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Airline Stock Roundup: Impressive Traffic at GOL, Mixed Bag Results at Copa

Over the past five trading days, headlines were dominated by the impressive October traffic data revealed by Latin American carrier, Gol Linhas Aéreas Inteligentes S.A. (GOL). However, the news on another Latin American company, Copa Holdings SA (CPA) was not so promising. The company delivered soft revenues in the third quarter though earnings came above expectations.

JetBlue Airways Corporation’s (JBLU) decision to charge its customers for checked baggage and squeeze seats in order to boost profit was another highlight of the period under consideration. Delta Airlines (DAL) was also in the news when it placed a $14 billion order to the Airbus Group for 50 widebody jets.

Major companies in the airline space such as American Airlines Group (AAL) and Delta Airlines have waived rebooking charges for customers booked on their flights for travel today (one of the busiest travel days historically) in anticipation of a storm targeting the East Coast. The storm, if it materializes will result in heavy snowfall in the area, spoiling travel plans on the eve of the Thanksgiving Day.

Overall, it was a mixed week for major airline stocks, with quite a few of them suffering losses over the last 5 trading days. However, the losses incurred were not half as drastic as the ones suffered by airline stocks throughout September and early October due to Ebola related worries.

In fact, airline stocks have rebounded nicely from the lean period aided by healthy earnings reports and weak oil prices (Read last to last week’s developments here: Airline Stock Roundup for Nov 19, 2014).

Recap of Most Important Stories of the Last Five Trading Days

1. Latin American company Copa Holdings delivered mixed results in the third quarter of 2014. While earnings (on an adjusted basis) surpassed the Zacks Consensus Estimate, revenues missed expectations. The top line was hurt by lower passenger revenue yields. Capacity reductions in Venezuela also weighed on the results (read more: Copa Holdings Q3 Earnings Top, Revenues Lag; Shares Slide).

2. Another Latin American carrier Gol Linhas Aéreas Inteligentes S.A. was also in the news in the period under consideration when it reported impressive traffic statistics for the month of October on the back of strong demand. Revenue passenger kilometers increased 8% from the comparable year-ago period (read more: GOL Impresses with Strong Oct 2014 Traffic Numbers).

3. JetBlue Airways has announced that it will add bag fees and squeeze seats. The decision, which is believed to have been taken in a bid to bolster revenues going forward, was announced at the company’s Investor Day. Post-JetBlue’s decision, Southwest Airlines (LUV) is the only U.S.-based carrier to allow free check-in of a bag for all passengers (read more: JetBlue to Add Bag Fees, More Seats on Flights; Stock Rallies).

4. Delta Airlines has placed an order worth $14 billion to the Airbus Group for 50 widebody jets. Delta’s order comprises of 25 Airbus A350-900 aircraft and 25 advanced Airbus A330-900neo aircraft. The first A350 is expected to be delivered to Delta in the second quarter of 2017. A330neos will arrive in 2019 (read more: Delta Air Lines to Add Airbus A350-900 A330-900neo).

5. In order to enhance its in-flight entertainment offerings, United Airlines – the wholly owned subsidiary of United Continental Holdings Inc. (UAL) – has introduced a new application called United app. The offering allows fliers to access a wide range of movies and television shows through Wi-Fi-enabled mobile devices and laptops (read more: United Airlines App to Better In-Flight Entertainment Quotient).

6. American Airlines – the wholly-owned subsidiary of the American Airlines Group– will launch its a new daytime daily flight from Philadelphia International Airport to London Heathrow Airport on May 29, 2015. The new service, aimed to boost trans-Atlantic travel, is the second American Airlines flight in the route.  Delta Airlines has also announced its plans to launch a new Philadelphia-London service on Apr 7 next year (read more:American Airlines to Start Second Philadelphia-London Flight).

Performance      

The following table shows the price movements of the major airline players over the past 5 trading days and during the last 6 months:
 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

 

As the chart above suggests, the share prices of quite a few major airline stocks were down over the past five trading sessions. Gol Linhas emerged as the biggest gainer among the major players in the airline industry, thanks to its strong October traffic data, with its share price rising 11.18%. Southwest Airlines witnessed the highest upside (48.86%) over the last six months compared to its peers.

Copa Holdings, which fell 7.13% during the 5-day period, was the biggest loser hurt by below-par third quarter results. The company also experienced the highest drop in share price (19.9%) over the last 6 months.

What’s Next in the Airline Biz?

Focus will remain on whether inclement weather will affect the lofty projections for the Thanksgiving holiday season. According to media reports, flight cancellations are on their way up due to the anticipated storm (Cato) in the northeastern states of the country.

With bad weather expected to play spoilsport as far as travel on the eve of the Thanksgiving Day is concerned, it would be interesting to see weather the forecast of trade organization, Airlines for America, holds true or not. The organization predicted that U.S. airlines will carry 1.5% more passengers in the Nov 21–Dec 2 period this year compared to last year.
 

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Zacks Investment Research

Zacks Industry Outlook Highlights: Delta Airlines, GOL Linhas and United Continental Holdings

Chicago, IL – November 26, 2014 – Today, Zacks Equity Research discusses the Airlines (part 1), including Delta Airlines Inc. (NYSE:DALFree Report), GOL Linhas A (NYSE:GOLFree Report) and United Continental Holdings Inc. (NYSE:UALFree Report).
 
Industry: Airlines (part 1)

Link: http://www.zacks.com/commentary/35570/airline-stocks-soar-fuel-costs-offset-ebola-scare
 
The global aviation industry retained its strong momentum even in the recently concluded third quarter of 2014 on declining fuel prices, rising passenger travel demand and growing cargo and passenger traffic. Despite the outbreak of Ebola virus, most airline companies were able to maintain impressive air traffic growth in the recent months, resulting in an optimistic outlook for the remainder of 2014 and beyond.
 
Fuel costs comprise nearly 30% of the total operating expenses incurred by airline companies. Since June this year, crude oil prices have gone down by 30% which has translated into the impressive profits garnered by airline stocks in the third quarter.     

According to the International Air Transport Association (:IATA), expansion of the economic cycle along with rapid Gross Domestic Product (GDP) and world trade growth are expected to boost air travel by 5.9% − the best since 2011. The rise in capacity may, in turn, lead to a 3.5% cut in airfares, thus benefiting travelers.

The IATA remains positive on the industry and projects overall airline profits of $18.0 billion on revenues of $746 billion for 2014, from an estimated 3.32 billion passengers. In 2014, net profit margin is projected at 2.4%, up from 1.5% in 2013. The industry is expected to generate $5.42 from every departing passenger on an average, a rather soft number for a high-risk business.

Additionally, air cargo volumes — a crucial indicator of business confidence — have been a trouble spot since 2010. However, figures have been recovering since the start of 2014 and could expand 3.1% in the course of the year to reach $197 billion.

Outlook for North America

North America: With an improvement in the world’s largest economy, airlines in North America have seen considerable opportunities in 2014. Consolidation benefits, rising travel demand and several new and enhanced ancillary revenues provide an impetus to growth.

Better days are ahead for the U.S. airline industry with Airlines for America (A4A) predicting a 1.5% increase in the number of flyers during the Thanksgiving holiday season this year. According to the forecast, U.S. airlines will transport 24.6 million passengers in the Nov 21–Dec 2 period. Nov 30, the Sunday after Thanksgiving, is expected to be the busiest flying day in the period under consideration.

To tap in on the holiday season opportunity, most domestic airline companies in the U.S. have decided to maximize profits by increasing fares and seats. Recently, Delta Airlines Inc. (NYSE:DALFree Report) hiked round-trip fares by nearly $10 and was well followed by other leading carriers. Likewise, to boost revenue during the holiday season, JetBlue has also decided to charge bag fees and squeeze seats.

The recent agreement between the U.S. and China governments, to extend the validity of short-term visas for visitors between both nations for up to ten years followed with the extension of student exchange visas from one to five years will considerably benefit airline companies while going forward.

Although performance will continue to vary substantially between different U.S. carriers, a strong 2013 has made way for a higher 2014 profit forecast of $9.2 billion.
 
Underlying Factors for 2014 Profits
 
There are several catalysts that are poised to trigger profits for the overall airline industry in 2014 and beyond. These include:
 
Passenger Cargo: The IATA suggests that economic recovery along with faster GDP and world trade growth will drive air transportation demand. Customers, on the other hand, will benefit from cheaper air travel as one-way fares are expected to be slashed by 3.5% this year. The association projects global airline passenger growth of 5.9%. Meanwhile, the average industry load factor is expected at 80.4%.
 
Coming to demand-supply balances, demand (measured in traffic) is expected to outpace capacity in 2014. While the projected capacity increase is pegged at 5.5%, air travel demand is likely to see a 5.9% pickup.
 
Fuel Price Effect: Airline profits largely depend on fuel prices, the major variable component in the industry. For 2014, average jet fuel prices are expected to stay at $122.9 per barrel, a notch lower than $124.5 per barrel in 2013. However, oversupply of crude oil in the market has resulted in the downward trend in jet fuel prices, reaching price levels much below the forecasted price which is currently hovering near $100 a barrel. The association also expects fuel costs to remain stable at around $212 billion in the remainder of 2014.
 
Fleet Restructuring: Air carriers at large are looking for fuel efficient fleets in order to reduce costs that have gained 55% over the period 2006–2013. Most airline companies have set long-term goals of replacing aging planes with new and upgraded ones. Volatile oil prices have also played a major part in the fleet replacement decision. In a bid to retire depleted aircraft, recently Delta Airlines has recently ordered 50 new jets from Airbus worth $14 billion, to be delivered between 2017 and 2019. Even, Brazilian carrier GOL Linhas A (NYSE:GOLFree Report) plans to invest nearly $1.7 billion to buy small, single-aisle jet models from Boeing Co. and Embraer SA.

According to Boeing, over the next 20 years, global airlines are expected to invest around $5.2 trillion in fleet development. Over the long run, the carriers aim to replace old narrow-body jets — A320’s/B757-200/300 — with advanced ones such as A-321, A320 Neo and the B737 Max, for better service and demand-supply equilibrium.
 
Jet Renovation: With passengers demanding comfort and quality service along with proper security, airlines are increasingly focusing on aircraft redesigning with the inclusion of new and attractive products and services within the travel plan. Meanwhile, United Continental Holdings Inc. (NYSE:UALFree Report) is offering premium flat-bed cabin seats on every long-haul international flight.
 
Further, the carrier has installed in-seat power on more than half of its mainline fliers and has paced up the installation of the satellite-based first ever Wi-Fi service for fliers. Delta Airlines plans to invest $750 million over the next two-year period to deploy Wi-Fi as well as to refurbish the interiors of its narrow-bodied aircraft over the next three years.
 
Apart from offering mini iPAD to its in-flight crewmembers to improve passenger service, the company will also extend its Porsche service to premier customers of three additional airports by Nov 30, 2014. Recently, JetBlue also launched its version of premium service, Mint, between JFK Airport, NYC and San Francisco International Airport.
 
Hedging Strategies: Hedging strategies are frequently used by airline companies to cope with rising fuel prices. Notably, carriers use a combination of calls, swaps and collars at varying WTI crude-equivalent price levels to hedge.
 
Zacks Industry Rank
 
Within the Zacks Industry classification, airlines are broadly grouped into the Transportation sector (one of the 16 Zacks sectors).
 
We rank all the 260-plus industries in the 16 Zacks sectors based on the earnings outlook and fundamental strength of the constituent companies in each industry. To learn more visit: About Zacks Industry Rank.
 
As a point of reference, the outlook for industries in the top one-third of the list (with Zacks Industry Rank #88 and lower) is ‘Positive,’ the mid one-third of the list (between #89 and 176) is ‘Neutral,’ while the last one-third (#177 and above) is ‘Negative.’
 
The Zacks Industry Rank for the airline industry is currently #48, implying that the outlook remains positive on this sector for this year owing to a rise in passenger air travel demand.
 
Earnings Trends
 
The broader Transportation sector reflects a stable growth pattern. So far, 100% of the sector participants in the SP 500 index have reported third-quarter results, which have been fairly good in terms of growth rates and beat ratios.
 
Total earnings for these companies are up 10.4% on 6.6% higher revenues, with 81.8% of the companies beating earnings estimates and 72.7% coming ahead of revenue expectations. This marks a much better performance by the Transportation sector than in any other recent quarter.
 
Third-quarter 2014 earnings are expected to rise 13.6%, thereby pegging the full-year 2014 growth outlook at 15.2%. For 2015, the sector’s earnings are poised to expand around 17.2%.
 
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Delta takes stand for immigration reform

Delta Airlines isn’t too afraid to wade into a political issue despite the risk it will alienate many of its customers.

After President Obama announced his executive order on immigration last week, the airline issued this statement:

“Delta Air Lines applauds the steps announced this week to enact much-needed reforms to the nation’s immigration system,” said Joanne Smith, Delta’s Executive Vice President and Chief Human Resources Officer.

“The President’s actions will provide economic development opportunities and enhance public safety by streamlining legal immigration while cracking down on illegal immigration at the border and focusing on deporting felons rather than families.”

“Why did you issue that statement? It’s controversial,” a CBS morning show anchor asked Delta boss Richard Anderson today.

“If you’ve seen some of the email I’ve gotten,” Anderson replied, “you’d wonder why I issued the statement.”

So, why?

“Because this problem needs to be solved,” he said.

“We’re an airline, next year we hope to carry 175 million people, we have people all over the world and having immigration reform to allow people the freedom to move over the border is important,” he said. “Our country needs to reflect the diversity and values of people all over the world.”

It’s a point that could come with a cost.

Or not.

Pocatello's Delta air service upgraded to jets

POCATELLO, Idaho (AP) — Pocatello’s commercial air service is getting an upgrade.

SkyWest Airlines, a regional carrier on contract with Delta Airlines, will begin using 50-seat jets next year in place of 30-seat turboprops on its Pocatello to Salt Lake City service.

The airline provides the only commercial service at Pocatello’s airport. It operates twice daily on weekdays and once a day on weekends.

Pocatello Regional Airport manager David Allen tells the Idaho State Journal (http://bit.ly/1zPzwSr ) that the Canadair CRJ-200 jets are quieter and more comfortable. They’ll replace Embraer EMB-120 turboprops.

Allen says the Pocatello airport has seen 8 percent annual growth since September 2012, higher than the national average.

___

Information from: Idaho State Journal, http://www.journalnet.com

Critical Alerts For Cliffs Natural Resources, Ford, Delta Airlines, Halliburton and Aegerion Pharmaceuticals Released …








CHICAGO, Nov. 24, 2014 /PRNewswire/ — InvestorsObserver issues critical PriceWatch Alerts for CLF, F, DAL, HAL and AEGR.

To see what our analysts have discovered about a particular stock, read the InvestorsObserver’s PriceWatch Alert by selecting the corresponding link. (Note: You may have to copy this link into your browser then press the [ENTER] key.)

CLF: http://www.investorsobserver.com/pr/112120142/CLF
F: http://www.investorsobserver.com/pr/112120142/F
DAL: http://www.investorsobserver.com/pr/112120142/DAL
HAL: http://www.investorsobserver.com/pr/112120142/HAL
AEGR: http://www.investorsobserver.com/pr/112120142/AEGR

(Note: You may have to copy this link into your browser then press the [ENTER] key.)

Today’s PriceWatch Alerts cover the following stocks: Cliffs Natural Resources (NYSE: CLF), Ford (NYSE: F), Delta Airlines (NYSE: DAL), Halliburton (NYSE: HAL), Aegerion Pharmaceuticals (NASDAQ: AEGR). InvestorsObserver’s PriceWatch Alerts contain concise, detailed strategies for each stock we cover, including position protection tactics designed to defend investors from potential market shifts. While many other market reports only provide stock news and opinion, we offer strategies that can bulwark investments against uncertainty and increase chances of making a profit, even if a stock goes down.

“We go above and beyond typical market coverage,” said Bobby Raines, Analyst at InvestorsObserver. “Trading experts and beginning investors alike can find value in our PriceWatch Alerts. We provide actionable strategies that protect investments with basic hedging tactics, along with a concise explanation of our techniques.”

InvestorsObserver.com is an online newsletter which focuses on the U.S. equities and options markets. Our analytical tools, screening techniques, rigorous research methods and committed staff provide solid information to help subscribers make the best possible investment decisions. For more information go to www.investorsobserver.com.

All stocks and options shown are examples only– not recommendations to buy or sell. Our picks do not represent a positive or negative outlook on any security.  Potential returns do not take into account your trade size, brokerage commissions or taxes–expenses that will affect actual investment returns. Stocks and options involve risk, thus they are not suitable for all investors. Prior to buying or selling options, a person should request a copy of Characteristics and Risks of Standardized Options available at http://www.cboe.com/Resources/Intro.aspx. Privacy policy available upon request.

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Delta Selects BETA Fueling Systems For Its Hydrant Dispenser Trucks

BETA Fueling Systems has received an order from Delta Airlines to supply ten 800 gallon per minute (3000 Lpm) hydrant dispenser trucks for Delta’s Hartsfield-Jackson Atlanta International Airport.
BETA’s newest hydrant truck series, the HT-800’s are designed to endure the rigors of the world’s busiest airport as well as extreme hot-to-cold climate swings experienced in Atlanta, Georgia. The company began delivering the new order in November 2014.

“Delta wanted a supplier who could leverage global experience to help them survive extreme conditions like last winter’s polar vortex”, said Jon DeLine, President and CEO of BETA. “BETA’s equipment proved to be fully reliable for Delta in last year’s sub-zero conditions, which was one of the driving factors to give us this new order”, said DeLine.

BETA has developed a unique skill set serving global customers in extreme climates around the world for over 40 years. “There are many variables to consider when designing equipment for
global fueling operations”, said John Ingold, BETA’s Engineering Manager. “We consider everything from aircraft types to user safety, and ergonomics to climates. Our mission is to
thoroughly cover every operational scenario to ensure fuel gets safely into the aircraft and flights to depart on time”, said Ingold.

BETA Fueling Systems, is the world’s leading manufacturer of hydrant dispensers, hydrant carts, and aviation refueling modules and has 1000’s of refueling units in service in over 30
countries world wide. For more information about BETA Fueling Systems, visit www.betafueling.com

Airbus to sign Delta deal for '50 planes'

DELTA DEAL: An Airbus A350-900 aircraft performs a flight pass.



European aerospace giant Airbus is poised to sign a deal to deliver 50 long-haul carriers to US Delta Airlines in a contract worth US$14 billion (NZ$17.8 billion) at catalogue prices, sources say.

Under the terms of the deal, Airbus will deliver 25 A350-900s, the company’s new long-haul carrier that this month received certification from the US Federal Aviation Authority, a source close to the negotiations said on condition of anonymity.

The other 25 planes will be A330-neos, an updated version of its wide-body medium-haul jet with fuel saving engines which is slated to enter into service at the end of 2017.

“The order should be finalised in the coming days,” said one of the sources.

“The announcement could be made at the beginning of next week.”

Delta had asked Airbus and Boeing in April to submit offers as the airline considers replacing its ageing fleet of long-haul 747-400 and 767-300 jets, saying it expected to place an order by the end of the year.

The A350-900 is designed to compete with Boeing 777 and 787 jets in the lucrative long-haul segment and has already received 750 orders.

Equipped with Trent XWB engines from Rolls-Royce, the plane can transport 315 passengers up to 14,500 kilometres.

Earlier in the month, Airbus announced that it had signed a preliminary deal to supply the China Aircraft Leasing Company with 100 planes in a contract worth around US$10.2 billion at catalogue prices.

AFP





Comments

You are now free to pollute about the country

The climate clamor over flying doesn’t stop with environmental activists. One British bishop denounced flying on a vacation as a “sin.” Even publishers of travel books lament the climate impact of their wanderlust guides and are advising travelers to “fly less and stay longer.” Mark Ellingham, founder of Rough Guides, and Tony Wheeler, founder of Lonely Planet, have decried the growth of what they call “binge flying,” and urged air travelers to take to the skies less often. “In Europe, and especially Britain, we have become addicted to cheap flights, heading off to Rome for the day or Prague for the weekend,” writes Ellingham in e-mail. “Many people buy these as casually as booking a restaurant. I consider this ‘binge flying’ and I don’t think it’s sustainable behavior.”

How worried should air travelers be about contributing to global warming? Flying still makes up a very small percentage of greenhouse gas emissions. Globally, just 1.5 percent of greenhouse gas emissions caused by human activity each year come from air travel, according to Tim Herzog, a climate policy analyst for the World Resources Institute. In the U.S., that number’s about 3.5 percent. Yet those numbers are projected to rise sharply, making air travel one of the fastest growing contributors to global warming, while the world is struggling to reduce emissions. Over the next 20 years, more than 27,000 new aircraft will take flight, and the number of air travelers will double to 9 billion during the same period, according to the Hodgkinson Group, an aviation consulting firm. Here in the United States in the next two decades, demand for air travel will grow 150 percent, according to the Department of Energy.

Some governments are stepping in to curb the rising tide of emissions. By 2011, airplanes traveling within the European Union will be subject to a carbon trading scheme. But debate about such regulations inspired the unrepentant boss of one low-cost airline, Ryanair, to pledge to increase his company’s carbon emissions, saying if his customers are worried about the environment, he had some advice for them: “Sell your car and walk.”

Hopping a commercial flight sure feels like an airborne form of carpooling, especially when the blowhard sitting next to you won’t close his yapping trap for six hours. And, sure, fine, it’s unquestionably better for the environment than owning a private jet, which one horrified activist compared to buying a whole coal-fired power plant to power a single mobile phone. Yet even on today’s full flights with passengers crammed into small seats, flying packs a big climate punch. For a long trip, like a transatlantic flight on an average-size plane, each passenger is responsible for sending .39 pounds of CO2 per mile into the atmosphere, according to the World Resources Institute’s Greenhouse Gas Protocol Initiative. By that measure, flying direct from Denver to London and back puts about 3,600 pounds of CO2 into the atmosphere, equivalent to driving a Toyota Prius hybrid 10,000 miles.

While most Americans still emit more by driving than flying, simply because they spend so many hours in the car, frequent fliers can spew a lot more emissions than daily commuters. Take the doting grandmother, recently profiled in the New York Times, who flies 500 miles a week, jetting from her home in Houston to Dallas and back to care for her grandkids, a tale the paper dubbed “The Incredible Flying Granny Nanny.” A year of this high-flying childcare arrangement will pump almost 16,500 pounds of C02 into the atmosphere, more than the average driver of a four-wheel-drive Ford Ranger emits in a year.

It may be a short flight from Houston to Dallas, but shorter flights have a larger impact per mile than longer ones, since the takeoff and landing are the most fuel-hungry part of the journey. “These regional flights are not efficient because they don’t have time to get up into the atmosphere and cruise, where jets are most efficient,” says Luke Tonachel, a vehicles and fuels analyst for the Natural Resources Defense Council. That means the Incredible Flying Granny emits .63 pounds per mile every time she jumps on a jet to see the grandkids. She could reduce her emissions by hopping behind the wheel of a Honda Civic by herself and driving from Houston to Dallas and back.

But why pick on one grandma, when business travel accounts for 65 percent of all flights in the United States, according to PhoCusWright, a travel research firm. It’s the management consultants jetting from New York to Kansas City, and the tech executives winging it from Silicon Valley to the Bangalore outpost, who are really racking up those airborne emissions. Just ask Tom Arnold, chief environmental officer for TerraPass, a Silicon Valley company that sells carbon offsets: “The overwhelming majority of my personal carbon footprint is flights,” he says. Arnold says he cuts down by consolidating trips, and staying four or five days when he goes on a cross-country trip to New York, instead of just flying in for a meeting or two.

Flying also has another warming effect, beyond the greenhouse gas emissions. Planes leave behind contrails, thin wisps of condensation in their wake, which act like high, thin ice clouds producing an effect called “radiative forcing.” The contrails trap heat that’s radiating off the earth’s surface, contributing to global warming. During the day, they also reflect sunlight, which has a counterbalancing cooling effect. At night, and during the winter, when its darker, there’s less sunlight for the clouds to block. “The warming effect goes on 24 hours,” says Don Wuebbles, a professor of atmospheric science and director of the School of Earth, Society and Environment at the University of Illinois. “It’s generally thought that the warming effect wins out. The cooling effect is only during the day.” Right after 9/11, when most planes were grounded in the United States for days, scientists were able to measure a change in the temperature.

A purist might argue that if you’re really worried about global warming, any recreational flying is unsustainable. As with so much else with global warming, the emissions math is not that straightforward. Deforestation is a major contributor to global warming — second only to power generation as a source around the world — accounting for some 18 percent of annual human-induced greenhouse gas emissions. Tourism is one of the key industries that makes it economically viable for poorer countries to avoid clear-cutting rain forests for cattle ranching or agriculture. If visitors from richer countries suddenly stopped flying, more rain forests would fall, creating more emissions.

“I don’t think it would be a great thing for the world — and the developing world especially — if we all stopped flying entirely,” writes Ellingham from Rough Guides. “What is crucial, however, is that aviation doesn’t continue to grow at present rates — 10 percent in the U.K. and more than 5 percent globally. We don’t have a God-given right to cheap flights that overrides our responsibility to the planet and its people, most of whom, of course, never get on an aeroplane.”

It may come as a surprise to learn the airline industry itself is talking green. In June, Giovanni Bisignani, director general and CEO of the International Air Transport Association, threw down the gauntlet to his colleagues in the airline industry at their annual meeting. “Air transport must become an industry that does not pollute. Zero emissions,” he said. How to get there? “I don’t have all the answers, but our industry started with a vision that we could fly. The Wright brothers turned that dream into reality and look at where we are now.b

The association issued a challenge to its members to replace 10 percent of their polluting fossil fuel with low-carbon alternatives within the decade, and called on the airline manufacturers to build a zero-emissions aircraft within the next 50 years. The U.S. Air Force has set an even more ambitious goal, challenging fuel refiners and alternative energy companies to move the Air Force’s entire fleet to fuel that’s only 50 percent petroleum-based within the next decade. In the meantime, there’s an air travel industry-based Web site to soothe public fears about climate change and flying.

Richard Branson, maverick founder of Virgin Atlantic, has pledged $3 billion to search for alternative fuels. Biofuels don’t pack as much energy per unit as fossil fuels, which makes it challenging to use them aloft. There’s also some concern about them freezing or gumming up at high altitudes. Nevertheless, Virgin claims that it will be ready to test an alternative fuel on a commercial jet in 2008. In the meantime, the race is on to be more efficient with conventional fuels. Boeing boasts that its forthcoming 787 Dreamliner will use 20 percent less fuel than similar-size planes flying today. And one low-cost carrier, EasyJet, has a prototype for a short-haul jet that will reduce CO2 emissions by half.

To conserve fuel, Virgin Airways has experimented with towing airplanes to the runway to avoid turning their engines on until the last possible second. In fact, many planes now taxi with just one engine on, instead of using both, according to Steve Lott, a spokesman for the International Air Transport Association. Better air traffic management to ensure that planes take the shortest routes to their destinations and spend less time circling above airports waiting to land could also yield significant efficiency savings, according to Lott.

Yet these glimmers of conservation don’t appease Joel Makower, executive editor of Greenbiz.com, an environmental consultant to Fortune 500 companies. He recently mused on his blog about whether air travel will ever be green. “I don’t see anything that’s being done by the industry that suggests that airplane travel is going to be climate-friendly within my lifetime,” says Makower, who flew 51 times in the first half of 2007. He argues that the projected growth of the industry and current state of technology mean that airline emissions simply will get worse before they get better.

Still, without an obvious technology fix for air travel, inspiring passengers to give up flying is like trying to toss a paper airplane through a hurricane. Sure, a business traveler can replace a shuttle flight from New York to Boston with a more efficient train ride, but most trips, at least in the U.S., don’t offer such an obvious, efficient and convenient alternative to flying. “If you’re traveling on business between Atlanta and Chicago, what else are you going to do?” asks Herzog from the World Resources Institute. Makower says he hasn’t seen companies voluntarily replacing far-flung meetings with videoconferencing to curtail flying. “Some companies recognize that air travel is the biggest part of their carbon footprint, and the typical response is to offset it, not to reduce it,” he says. Even Ellingham from Rough Guides admits that asking people to cut back on flying won’t achieve much. “I think that a lot of people are moderating their flying habits, and many more will do so as the facts and urgency of acting on climate change become clear. But, no, I don’t think that it will be enough unless governments intervene.” Currently, the European Union’s plans to implement a carbon emissions trading scheme for airlines in 2011 is the only such action.

If you’re trying to figure out the impact of your own flight, you can use many online calculators, mostly presented by companies selling carbon offsets. Be forewarned that the results represent rough approximations. Also, each calculator makes somewhat different assumptions about how big the average plane is, how efficient it is and how full of passengers it is, and so your results will vary. Most online calculators don’t attempt to include the added impact of contrails.

The best way to reduce air travel emissions is, of course, not to fly. If a train is available and efficient, it’s always a better option, according to Jennifer Hattam, green lifestyles expert for the Sierra Club. She also recommends limiting shorter vacations to spots close to home, while saving flying for longer journeys. Another tip: Horde all your vacation days to take one long holiday instead of several shorter vacations throughout the year, involving flying.

Although you won’t catch anyone at the Sierra Club telling you to jump in a car, driving can produce fewer emissions per passenger mile than flying, especially if you have a fuel-efficient car. Trying to decide if you should drive or fly from, say, San Francisco to Los Angeles, adding people to your car who would have flown can easily tip the scales in favor of driving. Flying in the summer, when there’s more light, is also better for the atmosphere than flying in the winter, when it’s darker. And now that you know it’s better to fly in the day, you have a perfect excuse, should your eco-savvy boss want you to be in your transcontinental office the next morning, not to take the red-eye.