Continental and the City of Houston this week broke ground on a new $350 million expansion project, including a new international terminal, at Bush Intercontinental Airport. Terminal E, slated to open in summer 2003, is the largest facility expansion at the airport in 20 years and the first new terminal to be built in 10 years. Located south of Terminal D, the 550,000-square-foot, glass-atrium structure will have 15 to 20 new gates that will accommodate both domestic and international flights, an expanded baggage claim area, and new retail shops.
Japan Airlines' six-month net profit soared more than 500% to 38.5 billion yen (US$353 million) due to a dramatic improvement throughout its international network. The airline's total unconsolidated operating revenues were up 7.7% to 645.5 billion yen ($5.9 billion), outpacing the 3.4% increase in expenses. Even though fuel costs rose 26%, operating profit was 56.7 billion yen ($520.3 million), JAL's second-highest mid-term operating income in its history.
Augsburg Airways has enhanced service from London City to Muenster, Germany, by introducing a connection to Nuremberg. The service, operated in cooperation with partner Team Lufthansa, will offer daily flights on weekdays with Bombardier Q300 Dash 8 aircraft. Direct London City-Muenster service will continue to operate throughout the winter.
Expedia, Inc. posted a smaller-than-expected net loss of $1.6 million as its strengthened the non-air side of its business and increased the conversion of visitors into purchasers. Revenues for the period ended Sept. 30 increased 115% year-over-year to $76.5 million. The net loss excluded non-cash charges, and the company reported positive operating cash flow for the quarter for the first time. With the $60 million financing Expedia completed in August, the company's cash position increased from $61 million on June 30 to $122 million on Sept. 30.
Orbitz has made available Monday a sample version of its flight search engine on its site but will not begin the official "monster" beta test until February. The search engine, licensed from ITA Software, enables allows users to find actual domestic flights and fares but not buy the ticket.
AIRCRAFT TRANSACTIONS FOR AUGUST 20 - 22, 2000 Seller/ New Type / Previous Operator Owner Engine Operator Laker Airways Emery Polaris Douglas Worldwide Holding DC-10-30(F)/ 50C2 Airbus United United Airbus A320-200
The House has given final congressional approval to a bill requiring DOT and other federal agencies to make their annual performance and financial management reports more candid in disclosing serious waste, fraud and abuse problems. The bill would require an assessment by the inspector general of the most serious management and performance problems and an assessment by an agency head of the reliability of the performance and financial data.
Aer Lingus yesterday reported that the unions representing clerical and catering staff have canceled their strike planned for Thursday and Friday after agreeing to negotiations under the auspices of the Labor Court. The Irish carrier expects normal service and flight schedules through the end of the week. The airline has been forced to cancel dozens of flights over the past two weeks due to the union labor actions.
Site59.com concluded its Series B investment round of $10.5 million from a group of strategic investors last week. Accor, Bass Hotels and Resorts, and National Leisure Group are participating in the round, along with iFormation Group. "We have assembled a very powerful and diverse group of financial and strategic partners that will help us develop our e-commerce platform and broaden our industry partnerships," said CEO Michelle Peluso. Conceived in August 1999, Site59 was backed by The Boston Consulting Group and closed its seed round of financing in January 2000.
Domestic startup Royal Airways will launch operations in January with five leased Boeing 737s. To be operated by Royal Holdings Service (RHS), the company has taken over the operating certificate of now-defunct Modiluft, a joint venture between Lufthansa and Indian businessman S.K. Modi. The airline, which was set up in 1993, collapsed three years later with debts of more than US$20 million. According to the CEO of RHS, Modi will join Royal's board as non-executive chairman. RHS holds 54.7% in Royal Airways. The remaining 45.3% is said to be held by Modi.
FAA's Southwest Region said it plans to fine Parker-Hannifin $2.5 million for allegedly making thousands of minor design changes to aircraft hydraulic hose assemblies without reporting them, as required. FAA said the Stratoflex Division made the changes to aircraft fluid connectors over a 12-year period without submitting changes on a quarterly basis. FAA said the company failed to report design changes "even after being notified" of its failure and of FAA's intent to investigate the failure.
Qatar Airways is conducting a feasibility study to determine how many freighters the airline should order to meet the needs of its growing air cargo business. According to Qatar CEO Akbar Al Baker, the study was prompted by the airline's projection that air freight will grow at a tremendous pace over the next five years. Akbar is confident that Qatar will contribute significantly to the overall growth of the industry in the Middle East and in the Gulf States, in particular.
Aer Lingus, tackling difficult labor negotiations and increased competition, is at a key turning point in its history, according to Executive VP-North America Jack Foley. The carrier is marching toward privatization next year and is planning to expand transatlantic capacity, but there are several "short-term issues" that must be resolved first, Foley said yesterday in Washington. The carrier was forced to cancel about 35 flights last Friday, and further strikes are planned this week.
EADS-Sogerma, a unit of the European Aeronautic Defense and Space (EADS) Co. and Northrop Grumman last week signed a joint venture for the repair, maintenance and overhaul of large commercial aircraft. EADS-Sogerma, as majority investor, will lead the operations of EADS Aeroframe Services, based in Lake Charles, La.
A special technical audit of Boeing by a team of 18 engineers and inspectors from throughout the U.S. found "systemic" problems with the company's engineering and production processes but no "immediate" safety problems, John Hickey, manager of FAA's Transport Airplane Directorate, said yesterday in Washington, D.C. Engineering analysis that could expose problems requiring corrective action on in-service aircraft has not been completed and could take several more years, Hickey said.
Lufthansa Cargo will take over the marketing, handling and accounting of Spanair's cargo activities, so the Spanish carrier can concentrate on the passenger business. The new Madrid hub will enable Lufthansa Cargo to establish nationwide services in a major market. Spanair operates to Madrid from 17 Spanish, five European and three intercontinental points.
Iberia is considering purchasing Air Europa, Spain's largest carrier confirmed yesterday in Madrid. Iberia Chairman Xabier de Irala told his board yesterday that Air Europa offered to be taken over, an Iberia source said. Air Europa carried some 9 million passengers in 1999 with a fleet of 50 aircraft. If the deal goes through, it is expected to come under close scrutiny of Spanish and European competition authorities. At present, Iberia wet-leases nine aircraft from Air Europa, the third-largest airline in Spain.
Rep. James Oberstar (D-Minn.) last week asked the acting assistant attorney general of the Justice Department Antitrust Division to say no to the proposed United/US Airways merger regardless of promised concessions, such as US Airways' divestiture of certain assets, including gates and DC Air.
ARINC and Concourse Communications formed an alliance they said will bring "neutral, multicarrier, uninterrupted full-spectrum wireless network access to frequent travelers at airports worldwide." ARINC will work with Concourse to develop data concession solutions over Concourse's integrated wireless backbone network. "This will allow a broad array of wireless providers to use both licensed and unlicensed frequencies to operate in selected areas with equal access," the companies said.
Cash-strapped Pakistan International Airlines plans to sell four of six Boeing 747-200s currently parked at Karachi Airport for lack of spares and major repairs. According to PIA Managing Director Sher Afgan Malik, two aircraft would be used for parts to make the four operational before they are put on the open market for sale. Sher said the carrier was left with no alternative but to cannibalize the two aircraft. "We don't have the funds to buy spares or carry out heavy maintenance checks and repairs outside Pakistan," Sher said.
KLM posted better-than-expected results for the second quarter, reporting a new profit of 118 million euros (US$99 million), 71% higher than last year. Analysts had expected a lower net profit largely because of rising fuel prices and intense competition. Operating profit rose 52% to 201 million euros ($169 million) despite a 77% hike in fuel expenses. "In particular in the face of the continuing high fuel price levels, these results are impressive," said CEO Leo van Wijk. He cited the airline's ability to respond quickly and reduce its unit costs.
Atraxis recently completed a one-month trial phase of its WebTicketing product with launch planned early next year. WebTicketing allows end users to print airline tickets purchased via the Internet on their own personal computers. The only equipment required is a PC with an Internet connection and a regular laser or inkjet printer. The ticket's authenticity can be verified by a two-dimensional bar code that contains the digitized and encrypted customer data. Although tickets could be copied, they cannot be used more than once, the company said.
When Shuttle America begins its five daily Hanscom-LaGuardia roundtrips tomorrow, 40 days after the FAA put a halt to the flying at the behest of national historic preservationists, the Save Our Heritage Foundation will be there to protest the new service. Foundation representatives plan to voice their disapproval over what they perceive as nearly unlimited airport growth that threatens historic sites, such as nearby Minute Man National Park.
