December 15, 2009  |  permalink

British Airways’ Twelve Days of Christmas

If you’re planning to fly to London on BA this Christmas, you should rebook right away. The airline’s cabin crews have decided to strike from Dec. 22 through Jan. 2, just long enough to throw the airline and Heathrow into holiday chaos. As if things weren’t bad enough for BA—falling premium traffic, slashed routes, the inability to add a third runway at Heathrow in our lifetimes—analysts are pegging potential losses at 40-50 million pounds, or close to triple what it was losing this time last year.

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By the perverse logic of the airline industry, this is a good thing, because by breaking the union, BA will save an estimated 100 million pounds a year. (You have a break a few eggs to serve complimentary omelettes in Club World, after all). But the real winners will be easyJet, Ryanair, and Flybe, hastening the gradual consolidation (or collapse) of Europe’s legacy carriers and the ascendency of ala carte carriers overall.

In related news, the global airline industry only expects to lose $5.6 billion next year, barely half what it expects to lose this year. The money quote: “Tough times continue,” Mr. Bisignani said. “The number of travelers will be back to the peak levels of 2007, but with $30 billion less in revenues.” (emphasis mine)

Who will take the biggest hit? Airlines in Europe are expected to be the slowest to recover, generating the largest expected losses of $2.5 billion next year, the I.A.T.A. said. In North America, losses will likely shrink to around $2 billion from $2.9 billion this year.

And who will be the big winners? “Asian airlines are likely to show the most dramatic improvement next year, with losses expected at around $700 million compared with $3.4 billion in 2009. The recovery will be led by China , where the economy is forecast to grow by 9 percent next year... Middle East carriers are likely to see their losses shrink to $300 million from $1.2 billion in 2009, despite the recent financial difficulties affecting Dubai. The Gulf region has become a major hub for intercontinental traffic.”

Emirates Airlines expects to post a billion-dollar profit next year, by the way. There’s a good reason why it might end up the property of Abu Dhabi.

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December 14, 2009  |  permalink

From The Everything-Bad-Is-Good-For-You Department

Writing in the new McSweeneys newspaper, The San Francisco Panorama (PDF), Proust Was A Neuroscientist author Jonah Lerer extols the cognitive origins and benefits of travel:

Travel, in other words, is a basic human desire. We’re a migratory species, even if our migrations are powered by jet fuel and Chicken McNuggets. But here’s my question: is this collective urge to travel - to put some distance between ourselves and everything we know—still a worthwhile compulsion? Or is it like the taste for saturated fat, one of those instincts we should have left behind in the Pleistocene epoch? Because if travel is just about fun then I think the TSA killed it.

And if the TSA hasn’t finished it off, there are plenty of climate change protestors in Copenhagen at the moment who would be happy to deliver the killshot. But not so fast:

» Continue reading...

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December 14, 2009  |  permalink

Larry Sultan, RIP

The New York Times carries the obituary this morning of Larry Sultan, the art & fashion photographer best known (in the 1990s, at least) for his series on bourgeois pornographers in the Valley. From an NYT appreciation of Sultan five years ago:

“Contrasted with the Teller book, Larry Sultan’s pictures from pornographic-film sets in the San Fernando Valley, a show of which opened at the Janet Borden gallery on Wednesday, seem somehow chaste. The Sultan show, in SoHo, coincides with the release of a coffee-table book of sex industry studies titled “The Valley” (Scalo, $75.) What is curious about both book and show is that, far from being a huge conceptual leap from the narrative Mr. Sultan conjured in “Visiting Tennessee,” a Kate Spade campaign that depicted a prosperous family on a road trip, the images in “The Valley” seem fully congruent with upper-middle-class life in a post-Cheever world.”

BTW, “Visiting Tennessee” is easily my favorite ad campaign ever.

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December 14, 2009  |  permalink

Welcome.

I see the site has finally gone live. Come in, take a look around, stay awhile. There’s a lot more where this came from.

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December 14, 2009  |  permalink

It’s an Eid al-Adha Miracle!

Abu Dhabi has given Dubai a $10 billion bailout, allowing it to pay off the $4.1 Nakheel sukuk (i.e. bond) coming due today. Armageddon has been postponed until April 30th (when the rest of the cash runs out), but it remains to be seen what the true price of Abu Dhabi’s assistance will be. Is it simply tired of Dubai’s trouble dragging down its own banks’ credit ratitings, or is this the first step toward repossessing the place?

[Update: Or was it just a cynical ploy by Dubai to scoop up the publicly-traded bond for fifty cents on the dollar?]

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December 13, 2009  |  permalink

The best thing to come out of this.

I’ll never see these ads at the airport again, thank god.

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December 13, 2009  |  permalink

Open Skies vs. Oneworld

The battle for the future of the airline industry is being fought in the skies over Tokyo.

For months, American Airlines and Delta have waged a public bidding war for Japan’s flag carrier JAL—not to buy it, but to bail it out. Each has offered more than a billion dollars in cash for JAL’s loyalty. In American’s case, this means sticking with the Oneworld alliance; to Delta, it entails defecting to Skyteam. At stake is access to one of the world’s largest and most lucrative markets. (Despite the shinkasen barreling their way to Osaka and back every day, Japan still has one of the world’s largest domestic markets—fully loaded JAL 747s take off every hour for Sapporo.) American wants to cover its flank, while Delta is keen to protect the hub at Tokyo Nartia it acquired along with the rest of Northwest Airlines. It appeared this highly entertaining tussle would go on for quite a while, complicated by Japanese politics.

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Surprise: the U.S. and Japan agreed last week on Open Skies.

In a nutshell, Open Skies means airlines can fly wherever and whenever they like without political restrictions. The U.S. and E.U. signed such an agreement last year; negotiations had been dragging on with Japan for nearly a decade. The advent of Open Skies should mean more flights, more destinations, and lower fares thanks to increased competition, especially considering United and Delta/Northwest would lose some of their special privileges. But that’s probably not going to happen.

As the Financial Times points out tonight, United and JAL’s more nimble rival ANA are racing to apply for an anti-trust exemption on closer cooperation on schedules, pricing, and strategy—a precondition of which is Open Skies. Both happen to be members of Star Alliance, and those ties will take precedence over competition between the two. The same thing is likely to happen with whomever successfully woos JAL—either American will keep it in the fold and strive for an even closer partnership, or Delta will steal it away, secure its dominance in Tokyo, and add another much-needed Asian partner to Skyteam.

Either way, the future of the airline industry is taking shape as you read this—airlines’ individual identities will begin to matter less than their alliance membership and partners. This might be old news to road warriors who don’t let any frequent flyer miles go to waste, but I’m curious to see if and when casual passengers start to notice.

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December 13, 2009  |  permalink

If You Need Advice For Your Oscar Pool…

I’ve been telling anyone who will listen that Up in the Air is a lock for Best Adapted Screenplay and Best Actor (for George Clooney, of course), and a strong contender for Best Picture, Best Supporting Actress (Vera Farmiga) and maybe Best Director (Jason Reitman).

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The reason? It isn’t a film about about emotionally unavailable frequent flyers, but the way we live now in post-recessionary America, just as Crash was about the way we live now in post-racial (but not really) America. Don’t take my word for it; The New York Times’ Frank Rich has reached the same conclusion:

“Here is an America whose battered inhabitants realize that the economic deck is stacked against them, gamed by distant, powerful figures they can’t see or know. “Up in the Air” may be a glossy production sprinkled with laughter and sex, but it captures the distinctive topography of our Great Recession as vividly as a far more dour Hollywood product of 70 years ago, “The Grapes of Wrath,” did the vastly different landscape of the Great Depression.”

 

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December 08, 2009  |  permalink

It’s 1998 All Over Again

So… the wholesale bankruptcy of the American airline industry has been deferred once more. Today’s Wall Street Journal article points out that a combination of fewer, fuller planes, fewer dirt-cheap tickets, and a raft of fees have stabilized domestic carriers’ finances. People who are down on aviation will point to the fact there are fewer seats aloft now than in 1998, but I’d rather dwell on the fact that ticket prices are also hovering around their pre-millennial level of $301. If they had kept pace with inflation, the average ticket would cost $417 today. In other words, the cost of flying continues to fall. And while that’s terrible for the airlines and their investors, that’s good for us.

There’s a counter-argument to be made that permanently depressed fares prevent airlines from upgrading their product, but then again, if United can scrape together enough cash to order 50 new widebodies from Airbus and Boeing (with options for presumably dozens more), than anyone can.

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December 07, 2009  |  permalink

The World’s Factory Meets India’s Silicon Valley

In Aerotropolis, I stress how the advent of aerotropoli in western China around cities such as Chongqing and Chengdu (both of which are larger than any city in the United States) will instantly connect tens of millions of people to the global economy. And more than that, they will enable China’s economy to continue evolving on the coast, while low-cost manufacturing migrates to less expensive cities inland. You can already see that in Chengdu and Chongqing, where Intel, HP and Foxconn (the Taiwanese manufacturer of Apple products) are all running or busy building factories. Five years from now, your next iPhone may very well be made in Chongqing.

But all of that depends on strong air service beyond China, and not just gigantic empty airports. There are signs of this happening, too, the latest being Air China’s announcement it will start direct flights in February between Chengdu and Bangalore—the Silicon Valley of India. In the short run, these flights will probably be filled with engineers working for HP, Intel and Cisco in India commuting to Chinese factories churning out devices on behalf of their employers. But in the long run, this represents one of the first tie-ups of perhaps the greatest threat to America’s high-tech dominance: highly-skilled Indian entrepreneurs and low-cost Chinese factories working in tandem to undercut and out-think the American brands which outsourced their expertise a long time ago.

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About Greg Lindsay

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Greg Lindsay is a journalist, urbanist, futurist, and speaker. He is a senior fellow of the New Cities Foundation — where he leads the Connected Mobility Initiative  — and the director of strategy for LACoMotion, a new mobility festival coming to the Arts District of Los Angeles in November 2017.

He is also a non-resident senior fellow of The Atlantic Council’s Strategic Foresight Initiative, a visiting scholar at New York University’s Rudin Center for Transportation Policy & Management, a contributing writer for Fast Company and co-author of Aerotropolis: The Way We’ll Live Next.

» More about Greg Lindsay

Articles by Greg Lindsay

Medium  |  May 1, 2017

The Engine Room

Fast Company  |  January 19, 2017

The Collaboration Software That’s Rejuvenating The Young Global Leaders Of Davos

The Guardian  |  January 13, 2017

What If Uber Kills Public Transport Instead of Cars

Backchannel  |  January 4, 2017

The Office of the Future Is…an Office

New Cities Foundation  |  October 2016

Now Arriving: A Connected Mobility Roadmap for Public Transport

Inc.  |  October 2016

Why Every Business Should Start in a Co-Working Space

Popular Mechanics  |  May 11, 2016

Can the World’s Worst Traffic Problem Be Solved?

The New Republic  |  January/February 2016

Hacking The City

Fast Company  |  September 22, 2015

We Spent Two Weeks Wearing Employee Trackers: Here’s What We Learned

Fast Company  |  September 21, 2015

HR Meets Data: How Your Boss Will Monitor You To Create The Quantified Workplace

Inc.  |  March 2015

Which Contacts Should You Keep in Touch With? Let This Software Tell You

Inc.  |  March 2015

5 Global Cities of the Future

Global Solution Networks  |  December 2014

Cities on the Move

Medium  |  November 2014

Engineering Serendipity

New York University  |  October 2014

Sin City vs. SimCity

Harvard Business Review  |  October 2014

Workspaces That Move People

Inc.  |  April 2014

The Network Effect

Atlantic Cities  |  March 2014

How Las Vegas (Of All Places) May Be About to Reinvent Car Ownership

Wired (UK)  |  October 2013

How to Build a Serendipity Engine

Next American City  |  August 2013

IBM’s Department of Education

» See all articles

Blog

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NewCities Summit 2017: Songdo Redux

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Seedstars, Ananda Urban Tech, and “Cities as a Service”

July 14, 2017

“Columbus Park” and Redesigning Manhattan for Autonomous Vehicles.

» More blog posts