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Last Exile is an anime realized by Gonzo studio (also responsible for the more well-known Full Metal Panic). There are two season : the first one is actually the original anime, simply titled Last Exile, which aired back in 2003; the second season, Fam, the Silver Wing, has aired in 2011 and early 2012.
Last Exile is often considered to be one of the rare "steampunk" animes although I'd personally say it's more of a "dieselpunk" anime, but that's nitpicking. The first season is set in a seemingly alternate universe, on a world called "Prester", which has the shape of an hourglass. The second season is set a few years after the first one, and takes place on a future Earth, although it's not sci-fi (and the Earth geography is different from the one we're used to).
Although at first it seems Last Exile takes place in a different universe altogether, it is actually revealed at the very end that it is set in our own world.
Claus and Lavie, the two main characters, live on Prester, the world that has the shape of an hourglass, and are part of the nation Anatoray. They live as sky courriers, making delivery and such aboard their "Vanship", a mix between a 30s car and a WW2 airplane. They only know that in the other side of the hourglass, beyond the narrow part of the hourglass, another country exists, called Disith. The two nations are separated by the Grand Stream, a stream of air so powerful that only big ships of the line can cross it - no Vanship allowed. Anatoray and Disith are at war, mainly because Disith is trying to leave its side of the hourglass to invade Anatoray's side. Reasons unknown at this point. A third faction exists, the Guild, which de facto controls everything because they're the "masters" of the technology that allows machines to fly on Prester. This technology is based on "Claudia", sort of crystal stuff that powers Claudia Unit, the core of the ships of the line of Anatoray and Disith. Thus when Anatoray and Disith want to do battle they must first refer to the Guild.
Claus and Lavie, completely by chance, stumble upon a wounded guy in a Vanship. It turn out the guy is carrying a small girl and must deliver her to the Silvana, but can't do it because he has been wounded by Guild fighters (fighters as in, fighter planes). Just before he dies he asks Claus and Lavie to complete his mission and take the girl to the Silvana. Claus and Lavie agree to help but are soon attacked by Guild ships willing to take back the girl, whose name is Alvis (Al). They take a run for it into the wild.
Soon they encounter Alexander Row (Alex), the Silvana's captain and coolest anime character ever. They unwillingly (at first) become part of the Silvana's crew.
At this point mysteries pile one on the other (who is Alvis, who is really Alexander Row, why is the guild trying to get back Alvis, etc). It turns out the Silvana is an Anatoray warship, but it is independent in that his Claudia Unit is not controlled by the Guild. Alex and the Silvana is actually a rogue ship fighting for its own goals - whatever they are. Something seems to be at the center of every conflict though, something called "Exile", although nobody really knows what it does or what it is, it's though to have some kind of incredible power. The Guild wants to have it and seems to know more than Anatoray and Disith though.
After some more adventure and dogfighting with Guild ship, Anatoray and Disith realize they're being played and controlled by the Guild, and decide to unite against it. This is made possible by the fact the Emperor of Anatoray just died and its daughter (now Empress) is actually the second-in-command of Alexander Row, the Silvana's captain. That's right, looks like a weak rope, but there are actually reasons for this (--> the Silvana being an Anatoray rogue ship, the Emperor sent his daughter aboard to keep an eye on it). Disith actually wanted to invade Anatoray territories for their climate; indeed the Grand Stream caused considerable change in meteorology in Disith, making the country impossible to live in due to harsh climate (snow and cold everywhere).
Anyway, Anatoray and Disith recapture the Claudia Units powering their flying battleships and soon take on the Guild. But the main Guild ship, aboard which is Maestro Delphine, the leader of the Guild, retreats into the Grand Stream. Turns out Exile is also in the Grand Stream and takes the form of a giant ship with mechanical tentacles. Claus and Lavie has in the meantime learned from Alex that Alvis is the key to Exile. If someone tells here some verses called "Mysterions", they can control Exile. That's why Alex and the Guild wanted to have her back. With this knowledge Claus and Lavie take Alvis to the Exile, tell her the Mysterions, and Exile ends up neutralized along with the Grand Stream, allowing the Anatoray-Disith alliance fleet to sink the main Guild ship.
After that the true nature of Exile is revealed (hinted by the Mysterions): it's actually a spaceship designed to get everyone on Prester back to Earth, where they belong. In fact Prester was one of many space colonies, temporarily set up to shelter humanity while the Earth, polluted beyond measure, regenerated itself. But with time, everyone on the colonies forgot about that.
And so the main characters and a good portion of the Prester population go back to Earth, where season 2 takes place.
Okay here goes, very quickly. Humanity went to space to allow Earth to regenarate because it was so polluted that it had became unhospitable. But not everyone went. Some, mainly poor people, were left behind. These people formed the Ades Federation.
When the Exiles returned, the Ades Federation, still full of resentment for the people who abandonned them centuries ago, didn't accept the situation. Fortunately, the Federation leader, Augusta, managed to get everyone on its side and peace ensued. Until, on a fateful day, she was assassinated; then, unrest resumed.
Now the new Augusta, the daughter of the former assassinated one, is like an 11 year old girl, and a guy named Luscinia (the former bodyguard of Augusta), incidently the leader of all Federal armed forces, uses the young Augusta to wage war against all other nation in the world. The thing is, he does it for global peace and has incredible support from the army and population.
One day he declares war against Turan, a small kingdom, kills its king and kidnaps one of the two princesses of the Kingdom. Millia, the younger princess and the character which SHOULD HAVE BEEN the main character, managed to gather forces from other countries (including one called Glacies). It takes 12 episodes - the first half of the season, and it's kinda boring and not as well-done as it could have been. The second half is the actual fight against the Federation. Awesome air battles ensued and in fine
1) the older princess is the key to another Exile that Luscinia uses as a weapon to wage war more effectively against the world;
2) he is defeated in battle because the former Anatoray-Disith alliance comes back at the last moment, and they're still in possession of Alvis, the key to the Prester Exile (see season 1);
3) everyone's happy and peace is back to the world, whee.
Many Last Exile fans have been very disapointed in Fam, the Silver Wing (season 2), and I can understand them. However I still like it very much. More on that now.
First the main characters. They're bad, bad, bad.
Fam Fan Fan has zero character developement through the entire show. ZERO. Nothing, nada. That wouldn't be so bad if she had a well thought of personality but the thing is, she's dumb and stupid and it never changes. She has apparently no idea what her own ideals exactly are and yet she clings to them like if there's no tomorrow. In Season 1, Claus knew his reasons to fight and while reluctantly, he didn't hesitate to fight when it was needed. Fam, on the other hand, is always spouting some hippie-ish nonsense as if it was still the 60s, while the world around her is crumbling.
Giselle, her co-pilot and navigator, is no better. No character developement and no personality either. She's just the shy girl serving NO purpose, nothing.
Millia, fortunately, while a secondary character, is often hanging around the two other girls but has an actual head on her shoulder.