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A passenger hears aloud noise near the overhead bin, then sees ahole not far from his head in the fuselage of the plane. This is Southwest flight 2294, June 13, 2009, on a 30 minute 737 Boeing airplane flight from Nashville to Baltimore. outhwest inspected all of its 181 737 planes and found no problems. The National Transportation Safey Board, the FAA, and Boeing are investigating what caused it to happen. In March, the FAA ordered Southwest to pay a$7.5 million fine for aseries of safety violations in which its jets were flying with undetected fatigue cracks. The investigation also uncovered efforts by managers to cover up reports of maintenance problems at Southwest. Two inspectors filed whistleblower complaints aginst the FAA claiming that they were threatened by the superiors after warning that Southwest was flying planes too long between inspections.

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Air France is increasing the fuel surcharge on medium haul and long haul tickets. For example the fuel surcharge on a long haul flight from Paris to New York will be 91 Euros one way flight. Air France says it will cut the increase of 4 euros by half if oil price is stabilized over time to $100 a barrel and eliminate the increase if the price stabilizes below $95 a barrel. This is another approach to the rise in fuel prices. Airlines have the options of not investing in their business and in quality of service and letting it deteriorate as is happening in the US or one way or another transferring the cost of fuel increases to the customer directly through increasing fuel surcharges and maintaining the quality of their service and investing in their business.

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The 1 hour 20 minute flight London to Amsterdam uses a Virgin 747-400. Virgin teams up with Boeing and GE Aviation for this project. The plane will use 20% biofuels and a drop-in solution, meaning the GE engine needs no modification and the engine performance is not affected. Virgin gets marketing cache from this move. Why aren't other airlines doint this? Another thing Virgin will not use biofuels that are derived from crops like palm oil or others that consume vast amounts of land and water.

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Ingram says Obama's 2015 budget is more of a wish list for Democrats, because 2015 spending levels are already set and House Republicans will put together their own budget putting forward the Republican views. Obama's budget includes new taxes on busiess and the wealthy to reduce the deficit. Other ideas- raise tobacco taxes to pay for universal pre-K education, a "Fianncial Crisis Responsibility Fee" on big banks, overhaul immigraion laws to increase tax revenues, limit itemized deductions for the rich, force drug companies to give large rebates on Medicare prescriptions. Another proposal is a $56 billion "Opportunity, Growth and Security" Initiative, for spending on early childhood education, job training, and medical research. To pay for this he would cut the amount wealthy people can save tax free for retirement, cut crop insurance and raise airline security fees.

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The WSJ's Jon Ostrower's intervew with Ray Conner, head of the commercial airplanes division of Boeing. Conner says the era of moon shot type projects is over at Boeing. The Dreamliner project cost $50 billion and ran into repeated delays, with a supply system not ready for the complexity of the project, manufacturing issues, cost overruns, labor issues, and battery failure leading to emergency landing of a ANA Dreamliner in Jan. 2013 leading to grounding of many ANA and JAL aircraft. Boeing's CEO McInerney and Conner see the experience as a lesson for Boeing on the risks of such large projects when airlines are not willing to spend more for revolutionary improvements. Conner cites the example of the incremental improvements in the iPhone since its introduction, with the cost to the consumer not changing much with each new model, as one Boeing would like to follow. Manufacturing improvements are critical to the new model with design needing to include manufacturing process at the outset, reducing complexity, increasing simplicity and improving reliability, as critical goals. As part of this effort Boeing has hired Toyota managers to bring better manufacturing practices, and the focus is now on incremental change and improvement throughout the Boeing organization....

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To return the airline industry to profitability would require that they cut their fleets by 19% and raise fares by 22%, according to airline consultant at Morton Beyer & Agnew. Delta had plans to shift 10% of its capacity to overseas routes before the merger with Northwest. This would bring passenger traffic down from 299 million to 240 million and raise the average fare from $280 to $340.

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Problems that linger at United Airlines include fewer employees to do the same amount of work after rounds of costcutting and pay concessions, less motivated and overworked employees. So complaints from customers and late arrivals continue to keep United struggling in most customer satisfaction areas.