U.S. National and Regional Carriers Traffic, as of March, 3 Months 1999 March March % 1999 1998 Change Air Wisconsin Revenue Passenger Miles (000) 102,258 52,970 93.0 Available Seat Miles (000) 155,548 86,674 79.5 Load Factor (%) 65.7 61.1 Passengers 322,341 182,692 76.4
AMR Corp. said first quarter earnings fell 81% to $56 million as the February sickout by its pilots and harsh winter weather severely curtailed its flights. Chief Financial Officer Gerard Arpey estimated the total impact from the pilot dispute, which forced American to cancel 6,700 flights, at $225 million pretax or $140 million net after tax. He said the $45 million penalty against the Allied Pilots Association was not included in the quarterly analysis because the pilots will appeal the decision.
Japan Airlines is drawing a line in the sand with code-share partners American, British Airways and Cathay Pacific, vowing not to join their global oneworld alliance unless the Japanese carrier is allowed to keep some of its separate partnerships. "If they are not flexible, we don't want to join," Nobutaka Ishikure, VP industry affairs and interline marketing, told The DAILY in Nagoya.
US Airways Group earnings dropped to less than half of year-earlier levels during the first quarter as bad weather on the East Coast disrupted operations and increased the complexity and cost of converting the airline to outsourced information technology services. Flight operations improved with the weather as the quarter ended, and a US Airways spokesman said yesterday the conversion to Sabre systems for yield management, personnel scheduling and a variety of functions will reduce rather than increase costs from now on.
Mesa Air Group earned net profits of $2.9 million, or 10 cents per share, for the quarter ended March 31, compared with a loss of $13.3 million, or 47 cents per share, for the same quarter last year. Operating revenue dropped 34.8% to $77.9 million from $119.6 million, as operating expenses fell faster - 44.9% to $72.1 million from $131.1 million. Unit cost dropped 34.4% to 13.7 cents per available seat mile from 20.8 cents. On its unaudited balance sheet, Mesa listed cash and securities of $65.5 million, up 84%.
DOT granted Asiana a statement of authorization to conduct code-share operations for Gemini Air Cargo, under which Asiana will display Gemini's designator code on Seoul-New York; Seoul-New York/Chicago and Seoul-Los Angeles flights. DOT, noting that Asiana wanted to retain the option to change frequency on these routes or provide blocked space/code-share service with Gemini on other Asiana routes between the U.S. and Korea, dismissed that portion of Asiana's application.
FAA has issued a policy statement on determining sanction amounts to be paid for violations of DOT's hazardous material regulations. It says the policy should "promote a relative consistency in determining civil penalties."
Pilots who work for the four largest Wings Alliance member carriers met in Thailand recently to pledge mutual cooperation in matters affecting job security, job quality and future flying opportunities within the alliance. Pilots from Northwest, Alitalia, Continental and KLM signed a tentative agreement acknowledging significant long-term career effects that the proposed Wings Alliance will have on member airlines, employees and shareholders.
DOT Secretary Rodney Slater and U.K. Deputy Prime Minister John Prescott, who met Tuesday in Washington on open skies, agreed that U.S. and U.K. officials would meet informally in May "with the hope that such talks would lead to formal discussions in June."British Airways chief Robert Ayling told the Wings Club in New York yesterday that BA hopes to "achieve immunity for our cooperation with American...by the end of the summer."
Sen. Ernest F. Hollings (S.C.), a former Senate Budget Committee chairman and ranking Democrat on the Senate Commerce Committee, has charged that trust funds throughout the U.S. government, including $11 billion from the aviation trust fund in fiscal 1999, are being used to pay down the deficit, and he is fighting to halt the practice.
Tower flight attendants have won back pay plus interest in a two-year dispute with the company over unpaid wages. Arbitrator Daniel Brent ordered the company to pay cabin crew the owed salary plus 9% interest within 30 days.
IATA has issued a new edition of its Perishable Cargo Handling Manual. The publication, aimed at airlines, airports, handling agents, forwarders and shippers, is available from IATA Customer Services.
Nations Air Express filed a reorganization plan with the U.S. Bankruptcy Court for the Northern District of Georgia in Atlanta. The Norcross, Ga., charter and scheduled service carrier will be acquired by a new company organized by David Fink, president of New Hampshire-based Guilford Transportation Industries. Fink is part of a group of investors that successfully negotiated to bring Pan Am out of bankruptcy in Florida last June.
New Air, which plans to begin service in January as a low-fare carrier based at New York Kennedy, signed an agreement to purchase 25 Airbus A320 family aircraft and took 25 options and 25 purchase rights. If all options and purchase rights are exercised, the contract will be worth more than $4 billion, based on list prices. The deal also includes seven leased A320s. The first purchased aircraft will be delivered next June.
DaimlerChrysler has set up DaimlerChrysler Aerospace Japan Co. in Tokyo to "signal our commitment to the Japanese market and to Japanese customers," said Stefan Weingartner, president of the aerospace unit. Eyeing the commercial satellite and aviation market, Weingartner said, "We want to expand our engagement in Japan and fortify our cooperation with the Japanese aerospace industry." The new unit arose from the existing DASA representative office and aerospace division of DaimlerChrysler Japan Holding Inc.
US Airways is offering group travel planners discount roundtrip fares for the year 2000, with tariffs for U.S. and Canada travel from $270 to $495 and a required seven-day advance purchase and minimum two-night stay.
Northwest, still recuperating from two years of labor disputes including last fall's pilots strike, posted a $29 million net loss for the first quarter 1999, or 36 cents per diluted common share. The carrier, estimating strike costs at $90 million pre-tax, reported an operating loss of $14 million. The net loss for the first quarter was $46 million, excluding an after-tax, non-recurring gain of $18 million on the disposition of certain securities.
FAA should withdraw the 'interpretive rule' that places blame on the pilot FAA should withdraw the "interpretive rule" that places blame on the pilot for errors in ATC clearance readbacks (DAILY, April 2), says AOPA President Phil Boyer."Fix the problem, not the blame," Boyer said. "Just as with the ticket program, FAA is sending the message that enforcement is more important than safety." Boyer complains that the rule absolves ATC personnel from any legal responsibility to correct misunderstandings between pilots and controllers.
Security precautions for the NATO summit in Washington will restrict access to the downtown area in which Aviation DAILY is published. Because of this, there may be delays in delivery of print issues on Friday, April 23, and Monday, April 26. On both days, readers may access The DAILY at the Aviation Week Newsletters web site, http://www.awgnews.com, by using the username aviation_daily and the password airline.
Aer Lingus Group posted a $77.6 million pre-tax profit for 1998, up 13.7% from 1997. Revenue improved 12.4% to $1.3 billion. The airline carried a record 5.8 million passengers last year, up 10%. Group Chairman Bernie Cahill said the profits are important for the carrier as it enters a period of higher fleet spending. Aer Lingus said it has been mandated to enter into alliance discussions and will make recommendations to the Irish government. "Proposals have been received from a number of airlines and are currently being evaluated," Cahill said.
FAA, acting on a report of a burnt insulation blanket, yesterday ordered operators of 45 U.S.-registered MD-11s with 72-inch cargo doors to inspect the wiring harness support bracket and clamp in the lower center cargo compartment. The agency said a missing bracket and clamp could cause a wire bundle to contact the blanket and rub against the fuselage frame, producing a possible fire source.
Hawaiian Airlines reported a 6.3% jump in traffic on a like increase in capacity for March 1999 compared with the same 1998 month, which raised the load factor 0.1 percentage points to 76.3%. The carrier flew 391.9 million revenue passenger miles and 513.9 million available seat miles. Passengers flown grew 6.6% to 489,959. Year-to-date RPMs jumped 11.5% and ASMs 4.0%, boosting the load factor 5.1 points. Passengers flown increased 9.1%.
CIT Group ordered 25 A320 family aircraft and five A330-200s with options to require more Airbus aircraft over five years, said Albert Gamper, president. Gamper said CIT deliveries will start in the fourth quarter of 2000. "We have been a lessor of aircraft for more than 30 years and this investment in new aircraft clearly reinforces our commitment into the next century," he said. Gamper said the deal is among the largest this year. CIT has the option of switching its orders among the A319, A320 and A321.
If the $45 million fine imposed on American's Allied Pilots Association by U.S. District Court Judge Joe Kendall sticks through APA's appeals process, it would wipe out the net assets in the union's emergency fund reported in APA's most recent financial statement. The union says it plans to appeal Kendall's decision, reached last week, forcing pilots to pay a penalty for the February sickout that American claims cost the company more than $50 million (DAILY, April 16). It has no insurance that would cover the fine.
U.S. Carriers Labor Expense, Fourth Quarter 1998 Major Carriers % Of Total Labor Operating Expenses Alaska 113,954,000 33.02 America West 111,882,642 24.23 American 1,225,817,000 33.95 Continental 493,768,000 29.21 Delta 1,058,917,000 33.06 Northwest 742,648,000 32.06
