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People have short memories. Why the Boeing 737 MAX will survive the current crisis.

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People have short memories. Why the Boeing 737 MAX will survive the current crisis. | The Thaiger

If history is anything to go on people’s current fears about the Boeing 737 MAX jets will be short-lived.

The make0ver of the venerable 737 plane, the most popular passenger jet in history, was supposed to set Boeing on a path to success. Airlines said it was the plane they wanted – perfect for short-haul, cheap to run, new efficient engines.

Boeing didn’t go down the path of coming up with a new single-aisle jet to compete with the new Airbus 320 Neo series, instead they decided to come up with a revised 737. The revised plane has slightly larger and more powerful engines, is a little higher off the ground, features some new hi-tech construction materials making it lighter, upgraded avionics and, importantly, new software that was meant to make it even safer.

You can identify a 737 MAX because of the two-spoke winglets at the end of the wings.

Now two of the new series 737 MAX have crashed within six months with investigators speaking about ‘similarities’ in the early days of the crash investigation.

Travel site Kayak even added an option to screen out flights using the 737 Max jets.

If panic persisted, the media kept writing stories about it and airlines were unwilling to buy it, the future of Boeing would be in jeopardy.

That’s the current situation. But it also reflects a similar time during a four-month period in late 1965 and early 1966 when four new Boeing 727 jets crashed. Three of the crashes occurred while the planes were attempting to land at US airports. Two of them happened within three days of each other in November 1965. The 727 was the first commercial jet to fly with less than four jet engines.

Like the 737 MAX crashes, the US regulator, the FAA, defended the planes’ safety and refused to ground the 727s at the time. It issued a statement the day after the third fatal 727 crash, saying that it could find no pattern in the crashes. It declined to ground the jet.

At the time Boeing was still riding on its reputation built around the Boeing 707 jet, the first successful commercial passenger jet (the British Comet was the first commercial passenger jet in 1952 but had a series of catastrophic crashes from which it never recovered profitable sales).

Eventually the Civil Aeronautics Board, which was created in the wake of the crashes, cleared the 727 and blamed pilot error for the accidents. Pilots were not prepared to fly the 727, and that led to the crashes. The new wings of the revolutionary (for the time) 727 made the plane descend much faster than was possible in the past, giving pilots the chance to slow the planes down faster and land on much shorter runways than the jets of the time, a big selling point.

But the pilots at the controls of the four doomed jets in the 60s were apparently unprepared for how quickly the planes would descend with the new wings.

But Boeing did get past the 727 crisis. Increased training led to safer operation of the plane, and these kinds of crashes ended. Customers soon forgot.

The 727 went on to become the bestselling jet of its time for Boeing. It eventually sold 1,831 of the jets, a lot when flying in jets was still mostly reserved for the ‘jet set’ and people able to afford the expensive ticket prices of the time.

“I don’t know that people will care that much for very long,” says Shem Malmquist, a Boeing 727 and 777 Captain.

“They only worry about the price of the ticket.”

People have short memories. Why the Boeing 737 MAX will survive the current crisis. | News by The Thaiger

The Boeing 727 suffered four high-profile crashes in the mid 60s and went on to become a flying favourite.



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Phuket hotel watch – 3 months down, 9 to go in 2019

Bill Barnett

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Phuket hotel watch – 3 months down, 9 to go in 2019 | The Thaiger

by Bill Barnett of C9Hotelworks.com

At the beginning of the year Phuket’s tourism and hotel sector was cautiously optimistic after a strong first half of 2018 and humbling second half. Key terms that kept popping up were Mainland Chinese, Thai Baht Appreciation, Elections and Supply Concerns.

So today, with three months of performance under the belt in 2019 what are the key trends in hotel trading? These can best be compressed in the following points –

According to data from hotel benchmarking group STR, Thailand remains Southeast Asia’s leading destination for Mainland Chinese, but the gloss is being diminished by Vietnam’s meteoric rise, and strong numbers by the Philippines and Cambodia.

Market-wide RevPar shunk by 0.04% in 2018 and flat demand at the onset of the year is now shifting into negative territory moving into February and beyond. Turning back to last year, group demand is falling which is as key concern in a wholesale driven marketplace.

One stark positive is that RevPar is being propped up by rates and not occupancy. A key takeaway is that in peak and high season, Phuket hotels are able to drive rates up in key periods and continue to do so. This of course is a broad trend.  Good hotels tend to perform at higher levels, while poorly managed ones remain subpar.

Getting beyond the numbers, as I speak to hoteliers the expectation is that wholesalers remain a critical component of the island’s hotel industry and despite the expected shift with technology to more direct bookings, the reality is that wholesale models are sensitive to demand volatility and the result of this feeding frenzy most often will be either flat rates for the year or in some cases a retraction.

We expect the remainder of 2019 to be challenging. Some hotels will look at this as an opportunity to reposition, renovate or cut costs. While others will look at new segments, niche offerings or emerging markets like India to regain momentum.

As for the top critical issues facing Phuket hotels, in my opinion these can be distilled in the following Top 3 Things Keep Me Awake at Night…

• Mainland Chinese – If tourism players or hotels believe the damage to Brand Phuket is over, think again. Talking to key tour operators there remains a hangover from last year’s boat sinking incident and travellers remain keenly concerned over safety. Only time and more concentrated promotion will see a return of the numbers.

• Growing Supply and Demand Imbalance – The current pipeline is just over 8,000 keys in development on the island. What’s more concerning is that projects in planning are not represented in this metric, and by our estimate there are approximately 5,000 more keys in planning. While both the pipeline and planning numbers will see some wash, the sum total exceeds current and forecasted demand.

Moreso, the rise of unlicensed condominiums, apartments, houses and villas is continuing unabated and is further exacerbating supply issues. Every time you see a group of tourists renting a 3 or 4 bedroom villa, that’s three or four hotel rooms that lay empty. Government control of unlicensed properties is a key issue facing Phuket’s tourism industry.

• Diminished Natural Resources and Strained Infrastructure – Water tops the list and there is little doubt we are reaching the tipping point with mounting shortages and soaring demand. Electricity is another concern. Lastly is a rising number of vehicles on the road, a urbanising trajectory and slow development of roads and public transport.

To these point’s lets revisit the hotel development pipeline and reflect that a island long term master plan, zoning for new tourism expansion and requirements for developers to invest in public infrastructure to obtain operating licenses is sorely lacking. Something has to give on this front.

In conclusion am I pessimistic about Phuket’s tourism and hotel future in 2019 and beyond? Absolutely not, direct airlinks are growing and the island has a well-structured capacity for handling tourism, but I firmly believe looking into our problems, discussing and finding ways to resolve these are critical to a sustainable growth pattern.

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‘Seastead’ set up off coast of Phuket

The Thaiger

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‘Seastead’ set up off coast of Phuket | The Thaiger

PHOTOS: Nation TV

A Thai couple has successfully set up a ‘Seastead’ near Phuket.

Seasteading is aiming to build floating societies with “significant political autonomy”. Nearly half the world’s surface is unclaimed by any nation-state, and many coastal nations can legislate “seasteads” in their territorial waters (like a “homestead” but wetter).

The nation TV reports that website ‘Bitcoin.com’ and ‘Ocean.builders’ report that the Thai couple Chad Elwartowski and Nadia Summergirl are are the first seasteaders who established a small seastead 12 nautical miles off Phuket.

Most of the construction of the Seasteading was built on the island of Phuket. The installation in the sea started on January 9.

Mr Elwartowski reveals that the reason that they have chosen to settle near Phuket as the construction price is cheap. The sea is suitable for the establishment as waves are not too high and can attract many tourists.

SOURCE: Nation TV

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Massive 11 hotel project, surf club and waterpark for Kata, Phuket

Bill Barnett

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Massive 11 hotel project, surf club and waterpark for Kata, Phuket | The Thaiger

by Bill Barnett, C9Hotelworks.com

Thai developer K.W. Plaza group has unveiled plans for a large-scale mixed-use project called The Beach Plaza on 15 rai, that will have 11 three and four star hotels with a total of 1.490 rooms. The developer is already pitching the unconstructed project to global hotel interests for an imminent sale.

The properties will have varying room sizes from 25 to 35 square metres and range in size from 78 to 204 rooms. Part of the development scheme will see the hotels individually sold off to hotel investors and/or operators.

Late last year the group built and sold the Surf Resort in Patong which was brokered by JLL to a Singapore-based owner/operator.

Other components of the project include a surf club, waterpark, and freestanding restaurants and retail.

An initial hotel has already obtained EIA approval and is currently for sale, with construction of other properties to be phased. The Beach Plaza is off-beach, behind the Kata Night Market and close to Club Med, Ozo and the Ibis.

For more details on the project click HERE.

Massive 11 hotel project, surf club and waterpark for Kata, Phuket | News by The Thaiger Massive 11 hotel project, surf club and waterpark for Kata, Phuket | News by The Thaiger

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