Owing to record nominal fuel prices, the July-September period was going to be painful for US carriers well before Mother Nature decided to visit her fury on the refinery-rich Gulf Coast. According to the Air Transport Assn., which cited data from the US Energy Information Administration, the spot price of West Texas Intermediate reached $61 a barrel on Aug. 1 while the differential between crude oil and jet fuel prices (the crack spread) pushed the all-in cost to airlines to around $74 a barrel.
AE&T Editor Sandra Arnoult spoke with JoAnne Paternoster, a former official with the Port Authority of New York & New Jersey who was in charge of the Port Authority's Airport Customer Improvement Program. She spearheaded development of branded regional customer service programs and a performance management program to improve perception and image at JFK and LaGuardia airports while increasing net revenues. Paternoster is now an executive consultant for Maritz Research.
Unlike a number of congested European hubs, Munich Airport traditionally has rolled out the welcome mat for Regional airlines. For this reason, the eighth-busiest airport in Europe was honored by the European Regions Airline Assn. at its annual meeting here in October as Airport of the Year.
The underlying reason for airports and airlines' clashing perspectives on the installation and management of airport wireless networks can be summed up in a few words: "Airports can be served by 20 or 30 airlines; each airline can serve hundreds of airports."
When the father of the 747, Joe Sutter, was asked by ATW about the longevity of the model on the 30th anniversary of its entry into service, he said without so much as a second's hesitation that the "Queen of the Skies" would be around for another 30 years. A bold statement indeed when made against a backdrop of the launch of the A380 and the many failed attempts by Boeing to commit to significant upgrades since the dash 400 version rolled out in January 1988.
The European Commission and the US government have restarted negotiations to try to establish an Open Aviation Area between the two blocs. Are you hopeful on a positive outcome?
It would be difficult to pick a worse day than Sept. 10, 2001, to start up a new airline. Gothenburg-based City Airline had the misfortune to do just that. "It was bad timing," MD Tom Ericsson agrees. "We seriously considered closing down the operation, but we didn't."
We'll begin by statingas we have beforethat we believe that non-government-owned airlines deserve the same opportunities as other privately run businesses when it comes to attracting investment from wherever it may be available. Moving from the general to the specific, we support changes in US law to permit non-US entities to invest freely in and own US-based airlines provided those parties fully abide by all applicable US laws and regulations, including any new ones that may arise regarding participation in the US Air Mobility Command and CRAF.
Aloha Airlines' reorganization plan was confirmed by the US Bankruptcy Court Tuesday, clearing the way for the Honolulu-based carrier to exit Chapter 11 protection as early as Dec. 15. Aloha sought bankruptcy on Dec. 30, 2004. The confirmation is subject to the airline and its 270 pilots, represented by the Air Line Pilots Assn., finalizing a tentative agreement on a new five-year contract that was reached Tuesday. On a busy day, Aloha also announced that its flight attendants had ratified their agreement.
Hong Kong Civil Aviation Dept. approved the use of fuel surcharges for an additional two months through January. Airlines may raise the levy 2.1% to HKD93 ($12) on short-haul flights and 8.4% to HKD383 on long-haul flights, the Associated Press reported.
A profitable carrier at this time last year, Malaysia Airlines was unable to handle rising costs during the fiscal second quarter ended Sept. 30, posting a net loss of MYR367.7 million ($97.3 million) that reversed earnings of MYR132.7 million in the year-ago quarter.
Oneworld member Finnair and soon-to-be-member Japan Airlines agreed to codeshare on JAL's domestic routes and Finnair's European routes starting this month. Finnair's code will be added to JAL's routes between Osaka and Sapporo, from Fukuoka to Osaka and Tokyo and from Tokyo Haneda to Osaka. JAL's code in turn will be added to Finnair's Helsinki-Amsterdam and Helsinki-Frankfurt routes. Both companies will explore possibilities to codeshare on Finnair's routes to Japan and JAL's routes from Japan to other Asian destinations.
IATA, citing the easing of oil prices in the current quarter, trimmed its estimate of industry losses in 2005 from $7.4 billion to $6 billion. Brian Pearce, IATA's chief economist, told ATWOnline that the organization decided the average price of oil will be in the $54-$55 per barrel range, down from the $57 price assumed in August. That reduction, coupled with "quite a strong revenue environment," produced the revised forecast. Total fuel bill for the world's airline industry still will amount to $92-$93 billion compared to $44 billion in 2003.
Bombardier Aerospace reported third-quarter earnings before taxes and interest of $28 million, a 41.6% drop from the $48 million posted last year. Revenues increased 12.5% to $1.8 billion, boosted in large measure by a 71% rise in deliveries of business jets and CRJ705s. However, the profits were not enough to lift the overall results for the Canadian transportation manufacturer, which reported a $9 million loss for the three months to Oct. 31.
SkyEurope Holding AG, parent of the Bratislava-based LCC, in its first financial report since completing an initial public share offering last September, reported an annual loss for its fiscal year ended Sept. 30 of €28.6 million ($33.5 million), or €26.8 million adjusted to reflect the phase-out of its Brasilias. This compares to a loss of €10.1 million in the 2003-04 fiscal year.
Far Eastern Air Transport of Taiwan said US insurance giant American International Group intends to sell its 18% stake in the airline, likely to China Development Financial Holding Corp., which already holds 13% of FAT, the Associated Press reported.
American Airlines will begin charging $2 per bag for curbside check-in at Dallas-Ft. Worth in December, a move that will reduce annual costs by $10-$30 million, according to The Dallas Morning News. AA already charges for the service at more than 20 airports.
Lufthansa Systems Group will be converted into a stock corporation effective Jan. 1. The decision by the group executive board of Deutsche Lufthansa AG was confirmed by the supervisory board of Lufthansa Systems on Nov. 24. Following Cargo, Technik, LSG and Thomas Cook, the IT services segment will be the latest Lufthansa Group company to be transformed into a stock corporation. It will remain a wholly owned subsidiary of Deutsche Lufthansa.
FAA Administrator Marion Blakey on Monday asked for federal mediation of the ongoing contract negotiations between the agency and its controller workforce, represented by the National Air Traffic Controllers Assn., charging that the two sides remain far apart on a new agreement. But NATCA said talks are showing progress. Both sides must agree to mediation. FAA claims that NATCA's contract proposal will raise average total compensation for controllers to more than $200,000 within four years, up from $166,000 today including benefits. NATCA disputes the numbers.
US Airways firmed up its May commitment for 20 A350s, Airbus announced. No engine choice was announced for the aircraft, which will be delivered between 2011 and 2014. US Airways operates nine A330s, which have cockpit commonality with the A350.
Frontier Airlines plans to sell $80 million worth of unsecured convertible debentures due in 2025. In addition, it will grant its underwriters, led by Morgan Stanley and co-manager Citigroup Global Markets, the option to purchase an additional $12 million in debt.
China Airlines purchased 20% of China Aircraft Services Ltd. of Hong Kong and said it will switch its Hong Kong MRO and ground service from HAECO to CASL in January. CAL bought 13.33% of CASL from China National Aviation Corp. and 6.67% from Hutchison Whampoa.
Boeing delivered to Air France the first 777-300ER incorporating enhancements that improve overall fuel efficiency by 1.4%. This equates to an annual fuel savings of approximately 200,000 gal., according to the manufacturer. The improvements result from a modification to the GE90-115B by GE, drag reduction via modification of the vortex generators and air induction systems for the environmental control systems, and weight savings that include lighter weight ECS ducts and main deck floor panels.
Innovative Solutions & Support and ABX Air, the former air arm of Airborne Express that now operates independently, have teamed up to offer operators of 757s and 767s a flat panel display retrofit. The two achieved an FAA STC for the conversions. Under a partnership, ABX will provide installation and pilot training while IS&S will supply the LCDs and STC.
