US Airways lost $30 million in the third quarter and warned of a fourth quarter deficit as well. The airline is suffering from soaring fuel costs, weather delays and intense competition from low-fare carriers, said CEO Rakesh Gangwal. US Airways reported an $85 million loss in the comparable 1999 period.
Fortis Aviation was appointed by KeyCorp Leasing of New York and United Capital of Connecticut to remarket three DC-8-60 freighters following both banks assuming control of the aircraft from the Kitty Hawk Group of Dallas.
American parent AMR Corp. showed a net profit of $322 million before a one-time loss, up 12.2%, and aided by stronger yields, higher demand and adept fuel purchasing strategies. Revenue swelled 11.9% to $5.3 billion, partially helped by fare increases during the period. "The underlying fundamentals of our business -- both traffic and pricing -- remained solid and combined to generate double-digit revenue growth," said CEO Don Carty. American was the primary beneficiary of United's summer labor dispute, gaining $80-100 million in revenue.
U.S. Trade and Development Agency and the FAA are hosting a delegation of 20 Latin American and Caribbean aviation officials Oct. 23-26 at the FAA Technical Center in Atlantic City. The delegation will tour technology and security efforts at the center, including an overview of Global Navigation Satellite System technology, the National Satellite Test Bed and see a demonstration of the Wide Area Augmentation System. Various security programs, including explosives detection and passenger and baggage screening, will be featured in the program.
AIRCRAFT TRANSACTIONS FOR AUGUST 3 - 7, 2000 Seller/ New Type / Previous Operator Owner Engine Operator Boeing Southwest Southwest Boeing 737-700/ CFM56-7B22 Cessna Corp Jet CE Leasing Cessna 208B Grand
American Trans Air selected Rolls-Royce to upgrade RB211 engines on five Lockheed L-1011s in a contract, including spare engines, valued at $63 million over three years.
Sabre Holdings yesterday reported 8.1% growth in third quarter revenue to $667 million, with revenues from the electronic distribution business gaining 19.8% to $451 million. Revenues from information technology declined 10.2% to $216 million because of the conclusion in 1999 of two of Sabre's IT outsourcing contracts. In addition, the company divested a portion of its logistics business and reduced work for Canadian Airlines. Net profits, excluding special items, increased 21.% to $73 million.
Mexican holding company Cintra, which controls AeroMexico and Mexicana, has formed a panel of stockholders to arrange a bidding tender in the first quarter 2001 for the two carriers. The airlines are scheduled to be broken up as recommended by the Federal Committee on Competition, Mexico's antitrust agency.
Air Canada, continuing its equipment upgrade, said it is purchasing five Airbus A319s and leasing four Boeing 767-300s from General Electric Capital Aviation Services.
The European Commission has asked for additional information on UAL Corp.'s planned takeover of US Airways, an EC spokesman said yesterday in Brussels. In practice, the request extends the commission's investigation. According to European Union competition rules, the commission had one month -- until Oct. 25 -- to decide whether it would clear the deal or launch an in-depth, four-month investigation. The initial notification of the deal was "incomplete," the spokesman said. The commission has now suspended its preliminary probe.
Boeing yesterday reported third quarter net profits of $609 million, up 29%, while revenues decreased 11.6% to $11.9 billion. Chairman Phil Condit raised his forecast for commercial aircraft deliveries over the next two years. "We are seeing great strength in the smaller aircraft end of the business, exactly in line with where we think the market is headed," Condit said. "More point-to-point in all segments of the market, not just domestic." Overall operating margin in the quarter rose to 7.3% from 5% the same period last year.
AG Aviation has received local planning commission approval for its proposed development of the Farnborough Airport, home of the Farnborough Airshow, which removes one of the last major hurdles in its plans to make Farnborough "the leading business aviation airport in Europe." The approval permits 28,000 movements a year, including 1,500 by aircraft, such as the Boeing Business Jet and the Airbus Corporate Jet.
Delta yesterday unveiled plans to invest $1.6 billion to aggressively expand its domestic and international operations at New York Kennedy, a long-time structural eyesore for many airlines. Delta hopes to begin construction in June 2001 and complete the massive project in 2004. It submitted a proposal to the Port Authority of New York and New Jersey for approval. Once the expansion is completed, Delta will embark on a major boost in service at the airport that will last 10 years.
Air Lithuania, Lithuanian Airlines, Rheintalflug, Aer Arann and Gill Airways have joined Europebyair.com's Flight Pass Program. Lithuanian routes stretch from London to Moscow and Air Lithuania serves European cities, including Oslo and Hamburg. Gill serves the U.K., including Newcastle, London Stansted and Belfast. Aer Arann of Ireland flies from Dublin to Irish coastal cities, including Cork, Sligo, Derry, and the Isle of Mann. Rheintalflug flies several routes in Austria. Europebyair.com's Flight Pass Program now serves 150 European cities.
American Trans Air and Chicago Express Airlines will increase service between Chicago and Indianapolis Nov. 9. ATA will offer three additional roundtrips per day, giving customers nine daily rather than the present six. One additional roundtrip will be added between Midway and Dayton on Nov. 9.
Ministers of development from Latin America and the Caribbean last week signed a "safer skies" agreement under the auspices of the Inter-American Development Bank in Washington.
Alaska Airlines' parent Alaska Air Group reported a fourth quarter profit of $15.9 million, down 71% from 1999, largely because of soaring fuel prices and higher maintenance costs. The group's results beat lowered analyst expectations as the airline paid an average fuel cost per gallon of 100.4 cents, up 55.1% from last year. As a result, operating expenses jumped 12.3% to $565 million and unit costs soared 16.3%. Maintenance costs also hurt the bottom line, rising 37.6% from last year.
Japan Airlines and American plan to boost their code-share program Oct. 25 with service to new cities in Mexico and Canada. JAL will add its code on American's double daily flights from Dallas/Fort Worth to Mexico City, Guadalajara, Monterrey and Cancun. JAL currently serves Mexico City with its own operation via Vancouver twice a week. The airline also offers daily connection service through Los Angeles to Mexico City in cooperation with Mexicana.
Southwest's third quarter earnings jumped 45.1% to $184.3 million thanks to unprecedented demand and strong cost-control efforts. The airline benefited from a strong economy and "excellent" revenue management, said CEO Herb Kelleher, which produced a 5.3% year-over-year increase in yields and a 6.5% gain in unit revenue. The airline raced past other U.S. majors, posting a 20.3% operating margin, the best third quarter performance since 1980.
Atlas Air this week signed a lease with the Alaska CargoPort for 4,491 square feet of warehouse space and 5,342 square feet of office space. The move aims to unite Atlas Air's Anchorage operations, enabling the carrier to lower costs at its transpacific cargo hub. Atlas Air will move its operations to the CargoPort by yearend. The carrier operates an average of 70 flights per week from Anchorage.
Virgin Atlantic plans to relocate its U.S. call center operation to Stamford, Conn., in January. Moving from Norwalk, Conn., the call center will occupy a 22,000-square-foot building. More than 150 employees will move to the new facility, with more than 250 remaining in Norwalk. "When we moved to Norwalk five years ago, we expected that we had enough space for at least 10 years," said Executive VP David Tait. "We have grown faster than we ever could have predicted.
United Chairman Jim Goodwin yesterday reported that the carrier's operations "are back to normal" and that he plans to ramp up its schedule to the capacity levels it flew before its summer labor dispute. The airline was forced to start reducing its capacity beginning in April due to a pilot shortage across its system. During the summer, United had removed thousands of flights from its schedule -- the equivalent of 32 aircraft at one point. The airline has now increased the level to roughly 24 spare aircraft, but by Jan.
American wants an exemption to fly Chicago-Cancun nonstop on a seasonal basis. The carrier plans Saturday and Sunday service on the route from Feb. 3 through March 25, using Boeing 737-800 aircraft configured for 134 passengers. No U.S. carrier operates nonstops on the route, American noted, although several carriers offer one-stop service. (Docket OST-00-8101)
The Teamsters and AirTran plan to sign a new five-year contract today in Washington. The deal, ratified Oct. 9, affects about 350 aircraft mechanics and inspectors.
