United Airlines will launch twice-daily Chicago O'Hare-Duluth, ORD-Asheville, Denver-Midland/Odessa, Los Angeles-El Paso and daily DEN-Louisville service on Dec. 17 aboard SkyWest Airlines CRJ200s. Midwest Airlines will launch 19-times-weekly Milwaukee-St. Louis flights on March 1 aboard an E-135. It will operate daily MKE-Fort Lauderdale and six-times-weekly/daily Kansas City-Fort Myers flights Dec. 17-April 19 aboard E-170s.
Honeywell said Memphis International will become the first US airport to deploy its Smartpath Precision Landing System early next year following approval this week by FAA. The ground-based augmentation system initially will supplement legacy instrument landing systems and later replace ILS by augmenting GPS equipment "to provide precision approach guidance to all qualifying runways," FAA said.
American Airlines parent AMR Corp. yesterday announced concurrent offerings of 30 million shares of common stock and $250 million principal amount of its convertible senior notes due 2014. AMR said it would grant underwriters of both offerings 30-day options to purchase up to 4.5 million additional shares and $37.5 million principal amount of notes to cover any overallotments. It said it would use the net proceeds for general corporate purchases.
Lufthansa plans to cut 15% of the 1,800 employees working in central operations, such as those in the communications and financial departments, a spokesperson confirmed to ATWOnline. The company will reduce the number of positions by 5% annually in 2010-12. "During the same period, we want to reduce our nonpersonnel costs by 7% annually," the spokesperson said.
Airlines in the US collected $669.6 million in baggage fees in the second quarter, nearly four times more than the amount collected in the year-ago period and up 18.2% from the first quarter, helping boost operating margins nearly across the board, the US Dept. of Transportation reported yesterday. American Airlines led the way last quarter with $118.4 million in baggage revenue. Delta Air Lines (not including Northwest Airlines) was just $86,000 behind and US Airways took in $104.1 million. AirTran Airways, the leading LCC, came in seventh with $40.5 million.
Finnair announced the issue of a €120 million ($176.7 million) domestic hybrid bond with a coupon rate of 9% per year. The bond was oversubscribed, the company said, and will be used to "finance the investment program and to strengthen the group's capital structure." Nordea Markets was appointed sole bookrunner. A hybrid bond is subordinate to the company's other debt obligations and is treated as equity on IFRS statements, Finnair said.
International Bureau of Aviation said at last week's SpeedNews Annual Aviation Industry Suppliers Conference in Toulouse that the value of new single-aisle aircraft has dropped 8% in the past year. New 737-800s were valued at $42.2 million in the 2009 second quarter, down from $45.9 million in the 2008 quarter, while the value of a new A320 declined to $40.2 million from $43.5 million. Average lease payments also fell, to $340,000 per month from $415,000 per month for the -800 and to $320,000 from $395,000 on the A320, IBA said.
Virgin Blue is hoping to take advantage of the global downturn to order up to 50 new 737s at "bargain prices," CEO Brett Godfrey told ATWOnline. "Now is a great time to buy. We are in the market because the market is right and we don't want to miss the opportunity," he said. Blue operates 65 aircraft comprising 50 737-700s/-800s and 15 E-Jets. It now is considering the -900ER, which can seat up to 215 passengers, 26 more than its largest current aircraft.
US Air Transport Assn. said yesterday that US airlines' August passenger revenue fell 21% year-over-year, marking the 10th consecutive month of decline, while IATA said there was evidence of "an upturn" in premium passengers in July but warned that the rebound likely will be slow and excess capacity will keep yields low.
Mexicana and its MexicanaClick and MexicanaLink subsidiaries officially will become part of oneworld on Nov. 10, the alliance announced yesterday ( ATWOnline, April 11). Mexicana's network spans 67 destinations in 14 countries (including 37 in Mexico). Addition of the mainline and the two subsidiaries, which will join as affiliate members, will add 26 destinations to the oneworld map--24 in Mexico along with Oakland and Edmonton. Oneworld airlines currently serve 13 Mexican destinations.
Nigerian Eagle Airlines is the new name of the former Virgin Nigeria, CEO Dapo Olumide announced in Lagos last week. He said the new name and logo, a multicolored eagle in flight, "represent the rich culture and heritage of Africans" and that the rebranded carrier will "fill the gaps in the aviation sector." It is 51% owned by local investors and 49% by Virgin Atlantic Airways. Plans for a private placement to raise operational capital "are underway," it said ( ATWOnline, Aug. 26).
US Airways said it will begin installing its new Envoy Suite business class product on its A330-200s in November. Suite includes a lie-flat bad, direct aisle access, 12.1-inch touchscreen from Panasonic Avionics Corp., power outlet, satellite telephone and USB port. The 20-suite cabin will feature a 1-2-1 "reverse herringbone" configuration. First aircraft will be completed in December, with the remaining 14 finished by summer 2011. The design for the A330-300 cabin is "under development," US said, with installation expected by summer 2012.
Air France KLM Group will trim winter ASKs by 2% year-over-year, comprising a 1.8% reduction in its long-haul network and a 2.9% cut in medium-haul flying. Air France and its subsidiaries will lower winter capacity by 1.7%, while KLM will cut by a more comprehensive 4%. The carriers insisted that connectivity at their Paris Charles de Gaulle and Amsterdam hubs will be maintained.
Continental Airlines said mainline domestic advanced booked seat factor for the next six weeks is running 1-2 points higher than the year-ago period, with transatlantic bookings 6-7 points higher. It now expects third-quarter consolidated and mainline load factors to be up approximately 3 points year-over-year to 84%-85% and 85%-86% respectively, it said in an investor update.
Baboo will launch service from Geneva to London City (11-times-weekly), Milan Malpensa (12-times-weekly) and Marseille (12-times-weekly) on Oct. 25 aboard E-190s or Q400s. Air France will codeshare on the LCY and MRS routes. Etihad Crystal Cargo launched twice-weekly Abu Dhabi-Baghdad service aboard an A300-600F. Brussels Airlines and bmi announced an expanded codeshare agreement under which bmi will add its code to SN's twice-daily Brussels-London Gatwick service and SN will place its code on bmi's seven-times-daily BRU-Heathrow flights.
Ryanair yesterday began offering passengers smokeless cigarettes that "deliver a small amount of nicotine through inhalation" without being lit. Packs of 10 will be available to adult passengers for €6 ($8.82).
Amsterdam Airport Schiphol said it will not raise its airport charges on April 1, 2010, "in view of the current economic situation." It set its charges as of April 1, 2009, in late 2008 and said those were reduced by an average 10% from the prior year.
Airbus last week said it expects operators to take delivery of approximately 25,000 new passenger and freighter aircraft valued at $3.1 trillion over the next two decades, compared to Boeing's recent target of 29,000.
AerCap Holdings and Genesis Lease Ltd., two midsize operating lessors, announced Friday that they will merge in an all-stock transaction valued at $1.75 billion. Genesis will become a wholly owned subsidiary of Amsterdam-based AerCap and its stockholders will receive one share of AerCap stock for each Genesis ADS (each ADS represents one Genesis common share). AerCap's ordinary shares were valued at $8.81 at the market close on Sept. 17.
Amadeus IT Group is considering an IPO and has retained Rothschild & Sons to evaluate the possibility, sources close to the deal told Bloomberg News. No decision has been taken, but an IPO would allow current shareholders to sell their shares. Amadeus has been majority owned since 2005 by WAM Acquisition, whose shareholders are private equity firms BC Partners and Cinven. WAM owns nearly 53%, Air France holds 23% and Iberia and Lufthansa each have about 12%. All shareholders declined comment, Bloomberg said.
United Airlines Chairman and CEO Glenn Tilton visited with the chairman of China Eastern Airlines this month to try to persuade the Shanghai-based carrier to join Star Alliance. CEA, which is unaligned, is acquiring current Star partner Shanghai Airlines ( ATWOnline, Aug. 31). "As the financial capital of China, Shanghai is an important destination for us," Tilton explained in an employee communication.
Lufthansa plans to exchange 45 of its 109 regional aircraft in the coming years, Passenger Airlines CEO Christoph Franz said in the staff magazine Lufthanseat. An LH spokesperson confirmed to ATWOnline that 50- and 70-seat aircraft like the CRJ200s and ATRs operated by Eurowings and CityLine will be replaced by 118-seat E-190s. "The smaller aircraft are not economical enough anymore compared to more modern aircraft in the 70/90-seat segment," the spokesperson said.
United Airlines will retire its final 737, a -300 on Oct. 28. It has operated 737s for more than 41 years, having placed the launch order for the 737-200 version in April 1965. According to an internal communication, the aircraft has been numbered UA737 for its final journey, which begins at Washington Dulles with stops at Chicago O'Hare, Denver and Los Angeles, then on to San Francisco where it will be decommissioned at UA's maintenance base before being transported to Victorville for storage.
