Global Aviation Holdings and its two operating units World Airways and North American Airlines have filed for Chapter 11 protection to facilitate a fleet and staff reduction plan caused by the continued slump in airfreight demand and a recent change in U.S. military spending that affected 20% of World’s revenue. The cuts will include a 16% reduction in staff in the next 90 days.
Air Canada expects 2014 capacity to grow about 10% next year, a significant increase on the 2-2.5% rise in available seat miles the carrier is forecasting for this year.
The 2014 increase in supply is the result of a fleet plan that adds six Boeing 787s, the planned growth of low-cost subsidiary Rouge and the final deliveries of high-density Boeing 777-300ERs, Air Canada said last week during its third-quarter results earnings call.
Talks between Indigo Partners and Republic Airways over the sale of Frontier Airlines will continue for two more days, as the investment group pushes to “resolve all the conditions to close the transaction,” says Republic.
This extension comes four days after Indigo announced that while it had reached a tentative agreement with Frontier’s pilots’ union, it still needed a deal with Barclaycard about an extension of the airline’s credit card program and associated line of credit, as well as a labor accord with the flight attendants union.
U.S. Attorney General Eric Holder yesterday said the Justice Department will only reach an out-of-court settlement with American Airlines and US Airways if the operators “fundamentally resolve the concerns” listed in the regulator’s lawsuit against their proposed merger. Those concerns involve more than 1,000 domestic routes currently operated by the two airlines that the Justice Department deems anti-competitive should the two companies consolidate.
JetBlue Airways is targeting high-density markets as part of an effort to control costs, and has initiated a significant fleet revamp and a major retrofit program to reach its goal.
The fleet plan, which upgauges and expands the airline’s Airbus narrowbody order book and defers 24 Embraer 190s, dominated the conversation during JetBlue’s Oct. 29 third-quarter earnings call, both in its scope and its financial implications.
A disappointed United Airlines management team says a poorly calibrated revenue management system, sub-optimal use of the fleet and pressure on Pacific yields, particularly in China, depressed the carrier’s third-quarter financial performance, and that efforts already have started to increase revenue and control costs.
Southwest Airlines Chief Executive Gary Kelly is confident the “very good revenue momentum” that produced a record third-quarter profit will continue into 2014, a year that should not see any capacity growth for the carrier.
US Airways expects to increase capacity 3-4% in 2014, roughly the same rate as this year, but without any change to its fleet count.
The growth plan maintains US Airways’ previous capacity strategy by upgauging older aircraft with larger Airbus A321s and A330s and, according to statements made yesterday by Chairman and CEO Doug Parker during the airline’s third-quarter earnings call, will continue to focus on increasing the airline’s presence in profitable markets.
Aerolineas Argentinas intends to add 20 Boeing 737-800s to a fleet that already includes 26 737NGs. Airline President Mariano Recalde says the fleet addition “is a key part of a greater plan to renew our fleet and prepare our operations to accommodate growing demand.” The agreement with Boeing still has to be firmed.
A bullish Delta Air Lines management team expects to post a record profit this year and an even better unit revenue performance next year, after generating a $1.4 billion net profit in a seasonally strong third quarter.
The optimism of CEO Richard Anderson and his team is based on many factors, most notably a continued growth in corporate bookings, improved revenues in most market sectors (particularly within the U.S.) and the performance of current and pending joint ventures and partnerships.
American Airlines plans to launch non-stop services in mid-2014 from its Dallas/Fort Worth International Airport base to Hong Kong International Airport and Shanghai Pudong International Airport. Hong Kong will be the first destination in Asia to be served by American’s new fleet of Boeing 777-300ERs, which American also intends to introduce to its Miami International Airport hub next year on flights to London Heathrow Airport and Sao Paulo-Guarulhos International Airport. Shanghai will be served by Boeing 777-200s.
As Alitalia’s shareholders met yesterday to discuss a €500 million ($679 million) recapitalization plan, the European Commission declared that any effort to save the troubled airline from collapse will have to be reviewed to ensure it meets stringent rules on state aid. The investment plan, which includes a major influx of capital from Italy’s state-owned postal service, has already been attacked by International Airlines Group, the parent company of British Airways, Iberia and Vueling Airlines, as illegal.
Canada has added three new bilateral air transport agreements in a negotiating effort that also expanded bilateral accords with four countries. The new agreements are with Burkino Faso, Ecuador and Macedonia, while deals with Algeria, Ethiopia, South Africa and Turkey have been amended “to introduce more flight options and routing.” Canada’s transport ministry says most of the agreements can be implemented immediately.
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