Argentina's domestic traffic fell 20% last year amid the worst depression in that nation's history, new figures show, leaving carriers dependent on domestic revenues in jeopardy. Facing revamped Aerolineas Argentinas and its domestic subsidiary Austral, other carriers have been forced to cut flights, temporarily suspend routes and get access to international market to seek hard currency.
Midwest Express yesterday reported a $6.7 million fourth-quarter net loss, more than double the amount of last year's deficit, largely due a sharp drop in yields and unit revenues. The loss was narrower than analysts expected thanks to the airline's efforts to cut expenses. Overall revenues grew 9.7% to $103.1 million, but unit revenues sank 5.2% as a load factor improvement was not enough to offset an 8.3% drop in yields. "Weak travel demand has resulted in depressed pricing, while costs for insurance and fuel have escalated," said CEO Tim Hoeksema.
Houston Airport System recently opened a $125 million cargo facility that officials claim will help meet growing cargo demand in the region. The new George Bush Intercontinental CargoCenter, on 120 acres on the northeast side of the airport, has ramp space for up to 20 widebody aircraft and more than 550,000 square feet of storage. The airport ranks 11th in the U.S. for international shipments, with about 600 million pounds of cargo passing through it a year.
LanChile is eliminating standard commission or distribution fees to travel agents on all U.S.-issued tickets and documents, citing the "present competitive environment."
Mesaba Holdings yesterday eked out a $1.3 million fiscal third quarter profit, up from last year's loss of the same amount and better than analysts had expected. Mesaba Holdings is the parent of Mesaba Airlines and recently acquired Big Sky Airlines. Big Sky's December operating results were included in Mesaba's financial report. The parent company posted an operating profit of $1.4 million, up from last year's $9.3 million operating loss.
Small communities increasingly struggle to keep a steady flow of air service once financial incentives for airlines disappear, the General Accounting Office said in a report released Wednesday. In "Factors Affecting Efforts To Improve Air Service At Small Community Airports" (GAO-03-330), GAO explained communities have tried a combination of marketing, studying types of services passengers preferred and financial incentives to air carriers, including revenue guarantees.
DOT Inspector General Kenneth Mead yesterday called on FAA to put the brakes on its rapidly rising budget, and singled out the agency's operations costs and expensive modernization programs as areas of particular concern.
Investigations by Thailand's National Counter Corruption Comission (NCCC) in Bangkok implicated former Thai Minister of Transport Wan Muhamad Noor Matha of abusing his position and authority in the bidding and construction contracting of the New Bangkok International Airport.
Sen. Arlen Specter (R-Pa.), who last week held a hearing on US Airways' pilot pension funding problems, failed Wednesday to pass an amendment that would have let the Pension Benefit Guaranty Corp. (PBGC) terminate and reinstate the company's pension plan, giving the bankrupt carrier more time to pay out.
Mesa yesterday managed to keep its "Jets For Jobs" program with US Airways intact after pilots represented by the Air Line Pilots Association (ALPA) and management reached a tentative labor agreement. "This allows us to move forward with our regional jet expansion," Mesa CEO Jonathan Ornstein told The DAILY.
European turboprop manufacturer ATR aims at delivering 20 aircraft in 2003 and hopes for a similar amount of orders, though conceding "2003 should also be a difficult year for the air transport market." ATR is launching a long-term study, dubbed Regional Aviation Market Prospective Study (RAMPS), on the future of regional aviation. Initial results of the survey will be published at the Paris Air Show in June. ATR hopes the study will enable it "to look at several scenarios in the years to come."
American has proposed merged seniority lists and new regional fleet limits to its pilot union in an attempt to resolve the debate over scope restrictions that has been a sticking point in their long-running contract negotiations.
After several years of lobbying in Washington, AirTran yesterday won the rights to launch nonstop service from the city's National Airport to three Florida cities, beating out five other carriers. DOT awarded AirTran four slot exemptions to start service to Fort Lauderdale, Fort Myers or West Palm Beach, Fla. The agency also awarded Smyrna, Tenn.-based Corporate Airlines two DCA slots to provide nonstop service to Wilmington, Jacksonville or Fayetteville, N.C. Privately held Corporate Air started service in December 1996.
SAS has deferred the delivery of four Airbus A321s. The aircraft will be taken in 2005 and 2006 instead of 2004 and 2005, the company said. SAS ordered 12 A321s in 2000, of which eight are in operation.
Air New Zealand flights attendants, through the Flight Attendants and Related Services Association (FARSA), have served notice for a proposed 24-hour strike over rostering issues on Feb. 5, followed by 48-hour strikes Feb. 7-8, Feb. 10-11 and Feb. 13-14. ANZ Senior VP-Customer Services Brendan Fitzgerald said the proposed strike by the majority of the airline's long-haul flight attendants has the potential to disrupt the plans of thousands of passengers during a busy time of the year for travel.
Swiss International Air Lines will shift its charter flying by early next year to Airbus A320s flown by former Swissair pilots, setting up yet another conflict with former Crossair pilots it absorbed through its merger. Swiss plans to phase out the seven ex-Crossair Boeing MD-83 narrowbodies in its charter operations fleet in favor of four A320s with former Swissair pilots as flight crew. The airline already took over 25 former Swissair A320s, including crews, and is looking for operational efficiencies.
The Hong Kong Air Transport Licensing Authority (HKATLA) today will begin a five-day public hearing to decide whether Cathay Pacific should be given rights to resume passenger flights to China that were suspended in 1952. Cathay has applied to operate four daily flights to Shanghai, three-times-daily service to Beijing and daily to Xiamen.
Dragonair will commission its first aircraft with the upgraded cabin yesterday, after an investment of HK$195 million (US$26 million) to upgrade cabins in its fleet of nine Airbus 330-330s, eight -320s and four -321s.
Sen. John McCain (R-Ariz.), chair of the powerful Commerce Committee, and Sen. Trent Lott (R-Miss.), chair of the Commerce aviation subcommittee, told The DAILY yesterday they are confident the airlines know they must make substantial internal changes to pull out of the economic crisis. "I think the airlines recognize they will have to make fundamental changes if they are going to survive," McCain said, noting the industry also realizes the funding sources available after Sept. 11 are "no longer there."
The DOT's Inspector General (IG) today will release its annual report on DOT's top management challenges, and sources say most of the 10 items relate to safety and mobility thanks to TSA and the Coast Guard being shifted out of DOT. In addition to the transition to the new Homeland Security Department, other challenges include reducing operational errors and runway incursions, reversing FAA's spiraling operating costs, improving system capacity, and reauthorizing AIR-21.
The French government will table a bill preparing the privatization of Air France at the French Senate on Feb. 12, French Transport Minister Gilles de Robien said in a television interview this week, but the airline will not be privatized immediately.
