The yearend crisis at Lloyd Aereo Boliviano (LAB), resolved when Bolivian investors acquired the 51% share package held by Brazil's VASP, will set an example for national legislators as they draft a bill on joint public/private sector corporations or state corporations that have been "capitalized" by private investors.
Korean Air recently added two new destinations to its network and expanded its service to Vietnam. The airline launched two weekly flights to Hanoi, Vietnam with Boeing 737-800s. The new Hanoi service complements the carrier's current twice-weekly Vietnam service between Seoul Incheon and Ho Chi Minh City. On Jan. 11, Korean Air will start daily service between Seoul and Saipan, using Airbus A330-300s.
Virgin Express confirmed that it is holding exclusive merger talks with DAT, the regional unit of bankrupt Sabena. Richard Branson's Brussels-based company is aiming at completing merger talks in the first quarter of 2002. "If successful, the two airlines will be integrated under a new brand name," said Virgin. It would be a "Brussels-based, business-oriented carrier serving the main European destinations with multiple frequencies." Virgin also said it will code share with DAT until the end of March.
America West's stock price has soared more than 50% since it received approval for $380 million in federal loan guarantees, a move that staved off any near-term threat of bankruptcy. The airline's stock closed at $3.93 per share yesterday, up more than 12% on the day and up 60% since Dec. 28, the day loan guarantees were approved. If the airline defaults on the loan, the government is not only liable, it could end up owning more than 33% of America West shares.
Investment banker Joseph Adams next week will begin work as the executive director of the U.S. Air Transportation Stabilization Board. Adams will start Jan. 7 at the board's office in Washington, overseeing the operations of the ATSB as it reviews air carrier applications for loan guarantees. Since last April, Adams has been a partner with New York-based Brera Capital Partners, which manages a $680 million private equity investment fund.
Chengdu-based China Southwest Airlines has become the fourth major international Chinese carrier after Air China, China Southern Airlines and China Eastern Airlines. In a major development, the Civil Aviation Administration of China (CAAC) released Air China's Beijing-Vancouver, Shanghai-Paris and Beijing-Xiamen-Singapore routes to China Southwest.
FAA's second annual analysis of runway incursion severity, expected this quarter, will show that the most dangerous types of incursions made up a lower percentage of overall events in 2001 compared with 2000, agency officials reported.
TelAir International, manufacturer of commercial aircraft baggage and cargo-handling systems, has begun producing a ballistics-tested and flammability-qualified "hardened" material for cockpit door and other cabin surface security applications. The material successfully passed the National Institute of Justice level IIA threat test and met FAA flammability requirements in October, said Dennis Staver, VP and general manager of Cargo Containment Systems. The material weighs less than two pounds a square foot, he said, or "about half the weight of other materials."
Continental yesterday reported that its December unit revenues dropped between 14-16% from last year, a slight improvement from the drop in November. Yields remained lower in December, but the unit revenue drop was mitigated by somewhat higher load factors. The carrier also reported record domestic, international and systemwide December load factors of 72.5%, 73.0% and 72.7%, respectively. The systemwide December load factor is 1.3 points above the previous record reported for December 2000.
Many U.S. major airlines reported strong traffic and smooth operations over the holidays thanks to reduced capacity and calm weather across the country. United said its holiday operational performance was "the best it has been in years" in terms of completion rate. Operating a reduced schedule from last year, United posted a domestic completion rate of 99.6% for the Dec. 17-27 period, equal to those of other U.S. majors. For the same period, United experienced almost 75% fewer cancellations than its previous best holiday period in 1997.
Argentina's worst economic crisis in history, which forced two presidents to resign in the last 10 days, has led to the cancellation of 50% of airline bookings for travel abroad at the peak of the summer vacation season in the southern hemisphere. Specific causes that pressured vacationers to cancel or postpone travel plans were brusque fluctuations in money exchange regulations, difficulties in transfers of money abroad and general uncertainty, according to Marcos Palacio, president of the Argentine Association of Travel Agencies.
Southwest's market capitalization at the end of 2001 -- $14.1 billion -- is more than all the other major and national U.S. carriers combined. Nine major airlines and five nationals have a combined value of just $13.4 billion (see chart, page 8). AirTran's and Frontier's market cap are each higher than US Airways' and America West's. United is worth just $736 million.
The U.S. federal government next month plans to begin charging a $2.50 fee to all air travelers to cover the government's aviation security costs. The new security fee was authorized in the Aviation and Transportation Security Act, which was signed into law on Nov. 19. DOT on Monday issued an interim final rule that imposes the fee, beginning Feb. 1. Under the rule, direct air carriers, both domestic and foreign, will be responsible for collecting the tax for passenger enplanements from U.S. airports.
LanChile on Jan. 8 will offer flights to Canada as it extends daily service from New York to Montreal as part of its code-sharing alliance with American. Southbound passengers may travel through LanChile's New York gateway to Santiago, with connections to Buenos Aires and vice versa, requiring only one ticket and one check in.
The FAA has approved two runway development projects at Cincinnati/Northern Kentucky Airport, projects which studies show will allow 28% growth of operations in good weather during the next 10 years. An all-new 8,000-foot runway in the plan will allow for simultaneous operations of what would be three north-south runways (18/36). A 2,000-ft. extension of an existing east-west runway (6/27) to 12,000 feet will help the airport qualify for nonstop flights to Asia, a long-time goal.
Aeropostal Alas de Venezuela is expanding services to Colombia and the Andean region to channel more passenger traffic through its Caracas hub to Europe and the Caribbean. Early this year, the carrier will offer two daily flights to Caracas from Colombia's Medellin, Cali, Cartagena and Barranquilla, in addition to daily service operated from Bogota and Quito, Ecuador. Aeropostal forecasts revenues of $360 million for 2001.
Grupo TACA has expanded e-ticket service to all its Central American routes and most routes to North and South America via its Internet address at www.TACA.com.
As Transbrasil has remained grounded since Dec. 3 and its future dubious, TAM Brazil expressed interest to government agencies concerned in taking over the former's routes, schedules and airport infrastructure, thus saving the jobs of some 1,200 workers. Low-cost startup Gol Airlines reportedly is interested in acquiring Transbrasil's hangar at Sao Paulo Congonhas Airport but is not ready to assume responsibility for any jobs involved.
The U.S. federal government next month plans to begin charging a $2.50 fee to all air travelers to cover the government's aviation security costs. The new security fee was authorized in the Aviation and Transportation Security Act, which was signed into law on Nov. 19. DOT on Monday issued an interim final rule that imposes the fee, beginning Feb. 1. Under the rule, direct air carriers, both domestic and foreign, will be responsible for collecting the tax for passenger enplanements from U.S. airports.
American CEO Don Carty this month plans to revive his aggressive plans to boost the airline's on-time performance. The airline revealed plans last summer to expedite American's gate departure process to improve overall operations but delayed the project following the Sept. 11 attacks (DAILY, Aug. 22).
Senate adjourned for the year without acting on the nominations of Jeffrey Shane to be associate deputy secretary for policy and Emil Frankel to be assistant secretary for transportation policy. More importantly, the Senate Commerce Committee did not approve the nomination of John Magaw to be DOT under secretary for transportation security, even though it was expected following his Dec. 20 confirmation hearing that the committee would approve Magaw by unanimous consent. Sen.
GE Capital Aviation Services said yesterday it will convert 10 Boeing 767-200/300 aircraft to freighters and that it had selected Israel Aircraft Industries as the conversion facility. The first aircraft will be completed in mid-2004. GECAS earlier announced plans to convert 737-300s/400s from its current portfolio, as well as aircraft from the secondary market. The first 737 conversion is expected in by mid-2003. GECAS President Henry Hubschman said the expansion will permit GECAS to offer more options to airfreight customers.
LanChile on Jan. 8 will offer flights to Canada as it extends daily service from New York to Montreal as part of its code-sharing alliance with American. Southbound passengers may travel through LanChile's New York gateway to Santiago, with connections to Buenos Aires and vice versa, requiring only one ticket and one check in.
Teamsters union sued Sun Country Airlines, which suspended scheduled service in last month, saying the carrier did not continue insurance coverage for furloughed workers as required by law and under its contract (DAILY, Dec. 10). Ray Benning, director of the Teamsters Airline Division, said Sun Country also failed to give workers two-week notices of furlough and that, by contract, it is required to pay two weeks' salary but has refused.
AeroMexico has moved up the start date for its new nonstop service from Ontario, Calif., to Hermosillo, Mexico, to Jan. 8. The new flights will operate five days a week with an MD-80. On Mondays and Fridays, when AeroMexico does not operate the flights, Aerolitoral will provide regional jet service with Saab aircraft under AeroMexico's code.
