Embraer President and CEO Frederico Curado told reporters in Washington last week that keeping E-Jet production levels stable in 2010 will be "challenging" owing to the global economic downturn. "The [economic] signals we're getting are too faint to be regarded as a recovery," he explained, adding, "There's the economic downturn that affects airline demand. And then there's the [tight] financing market. We are shooting for a flattish 2010. We do have a sales challenge right now to keep our production levels stable in 2010, and 2011 is still very foggy."
Qatar Airways CEO Akbar Al Baker ratcheted up his rhetoric about Boeing Friday, telling reporters ahead of a meeting with the manufacturer regarding the airline's delayed 787 program that "a lot of heads would roll" if he were running the company, according to USA Today.
ASIG renewed agreements with American Airlines to provide aircraft refueling services at seven US airports including Seattle-Tacoma, John Wayne, New Orleans and Ft. Lauderdale-Hollywood.
Hainan Airlines opened a branch office in Shenzhen and said the move is part of an effort to expand its presence in the Pearl River region. "We plan to interconnect Shenzhen, Guangzhou and Zhuhai with Hong Kong," HNA VP-Marketing Chen Ming said. The company already has set up a branch office in Guangzhou and a sales center in Zhuha and holds 45% stakes in Hong Kong Express Airways and Hong Kong Airlines.
Kales Airline Services was appointed by Canadian carrier Air Transat Cargo to be its GSA in Scandinavia, Finland, the Baltic states, Austria, Switzerland, Hungary, Czech Republic, Romania and Ukraine.
Travelport GDS announced a new full-content agreement with Finnair providing Travelport GDS-connected travel agents worldwide with access to Finnair's entire published inventory and fares.
Alaska Airlines and Horizon Air parent Alaska Air Group reported second-quarter net income of $29.1 million, down 53.9% from a $63.1 million profit in the year-ago period, but said earnings improved excluding special charges owing to significantly lower fuel costs.
Air France KLM flew 17.07 billion RPKs in June, down 6.4% from the year-ago month. Capacity fell 5% to 21.25 billion ASKs and load factor dropped 1.1 points to 80.3%. Air Canada and Jazz flew 4.17 billion RPMs in June, a 9.1% drop year-over-year, against a 7.6% cut in capacity to 5.15 billion ASMs. Load factor slipped 1.3 points to 80.9%. AirTran Airways flew 1.76 billion RPMs in June, down 6.5% year-over-year. Capacity fell 5.3% to 2.11 billion ASMs and load factor dropped 1.1 points to 83.6%.
UPS reported second-quarter net income of $445 million, down 49% from $873 million in the year-ago period, on a 16.7% reduction in revenue to $10.8 billion. Chairman and CEO Scott Davis said that while weak global economic conditions have "pressured" the delivery company, "UPS remains financially very strong" and "can weather this recession." CFO Kurt Kuehn added, "Declines in both our domestic and international business appear to be stabilizing but volumes will remain significantly below last year's levels. .
Thai Airways Chairman Ampon Kittiampon told reporters yesterday that the airline negotiated with Airbus to delay the start of its A380 deliveries to December 2012 from late next year, Reuters reported. "We want to postpone the delivery as far as possible to reflect the current market conditions," he said. Last month, two other Thai executives told reporters that the carrier was reconsidering its order for six A380s ( ATWOnline, June 10).
Lufthansa could be headed to another showdown with its pilots. The Vereinigung Cockpit union, which staged a strike last summer ( ATWOnline, July 24, 2008), is asking for a 6.4% pay increase for its 4,500 pilots over the next year or a 9.6% rise over the next 18 months, plus bonuses depending on LH's profitability, a spokesperson told several German media outlets. LH said talks with the union have been constructive, but neither side revealed specifics.
Continental Airlines, which announced 1,700 job cuts this week ( ATWOnline, July 22), told the Air Line Pilots Assn. that 310 pilots, or 7% of the total, could be furloughed, the Houston Chronicle reported. "If reductions are necessary, we expect to begin furloughing pilots as early as Sept. 23. We expect these furloughs to be temporary but at least six months in duration," the airline said in a letter sent to 310 pilots who were selected based on seniority, ALPA told the newspaper.
Copa Airlines said the US Export-Import Bank offered a final commitment for financing two 737-800s scheduled for delivery this year and preliminary commitments covering 10 additional aircraft for delivery in 2010-12. Copa has 25 737NGs on order from Boeing.
Air France KLM Group said revenue in the fiscal first quarter ended June 30 plunged 20.5% year-over-year to €5.19 billion ($7.37 billion), reflecting continuation of the January-March trend and "in line with our expectations." Revenue in the passenger business fell 18.7% to €4.01 billion on the back of a 4.7% reduction in capacity, a 5.8% drop in traffic and a 14.5% decline in yield. Cargo revenue plummeted 41.5% to €544 million on a 22.7% decrease in traffic and 17.2% cut in capacity. Unit revenue was down 25.1%.
Aeroflot will defer delivery of two A320-200s from the 2010 first quarter to the first quarters of 2011 and 2012 and the delivery of three A321-200s from the 2010 third quarter to the first and third quarters of 2012, it said in a statement cited by Agence France Presse. "Given the current situation on the international air transport market, the board agreed to change the delivery schedule," SU said. Jat Airways announced plans to lease two 737-700s. It already has one 737-300 and one -400 on lease. No timetable for the -700s' arrival was announced.
A $192 million fuel hedging gain pushed US Airways to a second-quarter net profit of $58 million, reversed from a $568 million loss in the year-ago period when goodwill impairment charges weighed on the bottom line.
Vueling Airlines posted a second-quarter net profit of €2.9 million ($4.1 million), reversed from an €8.7 million deficit in the year-ago period, as it completed a restructuring plan based on network rationalization, access to new market segments, increased ancillary revenue and cost reductions. Revenue decreased 5.3% to €105.4 million and operating cost fell 25% to €92 million. Operating profit excluding restructuring costs was €13.4 million, reversed from an €11.4 million loss in the 2008 second quarter.
JetBlue Airways yesterday reported a $20 million second-quarter profit, reversed from a $9 million loss in the year-ago period, and said it expects to remain in the black in both the third and fourth quarters. "We believe our strong brand, unique value proposition and ongoing focus on maintaining financial strength will position us for continued success in this recessionary environment. Despite a challenging revenue outlook, we continue to expect to generate a profit every quarter this year," CEO Dave Barger said.
MyAir suspended all operations following a decision by Italian civil aviation authority ENAC to revoke the LCC's AOC effective July 24. ENAC said MyAir's service became unreliable owing to persistent financial difficulties and that it failed to meet restructuring-related obligations. The carrier had been flying on a provisional AOC since June 25. It operated scheduled services linking a dozen Italian cities and destinations in Europe and Morocco with a mixed fleet of A320s and CRJ900s. It commenced operations in December 2004 and had its main bases at Bergamo and Venice.
787's structural design problem, centered on the upper wing join area, is more complex than originally outlined by Boeing and may result in first flight being delayed until next year, engineers told The Seattle Times. One engineer with knowledge of the problem claimed that it will take "at least 3-4 months just to get something installed on the 787," while a second, familiar with Boeing's construction methods, claimed that the fix first must be installed on the nonflying test aircraft in Everett and only will be applied to flight test aircraft if proven successful.
AirTran Airways parent AirTran Holdings reported a second-quarter net profit of $78.4 million, reversed from a net loss of $14.8 million in the year-ago period, and projected it will maintain profitability in the second half of 2009 despite the poor economic environment.
Oxford Aviation Academy signed a five-year agreement with British Airways covering provision of pilot training and simulator time for BA CityFlyer's incoming E-170s and E-190SRs.
Boeing reported a $998 million profit in the second quarter, up 17% from the $852 million earned in the year-ago period, and said it has identified a fix to the defect in the 787's upper wing join area that led to last month's first flight postponement and will release a new schedule for the flight test program before the end of September.
Aeroflot carried 758,100 passengers in June, an 11.1% decline year-over-year. Load factor fell 3.8 points to 70.7%. Through the half-year, SU's passenger numbers fell 12.1% to 3.9 million, with load factor at 63.5%.
