The global airline industry has been hit mainly by the spiralling cost of fuel. Nearly 20 airlines have closed down while some others are considering mergers and cutting down their routes and services.

However, there are some companies like Etihad, Emirates and Qatar Airways which are booking orders for new aircrafts, adding routes and expanding their capacity. They are not feeling the pinch because they are lean and have a low cost base.

All these airlines are situated in the Gulf where oil is cheap as they are near its source, their investment in IT and human resource is paying dividend and above all, they have airplanes having an average age of five years or less. These new airplanes sip less fuel and require less maintenance.

All these carriers have lower or no liability in case of pension, health care etc so they can deploy their revenues where they will get good return. Qatar Airways is putting its dollars to good use by searching ways of using natural gas as fuel, which is in abundance there.

European carriers: On the European front, there are well-known and till recently profitable carriers like British Air (BA), Lufthansa, KLM-Air France. They are coping with the changing situation by cutting costs, laying off workers or by putting a ban on hiring. BA has decided to merge itself with Iberia- the Spanish carrier which will provide BA with access to the Latin-American market. Iberia will gain from BA’s Asian and European markets.

Although under stress, these airlines are still in a better position than the US carriers; the United Airlines, American Delta, Continental and others continue to lose money as oil prices surge. Some of them have added fuel charges to the ticket price whereas others charge money for every extra piece of checked baggage. The quantity of in-flight meals is being reduced while in-flight reading material and pillows are becoming scarce.

However there is one airline which is still in the black due to its one-plane one-customer and one-class policy. It flies one type of plane — the B-737— and has only one-class and it has prudently hedged its oil requirements which have resulted in lot of savings.

Pakistani airlines: The two main airlines — PIA and Air Blue — are in their own way trying to deal with the changing dynamics. Unlike some other carriers of the past like Bhoja, Hajvari and Safe Air who packed their bags, Air Blue has expanded from two aircrafts to eight. It is gained market share on domestic as well as on international routes. Now it is planning to go to India, Sharjah and Bangladesh. To deal with a difficult business scenario, the company recently reduced the agents’ commission who have boycotted it. It claims that this has not affected its business as it uses e-ticketing to sell seats.

PIA has increased its fares and has started online e-ticketing for domestic and UK routes. However, it has a lot of ground to cover in the case of its customer service, the condition of its planes and the facilities it provides.

Manufacturers: Meanwhile, the two giant airplane manufacturers-- Boeing and Airbus-- are making efforts to make high-tech and low cost airplanes.

The future bodes well for the industry (as soon the world economy will recover) but only if these air carriers understand that their survival and takeoff lies in cutting costs, streamlining operations and putting passengers first.

The writer is a senior officer in a local airline.