Delta confirmed yesterday that a tentative agreement has been reached between the Delta and Northwest pilot groups, both represented by the Air Line Pilots Association (ALPA), and Delta management on a contract to take effect upon closing of the merger.
New code-share agreements were inked between Star Alliance partners Air China and US Airways and Singapore Airlines and Garuda Indonesia. The SIA agreement with Garuda, currently a memorandum of understanding, will place the Indonesian carrier’s “GA” designator code on the Singaporean airline’s daily Boeing 777-200 service between its home base and Denpasar, the capital of Bali.
Delta and Northwest intend to give the U.S. government all of the remaining documents they need by the end of this month regarding their merger proposal. Delta believes that will lead to regulatory approval around the Thanksgiving holiday period, and is confident the merger will be rubber-stamped before the end of the year.
Alaska Air Group expects second-quarter mainline unit costs to rise by as much as 12%, even though it kept capacity near 2007 levels. The airline group, which operates Alaska Airlines and regional Horizon Air, now forecasts a CASM up to 11.6 cents for the three months to June 30. Excluding a 54% increase in fuel to $3.29 per gallon and one-time charges, mainline unit costs will rise between 3% and 5%, adds the airline group in a regulatory filing. Second-quarter mainline capacity rose 1.2% from the same period last year to 6.2 billion ASMs.
Bombardier has revealed firm orders for four CRJ700s and three Q400 turboprop aircraft worth more than $225 million at list price. The four CRJ700 NextGen regional jet orders came from an unidentified customer, who has also placed options of four more of the type. The firm order is worth $146 million at list price; Bombardier values the entire deal at about $302 million. The NextGen orderbook now stands at 213 firm aircraft and 19 customers.
Air Berlin is facing strong criticism over its current strategy ahead of its annual shareholder meeting, set for today at London Stansted Airport. The airline should abandon its existing strategy and focus on niche markets in which it can survive, several analysts said.
Mexicana is open to a merger or another consolidation option to survive the aviation sector’s crisis, CEO Manuel Borja Chico said last week. Borja Chico told Invertia/El Financiero News Services that there are too many airlines for the size of the Mexican market, with excessive seat offer and unstable fares as fuel costs shoot up.
Maryland-based GoIndustry USA made the highest bid for Eos aircraft spare parts under the bankruptcy-court approved auction process, offering $900,000. A bankruptcy court yesterday approved the sale. GoIndustry is an industrial machinery and equipment auctioneer.
Airlines continue to transfer their operations into the new Concourse A at Seoul Incheon Airport, which was officially scheduled to open last week. So far, 45 airlines have made the move, including Air France-KLM, Cathay Pacific, Delta, Northwest, Japan Airlines and Malaysia Airlines. The final five carriers — Lufthansa, United, Philippine Airlines, Emirates and Aeroflot — will move in on opening day. With the relocation, Korean Air and its SkyTeam partners will all occupy the East Wing of the main passenger terminal.
Southwest plans to invest $175 million over six years in an initial effort to equip its fleet of Boeing 737s for Required Navigation Performance and to pay Naverus to set up RNP procedures nationwide in partnership with FAA. Jeff Martin, senior director-flight operations, says RNP flights should begin in the fourth quarter 2009 and ramp up through 2013. Southwest plans to use RNP procedures at all 64 airports it serves.
Northwest CEO Douglas Steenland called on lawmakers yesterday to close loopholes that he believes allow speculation in the oil markets. Noting that Northwest's first-quarter fuel bill was $450 million higher than last year's, Steenland told the House Energy and Commerce Committee's subcommittee on oversight and investigations that Congress needs to "tackle reforms with alacrity." "If the current pricing dynamic does not change,” he said, “our industry will be severely challenged and will continue shrinking."
TUI Travel is shifting 19 aircraft it currently owns to lessors with lease-back agreements. The deal, which includes 11 Boeing 737-800s, six 757-200s and two 767-300ERs, was signed with a joint venture between AerCap Holdings and Deucalion Aviation Funds. AerCap will manage the assets. All the aircraft were immediately leased out to the respective TUI Travel airlines (HapagFly, Thomsonfly, TUI Fly Nordic and Jet4You), which had been operating them.
Three carriers have become the first aviation industry representatives on a Boeing-backed organization that’s pursuing second-generation, algae-based alternative fuels for commercial aircraft. Air New Zealand, Continental and Virgin Atlantic are joining the Algal Biomass Organization that Boeing and various research organizations founded in May to identify and accelerate development of the alternative fuels.
Madrid, Spain September 23, 2008 Green Aviation Don’t miss the second annual AVIATION WEEK Management Forum dedicated to green initiatives in the airline industry, including: emissions treading; carbon offsets; and air traffic management improvement. Learn more at www.aviationweek.com/forums or call +1.212.904.3195.
The industry has continued to pull down capacity every week to counter high fuel prices, but the current 7% cut is not enough and capacity will shrink further, AirTran Chairman and CEO Robert Fornaro said yesterday in a keynote address at the Airports Council International-North America marketing and communications conference.
Lufthansa Technik (LHT) will use radio frequency identification (RFID) systems from Motorola to track aircraft components. The company-wide implementation follows trials at LHT’s Hamburg maintenance center. For the initial phase, LHT will apply RFID tags to documents accompanying aircraft components, but plans are already being developed to directly tag the spare parts.
The Transportation Security Administration is expanding its reach to the airside of the airport with a new security initiative designed to further enhance its efforts.
If oil prices reach $150 and stay there, Spirit would probably have to cut five to 10 of its 35 aircraft to stay cash-flow-positive, which it is committed to doing, CEO Ben Baldanza told The DAILY. Spirit will decide by July 1 on whether to cut capacity this fall or defer some aircraft deliveries.
A Brazilian Senate committee investigating charges that the 2006 purchase of VarigLog from Volo do Brasil violated Brazilian law could lead to annulment of the sale, which also involved U.S. investment fund Matlin Patterson, controlled by Chinese businessman Lap Chan.
The European Commission is expected to introduce its latest Single European Sky legislative proposal this week, and is scheduled to brief reporters on the proposal today. The proposal is aimed at accelerating the formation of functional airspace blocks, which is one of the major Single Sky goals. The plan still needs the approval of the European Parliament.
Delta, in what it called “a matter of goodwill” in response to complaining passengers, said it is offering a rebate on its $25 checked bag fee to customers who bought tickets before April 9. Delta announced its new fee April 9 and, unlike other carriers implementing such a fee, made it applicable to any bookings for travel on or after May 5, rather than only to bookings made on or after the date it announced the fee. Customers complained about being charged a fee that did not exist at the time they booked their flights.
Congress is considering legislation that would extend FAA's funding authority through the end of September. The bill, introduced on June 20 by Rep. Charles Rangel (D-N.Y.), chair of the House Ways and Means Committee, and co-sponsored by the Transportation Committee leaders James Oberstar (D-Minn.), Jerry Costello (D-Ill.), John Mica (R-Fla.) and Thomas Petri (R-Wis.), extends Airport and Airway Trust Fund expenditure authority to Sept. 30.
