Magellan Aerospace won a C$160 million (US$115 million) order to produce exhaust nozzles for the Rolls-Royce Trent 900 and Engine Alliance BG7200 powerplants powering the Airbus A380. Nozzle production is slated for Magellan facilities in both the U.S. and Canada, with deliveries starting in 2003. -LR
Sabre's Airline Solutions group posted a 6% increase in first quarter revenue to $55 million and signed more than 100 carriers around the world. Five new carriers signed up for its "eMergo" suite of programs. Sabre now has a total of 46 eMergo client deals representing 35 customers worldwide. -SL
Ulrik Svensson, a Swedish financier "with experience in turning companies around," was named CFO at Swiss International Air Lines, replacing Thomas Hofmann, the carrier reported. Hofmann, a Crossair veteran, has been with the group for 15 years. With this latest change in the troubled airline's top management, Swiss said its team of managing directors is now "complete."
British Airways revealed plans yesterday to remove the first-class cabin from six Boeing 777s on routes where the carrier has not been able to fill the front of the aircraft profitably. CEO Rod Eddington, in New York yesterday briefing investors and analysts on BA's financial results, also told The DAILY he is content with the airline's fleet mix and has no plans for additional orders soon. As part of his strategy of simplification and cost cuts, he has adopted "a very modest fleet plan."
Rep. John Mica (R-Fla.), chairman of the House Transportation aviation subcommittee, will push language today during a full committee markup of the FAA reauthorization bill he says is aimed at taking "the French air show out of business." Mica will ask DOT in a manager's amendment to report back to Congress on arranging a rival international air show.
Transportation officials from Peru, Bolivia, Ecuador, Colombia and Venezuela met recently to discuss launching a new airline operated and supported by Andean states. Industry analysts applauded the initiative but doubt its feasibility, pointing to slumping airline economics and the governments' inability to find enough capital, given pressing public health, education and housing priorities.
LanChile moved last week to refute antitrust regulators' recommendations that the airline split its passenger and airfreight units to avoid cross-subsidies that generate below-market prices, sources say. In a 40-page brief to regulator Fiscalia Nacional Economica (FNE), LanChile denies the subsidies exist and rejects the idea from the National Association of Airlines (Anaco) and rival carrier Aerovias DAP that fares should be regulated according to the dollar and applicable taxes. LanChile believes this would boost fares 18%.
El Al's base commission paid on tickets issued in Israel will be reduced from 9% to 6%, effective July 1. The commission cut "is in line with the trend of base commission cuts by other international airlines around the world," the airline said.
America West's shareholders this week re-elected four directors at the company's annual meeting in San Francisco. Herbert Baum, John Goolsby, Richard Schifter and J. Steven Whisler were re-elected for a three-year term, expiring at the company's 2006 annual meeting. Including these individuals, the company's board comprises 10 members elected in three classes. The six directors whose terms continue are Robert Miller, Doug Parker, John Tierney, Walter Klenz, Richard Kraemer and Denise O'Leary. -SL
Southwest's board last week declared a quarterly dividend of $0.0045 per share to shareholders of record at the close of business on June 4 on all shares issued and outstanding. The 107th consecutive dividend will be paid on June 25.
House Transportation today will mark up the Flight 100-Century of Aviation Reauthorization Act (CARA) with a compromise on the number of slots added at Washington National Airport. Rep. Eleanor Holmes Norton (D-D.C.), who opposed adding more slots at DCA, yesterday said that leadership kept its promise to compromise, with input from the Metropolitan Washington Airports Authority, state delegations and leadership. H.R. 2115 adds 18 beyond-perimeter slots and 12 inside perimeter.
There is still no sign of the start of formal concession negotiations between Northwest and its employee groups, and some unions say the airline's financial condition does not indicate the need to rush into anything. The airline presented concession proposals to all its unions, but there has been no further movement since then. A Northwest spokesman would say only that the airline "continues to have discussions with all unions," but union officials stress these talks are informal and no decisions about whether to negotiate have been made yet.
The on-again, off-again merger between Varig and TAM in Brazil is keeping key players moving busily, as rumors on the merger's outcome have resulted in contingency plans and outside alliances.
ATA Holdings Corp. parent ATA Airlines yesterday named Jim Hlavacek as vice chairman in addition to his role as executive VP. Hlavacek will assume this new role immediately. Chairman and CEO George Mikelsons credited Hlavacek with spearheading ATA's re-fleeting program and its Chicago Midway growth plan. "He has been and will continue to be my most trusted adviser," Mikelsons said. Hlavacek will oversee three business units for the carrier, including military charters and the CRAF program, ATA Connection and ATA Training Corp. -SL
Congress will likely take a wait and see approach to the problems of "excessive" executive pay and benefits, at least for now, Senate Commerce Chair Sen. John McCain (R-Ariz.) said yesterday following a hearing on CEO compensation. After listening to nearly two hours of testimony, most favoring more transparency and accountability in deciding executive compensation packages and greater shareholder participation into compensation decisions, McCain said he was not sure Congress is prepared to act legislatively.
Boeing subsidiaries Jeppesen and Alteon have signed a joint marketing agreement to broaden training options offered by Boeing Flight Services. Jeppesen offers aircrews and flight management personnel courses in human factors, basic and advanced flight operations management and international flight planning. Alteon offers pilots, technicians and cabin crews training for 100-seat plus aircraft through classroom training, computer-based programs and flight simulators. -LR
European travel giant Thomas Cook AG is cutting 1,200 staff this year. The company -- which owns a large group of charter airlines -- said it won't lay off any employees but rather rely on natural attrition and the recently introduced hiring freeze.
Sen. Arlen Specter (R-Penn.) warned J. Hewitt Pate, acting assistant attorney general in charge of the Justice Department's antitrust division, that he plans to ask Pate some questions about Orbitz at his confirmation hearing scheduled for today.
SAS is moving medium and heavy maintenance -- spread across three bases in Copenhagen, Oslo and Stockholm -- to Stockholm Arlanda Airport. SAS Technical Services strategic management and support will also be based there. SAS said the changes should save SAS Technical Services about SEK500 million (US$63 million).
Delta's new low-fare subsidiary, Song, during the weekend started service from Boston to West Palm Beach. Song on May 24 will start service from Boston to Tampa. The airline's other current service is from New York Kennedy to West Palm and Orlando. -SL
Lloyd Aereo Boliviano Chairman Ernesto Asbun voiced strong opposition Friday to LanChile expanding into the Bolivian market. Local press reports floated that possibility, noting LanChile began flying in Peru and Ecuador through subsidiary carriers and will soon add the Dominican Republic to the list of countries in which it operates.
Embraer CEO Mauricio Botelho says major carriers have to rethink their fleet strategies as low-cost and regional carriers become a permanent staple in the air transport industry. "The airline industry today is in more than a cyclical downturn," Botelho told The DAILY at the Regional Airline Association (RAA) convention this week in Phoenix, Ariz. He said competition from low-cost and regional carriers is forcing majors to re-evaluate their mission, examine cost structure and scrutinize fleets.
