BAA entered into a strategic partnership with lastminute.com yesterday, aimed at strengthening both businesses by marketing the web in airports around the world. As a part of the strategic partnership, the U.K.-based airport management company invested $13.25 million in lastminute.com. Following completion of the deal, Brian Collie, group retail director of BAA, will take up a non-executive role on the lastminute.com board of directors. Lastminute.com offers consumers last-minute deals on premium travel, gifts and entertainment.
Legend Airlines yesterday asked a Northern Texas U.S. Federal District Court to stay any further state court actions until the First District Circuit Court in New Orleans has ruled on an appeal filed by American and Fort Worth on a DOT ruling that allows Legend to operate from Love Field. DOT ruled in December 1998 and again in April 1999 that Legend has a federally assured right fly from Love Field, Legend said. "Enough is enough with the abuse of our legal system," said Legend President and Chief Executive Allan McArtor.
Taiwan's government has given China Aviation Development Foundation (CADF), which holds 71.5% of flag carrier China Airlines, a Feb. 22 deadline to dilute 35% of its stake. CADF will sell the remaining 36.1% if the first phase is successful in attracting investors. Last year, CADF which served notice to sell the 35%, failed to meet the Dec. 22 deadline after several companies, including airlines, made bids. Among the foreign carriers that have expressed an interest in CAL are Lufthansa and KLM.
President Clinton today is expected to announce an agreement between FAA, pilots and airlines concerning data sharing.Airlines and pilots unions had expressed concern that sharing information could expose them to lawsuits. The new policy will allow data from quick access recorders to be reviewed to expose possible unsafe trends and practices and prevent some accidents.
The Korean government took dramatic steps against its troubled flag carrier yesterday, ordering a complete safety inspection of its 107 aircraft and grounding much of its freighter fleet. After three separate accidents last year, Korean Air received word yesterday that it will be forced immediately to ground its eight Boeing 747s more than 18 years old and will have to perform unscheduled maintenance C-checks on the aircraft.
Turkmenistan Airlines ordered an additional Boeing 757-200 in a $67 million contract signed in late December, Boeing said. This order, in addition to four others placed in the last week of December, brought Boeing's total orders for 1999 to 391 commercial jet transports, the company reported. The 757 is scheduled for delivery in a year, joining three other 757s in the Turkmenistan's fleet. Boeing did not identify the sources of the other four orders.
United Chief Executive Jim Goodwin warned that significantly higher labor and fuel costs will result in lower-than-expected 2000 earnings. Fuel prices are expected to average 25% above 1999 levels curbing profits, Goodwin told industry analysts in New York yesterday.
Preparations made by the airlines, airports and aviation manufacturers for the Year 2000 computer date-logic problem are expected to provide lasting benefits for the industry, according to Assad Kotaite, president of the ICAO Council, Pierre Jeanniot, director general of IATA, and Jonathan Howe, director general, Airports Council International. "This milestone achievement sets the stage for future global collaborative efforts to meet head on the myriad global issues that will certainly arise for international civil aviation in this new century," said Kotaite said.
Japan Airlines plans to focus its route plans around seasonal traffic and will place more demands on its low-cost regional subsidiaries this year. The airline, releasing its fiscal 2000 route and fleet plan yesterday, highlighted plans to expand its domestic operations following the opening of new runway at Tokyo Haneda in July. "Expanded use of lower-cost subsidiaries will strengthen the JAL Group airline management, in line with JAL's current 1991-2001 mid-term corporate plan, announced in March 1999," the company said.
Monday's announcement by American and American Eagle that will cut to 6% the commission fees for travel agents in Latin America and the Caribbean has drawn considerable flak from the travel and tourism industries the region. The Dominican Travel Agency Association called the cut a "death sentence" for hundreds of small travel businesses that operate on very low margins, adding that the reduction is illegal in the Dominican Republic because there is Civil Aviation Board that regulates such commissions.
Key players in discussions on the sale of Aerolineas Argentinas stock closed two days of talks yesterday in Madrid without coming to a decision. SEPI, the Spanish government agency that holds a majority interest in Aerolineas, and American, owner of 8.3% of the stock and in charge of management for the past year, agreed on a postponement of seven days.
Comair Jet Express has added a second 10-passenger Challenger 604 aircraft and one eight-passenger Lear 60 aircraft to its fleet. Comair Jet Express also will expand its charter management business.
Wings Club will feature Priceline.com Founder Jay Walker as its speaker Jan. 19 at the Grand Hyatt Hotel in New York. For information, contact [email protected].
U.S. Carriers Landing Fees Third Quarter 1999 Major Carriers Cost Landing Fees Per Landing Alaska 7,862,000 173.72 America West 8,612,509 162.70 American 67,678,000 315.96 Continental 38,206,000 322.86 Delta 59,814,000 247.85
Despite America West's terrible on-time arrival rankings and high customer complaints, one analyst believes the airline has several advantages that will lead it to profitable growth this year. "The company has a clear cost advantage over other full-service airlines," said Deutsche Banc Alex. Brown analyst Susan Donofrio, who started coverage of the airline yesterday with a "buy" rating. The analyst said there is a 25% gap between America West's unit cost and the higher average unit costs of the other U.S. major airlines.
SAS's December traffic was flat year-over-year, while load factor was down 3.4 percentage points to 59.7%. Passenger boardings were up 1% to 1.6 million. Freight volume fell 2%. The airline's 1999 load factor was down 1% to 64.1%.
American plans to expand its Latin American service April 2 when it begins nonstop service from Orlando to Sao Paulo, Brazil, with continuing service to Rio de Janeiro. American will offer the service four days a week with 204-seat Boeing 767-300s. Also effective April 2, American will add a second flight three days a week between its Dallas/Fort Worth hub and Sao Paulo, with continuing service to Rio de Janeiro.
Emirates last week launched daily nonstop service between Dubai and Bangkok with a Boeing 777. The dailies to Bangkok are the result of three additional flights a week, granted by Thailand's Department of Civil Aviation for Emirates to increase frequency to the Thai capital. "This will certainly support the growing air traffic generated into and from Thailand, which is earmarked for a 30% growth rate in 2000," said Keith Longstaff, senior general manager-commercial operations.
House Transportation Chairman Bud Shuster (R-Pa.) yesterday asked FAA to explain why the Marine Corps may be deployed to set up a temporary air traffic control system at the Palm Springs, Calif., airport after the primary FAA radar system was declared unusable last month. Shuster said that since the system was declared unusable on Dec. 19, FAA has been evaluating problems with the radar and trying to decide on an appropriate course of action.
Northwest promoted Tom Kennedy to VP-financial planning and analysis, reporting to the senior VP and controller. The promotion is effective immediately. Kennedy joined Northwest in 1992 and currently serves as managing director-corporate planning.
Ogden Corp. unveiled the formal ratification by the Congress of the Dominican Republic of a 20-year concession contract to design, finance and construct $400 million in airport improvements, and to operate four international airports in the Dominican Republic. Ogden expects the contract to generate total revenues of about $2 billion for Aeropuertos Dominicanos Siglo XXI (AERODOM), a consortium that is 35% owned by Ogden.
Northwest asked DOT for U.S.-Portugal and beyond rights, consistent with open skies. The carrier plans service to Lisbon via Amsterdam, Rome and Milan under third-country code sharing with KLM and Alitalia. Northwest wants authority to serve any point in Portugal. The carrier filed an answer to a request from Delta for similar comprehensive U.S.-Portugal authority, asking that DOT grant Northwest's request concurrently with Delta's. Delta plans to serve Porto and Lisbon via Paris under code share with Air France (DAILY, Jan. 4). (Dockets OST-00-6776, 99-6721)
Continental has recorded several non-recurring items in the fourth quarter, including the previously announced gain of $182 million ($297 million pre-tax) from the sale of its holding in Amadeus Global Travel Distribution. It also plans to write off $50 million ($81 million pre-tax) due to the early retirement of several DC-10-30s and other items announced in November.
BWIA West Indies Airways took delivery of its first Boeing 737-800, becoming the first operator of the aircraft in Latin America and the Caribbean, Boeing said.
Lufthansa plans to double the size of its regional network Team Lufthansa within the next five years. The carrier currently works on a five-year strategic plan for regional affiliates that is subject to board approval in a few weeks. Lufthansa has five regional carriers under the Team Lufthansa franchise. All except one -- Stuttgart-based Contact Air -- fly at their own economic risk but can take advantage of Lufthansa's massive sales and marketing organization and use Lufthansa flight numbers and a Lufthansa-style livery.
