Airports large and small are betting that cash incentives will help them get air service to important local and international cities. From recent moves by Dallas/Fort Worth aimed at supporting American's bid for Beijing service with large cash bonuses (DAILY, Aug. 3), to Fort Wayne's Traffic and Revenue Improvement Program packages, examples abound as airports become more creative in attracting airlines and their passengers to their facilities.
Spanish competition authority Tribunal de Defensa de la Competencia (TDC) imposed a EUR6.1 million fine on Iberia, Air Europa, Spanair and the travel agents of the association Cúpula Asociativa de Agencias de Viajes Españolas (CAAVE) for agreeing on a uniform surcharge for issuing airline tickets. Spanish consumer association Unión de Consumidores de España (UCE) welcomed the decision and claimed the surcharge generated total revenue of EUR1 billion in 2004, including EUR600 million for Iberia alone. Air Europa said it would appeal the decision. -MT
SkyWest's United Express operation on the West Coast are improving, executives reported yesterday, alleviating the pressure on the carrier's operating margins, which were hurt by the poor performance in the beginning of the year. The carrier missed a $3 million incentive target during the first quarter after facing obstacles in achieving on-time targets and baggage delivery (DAILY, May 4). Pre-tax margins during that quarter were 7.6%, compared with 9% a year earlier.
Comair flight attendants are appealing a recent bankruptcy court decision allowing management to void their contract, as airline management prepares to start talks next week with pilot and flight attendants regarding deals reached with those labor groups in February. The court ruled in Comair's favor last month after previously turning down the carrier's bid to void the flight attendant deal. At the time, the flight attendants said they would decide in 10 days whether to challenge the court's ruling (DAILY, July 24).
Republic Airways Holdings (RAH) expects to spend about $150 million during the next two years to support new business it recently garnered from Continental and US Airways, but executives are confident the carrier can fund the expansion through its cash flow and liquidity and have no plans to tap the public markets to support the growth.
FAA's system specialists yesterday voted to reject the agency's contract offer -- as expected -- and the union is now calling for FAA to return to the bargaining table.
The Czech Republic's Air Navigation Services (ANS) this week contracted Thales to help replace navigation aids for airports in Prague and other locations. The contract is part of a wider modernization program by ANS. Delivery of the Thales systems is expected to begin immediately, and will be completed next year. The upgrade will mean that Prague Airport will be able to handle precision landings with practically zero visibility, thanks to an instrument landing system (ILS) capable of Category III operations that is included in the contract, Thales said.
Costa Rica reopened Caribe Airport in Limon on the Caribbean coast to handle domestic traffic and one daily roundtrip frequency over the border to Bocas del Toro in Panama. By gradually upgrading Limon to international standards, Costa Rica is aiming to develop regional tourism in Central America, specifically to the benefit of one of the country's most economically depressed areas. Costa Rica now gets 1.6 million foreign visitors a year, who spend about US$1.6 billion.
Arinc Inc. said it will set a record for kiosk installation in the Asia/Pacific with the placement of 126 of its universal check-in kiosks at Tokyo Narita's Terminal 1 South Wing (DAILY, June 2 and June 12), home to several Star Alliance carriers. The Star-branded kiosks will use a new Java software platform that will accommodate any number of participating airlines, Arinc said, making Star carriers the first customers for the new technology.
US Airways management is "happy with what we've seen so far" of the redesigned Airbus A350, but CEO Doug Parker says the airline has a contract "for a different plane." The airline needs to meet with Airbus to decide what the A350 changes mean for the airline's contract to buy 20 of the aircraft type, he tells analysts. Parker is not overly concerned about the delivery delays related to the A350 changes.
JetBlue on Nov. 13 plans to end its service from Burbank to both Las Vegas and Orlando after launching a single daily roundtrip on the route five weeks ago. Although the Burbank-Las Vegas flight was JetBlue's first airport-to-airport competition with Southwest (DAILY, March 8), the carrier added the flight on June 30 to garner more utilization from the aircraft that left Burbank in the morning and returned to the airport in the late afternoon.
Correction: The DAILY should not have reported that Tulsa International Airport was ranked last among small airports in the J.D. Power & Associates survey (DAILY, July 5). While Tulsa was part of the survey, it was not included in J.D. Power's final published rankings due to a small sample size.
Midwest Airlines had a tough time finding the two Fairchild Dornier 328JETS it plans to place into its Midwest Connect regional service even though 30 planes were available after Independence Air ceased operations. The carrier reached a deal yesterday to acquire two planes, but a Midwest spokeswoman noted that a lot of the planes "have been snatched up all over the world" adding that "they're not especially easy to find." Midwest subsidiary Skyway plans to add the two aircraft to its fleet of 10 328JETS.
Iberia disappointed analysts this week by reporting a EUR35.7 million (US$45.7 million) second quarter net profit, down from EUR45.3 million a year earlier, as many observers expected the Spanish carrier would churn out a stable result. Soaring fuel costs, however, pushed Iberia into the red in the first half. The carrier reported a EUR9.2 million (US$11.8 million) net loss, versus a EUR29.2 million net profit in the same period a year earlier. The implementation of new accounting standards also played a role in the first-half loss, Iberia said.
The discrepancy in air transport security funding between the EU and the U.S. creates an unfair advantage for U.S. carriers, the European Commission said in a report released yesterday.
Thousands of passengers were stranded at Hong Kong Airport yesterday after most airlines ceased flights to the region due the changing track of Typhoon Prapiroon.
Air Midwest will not be allowed to end its essential air service operations at Hagerstown, Md., on Sept. 21 as planned and instead must wait for the U.S. Transportation Dept. to choose a replacement carrier, which will operate the service from Oct. 23 until next Sept. 30. DOT will accept proposals from interested carriers until Aug. 31 [OST-2006-25288].
Great Lakes is free to suspend the service it operates at Enid and Ponca City as of Sept. 1, because the U.S. Transportation Dept. decided it would no longer subsidize service for those Oklahoma communities after that date.
Mexicana this week won authority from the U.S. Transportation Dept. to launch service to Ontario, Calif., a move that will bolster Mexico-Los Angeles service.
ExpressJet's confidence of placing 69 jets coming off-line from Continental in January remains intact, and the airline has made some progress in placing the first handful of planes it will fly independently. Continental decided to cut flying covered by the aircraft late last year after it couldn't reach a favorable deal on rates with ExpressJet, and the regional opted to take the planes on higher lease rates and fly them outside the Continental network.
Dallas/Fort Worth International Airport's board is expected today to approve a $300,000 bonus under its Air Service Incentive Program to any airline that offers direct service to China by December 2007. The move is in support of American Airlines' U.S. Dept. of Transportation application for service to Beijing from its main hub.
