World Airways yesterday reported operating income of $1.7 million and net income of $600,000 for the second quarter, compared to an operating loss of $1.7 million and a net loss of $3.1 million for the same quarter last year. The company also reported it ended the quarter with cash of $20 million, a 235% increase over its cash position at the end of the previous quarter. Operating expenses declined to $61.1 million from $69.2 million. Separately, World said it will relocate its headquarters from Dulles, Va., to the Atlanta area early next year.
AirTran, Vanguard and Spirit are among the 30 airlines that have signed on as non-equity owner partners of the controversial airline-owned website Orbitz. CEO Jeff Katz said the company is actively wooing America West and Southwest. Southwest, in a statement submitted to the Senate Commerce Committee last week, said Orbitz illustrates "the dark side of Internet ticket sales." Orbitz, owned by United, American, Delta, Northwest and Continental, plans to launch in the fall.
Virgin Blue, Virgin Atlantic's low-fare Australian startup, will launch Brisbane-Sydney service Aug. 3, subject to approval by the Civil Aviation Safety Authority. Virgin Blue's documentation assessment is ongoing, and the airline has begun contacting customers who booked travel up to mid-August offering them compensation or alternate travel arrangements. Virgin Blue will defer future reservations until the CASA documentation review is completed, the company said Friday. CASA's delay in completing the review is caused by an unprecedented domestic carrier workload.
FAA Friday put out an emergency airworthiness directive (AD) to correct oxidation problems with BFGoodrich main brakes on Airbus A319s and A320s. The problem involves oxidation on brake rotor disks. FAA attempted to address the problem in a November 1999 rule (AD No. 99-25-07), but subsequent reports say the checks to determine main brake wear and modifications to wear-indicator pins did not solve the problem.
The Senate approved Norman Mineta's nomination as Commerce secretary. He replaces William Daley, who left to run Vice President Al Gore's presidential campaign. In a Commerce meeting, the panel endorsed the nominations of Francisco Sanchez to be DOT assistant secretary for international affairs and Dallas trial attorney Deborah Branson to be a member of the newly formed Federal Aviation Management Advisory Council. It did not act on the nomination of Aircraft Owners and Pilots Association President Phil Boyer to be a member of the same advisory council.
Embraer Friday announced the listing of its American Depositary Receipts (ADRs) on the New York Stock Exchange. Embraer will sell 18.9 million ADRs, each representing four non-voting preferred shares, in the U.S. and other countries outside Brazil. Embraer also is offering 8.4 million preferred shares in Brazil. It will use the net proceeds from both sales to develop its new ERJ-170/190 regional jet family.
Midwest Express Holdings' second quarter profits fell 32.3% to $8.8 million yesterday due to higher fuel prices and a pilot shortage. The parent company of Midwest Express and Skyway Airlines saw fuel expenses jump 75.5%. Revenues rose 6.9% but could not keep pace with a 16.1% gain in expenses. "We did not achieve the financial results of which we are capable," said CEO Tim Hoeksema. "While higher fuel prices lowered operating income $8.2 million, our results were also significantly impacted by slower-than-planned capacity growth.
Dallas Airmotive promoted Ian Cheyne to VP-engineering and quality, Weldon Walshe to program operations director for Rolls-Royce Spey/Tay and Jay Streb to program operations director for the Pratt and Whitney Canada PT6A and JT15D department, and appointed Carl Hill to the new position of VP and general manager for the Dallas turbine engine overhaul and repair facility
United wants DOT to dismiss Delta's U.S.-France frequency application, saying Delta was "well aware" of DOT's schedule and "afforded itself the luxury" of reviewing the other applicants' supplements and changing its gateways and proposed service start dates. Delta is using that knowledge by "extolling the superiority" of its aircraft proposal as a selection factor. Answers are due today, and United said Delta's failure to file its supplement "on time is particularly egregious." United's request for seven frequencies would allow it to enter the New York-Paris market.
America West further disappointed Wall Street last week when it posted lower earnings due to high fuel costs and a substandard operation. The airline "continued to struggle with the rudimentary fundamentals of running a reliable airline," said PaineWebber analyst Sam Buttrick. The airline's operating margin declined to 7.8%, the lowest second-quarter performance since 1993.
ABS Partnership delivered its 500th hushkit to Legend Airlines. ABS sold its first hushkit in 1991 to Airborne Express, one of its founding partners. The company has 33 customers using its Stage 3 DC-9 hushkits, including Northwest, US Airways, TWA, AirTran, Midwest Express, Spirit, Air Canada, SAS and Finnair.
United advised DOT that, having received approval from Portugal for code-share services with Spanair, it has no objection to DOT granting code-share authority to American and TAP Air Portugal. American and TAP Air requested U.S.-Portugal code-share rights available under the U.S.-Portugal open-skies pact, which does not address third-country code sharing to countries without open-skies agreements with the U.S. United and Spanair plan services to Lisbon via Madrid. (Docket OST-00-7504)
Air France and Iberia signed a memorandum of understanding Friday that likely will lead to a code-share partnership expected to launch in October. The airlines will start cooperating on certain Air France routes between Bordeaux, Lyon, Nice, Marseilles or Toulouse and Iberia's Madrid hub, as well as on Iberia's routes from Paris to Valencia, Alicante, Seville, Bilbao or Oviedo. Iberia first revealed the talks last month and insisted that a code-sharing deal with Air France would "in no way" affect its commitment to the oneworld alliance (DAILY, June 6).
Lufthansa's passenger traffic grew 7.4% to 22.7 million in the first half of 2000, the German airline said last week in Frankfurt. Lufthansa carried 20 million passengers, up 6.4%, and Lufthansa CityLine 2.7 million, up 15.8%. The aircraft were "exceptionally well-filled," said Lufthansa, as the load factor hit a record of 73.1%, up 1.2 percentage points. Lufthansa Cargo carried 878,701 tonnes of cargo and mail in the first half, an increase of 3.9% from the previous year.
Revised* - U.S. Major Carriers Traffic June 2000 (000) June June % 2000 1999 Change Alaska Revenue Passenger Miles 1,071,000 1,069,000 0.2 Available Seat Miles 1,408,000 1,495,000 -5.8 Load Factor (%) 76.1 71.5
The proposed United-US Airways merger gained the endorsement of several key members of Pennsylvania's congressional delegation yesterday following United's decision to invest $160 million in US Airways' Pittsburgh maintenance and overhaul facilities. United said it has been studying the feasibility of expanding the maintenance base since the merger was announced May 24. Before that date, US Airways had been talking with Pittsburgh officials about a new base that would focus on Airbus maintenance work.
