United Airlines parent UAL Corp. entered into agreements with J.P. Morgan Securities and Morgan Stanley & Co. to sell up to $200 million in stock "from time to time" through either broker. Air Canada reached agreement with Aeroplan to "accelerate" approximately C$70 million ($56.4 million) in payments by Dec. 31 for reward tickets issued for travel through May 29, helping AC boost near-term liquidity.
China's ARJ21-700 made its first flight on Nov. 28, GE Aviation announced ( ATWOnline, Oct. 10). The GE CF34-10A-powered regional jet reached an altitude of 9,000 ft. during the 1-hr. flight, which took place approximately 11 months after rollout. The aircraft is produced by Commercial Aircraft Corp. of China. A second flight is planned for this month, "followed by engineering flight tests in early 2009," GE stated.
A French rescue team yesterday recovered the flight data recorder from the Air New Zealand A320 that crashed into the Mediterranean Sea Nov. 27 on approach to Perpignan during a test flight, but the FDR and previously recovered cockpit voice recorder reportedly are badly damaged.
US Airways was selected by the US Dept. of Transportation to operate daily Washington National-Akron/Canton service beginning by Jan. 25. Slots became available when AirTran Airways ceased operating DCA-Milwaukee on Sept. 3. Midwest Airlines also applied for the slots.
Austrian Airlines Group said it expects €240-€290 million ($304.5-367.9 million) in one-off impairment charges to appear on its full-year financial report, which could drag the company's net loss to nearly €500 million. In late October it said it expected a €100-€125 million net loss before special items ( ATWOnline, Oct. 29). AAG said €150-€200 million will be related to the falling value of its fleet, especially its 767-300ERs, while around €90 million is related to tax deferrals.
SITA said Malaysia Airlines selected its in-house reservations system as part of a $130 million improvement program. Ten-year deal includes e-ticketing and departure control system upgrades allowing for self-service options including kiosk and Web check-in. Separately, SITA reached a deal with Guangzhou Baiyun International Airport Computer Informatics Service Center to offer its AirportConnect Open common-use check-in systems and baggage management solutions to regional hubs in China.
Cathay Pacific Airways unveiled new measures to "help the airline deal with a serious downturn in business as a result of the global financial crisis," including scaling back capacity growth and grounding two freighters. It also is offering unpaid leave to pilots and flight attendants and requesting a two-year delay in the completion of a new cargo terminal at Hong Kong International.
Malaysia Airlines said it "proved its resilience" with a MYR38.6 million ($10.3 million) third-quarter profit that, while representing an 89.4% plunge from the MYR364.6 million profit reported in the year-ago period, was the ninth straight quarter in the black for the restructured airline.
The percentage of U.S. online leisure travelers who consider themselves brand-loyal has plunged by 19%, from 31% in 2006 to 25% this year, according to Forrester's North American Technographics Retail, Travel, Customer Experience and Financial Services Benchmark Survey, Q3 2008. In a report on the study, authors Henry Harteveldt, vice president and principal analyst, and Elizabeth Stark, researcher, offer five reasons for the nosedive:
DURING A LONG "SAVE THE AIRLINE" MEETING, someone declared that airlines are basically cash accumulators for other constituencies. It's truethere are plenty of government entities that tax them, groups sell them equipment and banks lend them moneybut I've always believed they are so much more. Airlines drive the global economy and connect us in ways that no other business or technology can.
US airline financial woes deepened in the third quarter as even good news--per-barrel crude oil prices dropping significantly--was tinged with frustration: Carriers hedged fuel at prices that turned out to be much higher than actual prices as the quarter wore on, leading to big noncash charges that contributed to heavy net losses. The 10 largest passenger airlines posted a cumulative net loss of $2.52 billion, reversed from a $1.67 billion profit in the year-ago period, with only American Airlines in the black thanks to the sale of its asset management subsidiary for $432 million.
INTERNATIONAL AERO ENGINES celebrated its 25th anniversary this year. Plenty has happened since the consortium formed in 1983 to produce the V2500 and its shareholders divided design and production responsibilities, leaving Pratt & Whitney (32.5%) to take on the combustor and high-pressure turbine, Rolls-Royce (32.5%) to engineer the high-pressure compressor, Japanese Aero Engines (23%) to build the fan and low-pressure compressor and MTU Aero Engines (12%) to forge the low-pressure turbine.
OVER THE PAST SEVERAL YEARS, Flybe has chosen the road less traveled, yet the trail it has blazed has become a popular thoroughfare for the rest of the industry. Building a fleet dominated by high-speed turboprops in an era of regional jets, becoming the first carrier to charge for checked baggage, focusing on developing ancillary revenue and offering passengers an environmental report card for each flight they take: These are some of the things that Flybe pioneered.
ON AUG. 6, 1947, IN THE FIRST of several such appearances, Howard Hughes told an emotion-charged and sometimes heated US Senate hearing that he had put the sweat of his life and his reputation into his H4 Hercules "Spruce Goose" and if it was a failure he would leave the country and never return. During the hearings, which lasted several months, Hughes snuck in the aircraft's one and only flight on Nov. 2, 1947--about three years after it was contracted to fly.
ONE WAY TO PROCURE PRODUCTS and services is to focus on the destination of nickels and dimes and let the dollars take care of themselves. Then there's this one: Build strong strategic partnerships and everything else tends to fall into place.
It is hard to argue with British Airways CEO Willie Walsh's observation that the April 1-Sept. 30 financial semester "will be remembered as one of the bleakest on record," what with record fuel prices, the credit crisis and the failure of several airlines.
The world's first sustainable biofuel flight now is expected to take place as early as Dec. 18 or possibly over Christmas with a jatropha-based fuel powering one engine on an Air New Zealand 747-400 on a 3-hr. gate-to-gate flight from Auckland. The fuel is a 50/50 blend of standard Jet A1 and synthetic paraffinic kerosene derived from jatropha oil.
HERE'S A FAMILIAR STORY LINE: The airline industry is bracing for what it expects will be a serious traffic downturn in 2009 as it prepares to accept a record number of new aircraft at the very point at which the global credit crisis means that capital to finance those aircraft is on indefinite holiday. To paraphrase Yogi Berra, "It's deja vu all over again."
Goodrich's long-term program for nacelle aftermarket services, Prime Solutions, is gaining speed, with a major seven-year US program, a new customer in the growing Asian market and a product improvement that should enhance future business. Bob Gustafson, VP and GM-Goodrich Aerostructures Aftermarket Services, reports customer interest is increasing. The company looks forward to signing up more Prime customers, especially as the 787 enters service.
AAR Corp. elected Donald J. Wetekam group VP-maintenance, repair & overhaul. Air Namibia appointed Helen Adamou UK sales & marketing mgr. AirPlus International welcomed Colleen Black as VP-key account sales and John Callahan as regional sales dir.-northern Midwest. Alaska Air Group elected Thomas Nunn VP-safety. Arab Air Carriers Organization elected Saudi Arabian Airlines CEO Khalid Abdullah Almolhem president. Aviapartners named Henning Dieter GM-cargo services-Germany.
NO ONE KNOWS JUST WHAT MIX OF INVESTMENT AND INGENUITY will work to turn the economy around and drive it back north. It's probably safe to assume, however, that it won't just be Washington and bailouts.
Procurement of rotable and consumable parts for aircraft, along with the many nonaviation products airlines need, continues to be a tough game, played now for the highest stakes--carrier survival. New tools help achieve better deals and ensure deals are fulfilled. But better procurement requires a sound strategy and thorough process as well as tools. Choices are getting better, more varied and complex. The procurement process must match this complexity.
A PASSENGER-TO-FREIGHTER AIRCRAFT conversion is not a simple matter. It's not the actual conversion process that is particularly complicated; there are a number of companies with the capability to do modifications. Rather, it is the process before the conversion takes place that is among the most tangled in the aviation business. An airline needs to ground an aging passenger aircraft and then determine a price at which to sell it. A lessor or another airline needs to be seeking to add a freighter and agree to pay that price.
