Air Greenland plans to open the first route between Greenland and the US in May 2007. No decision on a US destination has been made, but the leading candidate is a weekly route between Kangerlussuaq and Baltimore/Washington International Airport. The company's financial report for 2005 shows a profit after tax of DKK40.8 million ($6.6 million) on turnover of DKK869.7 million. Air Greenland operates one A330-200, one 757-200, six Dash 7s and several smaller aircraft and helicopters on its domestic network.
US Airways announced the completion of a $1.25 billion debt refinancing transaction yesterday, allowing the carrier to pay off loans from America West ($250 million), the Air Transportation Stabilization Board ($551 million), General Electric Capital Corp. ($111 million) and "an affiliate of Airbus" ($161 million). A second Airbus loan of $89 million was forgiven as part of an agreement with the airframer. The new five-year loan, underwritten by GE Commercial Finance and Morgan Stanley Senior Funding, will bear interest at LIBOR plus 3.5%.
American Airlines and KLM are increasing their fuel surcharges. AA will add $10 each way on most transatlantic and transpacific routes, excluding Japan, effective immediately. KLM will add €5 per stretch on all long-haul segments effective April 15. Surcharge on intercontinental flights will rise to €45 but remain at €15 per segment on European routes.
The on-again-off-again relationship between Air New Zealand and Qantas is back on, with the carriers announcing yesterday a comprehensive codeshare agreement for their routes across the Tasman Sea. Both airlines will file shortly seeking authorization from the New Zealand Minister of Transport and the Australian Competition and Consumer Commission. Regulatory approval is expected to take approximately six months. The agreement replaces the more ambitious equity tie-up that ran foul of competition regulators in both countries in 2003.
Star Alliance is working on collective specifications for the 787, Air New Zealand CEO Rob Fyfe told ATWOnline during the group's meeting in Johannesburg earlier this week. The alliance has a working group including member airlines Lufthansa, ANA, Singapore Airlines, ANZ, Air Canada and LOT Polish Airlines negotiating with Boeing on a wide spectrum of specifications ranging from cockpit configuration through galley configuration and seat pitch.
TAM closed its preferred shares public offering ( ATWOnline, March 17) yesterday after distributing 37.1 million shares and raising BRL1.56 billion ($724.7 million). TAM said 54.7% of its capital now is held by TAM Empreendimentos e Participacoes SA and Aerosystem SA, with the remainder held by minority shareholders.
Air Canada parent ACE Aviation Holdings is selling 35% of its holding in US Airways Group to PAR Investment Partners LP. ACE invested $75 million to acquire 5 million shares representing 7% in the reorganized US Airways when it emerged from bankruptcy last September. ACE said net proceeds from the sale of 1.75 million shares will amount to $67 million, or 90% of its original investment, and it still holds 3.25 million shares worth nearly $123 million at Tuesday's midday price of $37.83 per share.
Airbus is taking recent criticisms of the A350 from some key customers to heart. Responding to questions from reporters at the opening of a new facility in Toulouse Monday, CEO Gustav Humbert said, "We are listening to the customers...We have every reason to go the extra mile and study all our options intensively," according to Bloomberg News. Last week, Singapore Airlines CEO Chew Choon Seng said Airbus should have "designed a new fuselage" for the A350 ( ATWOnline, April 11).
As expected, Australia's Qantas Group moved to rationalize its various airline brands, with leisure operator Australian Airlines being absorbed into the mainline from July and Jetstar International, the overseas arm of Qantas domestic LCC Jetstar, launching operations in November.
Cuba signed a deal on behalf of Cubana de Aviacion for the purchase of two new Il-96-300s and three Tu-204s, according to press reports. Aircraft will be delivered this year and next and cost $250 million, 15% of which will come from the Cuban government with the rest financed by Russian banks.
China Airlines reported an after-tax profit of TW$645 million ($19.9 million) in 2005 on record revenues of TW$108.6 billion, according to Taiwan's Government Information Office. Fuel accounted for 45% of the carrier's expenses compared to 27%-28% in recent years. It posted a fourth-quarter loss of TW$362 million but plans to continue expanding its network with the purchase of six aircraft in 2006, comprising four A330s and two freighters.
Continued rising fuel prices are undermining the "remarkable overall progress being made by the US airline industry to return to profitability," the US Air Transport Assn. said yesterday as it called for airspace modernization to mitigate the impact. "Record crude oil prices, which are expected to average nearly $70 per barrel this summer, will hamper the industry's widespread efforts to reverse the losses that have plagued the airlines in recent years," ATA VP and Chief Economist John Heimlich said in a statement yesterday.
SITA said it won a five-year, $5.6 million contract from the Moroccan National Office of Airports to install and maintain AirportConnect CUTE, "a state-of-the-art IT system for managing busy airport environments," at the country's main airports in Casablanca, Agadir and Marrakech.
Lufthansa Systems, NavAero and Virgin Atlantic signed a contract to equip the carrier's entire fleet with a full-service Class 2 electronic flight bag solution. NavAero will provide its tBagC2² EFB computer and display hardware and LHS will supply its SkyBook EFB solution. Project work is already well underway and the first Virgin Atlantic flight with the SkyBook/tBagC2² EFB onboard is scheduled to take off in December.
North American Airlines will launch weekly Baltimore/Washington International-Banjul-Accra service June 4, pending Gambian government approval, aboard a 767-300ER. AirBaltic launched twice-weekly Riga-Simferopol service yesterday aboard 737-500s.
Swiss International Air Lines must seek out further cost-cutting opportunities in view of today's sky-high fuel prices, CEO Christoph Franz told ATWOnline during the Star Alliance meeting in Johannesburg. Labor costs in particular must come down. "We require much concessions from our employees. Now it is the turn of our Airbus pilots," he said. Negotiations with pilots are underway. Franz declined to provide specific savings targets, but said in a clear statement, "less money, more flying." Swiss already has implemented higher productivity on its A320 fleet.
Lufthansa flew 24.04 billion RPKs in the first quarter ended March 31, a 1% increase over the year-ago quarter. Capacity rose 3.1% to 33.49 billion ASKs and load factor dipped 1.5 points to 71.8%.
Boeing announced late yesterday the signing of a general purchase agreement with China Aviation Supplies Import and Export Group for 80 737NGs, completing a deal launched last November with a commitment for 70 737s made at the Dubai Air Show ( ATWOnline, April 11). Fifty of the 70 aircraft eventually were booked the following month, with the remaining 20 ordered in January. The airframer said it would finalize agreements for the distribution of the new aircraft order with individual Chinese carriers in the coming weeks.
Air Berlin suffered a net loss of €115.9 million ($140.3 million) in 2005, up from €2.9 million in 2004, largely owing to €100 million in one-time charges stemming from debt revaluation and deferred taxes, according to Reuters. The airline flew 13.5 million passengers last year, up 12.5%. CEO Joachim Hunold, who owns 5% of the carrier, told reporters late Monday that AB is pressing ahead with its IPO ( ATWOnline, March 13) and hopes to launch it prior to the start of soccer's quadrennial World Cup, which will kick off in Germany on June 9.
South African Airways will launch a low-cost carrier by year end, President and CEO Khaya Ngqula revealed during a ceremony in Johannesburg Monday that saw SAA become a full Star Alliance member ( ATWOnline, April 11). "There is a clear demand for low-cost travel in the country," Ngqula said, noting that LCCs represent 20%-25% of the market. "The market for domestic travel has increased by 50% over the past five years [since the first LCC, kulula.com, commenced operations], and we have only captured 5% to 10% of this. We need to take a bit of this back."
Latin American Airline Assn. member traffic increased 2.1% in February to 9.14 billion RPKs as capacity grew 4% to 13.23 billion ASKs and load factor dropped 1.3 points to 69.1%.
SkyWest Inc., parent of SkyWest Airlines and Atlantic Southeast Airlines, priced a public offering of 4 million shares yesterday at $26.05, according to the Associated Press. The company expects to use about $99.3 million in net proceeds, excluding overallotments, to repay short-term debt, reduce amounts outstanding under a revolving credit facility and for other purposes.
Symbol Technologies and partner Peak Technologies were chosen by Virgin Atlantic Airways to supply RFID technology as part of a pilot project to track "high value" aircraft spare and replacement parts moving through its logistics supply chain at London Heathrow. According to Symbol, Virgin is the first UK airline to use RFID technology to track parts onsite.
