Bypassing the global distribution systems whenever possible has been a goal of the Major airlines for several years. Segment fees rose by an average of more than 6% a year from 1990 to 2000, but the airlines say the increases were not accompanied by a proportionate improvement in value to them. The rate of increase slowed following 9/11, but carriers now pay more than $4 per segment or an average of $12.50 per ticket-a hefty chunk of today's low fares.
It is almost one year since the implementation of the AF-KLM merger and you have stated several times that the first results are "extremely positive." How positive is this?
By summer, the fruits of nearly four years of seemingly disparate government biometric technology tests could weave together quickly into a cohesive strategy for US airports as key mandates come due and various trials conclude. Because of the sheer size of the US market, with more than 200 airports receiving scheduled service, decisions here will play a large role in influencing technology development and choices around the globe.
Original equipment manufacturers intend to grow their share of the commercial aviation maintenance, repair and overhaul business aggressively in response to both the needs of their customer base and their own internal corporate goals. Although this trend dates back more than a decade, it has accelerated owing to the tremendous upheavals of the past four years.
The view from this small town in the high desert of southwestern Utah is a panorama of valleys, patches of black lava and steep red cliffs topped by a canopy of endless sky that never seems to want for color. The sky--literally--is the limit in St. George, the headquarters of SkyWest Airlines. You could say the same about the future of this carrier, which was founded by Ralph Atkin in 1972 and has grown from operating a single Piper Seneca into one of the largest and most profitable Regionals in the world.
The variety of successful strategies in use today was in full display at the ATW Winning Strategies conference in Washington, where some of the airline industry's keenest minds shared their wisdom. Dr. Adam Pilarski, senior VP at consultancy Avitas, opened the conference with a controversial statement, "the myth of overcapacity is an urban legend," pointing out that historically high load factors should push fares up. "If airlines don't make money when they have the highest load factors ever, there is something wrong with their business model."
Albert Einstein said, "We owe a lot to the Indians, who taught us how to count, without which no worthwhile scientific discovery could have been made."
"There's an old saying around here that you never go bankrupt with too few seats or too few airplanes," Southwest Airlines CEO Gary Kelly tells ATW at the airline's Dallas headquarters.
Virgin Blue head Brett Godfrey denied speculation that he will resign following the change in management control of the airline. In a memo to staff, Godfrey said he is happy to continue in his position at least until late next year as long as he retains the support of Virgin Blue employees, shareholders and the board. He also refuted suggestions that the group's international arm Pacific Blue would be scaled back, saying that the subsidiary is profitable, has exceeded expectations and remains an integral part of Virgin Blue operations.
Although traffic and capacity continue to grow, IATA DG and CEO Giovanni Bisignani yesterday warned that if fuel prices continue to rise, the industry could see more red ink this year. "If the average price of oil settles at $43 per barrel for the year, the total cost of fuel to the industry will exceed $73 billion," Bisignani said. "Clearly 2005 will be another year of industry losses, despite aggressive airline cost cutting."
Lufthansa Technik Group, which includes LHT and 18 consolidated companies, grew stronger than the market itself and substantially improved earnings last year as evidenced by the €227 million in income from operations reported for 2004. "After three years of turbulence, the market is still under pressure but the demand for MRO services picked up for the first time since 9/11, resulting in a market growth of 5.3%," explained LHT AG Executive Board Chairman August Wilhelm Henningsen.
US Dept. of Homeland Security this week initiated the US-VISIT Biometric Exit Pilot Program at Hartsfield-Jackson Atlanta International Airport. Under the program, foreign visitors departing from the airport will be asked to provide their two finger scans and stop for a photo as part of the project to test and evaluate an automated biometric exit process. The program has been operating for a number of months at Baltimore/Washington International, Chicago O'Hare, Denver International, Dallas/Ft. Worth International and Miami International airports.
Swiss International Air Lines' large shareholders sold almost 84% of the carrier's capital to AirTrust, the holding company through which Lufthansa is taking over Swiss. According to the carrier, the newly formed company now holds 83.96% of Swiss share capital, almost all of the 86.13% previously held by majority shareholders. As part of the deal, AirTrust is offering major shareholders $342.3 million. It is offering another $58.1 million to individual investors whose shares are in free float.
Pacific Blue, the international arm of Virgin Blue, will begin to offer passengers APS digEplayers on flights between Australia, New Zealand and the Pacific Islands. The carrier said it will begin phasing in the portable on-demand entertainment players from late May and they will be available on all flights by June 13. Each aircraft will be equipped with 60 players and the airline will charge A$12 ($9) to rent one.
Continental Airlines flight attendants late Wednesday rejected a new agreement, becoming the only work group at the carrier that did not ratify a new deal. Earlier Wednesday, Continental's pilots, mechanics, dispatchers and simulator engineers all approved new contracts that include pay and benefit reductions ( ATWOnline, March 31).
Pinnacle Airlines named Clive Seal VP-fight operations effective April 18. He will be responsible for the administration and management of Pinnacle's pilots, the Pinnacle Airlines Corporate Education Center and System Operations Control.
Air New Zealand could pursue a little-known loophole in New Zealand aviation legislation to bypass the competition regulator and establish a codeshare partnership with Qantas on the Tasman. According to the general lawyer for ANZ, John Blair, the New Zealand government has the power to allow the carriers to sell seats on each other's international services under the Civil Aviation Act. However, he said the legislative provision cannot be exercised to extend such an alliance to domestic services.
US Airways yesterday said the US Bankruptcy Court extended until May 31 the period for it to retain exclusive rights to file a plan of reorganization. Previously the carrier was expected to file its plan with the court by March 31. According to a statement, the request for an extension was supported by the company's unsecured creditors committee and was "unopposed by other interested parties."
Lufthansa Systems announced that Etihad Airways opted to implement its NetLine/Plan and NetLine/Sched, allowing for an "integrated approach to optimizing the elements of resource planning and control."
Alpine Air Express posted a net loss of $168,843 for the three months ended Jan. 31, a significant improvement from a net loss of $413,081 in the prior-year period. Revenues rose 97.8% to $5.2 million owing to a sharp increase in cargo volumes, which more than doubled year-over-year as a result of a new USPS contract in Hawaii.
Estonian Air launched new twice-weekly service from Tallinn to Milan. The airline will operate a third weekly flight on the route from June to September.
As Dragonair launches its first transpacific freighter service, it served warning that it plans to double its freighter fleet to eight 747s in just three years. In addition, the airline is looking at an additional A300B4 for service to mainland Chinese cities.
