AirCell said it completed a successful "extended airborne demonstration program" of its inflight mobile phone system. The system is targeted for commercial deployment in 2007 and will permit passengers to use their Wi-Fi and cellular devices. FAA has yet to approve the inflight use of mobile phones, however.
Wizz Air announced establishment of a new crew base in Warsaw, its third base overall and second in Poland. It also took delivery of its first new A320. The aircraft, the seventh in its fleet, is leased from Aviation Capital Group on a 5.5-year term and will serve the Polish market starting Dec. 1. Separately, the carrier unveiled an incentive for frequent travelers, offering immediate 15%-25% bonuses on funds passengers contribute to a prepaid account.
Okay Airways, China's first private carrier, has abandoned its low-cost model. People's Daily reported the seven-month-old airline was unable to cut expenses due to China's unified regulatory and pricing systems.
FL Group, parent of Icelandair, as expected, reached agreement with Sterling parent Fons Eignarhaldsfelag to acquire the Danish low-fare airline for DKK1.5 billion ($241 million) including DKK1.1 billion in cash and DKK400 million worth of shares in FL Group ( ATWOnline, Oct. 20).
US airlines will return to profit at the operating level next year if oil stays at or below $60 a barrel, according to JP Morgan analysts Jamie Baker and Pakhi Elder, who forecast the industry will earn $4.6 billion at the operating level compared with an estimated loss of $2 billion in 2005. Operating profit excluding fuel should hit $28.8 billion in 2006, up from $21.9 billion this year. Driving the improvement are declining capacity and "surging RASM," the analysts wrote in a report released yesterday. System RASM rose 12.5% in September and will rise 13.1% this month.
Airbus's plans to build an engineering center in Mobile received approval from Alabama officials yesterday, paving the way for construction to commence in January. Scheduled to open a year later, the facility initially will handle design work on the A350, including ceiling panels, sidewall panels, overhead stowage bins, interior furnishings, seats, crew rest compartments, lavatories and galleys.
AirAsia said the Malaysia Ministry of Finance approved its application for an investment allowance incentive constituting an income tax exemption equating to 60% of qualifying capital expenditure incurred within the five years from July 1, 2004, until June 30, 2009. In conjunction with "the normal 100% allowance" for capital expenditures, "our future budgeted tax payments are minimal," noted AirAsia Group CEO Tony Fernandes.
Air France-KLM Group is extending its French spoke network to KLM's Amsterdam hub with a new twice-daily service between Strasbourg and Schiphol. The route, on which AF and KLM will codeshare, will commence Oct. 31 and will be operated by Regional, an AF partner, with ERJ-135s. Air France and KLM already link Bordeaux, Clermont-Ferrand, Lyon, Marseille, Nice and Toulouse to Amsterdam. They will launch a Paris-Eindhoven route Oct. 30 with two daily flights, increasing to three Dec. 12.
Continental Airlines completed the sale of 18 million shares of Class B Common Stock at a price of $11.35 per share, raising gross proceeds of $204.3 million. Sole underwriter UBS Investment Bank has a 30-day option to purchase an additional 2.7 million shares to cover overallotments, if any.
SkyTeam and Philips agreed to a global business-travel contract providing the electronics company access to 25 countries through eight alliance carriers. The deal offers customized travel solutions, a single point of entry, harmonized discounts and a single source of performance reporting.
Cendant Corp.'s board of directors approved the break-up of the company into four standalone, publicly traded "pure-play" companies with the Cendant name disappearing. Orbitz, the online travel site, and the Galileo GDS will be part of the as-yet-unnamed Travel Network company, which will maintain its headquarters at Cendant's New York City office. The unit will be headed by current Cendant Chairman and CEO Harry Silverman. Companies within the Travel Network group represent 18%-20% of 2005 estimated revenue and 21%-23% of estimated pre-tax earnings.
AirAsia completed fuel hedging for the second half of 2006 at $48 a barrel. "Fuel cost is the single largest cost item of the business and it constitutes approximately 60% of our total operating cost," AirAsia Group CEO Tony Fernandes said. "We took advantage of the recent dip in oil prices, in light that there might be more risk on the downside going forward."
Nordic Leisure and Iraqi Airways are evaluating a connection between Stockholm and the city of Erbil in the Kurdistan Region of the Republic of Iraq. Nordic Leisure plans to use MD-80s to operate between Stockholm and Istanbul while Iraqi Airways will conduct the Istanbul-Erbil sector with 737s or 727s. Malev will launch thrice-weekly service from Budapest to Tirgu Mures, Romania, by Jan. 16, becoming the first international carrier to serve the Transylvanian city.
Aeroflot will add seven A321s to its medium-haul fleet, Airbus announced yesterday. Deliveries of the newly ordered aircraft are scheduled to begin in fourth-quarter 2006. Each will feature a two-class cabin configuration seating 170 and will be powered by two CFM56-5s. The aircraft are intended for Aeroflot's Russian and European networks. The carrier already has a significant investment in the A320 family, operating eight A319s, seven A320s and three A321s prior to the new purchase.
ANA in cooperation with Japan Post, the Japanese postal system, intends to launch a cargo airline. Under terms of a strategic agreement signed by ANA President and CEO Mineo Yamamoto and Japan Post President Masaharu Ikuta, the companies will "cooperate in the field of international air cargo services from April 1, 2006, including participating in the airline venture and the joint development of international express courier services particularly to the growing Asian market."
British Airways' weekly frequencies between London Heathrow and India will increase from 19 to 25 starting Oct. 30. Service to Mumbai will grow to two flights per day, a new service to Bangalore will operate five times per week and service to Chennai will rise from two to six flights weekly. Service to Delhi will double to two daily flights beginning next summer. The carrier said the expansion is due to the lifting of restrictions on the two nations' bilateral agreements. Meantime, BA will launch service from Gatwick to Grenoble Dec.
India and New Zealand announced yesterday a bilateral air services agreement to replace the countries' 1997 accord. Terms were negotiated last week in Queenstown. Designated airlines will operate up to seven flights per week with full third, fourth and fifth freedom rights at points in Australia and Singapore. Codesharing will be introduced but there will be no direct flights.
Frontier Airlines is adding one daily flight each from Denver to Salt Lake City (starting Nov. 6), Dallas (Dec. 18), Phoenix, Las Vegas and Chicago Midway (all Jan. 4) aboard A318s and A319s. Phoenix and Las Vegas now are Frontier's most popular markets with seven flights per day.
Iberia plans to cut 2,164 jobs, representing 9% of its workforce, under the 2005-2008 Director Plan that is aimed at boosting its profit by €600 million ($716.3 million) over the next three years ( ATWOnline, Oct. 10).
Cargolux will start a direct weekly service to Damman Oct. 31 operating 747 freighters. The flight will continue to Hong Kong before returning to Luxembourg. Meantime, the carrier agreed with SITA to retain the name CHAMP Cargosystems for their joint IT cargo company.
Boeing yesterday completed the sale of its operations in Arnprior, Ontario, to Arnprior Aerospace, a wholly owned subsidiary of Consolidated Industries ( ATWOnline, Aug. 4). Terms of the deal were not disclosed.
Eastern Airways will launch new service Nov. 1 to Brussels from Southampton with two flights each weekday and one on Sunday. The service represents the Regional carrier's first international flights from the UK. Also, Eastern started service yesterday with three daily flights and one on Sunday from Bristol to Durham Tees Valley.
Ryanair renewed its Europewide travel insurance deal with Mondial Assistance Group. Under the arrangement, Ryanair passengers from France, Germany, Austria, Italy, Spain, Belgium, Holland, Norway, Sweden and Denmark can buy 28-day insurance cover for €14 ($16.71). In the coming months the product will be launched in Poland, Portugal and Finland owing to strong demand, according to Ryanair Deputy CEO Michael Cawley.
Accident investigators are looking for clues into the Saturday evening crash of a 737-200 belonging to Bellview Airlines. Flight 210 went down just north of Lagos around 8:45 p.m. local time, shortly after taking off from Lagos-Murtala Muhammed Airport en route to Abuja. According to published reports, all 111 passengers and six crewmembers onboard were killed. Reportedly, the pilot advised of problems 3 min. after takeoff. The aircraft at that stage was 15 mi. south of the city over the ocean; however, the wreckage was located 20 mi. north of Lagos.
