As the day came yesterday for airlines to be forcibly moved from Milan Linate to Malpensa airport, further chaos erupted as a Lufthansa flight was diverted in mid-air to the new Malpensa facility. As Italian authorities forced airlines to comply with the so-called Bersani Decree, some flights were moved to Malpensa; others were canceled. The decision is being sharply criticized by most airlines. An expert group investigating the matter said Wednesday it had "serious doubts" whether the Italian ruling complied with European legislation.
U.S. hopes for working toward open skies with Hong Kong were sidelined this week following three days of negotiations that yielded little movement on the part of Hong Kong to liberalize the aviation bilateral. While the U.S. delegation was encouraged by a willingness by Hong Kong to expand passenger code-sharing opportunities, it was disappointed that, in general, Hong Kong's proposals "did not give life to its vision of the city as a world-class aviation hub," the U.S. said. The U.S.
EVA Air reported a profit of US$37.36 million for the year 1999, representing almost a 17-fold increase from the previous year's US$2.26 million. Of the total revenue of US$1.562 billion recorded, passenger earnings accounted for US$847 million and cargo US$664 million. EVA's junior VP-business and corporate planning Moody Tsai Ming-fang attributed the increase in profits to the recovery of the regional economies and the airline's 5% increase in capacity. Tsai said had it not been for the Sept.
American Eagle will start regional jet service between Oklahoma City and Dallas/Fort Worth July 5. It will add a ninth flight on May 1 that will operate with ATR turboprops. The airline will replace turboprops on four of the nine round-trip flights between the two cities with 50-seat ERJ-145 regional jets. American has three mainline jet flights on the route as well. In addition, Eagle will begin nonstop RJ service between Boston Logan and Toronto beginning July 17 with four daily roundtrips using new 37-seat ERJ-135s.
America West tapped Phoenix-based Arvizu Advertising and Promotions to develop ads targeting the Hispanic market. It includes Spanish-language print, radio and television advertisements that will run in the Phoenix market. Publicis&Hal Riney remains the airline's agency for all other advertising.
Midwest Express Holdings reported a first quarter loss of $6.3 million yesterday, blaming higher fuel prices and labor costs. The parent company of Midwest Express and Skyway Airlines saw fuel expenses jump 93.2%. Revenues rose 8.0% to a first quarter record $106.8 million, but this could not keep pace with a 24.9% rise in expenses. "It was an extremely difficult quarter," said Chief Executive Tim Hoeksema. Higher fuel prices cost the company $9 million. Excluding frequent flyer mile and maintenance charges, the company lost $1.6 million.
Eurocontrol has selected ARINC and Aerodata of Germany to provide collection and analysis of aircraft height-keeping performance data. The information will be used to support the implementation of reduced vertical separation minimum in European Civil Aviation Conference airspace between flight levels 290 and 410, said Joe Sultana, RVSM program manager for Eurocontrol. ARINC will establish its operations control center for the project in London.
For improved safety, aviation needs to "forget low-cost, high-impact investment" and "make huge investments that get meager results," according to Dan Maurino, ICAO coordinator of flight safety and human factors.He adds, "We need to develop measures, markers, we can check on a daily basis."
Northwest yesterday reported a first quarter profit of $3 million, far better than the same 1999 quarter, when it had a $29 million loss. But the profit would not have occurred if not for a $37 million one-time gain from selling some of its shares in Priceline.com. During the 1999 period, Northwest had a $18 million gain from the sale its investment in Equant. Northwest's jet fuel costs soared 80.3%, boosting expenses 12.1% to $2.5 billion. Its profits exceeded analyst expectations, however, thanks to a 4.1% improvement in yield and a 6.4% gain in unit revenues.
Unions at British Airways' French subsidiary Air LibertE have called for a strike today to obtain more information on the sale of the company and to "get the voice of employees heard," union sources confirmed yesterday in Paris. French financial daily La Tribune reported yesterday that Air France had pulled out of the race to purchase Air Liberte from British Airways. BA said yesterday that it has entered "a period of exclusive negotiations with Taitbout Antibes BA," a European bank, for the sale of its 86% stake.
Speaking at a travel meeting in Acapulco last week, Cintra CEO Jaime Corredor said the TAESA bankruptcy does not benefit Mexico's major carriers AeroMexico and Mexicana. He denied the latter resorts to monopolistic practices because Mexico's regulatory aeronautical structure is basically anti-monopolistic and provides freedom of access and exit to all investors and operators in this sector. He said Aero-Mexico and Mexicana have had excellent financial and operational performance so far this year despite higher fuel costs.
Delta, which filed for the seven U.S.-Colombia frequencies available now to U.S. carriers in the first phase of the liberalized bilateral, said Continental's bid for the seven frequencies is a "blatant attempt to thwart new entry and competition." Continental holds 14 U.S.-Colombia frequencies and asked DOT to consolidate the mutually exclusive requests into a comparative selection proceeding.
Atlas Air this week reported record first quarter net income of $12 million, up from $10.2 million in the year earlier period. Operating income was $43.2 million and revenues were $166.4 million, both records. It was the ninth consecutive earnings record. Capacity increased 11% and Atlas saw a 9% improvement in aircraft productivity.
Atlantic Coast Airlines reported a 36.7% gain in revenue to $92.5 million in the first quarter, while net income dropped to $2.3 million from $3.8 million. Operating income fell 20% to $4.5 million and the company's operating margin declined to 4.9% from 7.8% a year earlier. ACA attributed results to a 61% increase in jet fuel prices and costs of starting Atlantic Coast Jet, part of the Delta Connection family. ACA paid 97.8% more for fuel in the quarter.
Sen. Kay Bailey Hutchison (R-Tex.), a member of the Senate aviation subcommittee, introduced an airport security bill on April 13 that would require criminal checks for employees with access to secure airport areas, increase fivefold the amount of classroom training required for security screeners and hold security personnel individually responsible for security lapses. Joining Sen. Hutchison in co-sponsoring the bill with Senate Commerce Committee Chairman John McCain (R-Ariz.), aviation subcommittee chairman Sen.
Malaysia's Department of Civil Aviation served Pelangi Air notice that its air operating certificate as a scheduled airline ceased at midnight last night, April 20. Malaysia Airlines, which has been providing ground handling, engineering and maintenance support services since the airline started operations in 1985, has pulled out, putting Pelangi in a tight spot. According to an MAS engineering official, Pelangi owes MAS more than US$15 million. "Pelangi does not want to pay for services rendered.
Aviation Safety Alliance named James McKenna as its executive director, taking over the post from John Meenan, senior VP-Air Transport Association. McKenna has been transport and safety editor of Aviation Week magazine.
Criminal charges brought against those involved in airline accident investigations is destroying confidence and participation in safety, according to Thomas McFall, American's managing director of safety and environmental. "It is perhaps the worst thing that's happened to our business in recent times," he said this week at Aviation Week's MRO 2000 conference in Nashville.
Thai Airways International will increase fares on all domestic routes by 13.5%, effective yesterday. After securing the government's approval to raise fares last year, Thai abandoned the move because of residual effects of the Asian financial crisis. The airline said it would lose US$42.5 million on domestic operations in the current fiscal year if it does not go ahead with the increase.
An FAA official said yesterday that the U.S. is committed to keeping separate the European Union's pending ban on hushkitted aircraft and attempts in ICAO to formulate a Stage 4 noise rule. The U.S. has filed an Article 84 protest against the ban. James Erickson, director of FAA's Office of Environment and Energy and the U.S.
Galileo International completed the purchase of Travel Automation Services from British Airways this week. The purchase includes Galileo UK, Galileo's distribution company in the U.K. Galileo International now will begin integrating functions such as sales, technical service and customer support currently provided to the U.K. travel market by Galileo UK, into its own organizational functions. The U.K. "is certainly one of the most competitive, with Galileo holding a significant market share," said Babetta Gray, executive VP of subscriber sales and service.
TAM, which already has a subsidiary called TAM Mercosur Paraguay, plans to set up a similar carrier called TAM Mercosur Bolivia. According to CEO Rolim Amaro, investments of some $120 million over five years is planned to develop the new venture in Bolivia -- $90 million to lease aircraft and $30 million for infrastructure and loan service to cover first-year losses. Concentrating first on domestic markets, TAM Bolivia subsequently will become an important cog in TAM's international expansion.
FAA yesterday rescinded an order that required tests to detect discrepancies in jet transports with Mode C transponders but not until finding that numerous transponders failed the tests. Over 50% of the test failures were reported "to be caused by the Mode C transponders," the agency said. FAA is conducting further reviews to determine whether a systemic root cause failure exists. It may consider further rulemaking based on the results. The order affected transponders with single Gilham code altitude input.
