Lufthansa is growing its China network with the addition of Nanjing and Shenyang to its current destinations there (Beijing, Shanghai, and Guangzhou). Nanjing will receive service from Frankfurt, starting March 31, while Shenyang flights will depart Munich, starting June 8. Lufthansa will use three-class, 221-seat Airbus A340-300s on the routes being added in the summer. The decision brings to 58 the number of Lufthansa weekly flights to China.
Morgan Stanley research analyst Heidi Wood lowered her rating on Boeing’s stock to “equal-weight” — the equivalent of neutral — one day after a yearend briefing on the 787 aircraft’s development status.
Reacting to a Government Accountability Office Report issued last week, Sen. Ted Stevens (R-Alaska), vice chair of the Senate Commerce Committee, yesterday urged FAA to update the National Runway Safety Plan. “It is crucial that the FAA seriously consider and act upon the recommendations of the GAO report,” Stevens said. The GAO report faulted FAA’s approaches to reducing runway incursions and increasing ramp safety (DAILY, Dec. 6).
IATA yesterday cut its 2008 industry profit outlook for the second time in three months mainly because of wider economic uncertainty, and the airline association now believes profits will drop slightly year over year to $5 billion.
Regional jets may be in high demand these days, but the market for turboprops is still strong, according to Forecast International. The firm projects that 3,800 regional aircraft will be produced by 2016, including 2,539 regional jets and 1,261 turboprops. The study estimates that the market value for the aircraft will total $99.7 billion.
The European parliament voted in favor of the creation of a European public-private Joint Technology Initiative (JTI) for research into environmentally friendly technologies for civil air transport, yesterday in Strasbourg. The European Union intends to contribute EUR 800 million to the undertaking, dubbed "Clean Sky", which is embedded into the EU's 2007-2013 research framework program (DAILY, June 18). The JTI, which is scheduled to be operational next year, should be headquartered in Brussels, said the Parliament.
The timing and direction of moves toward industry consolidation will likely remain the issue of greatest interest to creditors during 2008, said debt watcher Fitch Ratings. "Despite recent public pressure exercised by shareholders to accelerate merger discussions among some legacy carriers -- notably United, Delta and/or Northwest -- airline management teams will likely remain circumspect in evaluating the financial implications of various airline combinations," said Fitch in a report.
United's decision to distribute $250 million to its shareholders has its pilots union declaring war, and calling the move "ludicrous." United said recently in statements to investors that it will be doing everything possible to maximize shareholder value, and then on Friday it announced it had approved a special distribution of $2.15 per share (DAILY, Dec. 10).
Delta and Air France notified the U.S. Transportation Dept. Monday of plans to develop further operations under their blanket code-share authority. Starting about June 3, Delta will display Air France's code on service between Atlanta and Stockholm, Sweden, a route opened up for Air France by provisions of the new U.S.-European Union open skies agreement, which takes effect next March. At about the same time, Delta and its regional affiliates Comair and Atlantic Southeast will begin code-share service between Air France's U.S. gateways and Spokane, Wash.
While it works on details needed to get its first 787 into the air and the flight test program completed, Boeing's suppliers have begun producing ship sets for aircraft No. 7 - the first to be delivered to launch customer All Nippon Airways late next year.
As part of a state visit by Libyan President Col. Muammar al-Gaddafi, two of the country's carriers have increased orders for Airbus aircraft. Libyan Airlines signed a first contract for four A350-800s, four A330-200s, and seven A320s. The deal was previously announced, but only hits the order books now. The A350s are to be handed over in 2017.
The House of Representatives yesterday passed legislation that would require the Transportation Security Administration (TSA) to begin a pilot program for testing the feasibility of screening airport workers with access to secure areas. The measure, introduced by Rep. Nita Lowey (D-N.Y.), will set up pilot tests at seven airports yet to be named. A similar bill is pending in the Senate, and TSA is moving forward with industry groups to develop ways to screen workers (DAILY, Dec. 11). [email protected]
Mexico's civil aviation regulator (DGAC) CEO Gilberto Lopez Meyer, speaking at last week's International Civil Aviation Day, said domestic passenger traffic will grow by 30% in the near future -- from 22%-23% in previous years -- due mainly to consolidation of low-cost, low-fare carriers now competing in the market. Loretta Martin, ICAO's director for the region, said traffic growth forecasts for Mexico significantly exceed worldwide estimates of 4.6% per year through 2025.
CIT Aerospace this week announced a deal under which the leasing company will buy 15 737-800s from Ryanair. Deliveries of the aircraft will begin in 2008 and end in 2009. All the aircraft are committed to future leases, and CIT said they will help it "continue to meet customer demand" for -800s.
The House last night was expected to vote on a standalone bill that would raise the retirement age for commercial pilots from 60 to 65, a vote that would splinter off the pilot age provisions in the FAA reauthorization bill, currently stalled in the Senate.
The Commerce Department and the U.S. Trade and Development Agency (USTDA) have signed new agreements with China as part of the Joint Commission on Commerce and Trade (JCCT) meeting in Beijing this week.
Soaring jet fuel prices are taking a bite out of airline profits. Calyon Securities analyst Ray Neidl projects a collective $59 million loss for U.S. network and low-cost carriers in the fourth quarter. He's also lowered his full-year industry profit estimate by $400 million, to $3.5 billion. Carriers have been able to pass through fuel price increases on most international routes, but are recouping just 30%-40% of the higher costs on more competitive domestic routes, Neidl says.
An optimistic GOL foresees continued improvement in traffic and expects that the addition of new aircraft will bring down costs, the company said in its outlook for 2008, despite declines in margins and revenues it expects for the fourth quarter and full-year 2007.
By Pat Murphy, Gerchick-Murphy Associates Eight years ago DOT awarded JetBlue 75 slots at JFK, and the airline launched service. The reasons for DOT's unique 1999 decision were numerous, but generally can be grouped under two circumstances: struggling low-cost carrier competition, and minor JFK congestion.
Alitalia's board of directors will convene tomorrow to consider the three non-binding proposals it has in hand from potential buyers. The preferred bidder, with whom detailed takeover talks would take place, is expected to be selected at that time.
