We are proud and happy to announce that while you are reading Air Cargo News FlyingTypers, there is also a Doctor in the house.
     Dr. Julius Maldutis, who today joins Air Cargo News FlyingTypers with exclusive Special Commentaries, is among the most respected financial analysts in the history of modern commercial aviation.
     Based in New York, Dr. J is President of Aviation Dynamics, Inc.
     As a transportation economist and independent airline consultant with broad experience in global aviation and aerospace, Dr. Maldutis brings extensive experience to ACNFT.
     In 1998, he joined CIBC World Markets as Managing Director and Senior Global Transportation Analyst in the Equity Research Department and retired in 2001.
     Prior to 1998, Dr. Maldutis was a Managing Director and head of global aviation research at Salomon Brothers, Inc.
     Dr. Maldutis was ranked # 1 Transport Analyst in The 1997 Reuters Survey and has been selected by Euromoney’s Corporate Finance as one of the Ten Leading Global Equity Analysts of the Year by CFOs.
     First Call/Thompson Financial has named Dr. Maldutis as the Best on the Street for stock picking six years in a row and he has been consistently ranked as a top equity analyst by Institutional Investors.
     He has published frequently on U. S. and global aviation issues, and is a member of the New York Society of Security Analysts.
     Dr. Maldutis is past President of the Wings Club and was a member of the Board of Governors.
     In addition, he is on the Advisory Boards of GATX Capital, BAE Systems, and Swissair and has acted as advisor to IBM Corporation for a number of years.
     Prior to joining Salomon Brother, Dr. Maldutis was a transportation economist. Before that, he had been Director of Domestic Passenger Strategy Planning and Corporate Economist for Trans World Airlines, Inc.
     He also acted as a consultant to the U.S. Department of Transportation and as an economist with the Southeastern Pennsylvania Transportation Authority, providing economic and financial evaluations for rail services.
     Dr. Maldutis received a BA from Brooklyn College and an MA and Ph.D. in Economics from Columbia University.
Geoffrey

Airline Survival Strategies
And Bankruptcies

     Since August 2006, airline stocks have become almost totally dependent on airline oil prices. The AMEX airline index collapsed by July 11th and closed at 13.98 down 79.1% since they peaked in January 2007. Airline fuel prices which exceed labor costs increased 89% to $4.08/gallon during the same period. More recent sharp drop in oil prices from $147/barrel to $119/barrel triggered sharp rally in airline stocks just reinforcing the total dependence of airline stocks on oil prices. Recent public debate to reduce or regulate hedging in oil must have clearly dropped oil prices. Goldman Sachs forecast of $200/barrel by year end may not be achievable if hedging is no longer such a determinant fact. In fact, if oil goes below $100/barrel there will be a lot of embarrassment even among airlines who hedged in believing Goldman’s projection.

Second Quarter Not So Bad After All
     The top 10 airlines had an operating profit of $529 million in the second quarter compared to $3,253 million last year. As shown below, the airlines reported no net loss in the second quarter. The first quarter loss of $1.3 billion and rising oil prices generated projections of $7 billion to $10 billion for the full year with bankruptcies and maybe even liquidations.

     However, the financial losses in second quarter were not as bad as expected. The cash liquidity seems in a reasonably good position and therefore in my judgment Chapter 11s may not occur in 2008.

Unrestricted Cash June 30, 2008

Tianjin Olympic Field Of Dreams

     If you build it, will they will come?
     After the breathtaking opening of the Bejing Olympics last week that will go down in history as the greatest show of its kind ever, no doubt what China is doing and has done for the Olympics, protests notwithstanding, has redefined descriptive superlatives.
     No less spectacular right now, Tianjin, Beijing’s neighbor city, and Tianjin Binhai International Airport is serving as one of the major landing airports for the Olympic Games is now welcoming travelers and air cargo after its largest expansion project in history.
     The new terminal is five times larger than the old one, with the annual capability of handling 10 million passengers and 500, 000 tons of cargo.
     The expansion includes a total investment of nearly RMB3 billion (USD429.5 million), starting in August 2005, including a new 116,000-square-meter terminal building, a 270,000-square-meter apron and a 62,000-square-meter parking lot.
     More than 300,000 officials, athletes and visitors are expected to travel via the airport this month.
     Now completed, the airport has the capability of accommodating 500 thousand tons of mail and cargo and 200 thousand flights annually.
     Tianjin is about 120 kilometers southeast of Beijing.
     To make the two cities closer, and express travelers to Beijing,an intercity high-speed railway now links the two cities.
     With the design speed of 300 kilometers per hour, a journey between Tianjin and Beijing has been shortened from the current 70 minutes to around 30 minutes.
David

     Four current and former British Airways executives were charged on Thursday August 7 in connection with an inquiry into fuel surcharge price fixing, the UK's Office of Fair Trading (OFT) said.
     The OFT said the four are Martin George, BA's former commercial director, Andrew Crawley, its current head of sales, Iain Burns, its former head of corporate communications and Alan Burnett, ex-head of UK and Ireland sales.
     The complaint accused the four saying they "dishonestly agreed with others to make or implement arrangements which directly or indirectly fixed the price for the supply in the United Kingdom of passenger air transport services.”
     If convicted, the four could receive prison sentences of up to five years, as well as fines.

     Boeing that rolled out the B787 last July 2007, will not have Azerbaijan Airlines as a customer at least right away, as the carrier dumped its order for two, a move that may signal that other airlines may have had enough promises and are looking at other options.
     To make matters worse after the past few years of running up the numbers with A380 orders, this year Airbus is ahead of Boeing in the race to see who sells the most airplanes in 2008.
     Boeing and Azerbaijan Airlines said they had finalized an order for two single-aisle 737s and two twin-aisle, extended range 767s, worth about USD$450 million at list prices, with one of the 767s replacing one of the three 787s that Azerbaijan had ordered in February last year.
     Only the B787 Delay Liner was supposed to replace the B767, or something like that.

     Promising even more to come, Congress of South African Trade Unions in South Africa (COSATU) led its two million members in a one-day national general strike last Wednesday to protest high living costs, severely hurting transport and shut down mines and factories.
     AngloGold Ashanti and Anglo Platinum were affected by the strike.
     The union federation has vowed to fight President Thabo Mbeki's market-friendly and pro-business attitude saying the government should first pay workers better.

AirAsia links Guilin in southwest China's Guangxi Zhuang Autonomous Region, and Kuala Lumpur next month. Airbus 320 services commence September 3 and will fly every Monday, Wednesday, Thursday and Saturday.

Forget reports of talks starting up after Olympics. China Eastern Airlines said it had no plans to restart anything about selling a stake of itself to Singapore Airlines.
     "There's no timetable for resuming the talks now,'' Board Secretary Luo Zhuping told reporters.
China Eastern was to sell a 24 percent stake to Singapore Airlines and Temasek Holdings in September but the deal was squashed by China Eastern shareholders after the parent of Air China pledged to make a higher offer.
     Elsewhere Singapore Airlines increases its frequency on the Singapore-Delhi route to double daily (14 times weekly), up from the current nine flights a week on September 1, 2008.