Boeing announced record first-quarter earnings of $1.21 billion, up 38% from $877 million reported in the year-ago period, on a 4% increase in sales to $15.99 billion. Despite hiccups in the 787 program, Chairman, President and CEO Jim McNerney said the company was "off to a good start" in what he expects to be "another strong year." Total company backlog as of March 31 reached a record $346 billion, up 32% year-over-year, with growth driven by commercial airplane and V-22 multiyear orders.
Air Transport Assn. of Canada announced that Air Canada, WestJet, Air Canada Jazz and Air Transat have withdrawn from the organization effective immediately. The four carriers represented just under half its membership revenue, ATAC said, adding that it will work to develop a revised business plan. "Today's announcement is an unfortunate development. . .but does not change our commitment to our members to improve Canada's commercial aviation sector," Chairman Mike Doiron said. ATAC still boasts approximately 230 operator and associate members.
Air Europa pilots represented by SEPLA have called a series of strikes in May and June to protest the carrier's plan to set up a low-cost subsidiary. SEPLA claims the Palma-based airline will violate its 2001 labor agreement if it hires non-Air Europa pilots for the new LCC, Universal Airlines ( ATWOnline, Feb. 8). Talks between Globalia, which controls Air Europa, and SEPLA, broke down this week after five months.
Expedia will provide Air Berlin Group with its global points of sale under a multiyear agreement announced Monday. Contract extends the carrier's fares, schedules and inventory to Expedia and hotels.com branded POS as well as to Expedia Corporate Travel.
Frontier Airlines yesterday announced that it will terminate its codeshare agreement with Republic Airways and phase out the regional's 12 E-170s by mid-June. Frontier filed for Chapter 11 bankruptcy protection this month but will continue operating as it reorganizes ( ATWOnline, April 14). "Unfortunately, with current economic conditions and other business changes, we have been forced to drastically rethink the use of regional aircraft in our mix," President and CEO Sean Menke said.
UPS reported a first-quarter net profit of $906 million, down 12.2% from $1.03 billion last year, and said second-quarter earnings will be flat at best owing to an "anemic" economy. "US economic activity deteriorated more rapidly than expected during the [first] quarter," Chairman and CEO Scott Davis said. Revenue increased 6.5% to $12.68 billion while expenses grew 6% to $11.18 billion, producing operating income of $1.49 billion, up 9.9% over $1.35 billion last year. International package revenue, which is heavily dependent on UPS Airlines' operations, rose 15.7% to $2.76 billion.
ARINC said it completed installation of 64 new SelfServ check-in kiosks for Flybe at 13 UK regional airports. It already supports Flybe at Manchester, Birmingham, Newcastle and Belfast City.
Northwest Airlines reported a $4.14 billion first-quarter net loss yesterday owing to a noncash goodwill impairment charge of $3.93 billion necessitated after it "compared the carrying value of its equity and the fair value" and similar to the one incurred by merger partner Delta Air Lines (see story above). NWA lost $292 million in the year-ago quarter.
Air Line Pilots Assn. released a statement saying that the chairmen of the Delta Air Lines and Northwest Airlines pilot groups have "jointly discussed. . .the importance of commencing negotiations with Delta management in the very near future" on a single labor agreement "that will include immediate parity in rates of pay" upon the closing of the announced merger. The union said, however, that such a negotiation does not "constitute an endorsement" of the merger by the Northwest Master Executive Council.
Iberia and Consorci Zona Franca of Barcelona launched construction of a 12,100 sq.-m. widebody hangar at El Prat. The facility will accommodate two A340s or four A320s and is expected to increase airport capacity for dispatching and receiving long-haul flights. Specializing in C checks, it will offer MRO to nearly 80 airlines using BCN. Investment is put at €24 million ($38.2 million), with IB positioned to control 75% of the new company.
Delta Air Lines reported a $6.39 billion first-quarter net loss, dramatically widened from a $130 million loss in the year-ago period, owing mainly to a noncash goodwill impairment charge reflecting a decline in its market capitalization related to the sharp increase in fuel prices and the pending merger with Northwest Airlines.
United Airlines parent UAL Corp. suffered a massive $537 million loss in the first quarter, widened precipitously from a $152 million deficit in the year-ago period, and said Tuesday that it will "fundamentally overhaul every facet of our business," starting with the grounding of 30 aircraft and the laying off of 1,100 employees.
Airbus beginning May 1 will add $2 million to the list price of each single-aisle aircraft and $4 million to each widebody. The increases, which it said are owing to the continued decline of the US dollar and higher metal prices, are on top of the "normal" 2.74% escalation. The manufacturer said the dollar's decline translates into a more-than-15% devaluation. Compounding the problem, metal prices have risen by at least 6.5%.
Leaders from 13 commercial aviation organizations representing airlines, airports, air navigation services providers and aerospace manufacturers yesterday signed a "declaration on climate change" intended "to lead towards carbon neutral growth and a totally sustainable future." The declaration states: "We agree on the need to accelerate action to mitigate our environmental impact, especially in respect to climate change, while preserving our driving role in the sustainable development of our global society."
Biman Bangladesh Airlines and Boeing finalized a previously announced commitment for four 777-300ERs and four 787-8s at a signing ceremony yesterday in Dhaka ( ATWOnline, March 12).
BAA's common ownership of seven UK airports comprising London's Heathrow, Gatwick and Stansted along with Southampton, Edinburgh, Glasgow International and Aberdeen may not be serving the interests of either airlines or passengers, the UK Competition Commission said in an interim report.
Outgoing Italian government yesterday approved a €300 million ($475.7 million) loan to Alitalia that may prevent the cash-strapped airline from going bankrupt before newly elected Prime Minister Silvio Berlusconi finds new investors.
SilkAir chose IAE V2500s to power 11 firm and nine option A320s to be delivered between 2009 and 2013. Engines will be the SelectOne build standard and the deal includes aftermarket support.
A 34.2% surge in revenue helped JetBlue Airways fare somewhat better than its US rivals in a difficult first quarter as its net loss narrowed to $8 million from $22 million and its operating result improved to a $17 million profit from a $13 million deficit in the year-ago period.
Boeing and Airbus, on the sidelines of the Aviation & Environment Summit in Geneva, signed off on an agreement to work together "to ensure global interoperability in air traffic management in an effort to reduce the impact of aviation on the environment." They will seek to speed up improvements to air traffic management systems to "increase efficiency and eliminate traffic congestion."
AirTran Airways parent AirTran Holdings said "very strong" first-quarter revenues were not enough to overcome "the effects of record high fuel costs" as the company sank to a $34.8 million net loss that compared to a $2.2 million profit in the first three months of 2007. "We remain committed to serving our customers, reducing costs and profitably managing our company going forward," President and CEO Bob Fornaro said.
Asiana Airlines is preparing to place a significant order for 787s or A350 XWBs, bringing one of the year's most intense sales battles to a close. Speaking to ATWOnline in Seoul, Vice Chairman and CEO Chan Bup Park said an announcement is expected by the end of June. Asiana is looking to both buy and lease aircraft and in the interim is seeking two more 777-200ERs, a similar number of A330-200s as well as A321s. It will take delivery of two -200ERs this year. It also is weighing the A380 and 747-8 for replacement of its three 747-400Cs and two 747-400 passenger aircraft.
In a rare development, Airbus and Pratt & Whitney yesterday announced an agreement to flight test Pratt's Geared Turbofan engine on Airbus's A340 testbed, although the engine does not have an application on an Airbus airframe.
