Consolidation of China’s second- and third-largest airlines has become increasingly probable after minority shareholders in China Eastern rejected a proposal for Singapore Airlines and a Singaporean state investment fund to buy into the struggling carrier. The shareholder vote, itself a landmark in Chinese corporate history, has opened the way for the parent of second-ranked carrier Air China to go ahead with its proposed bid for 24%-30% of China Eastern.
EasyJet recorded a drop of 2.2 points in its monthly load factor in December as the airline filled 78.9% of its seats. The latest figures caused an initial 8.4% drop in its share price, the sharpest decline in almost two years. EasyJet introduced extra charges on checked baggage recently, and Chris Avery, a JP Morgan airline analyst, believes that may have deterred some demand. Passenger numbers for the month were up 9.9.%.
Carriers operating out of London Stansted Airport are asking the U.K. Dept. for Transport (DFT) to abolish the Civil Aviation Authority (CAA) and create a new regulatory body. DFT tapped Joseph Pilling in October to conduct an independent review of CAA based on a recommendation from the House of Commons Transport Committee. The review is studying the structure, scope and organization of the CAA to ensure that the U.K.’s arrangements for aviation regulation and policy making are able to meet current and future challenges.
Rolls-Royce has won a US$300 million deal to power Thai Airways’ fleet of eight Airbus A330-300s with its Trent 700 engine. The deal also includes a 10-year TotalCare service agreement. Thai Airways was the launch customer for the Trent 800 powering its 20 Boeing 777 -200s and -300s. It also uses the Trent 500 on its 10 A340 -500s and -600s.
Three potential bidders are emerging for the Airbus interiors plant in Laupheim, Germany. German financial daily Handelsblatt reports Zodiac, Diehl Aerospace and Kafer are still in the race for the fourth German Airbus site to be sold. Airbus declined to comment. Late last year, Airbus opted to sell its facilities in Varel, Nordenham and Augsburg to OHB Technology, a Bremen-based space specialist. OHB expects to close the transaction before the end of the first quarter.
The French “solidarity tax” on airline tickets — implemented by former French President Jacques Chirac to fund development aid (DAILY, March 2, 2006) — is generating less revenue than expected.
Despite growing fears of mounting financial pressure on airlines, Air France-KLM says it has been able to increase unit revenue, excluding currency effects. The two carriers note that a strike at Paris Orly Airport affected Air France traffic growth in December, but that the two airlines still managed a 3.1% increase. Load factor fell slightly to 78.6%, or 0.8 percentage points; load factors for traffic in all regions, with available seat kilometers up everywhere except on Caribbean routes, where ASKs were flat.
Ryanair’s dispute with Aer Lingus will get a legal hearing next month. Ryanair holds 29.4% in Aer Lingus and is complaining that its shareholder rights are being ignored by Aer Lingus management. Meanwhile, Aer Lingus has been pressing Brussels to force Ryanair to unload its stake.
FAA is requiring assurances from Boeing that passengers on the 787-8 won’t be able to tamper with the new jet’s electronic systems. In a Federal Register notice, FAA notes the 787-8’s “novel or unusual” digital systems architecture — aimed at giving passengers inflight Internet access — provides “new kinds of passenger connectivity to previously isolated data networks’’ — and that could lead to security “vulnerabilities” due to unauthorized access, the FA said.
Iridium officials say that a recent ICAO stamp of approval for use of the company’s satellite communications system in flight safety situations may help spur more airlines to install Iridium avionics.
Robert Johnson, U.S. Transportation Dept. chief of staff, is leaving Jan. 15 to return to Phoenix, Ariz., Secretary Mary Peters told staff in a memo this week. Johnson will be replaced by Quintin Kendall, currently deputy assistant secretary in the DOT budget office. Details on Johnson’s plans were not available at press time.
Boeing has delayed delivery of the second 787 flight test aircraft of “a couple of weeks” to allow the program’s supplier/partners to improve the “conditions of assembly” of their large deliverables, according to a company official.
March 26-28, 2008 at The Phoenician Resort in Phoenix, Arizona Join industry executives from around the world as we gather for this much anticipated annual event. To register, visit phxskyharbor.com or call 602-683-2634. HOLD THIS DATE ON YOUR CALENDAR! PHOENIX SKY HARBOR INTERNATIONAL AIRPORT Click here to view the pdf
Pinnacle is suing the Air Line Pilots Association, charging the union with bad-faith bargaining in its pilot talks. “We regret having to file this lawsuit, but the union left us with no choice,” Pinnacle General Manager and VP Clive Seal said in a statement yesterday. “On more than one occasion, we agreed to terms that the union said would result in an agreement, and then they moved the goalposts and made additional demands.”
Frontier’s shares, not traffic or loads, took a hit from winter weather last month, and the airline expects it will post a pre-tax loss of US$0.78-$0.88 per share in the December quarter.
Amsterdam Schiphol Airport is blaming the government’s environmental ticket tax for predicting zero growth in passenger and air transport movements and 4% growth on cargo in 2008.
JetBlue Airways, promising to use more constraint in 2008, increased its capacity by 11.6% in 2007 as other U.S. carriers either held steady or slightly decreased theirs. The low-cost carrier flew 31.9 billion ASMs for the year, up from 28.6 billion. Its traffic rose 10.4% to 25.7 billion RPMs, up from 23.3 billion, causing load factor to slip to 80.7% from 81.6%. For December, capacity was down 10% to 2.8 billion ASMs while traffic rose 6.4% to 2.1 billion RPMs. Load factor was down 2.6 points for the month to 76.8%.
Venezuela’s civil aviation regulator INAC on Jan. 5 lifted its partial ban on sales of international tickets by domestic carrier Aeropostal/Alas de Venezuela. Sales were suspended on Dec. 19 in order “to protect consumers from the latter’s inability to guarantee operational safety,” INAC said. Factors cited at that time were a nagging conflict between labor and Aeropostal management, plus INAC’s own complaints that the carrier operated on some frequencies not authorized by the regulator, both generating serious flight delays and putting passengers at risk.
Virgin Atlantic has averted a potentially disruptive strike by cabin crew. The airline and Unite union have come to terms on a new pay package, leading the labor group to call off a strike that would have commenced tomorrow (Jan. 9) and lasted through at least Jan 17. The pay agreement calls for a two-year deal during which wages will increase 4.8% in the first year and another rise based on retail price increases in the following year. The pay increase amount will be reviewed in April 2009.
Chile’s Sky Airlines on Jan. 19 will launch daily service between the northern Chilean port of Iquique on the Pacific Coast and Puerto Iguazu in the Northeast of Argentina, gateway to fabled resort area of Iguazu Falls. The Boeing 737-200 flight will take 2.45 hours over several Argentine provinces and become a major link in roundtrip South America tour itineraries. Sky is also increasing international frequencies from Chile to new destinations in Peru.
US Airways has appointed two executives, pending board approval, to key positions in its East Coast operation. Suzanne Boda has been tapped as senior VP-East Coast international and cargo operations while Robert Ciminelli has been named VP-Philadelphia. Boda will oversee the Philadelphia hub, the shuttle operations international operations and the airline’s cargo business. This is a new position reporting to COO Robert Isom.
