The ultimate deadline for the creation of a new airline company on the remains of bankrupt Sabena is today at noon. The creditors of Sabena Interservices Center (SIC), Sabena's financial arm, will indicate if they agree with a proposal to restructure the debt of SIC. Unless the creditors agree unanimously not to claim reimbursement, SIC would have to be liquidated, as the company no longer has Chapter 11-style protection. On Monday night, there still was no such agreement.
Atlantic Coast has restructured its fee-per-departure agreement with United, enabling the airline to recover estimated operating expenses for its United Express operation in 2002, plus a previously negotiated margin and performance-based incentives.
Air Afrique will file for bankruptcy, representatives of the 11 African states that hold 68.5% the carrier said last week. Ivory Coast President Laurent Gbagbo was mandated to create a new Air Afrique with the support of Air France. The French carrier already bailed out Air Afrique once, in 1995, and injected EUR14 million into the airline.
U.S. Major Carriers Traffic December 2001 (000) December December % 2001 2000 Change Alaska Revenue Passenger Miles 990,300 1,044,000 -5.1 Available Seat Miles 1,465,000 1,512,000 -3.1 Load Factor (%) 67.6 69.0
Bryan Moss, vice chairman of Gulfstream Aerospace and a major player in the corporate aircraft business for more than three decades, announced plans to retire in April. "Gulfstream is a remarkable company and it has been a privilege to participate in its exciting growth," he said. Moss plans to continue as a consultant to Gulfstream after his retirement.
JetBlue yesterday added to its Airbus fleet by ordering 10 A320s in a deal valued at more than $500 million. This brings JetBlue's total firm order to 74 A320s and makes it one of Airbus's top five customers for the aircraft type. JetBlue currently has 22 A320s and will take delivery of 13 more this year, 14 next year, 13 in 2004 and 12 in 2005. The airline has options for 49 A320s and contracts for a fleet totaling as many as 132 A320s for a combined value of $6.5 billion. JetBlue also ordered more IAE V2500 engines to power the new aircraft.
United today will begin live diagnostic testing of its new security system on select flights at eight domestic airports and United Express will test at three locations. In order to comply with the new laws that go into affect on Friday, a team of 50 employees has been working since early December to prepare United for the new regulations, according to Pete McDonald, senior VP-airport services. Although the tests will be fully automated, United will not reconcile bags during the test period.
"The bloom is still on the rose" when it comes to regional carriers, says analyst Ray Neidl of ABN-AMRO. As of last week, the basic guaranteed operating profit under fee-per-departure contracts have not been modified for the three largest regionals that Neidl follows -- SkyWest, Mesa and Atlantic Coast Airlines. ACA last week announced it had renegotiated its United Express contract. Neidl estimates that the guaranteed margins are 12-13% at ACA and SkyWest and about 8% at Mesa.
Singapore Airlines Chairman Koh Boon Hwee believes there is "no strong sign" that people are returning to the skies as they did in the past. "Their confidence in the ability of airlines to deliver them safely to their destinations has yet to be restored," he told the American Chamber of Commerce in Singapore. Koh noted SIA has been hurt by the demise of Ansett; Virgin Atlantic "is also hurting, and SIA will have to share the pain."
Implementing requirements of the Aviation and Transportation Security Act will be a challenge, DOT Under Secretary John Magaw said yesterday at the annual meeting of the Transportation Research Board in Washington. Newly installed as head of the Transportation Security Administration, Magaw, who spoke to TRB as part of a panel of DOT modal administrators, stressed that he does not want to delay deadlines but that there are "kinks" to be worked out as the TSA gears up.
Stepping up its efforts to reopen Washington National Airport (DCA), the National Business Aviation Association went public last week with a new security plan that would allow business aviation back into DCA by March. It calls for the FAA to issue security letters of authorization (SLOA) to Part 91 and 135 operators who apply and agree to comply with SLOA requirements. SLOAs would verify the identity of crew and passengers and also outline specific operational practices.
British Airways Chairman Colin Marshall is allegedly under pressure from major shareholders to stop resisting plans by CEO Rod Eddington to downsize the airline to a profitable operation. British daily The Observer reported that key shareholders are worried that Marshall could block the plans because he himself built BA into the size it has today. The airline denied the report.
Traffic fell at Brussels Airport "for the first time in many years," Brussels International Airport Company (BIAC) said yesterday. Following the bankruptcies of Sabena and CityBird, traffic plummeted 43% in November and December 2001, compared with the same period of 2000. Overall passengers declined 9% to 19.7 million in 2001. "The future of DAT, Virgin Express and other projects under negotiation will have a decisive impact on 2002 figures," BIAC said.
Woodie Woodward has been named FAA associate administrator for airports, a position that she held in an acting capacity for two years. Woodward, who will report directly to FAA Administrator Jane Garvey, will oversee a 440-member professional staff with responsibility for national airport planning, including safety standards, design and engineering. She will administer the Airport Improvement Program, which in fiscal 2002 comprises $3.3 billion for the federal airport grant program.
Raytheon is selling its Aircraft Integration Systems unit to L-3 Communications for $1.3 billion but will retain the aircraft integration and modification division's work on the U.K.'s Airborne Standoff Radar (ASTOR) program and the Boeing Business Jet program. The companies said yesterday they hope to close the deal by the end of the first quarter.
American recently signed an order with Siemens Dematic worth nearly $90 million to design, manufacture and install a baggage handling system for the new Terminal 8 at New York Kennedy. The deal is with Siemens' Rapistan Material Handling Automation Division and includes a high-speed sorting system that can handle 80 bags per minute, as well as 50,000 feet of conveyor. Installation will take place in stages over the next five years "to allow AA to provide uninterrupted service to its customers at JFK," the company said.
The current aviation crisis has started off somewhat unusually. Even though the events of Sept. 11 happened in the U.S., two major bankruptcies of international airlines since then took place in Europe. Swissair went under merely one month after the terrorist attacks, Sabena followed not much later and left Switzerland and Belgium, two of the smaller European countries, temporarily without a national carrier. Is this an urgent sign that finally the long overdue consolidation in the European airline sector has begun?
The Air Transportation Stabilization Board yesterday told America West that it satisfied the two primary conditions for approval of $380 million in federal loan guarantees. The green light from the government paves the way for the company to close another $429 million loan and complete arrangements for more than $600 million in concessions, financing and financial assistance. The airline expects to close the deal and receive funding this week. The closing date will be a "red-letter day" for America West, said CEO Doug Parker.
United Technologies President and Chief Operating Officer Karl Krapek said he will retire at the end of the month after 20 years with the company. Krapek previously led UTC's Otis, Carrier and Pratt&Whitney divisions before being named president and COO in April 1999. "I have come to a time in my life where other priorities are important to me and my family," Krapek said. After his retirement, UTC's business unit presidents will report directly to CEO George David.
A show cause order on the U.K. alliance case would precede U.S.-U.K. talks, widely expected to take place before monthend, sources tell The DAILY. Thus, "conditions for immunity would be known" when negotiators for both sides sit down for formal talks, a source related. DOT expects to make a decision on American/British Airways and United/BMI British Midland soon, according to a DOT spokesman, confirming last week's comment by DOT Secretary Norman Mineta. DOT consolidated the two applications for antitrust immunity into one proceeding.
Delta Connection and American Eagle inked a code-share deal that lets Delta offer connecting service between Los Angeles and six California cities on 122 American Eagle flights, beginning Jan. 18. Delta customers can book flights to San Diego, Fresno, Monterey, Santa Barbara, Palm Springs and San Luis Obispo. Delta Connection carrier SkyWest will continue offering service in key western markets. American Eagle service will be operated with 34-seat Saab 340 turboprop aircraft.
A rule amending U.S. FAR Parts 25 and 121 to incorporate new regulations for strengthened cockpit doors and related flight deck access procedures is expected to appear in tomorrow's Federal Register. The new standards, which must be complied with by April 9, 2003, will require about 6,630 airplanes flown on Part 121 certificates to receive "hardened" cockpit doors, says a draft of the rule posted on FAA's web site.
