The European Commission has proposed an open-skies accord with Chile that would end the discriminatory provisions requiring European airlines to operate to Chile from their countries of origin, rather than any European Union member state. The draft agreement, which will now be submitted for final approval by the EU's Council of Ministers, would allow all EU airlines to fly to Chile from any EU member state. While this instrument will not replace agreements in force between EU member states and Chile, it will bring them in line with EU law.
US Airways today will hear if the airline's members of the Association of Flight Attendants will ratify the tentative concession deal reached last month. Sources expect the members to approve the 10-year contract, which includes a 9% wage cut. The bankruptcy court tomorrow is expected to decided whether to abrogate its current agreement with the mechanics union, assuming a tentative deal is not reached first.
U.S. regional airlines' unparalleled ability to slash unit costs, which, along with stepped-up use of the regional jet, propelled the segment's meteoric growth, may no longer be the ticket to success when growth slows down. While common wisdom usually credits low-cost carriers (LCCs) with taking Herculean steps to whittle down expenses and boost efficiency, a new analysis from The DAILY and partner Eclat Consulting shows its regionals that have achieved the greatest cost cuts in the industry.
Continental said yesterday its unit revenue for December dropped by about 5%, which airline analysts said was worse than Wall St. estimates. Revenue per available seat mile (RASM) was down 4%-5% systemwide, while mainline revenue dropped 4.5%-5.5%. The airline said RASM was off by about two percentage points because the Thanksgiving holiday fell in November rather than December, and it was down by another two points due to the timing of the Christmas holiday. There was a 1.1% consolidated RASM increase in November.
The Transportation Security Administration (TSA) is negotiating details to renew its single source contracts with InVision Technologies and L-3 Communications to maintain their own explosives detection systems (EDS), according to an agency presolicitation notice last week.
Spanish international low-fare carrier Air Madrid last week announced plans to withdraw its Brazil operations in January, six months after starting operations with two weekly Madrid-Rio flights. A local representative for the carrier told Rio's Jornal do Brasil the flow of Spanish and other European vacationers had decreased due to news about alleged acts of violence against tourists in Brazil.
Delta today is expected to unveil plans to simplify its fare structure throughout its U.S. domestic system after testing the program for nearly six months, but the carrier is already coming under fire from competitors and analysts who believe the timing is wrong and the move will take an unwelcome bite out of revenues.
Before the close of 2004, Brazilian Defense Minister Jose Alencar and President Chief-of-Staff Jose Dirceu both said the government's restructuring plan for Varig will be unveiled at the beginning of 2005. Dirceu said the plan would not call for the carrier's nationalization but would protect creditors and attract new investors. Possibly on the table is the congress' debt-for-stocks swap, which Alencar is studying. -LZ
FAA Administrator Marion Blakey yesterday unveiled relocation programs for the agency's flight service station employees who lose their jobs due to the largest outsourcing competition the federal government has ever undertaken. Blakey said a decision will be made by monthend on which of five bidding teams will be selected to take over the nation's flight service stations (FSS). Only one of the bids would keep the FSS employees under FAA's control, but all the proposals are believed to require fewer facilities and staff.
Aerolineas Argentinas (AR) entered 2005 with optimism after emerging from "concurso" -- Argentina's bankruptcy protection -- last month, but some of its labor unions say claims of an exit from the Chapter 11 equivalent are fraudulent.
Thailand, Brunei and Singapore have signed an open-skies deal that paves the way for their airlines to operate passenger flights with no capacity or frequency restrictions on routes linking the countries.
Wolfgang Kurth resigned as the CEO at German low-fare airline Hapag-Lloyd Express (HLX) at the end of December. Kurth wrote in a memo to reporters that he and HLX parent TUI AG disagreed on how the airline should be integrated into the group. TUI late last year decided to merge most functions of HLX and charter airline Hapag-Lloyd. Kurth also is the president of the European Low Fare Airline Association.
Only days after United's flight attendants union voted to strike if the carrier abrogates its contract this month, the airline received the good, albeit minor, news that two small unions agreed to tentative concession deals.
After only six week on the job, new Aloha Airlines president and CEO David Banmiller decided quickly to take the airline's parent company, Aloha Airgroup, into Chapter 11 bankruptcy protection as way to align the airline's costs with those of other airlines that compete on routes to Hawaii.
Heavy "snowbird" traffic between Northeast airports and Florida was a major cause of flight delays over the New Year's holiday weekend period, according to an FAA employee memo. Fort Lauderdale Airport had delay programs in place from Thursday through Sunday. Congestion also caused delay problems at Atlanta and Newark on Thursday, St. Martin on Saturday, and Palm Beach and Eagle, Colo., on Sunday.
Lufthansa reduced its Internet booking fees after current charges turned out to be prohibitively expensive by comparison with those of other airlines. The airline will charge EUR10 (US$13) per booking on domestic and European flights and EUR15 (US$20) for long-haul flights, compared with EUR30 and EUR45 in the past. The airline said travel agencies and other providers charged customers less and could offer lower-end prices.
A German air transport operator association, Arbeitsgemeinschaft Deutscher Luftfahrtunterneh- men (ADL), has filed a lawsuit with the regional court of Luebeck against the operator of Luebeck Blankensee Airport, for distorting competition in favor of Ryanair. For "legal reasons," association member Air Berlin took the lead in the complaint and is supported by the other members (LTU Lufttransport Unternehmen, Aero Lloyd Flugreisen, Condor, Germania, Hapag Lloyd, Britannia Airways and Fly FTI), said ADL.
Despite a recent drop in fuel prices from record highs, Japan Airlines plans to add a fuel surcharge on international fares. Subject to government approval, the charge, based on flight distance, would be added Jan. 20. The fee will be lifted if the monthly average price of fuel falls below US$40.00 per barrel.
Thai Airways International reported losses of THB320 million baht (US$8.2 million) in the first week after a tsunami hit several beach destinations in Thailand on Dec. 26 because of cancellations, and the carrier expects to lose more money in the coming weeks.
