Senate Judiciary antitrust subcommittee's planned hearing into anticompetitive airline practices next month will "probably be a little wider" than an examination of American, subject of a Justice Department lawsuit, a spokesman for subcommittee Chairman Sen. Mike DeWine (R-Ohio) said yesterday.
Two days of informal talks between U.S. and U.K. negotiators concluded yesterday in London after "productive discussions" of ideas for a transition from the current restrictive bilateral to open skies, a DOT spokesman said yesterday. The U.K. presented its strategies, which he said were "broad and preliminary - and the gaps are many," and the U.S. provided an "initial reaction." The U.S., whose initial reaction was positive, will respond further after U.S. representatives consider the ideas put forth by the U.K. on structuring a transition.
Airport managers' commitment to "promoting competition at their airports is critical to the success of failure of new-entrant air carriers," DOT Assistant Secretary Patrick Murphy said this week in Phoenix. He asked airport managers attending the annual conference of the American Association of Airport Executives whether federal, state and local officials are doing enough to promote competition and competitive access at airports.
Emery Worldwide applied at DOT for an exemption to provide scheduled all-cargo service between Nashville and Guadalajara, Mexico. The carrier asked for the exemption on an emergency basis, telling DOT it wants to begin the service immediately. It plans to operate five times weekly on a Dayton-Nashville-Guadalajara routing, using its McDonnell Douglas DC-8 aircraft. No other carriers - all-cargo or combination - fly the route nonstop.
Frontier has formed a corporate travel advisory board to enhance the airline's brand among industry groups, including the lucrative business travel segment. Board Chairman Tom Allee, Frontier's national sales director, cited a recent survey by the National Business Travel Association predicting greater use of low-fare carriers, like Frontier, by business travelers and cost-conscious corporate travel managers. He said the carrier wants "to ensure the Frontier product meets and exceeds the expectations of this important constituency."
America West Holdings Corp. shareholders yesterday approved an amendment to the company's Incentive Equity Plan and elected new directors. The amendment, approved by a majority of 88%, increases by 1.5 million the number of shares of the company's Class B common stock available for awards under the Incentive Plan. The plan is the company's stock-based, long-term compensation program under which executives may be awarded stock options, restricted stock and other stock-based compensation.
Air fares declined for the eighth consecutive month, according to a study by the Air Transport Association, while an American Express study concludes that the gap is widening between the lowest unrestricted fares used mostly by business travelers and the heavily restricted tariffs favored by leisure travelers.
US Airways Chairman Stephen Wolf, and other officers, are eligible for bonuses of up to 500% (DAILY, May 20). The board recommended a 220% bonus target for 1999. Wolf's potential compensation makes him eligible for $56 million in options, and President Rakesh Gangwal $36 million, amounts that have not been awarded.
Lauda Air's new nonstop Vienna-Orlando service has bookings above expectation, the airline said. The first flight arrived in Orlando May 10. Lauda also added capacity to its Vienna-Miami service.
KLM stopped all bird shipments following an incident last week at Amsterdam Schiphol Airport when 226 birds of a consignment of 1,648 died after being improperly packaged and shipped from Johannesburg. The shipment originated in Mozambique and was destined for a Dutch import firm, but the consigner had not packaged the birds according to IATA Live Animal Regulations.
EasySabre, the industry's first travel web site, will stop operations June 15. Members are being directed to Sabre's growing Internet site, Travelocity.com.
Canadian Airlines has opened an Asian regional office in Hong Kong to increase revenue in Taiwan, China and Hong Kong markets, said newly appointed Managing Director Derek Galpin. The Hong Kong market was well developed, while Taiwan was strong and China offers huge potential, he added. Starting June 1, Canadian will increase capacity on its weekly Hong Kong-Vancouver flights and launch four weekly Shanghai-Vancouver flights from the new Shanghai Pudong Airport Oct. 1, the same day the facility opens.
Mesaba Holdings yesterday reported record results for its fiscal year despite a hailstorm in May 1998 that damaged more than 20% of its fleet and a pilots strike last fall at Northwest that forced Mesaba to suspend service for 18 days. Mesaba reported net income for the fourth fiscal quarter ended March 31 increased 34.2% to $6.4 million from $4.8 million during the same quarter last year. Net earnings for the fiscal year rose by 7.4% to $21.3 million from $19.8 million.
Rep. William Lipinski (Ill.), ranking Democrat of the House Transportation aviation subcommittee, on Tuesday introduced his Aviation Bilateral Accountability Act, which would require congressional review of all U.S. bilateral aviation agreements. Under the bill, the Executive Branch would have to submit a final copy of all new and updated bilaterals to Congress, which would have 90 days to review them and enact a disapproval resolution. Otherwise, the agreements would go into effect.
SAirGroup purchased Memphis-based Dobbs - the third largest airline caterer in the world - for $780 million, Swissair's holding company said yesterday in Zurich. Dobbs, previously owned by U.S. financial concern Viad, will be merged with SAirGroup's catering subsidiary Gate Gourmet. The operation "completes our activities on the important American market, where Gate Gourmet was not yet represented," said SAirGroup Chairman Philippe Bruggisser.
Argentina yesterday postponed talks with the U.S., expected to begin today and conclude Friday with an open-skies agreement (DAILY May 3). State Department spokesman James Rubin said without open skies, it is "highly unlikely" that DOT would approve a proposed code share between Aerolineas Argentinas and American. Aerolineas has resisted open skies, a U.S. official said, and questioned how continuing a severely restrictive and underserved market would serve its long-term growth.
Avteam, supplier of aftermarket jet aircraft engines and engine and airframe components, reported that net income increased 49.7% to $2 million on sales of $29.3 million, up from sales of $13.1 million. The company attributed the results to the success of combining its distribution business with its engine maintenance, repair and overhaul operation.
Hong Kong and South Korea have signed a new air services agreement, which, paving the way for carriers from both countries to open more flights and increase capacity on existing service. Currently, all flights operate between Hong Kong and Seoul. The accord allows services to start from Hong Kong to Pusan and Cheju. Capacity to the Korean cities will increase from 8,150 to 9,200 seats by April 2000.
KLM's net earnings for the March quarter fell 24.4% yesterday to 456 million Dutch guilders (US$221 million). Revenue declined 3.5% to NLG 3.04 billion ($1.47 billion) Cash flow more than doubled to NLG 1.3 billion due to KLM's sale of stock in partner Northwest. "The economic backdrop in 1998 had a negative impact on our business results," the airline said. KLM faced Asian economic weakness, more competition on European and North Atlantic routes and fallout from labor troubles at Northwest.
United will reward Mileage Plus members with frequent flyer miles when they use their Mileage Plus First Visa or MasterCard. Participating Mileage Plus Shopping merchants determine the mileage value of transactions, allotting one to 10 miles per dollar, which is added to the mileage normally awarded by First Card. For example, a $75 Mileage Plus First Card purchase with Lillian Vernon awards the shopper 750 miles.
Pan Am International flight Academy has completed an agreement to acquire Reflectone Training Centers, near Washington Dulles and St. Louis. The assets, previously owned by the British Aerospace North America Division, include four Level C simulators for a BAe 146, two J41s and a J31/32, and long-term leases on both facilities. Plans are under way for an immediate expansion of the Dulles facility, the academy said.
Aviation Distributors reported revenues for the year ended Dec. 31 were $28.4 million, a decrease of 27% from the $38.9 million the previous year. The company recorded a net loss of $5.8 million, compared with a net income of $404,490 the previous year. The revenue drop is due to reduced access to credit while the company was restructuring.
Emirates' passengers leaving Dubai can check into a brand-new departure terminal at Dubai Airport. The terminal is located to the east of the existing departures building, directly adjacent to the Dubai Duty Free Warehouse on the upper level. Emirates is the first airline to use the new facilities, part of the US$540 million expansion at Dubai undertaken by the Department of Civil Aviation. By September, all other airlines will have moved into the new facility, which will offer 213 high-tech passenger check-in counters.
U.S. Department of Justice's Antitrust Division has set up an e-mail address, [email protected], for comments on its lawsuit against American and AMR Corp. DOJ's web page links to the complete text of the complaint. The division has a similar e-mail link for its case against Microsoft.
