Air Plus Comet will restructure as a long-haul low-cost carrier. Air Plus will drop its charter airline image and present itself to the market as the best value carrier between a number of European key markets and destinations in .

Omni to acquire TAP's White charter carrier for $6.5m 06Sep06, ATI Portuguese aviation services company Omni Aviacao is to acquire the whole of TAP Portugal’s charter operation, White, and values the transaction at around $6.5 million. Omni Aviacao, a diverse group of around 14 aviation firms, is taking control of the carrier which started operations last year after emerging from the late-2004 restructuring of charter carrier Yes. Under the terms of the deal Omni will acquire a single leased Airbus A310-300. The carrier’s other aircraft, a Lockheed L-1011, will be handed back to Star Alliance carrier TAP.

Royal Caribbean acquires Air Pullmantur from Grupo Marsans 31Aug06, ATI Royal Caribbean Cruises has signed an agreement to acquire Grupo Marsans’ Pullmantur subsidiary, which includes long-haul charter carrier Air Pullmantur, for €430 million plus €270 million of the unit’s net debt. Air Pullmantur operates charter flights with its fleet of two Boeing 747-200s and a single 747-300.

FlyNordic turns to charter to counter losses 29Aug06, ATI Finnair’s budget carrier FlyNordic is expecting to make a full-year loss, blaming competition in the Swedish market and the cost of fuel. The airline forecasts an improvement on last year’s loss of around €17 million. FlyNordic, based in Stockholm, is turning its attention to charter services and cutting unprofitable routes to counter the effects of higher fuel prices. It has been operating to 18 destinations from Stockholm this summer, in co-operation with partners Sterling and Norwegian.

Kuoni reports half-year profits amid chairman's resignation 23Aug06, TravelMole Kuoni UK has reported operating profit of £9.8m in the first six months of 2006. Long-haul holidays were hit by fuel surcharges and the short-haul market was feeling the effect of

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 6 extreme competition. Kuoni said the impact of the World Cup was greater than anticipated, and the good weather in May and June also had an impact on bookings.

Internet and budget airlines fuel package holiday decline 31Jul06, TravelMole The number of people taking foreign package holidays has declined by 14% in four years as the level of web-booked independent travel has grown. The proportion of people who make their own travel and accommodation arrangements has grown from 41% to 45% since 2002. Meanwhile, those who have taken an overseas package has dropped from 36% to 31% - down 14%. Consumers are becoming more adventurous, with the number saying they prefer to take holidays 'off the beaten track' increasing by 16% from 7.5 million in 2002 to 8.7 million. By contrast, the number who say they only want to eat, drink and lie in the sun has declined by 10% in the period from 6.6 million to 5.9 million. The decline in the traditional beach resort holiday is demonstrated by a 300,000 drop in British visitors to the Canary Islands in four years, according to BRMB. Malaysia, Singapore, Thailand, Australia and New Zealand have all seen big increases in visitor numbers as people venture further.

Ski market sees highest growth in five years 12Jul06, TravelMole The UK ski market grew by 7% last winter, the largest single-year growth since the winter of 2000/2001, according to the Ski Industry Report 2006 by Crystal Ski. Crystal said much of the growth in the ski market was down to the increasing number of independent travellers, which increased from 9% from 330,000 to 356,000. No-frills airlines carried 947,000 passengers to ski destinations, just above the levels of 2003/04, and regular scheduled airlines saw slight growth to 1,150.000.

Mirpuri Group disposes of Portuguese carrier Air Luxor 04Jul06, ATI Portuguese carrier Air Luxor has been sold to Longstock Financial Group by Mirpuri Group, as part of a transaction which includes its sister travel subsidiaries. Air Luxor Holdings which also includes Air Luxor Sao Tome (STP), Air Luxor Guine Bissau (GB) and tour operator Air Luxor Tours. Last year these businesses generated €150 million in revenues.

B3 Regional airlines ERA members report growth 27/09/2006, ERAA website Capacity levels have been growing on ERA member airlines, with seat numbers up 5.1% and available seat kilometres (ASKs) up 5.9% in the first six months of this year when compared to the same period in 2005. Scheduled passenger traffic was up an encouraging 8.2% compared to the first half of 2005.

B4 Network carriers Actuarial valuation sees BA pensions deficit reaching £2.1b 29Sep06, ATI ’ (BA) deficit in its key pensions scheme has doubled to around £2.1 billion, according to a fresh actuarial valuation. This shows the deficit in BA’s New Airways Pension Scheme (NAPS) is set to rise from £928 million to around £2.1 billion. BA says it would need to make annual contributions of nearly £500 million, raising its contribution from five to 12 times that of members, to fund the pension scheme if it remains unchanged.

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Lufthansa board approves order for up to 65 Airbus 20Sep06, ATI Lufthansa’s supervisory board today approved an order for 30 short- and medium-haul Airbus aircraft, as well as five Airbus A330s. The order comprises 15 A321s, 10 A320s and five A319s, scheduled for delivery in 2007. The A330s will be delivered over the next two years and will be used to compensate for the delivery delays to the A380.

Air France axes flights due to new train link 18Sep06, ATI Air France-KLM is to axe its services between Paris and Metz-Nancy airport and is cutting back Strasbourg services due to a new TGV high speed rail link opening between Paris and Strasbourg. Services between Paris ORY and Strasbourg will be cut from 12 to eight daily, although Air France will continue its four daily flights between CDG and Strasbourg. The TGV will take 90mins between Paris and Metz and 2h 50mins between Paris and Strasbourg.

Iberia's new budget carrier to operate as 'Clickair' 25Jul06, ATI Iberia’s new Barcelona-based airline, known until today as Catair, has officially revealed that its new commercial name will be Clickair. Clickair, which is owned by Iberia, Grupo Iberostar, Nefinsa, Grupo Quercus and Cobra, will launch operations in October from Barcelona to 12 domestic and international destinations using a fleet of three leased Airbus A320s.

Alitalia patience wears thin as conditions tied to Volare approval 07Jul06, ATI Alitalia has hit out at the legislative and judicial hurdles it is facing in its bid to acquire Volare, after Italy’s competition authority required it to give up four slots at Linate airport in conditionally approving a deal. Volare, which gradually resumed operations since its collapse at the end of 2004, had originally hoped to complete an auction for the carrier at the end of last year. But in May Italy’s state council backed rival bidder ’s move to block the deal. Italy’s competition authority has conditionally cleared the purchase, but it is calling on Alitalia to give up two domestic and a pair of international slots from Linate.

Air France-KLM to begin RFID baggage-tag trials 03Jul06, ATI SkyTeam carriers Air France and KLM are to begin a trial of radio frequency identification (RFID) tags for labeling and tracking baggage this month. Air France today begins an RFID trial on flights between Paris Charles de Gaulle and Amsterdam Schiphol today. Its Dutch partner will start a trial on 10 July at two baggage drop-off points at Schiphol’s Departure Hall 2. KLM has developed the initiative together with Schiphol Airport

C Cargo and integrators

Italian startup Cargoitalia receives US rights 19Sep06, ATI Italian freight airline startup Cargoitalia has received authority to launch scheduled and charter all-cargo services to the USA. The foreign air carrier permit awarded by the US DOT allows flights from Milan Malpensa to Atlanta, O’Hare, Houston and New York JFK.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 8 Lufthansa offers $85m to settle cargo cartel civil lawsuits 11Sep06, ATI Lufthansa has offered $85 million to settle civil lawsuits in the USA claiming that the carrier and its subsidiary Swiss International Air Lines were involved in a cartel of world airlines fixing the price of airfreight. The carrier said it has received condition immunity from regulators including the US Department of Justice and the European Commission.

Greek carrier Sky Express to start cargo flights 07Sep06, ATI Greek passenger carrier Sky Express is diversifying into main deck freight transport, launching scheduled services to the later this month. Set up last year as a passenger operation offering services between Greek islands using Jetstream aircraft, Sky Express will launch scheduled freighter services between Europe and the Far East using a Boeing 747-200 leased from Polar Air Cargo. The airline will carry general cargo from Europe to with westbound loads largely made up of garments shipments.

Sweden's West Air to launch CRJ200 freighter 03Aug06, ATI Swedish cargo operator West Air Sweden is to become an initial customer for the Bombardier CRJ200 converted freighter, and plans to take two aircraft next year It is to introduce the aircraft, which were formerly part of the Lufthansa regional fleet, in April 2007 The acquisition comes as part of the carrier’s decision to step up to jet operations, a switch which will also see it introduce a British Aerospace 146 freighter in October.

Air Foyle winding down after split from Antonov: founder 12Jul06, ATI Air Foyle announced it is winding down after its outsize freight venture split with Ukrainian partner Antonov Airlines. Air Foyle HeavyLift, had been marketing the capabilities of Antonov Airlines. The division was formed when Air Foyle linked with HeavyLift Cargo Airlines in 2001 and continued to survive even after HeavyLift collapsed a year later. But its partnership with Antonov Airlines ended in June, as Volga-Dnepr, a former long-term partner of HeavyLift, linked with Antonov to create a new outsize cargo venture called Ruslan International.

D Airports

EasyJet CEO criticises airport development 13Sep06, ATI EasyJet CEO Andrew Harrison says the de-regulation and competition that has driven the airline industry has yet to occur in the airport sector, which has led to higher charges resulting from “overbuilt” airport facilities. Examples of this include London Stansted’s planned expansion and the construction of Berlin’s new €1.8 billion Brandenburg International Airport, says Harrison, claiming the new airport will stifle low-cost flights to the German city.

Expansion at Tallinn airport Sep06, ATI The state-owned operator of Tallinn Airport in Estonia, Tallinna Lennujaam, announced plans to build a new 15,000 m2 passenger terminal. The project will be undertaken by Swedish company Skanska at a projected cost of EUR 39 million.

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Ferrovial to take over Peruvian airports Aug06, ATI Spanish construction company Ferrovial, which earlier this year successfully completed the take-over of BAA, is the sole-bidder for a group of twelve Peruvian regional airports.

Privatisation at Leeds-Bradford Aug06, ATI The various local municipal councils that own Leeds-Bradford in the North-West of England announced their intention to privatise the airport.

Aena to expand Valencia airport Jul06, ATI Spanish airports operator, Aena, announced plans to spend EUR 68 million in expanding both terminal and facilities at Valencia Airport.

E Air Traffic Management

Balkan region to discuss functional airspace block strategy 21Sep06, ATI Representatives of nine Balkan region states have held the first stakeholder consultation workshop in an effort to develop a functional airspace block for southeastern Europe. Balkan region air routes link Europe with the Mediterranean, and parts of Africa. The area is busy and complex, a situation exacerbated by the closure of Kosovo airspace, and centres such as Belgrade and experience bottlenecks in traffic flow. Traffic in the region is set to increase by up to 30% by the end of the decade.

Joint French-Swiss airspace scheme could extend to Italy 06Sep06, ATI French and Swiss air navigation authorities are to develop a technical and operational co- operation strategy to combine their countries’ airspace into a single block, which could also expand to include parts of Italy. Joint designation of airspace responsibility between ’s Skyguide and France’s DSNA could be achieved by 2008 if the plan goes ahead. Several other groups of states, including the UK and Ireland, Spain and Portugal, and countries in Scandinavia and Central Europe, are also studying creation of such blocks.

EC adopts 'Single Sky' ATC interoperability regulations 07Jul06, ATI European Commission representatives have adopted another pair of crucial regulations, based on interoperability of air traffic management systems, to advance development of the Single European Sky concept. The two regulations deal with exchange of flight data and procedural requirements for flight planning. Under the first of these, the ‘co-ordination and transfer’ regulation, requirements have been established governing the exchange of flight data which enables the smooth notification and transfer of flights between air traffic centres. This also covers data-exchange for co-ordinating air traffic movements with military centres. The second regulation, concerning flight plans, sets out the obligations of a centralised flight- plan processing and distribution service. It aims to ensure that all parties connected with the flight-planning process – including pilots and air traffic centres – are granted access to the same flight plan before an aircraft’s departure.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 10 F Safety and security

BA expects £40m hit from August's UK security threat 05Sep06, ATI British Airways (BA) estimates a financial hit of £40 million for the month of August as a result of disruption stemming from heightened security measures at UK airports following the foiling of an alleged terrorist plot. The carrier was forced to cancel 1,280 flights between 10 and 17 August. The estimated £40 million impact includes lost revenue and increased costs for hotel accommodation, catering and baggage repatriation. BA says it has also seen “some impact” on forward bookings, in particular, transfer traffic levels have fallen because of the restrictions on carry-on baggage implemented by the UK Government.

G Environment

EasyJet CEO lambastes environmental lobbyists 13Sep06, ATI EasyJet CEO Andrew Harrison urged fellow low-cost airlines to work together to overcome two “significant threats” facing the industry; high airport charges and environmental lobbyists. Speaking at the World Low-Cost Airlines Congress in London, Harrison said these two factors are closing in on the industry and airlines need to work together to do something about it.

Eurocontrol eyes green tax options 29Aug06, ATI Eurocontrol’s latest business plan points to the possibility of using its route-charging system as an interim means of making airlines pay for environmental damage caused by aircraft emissions, while the idea of aviation emissions trading is pursued by the EC. The current charge system takes into account the distance flown and the weight of the aircraft. Using three-dimensional navigation technology, the organisation could impose charges related to the flight level. Eurocontrol is developing a new training course aimed at providing ATC staff with an understanding of the issues associated with the environment and aviation. Work is also being carried out in its Pagoda programme, which aims to provide the first estimate of fuel burn and greenhouse gas emissions within the European ATM network.

Cleaning the sky 01Aug06, ATI Europe's €1.6 billion bid to speed up the entry into service of greener aircraft received a boost at Farnborough when seven manufacturers signed up to lay the groundwork for the ambitious Clean Sky joint technology initiative, a seven-year programme under the Seventh research framework programme (FP7), half of which is to be funded by the European Commission.

H Aircraft manufacturers

ATR Announces a new contract for four new ATR72-500 aircraft 28Sep06, ATR website The regional aircraft manufacturer ATR announced today the sale of four new ATR 72-500s that will be operated by NAYSA, a regional operator based in the Canary Islands. The announcement has been made at the European Regions Airlines Association annual meeting currently being held in Barcelona. The total value of the contract is about $ 71 million.

Cranfield University: Quarterly Report Q3 2006 ANNEX 1: News 11 Boeing unveils new 737-900ER 08Aug06. Boeing website Boeing today unveiled the new 737-900ER (Extended Range) airplane. Boeing launched the 737-900ER in July 2005 when Jakarta-based Lion Air announced an order for 30 of the aircraft. Lion Air also exercised purchase rights for 30 additional 737-900ERs in June 2006. In addition to Lion Air, the aircraft has been ordered by Continental Airlines, GE Commercial Aviation Services (GECAS) and .

New Airbus chief to bide time before A350 XWB launch 17Jul06, ATI New Airbus chief executive Christian Streiff is to wait three months before seeking formal shareholder approval for the industrial launch of its new A350 successor aircraft family, the A350 XWB. Airbus detailed the new aircraft family at the Farnborough air show. It will include three aircraft sized between 270 and 350 seats, to enter service between 2012 and 2014. The revamp came after criticism of the aircraft from some of its high-profile customers who told the manufacturer that, as the aircraft was entering service later than Boeing’s rival 787, it should take the time and come out with a better product.

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