Great Lakes Aviation has been tentatively selected by DOT to continue to provide subsidized essential air service at Manistee/Ludington, Mich., for two years from Dec. 29, 1998, through Dec. 31, 2000, at an annual subsidy rate of $361,808. Great Lakes provides - and will continue to provide - two one-stop roundtrips per day, six days a week, with Beech 1900s, from Manistee to Chicago O'Hare. Objections are due May 25. (Docket OST 96-1711)
US Airways' Air Line Pilots Association Master Executive Council last week unanimously approved a deal that will for the first time cover pay and work rules for pilots in supervisory positions. The union also is asking for volunteers to help new pilots transition from training to flying the line. US Airways expects to hire 25 pilots per week through the yearend.
Spirit Airlines reported an 87.9% leap in traffic on 87.6% more capacity for April 1999, compared with the same 1998 month, which pushed the load factor up 0.2 percentage points to 80%. The airline saw a 67.7% gain in passengers carried. Year-to-date, Spirit flew 82.4% more passengers as traffic climbed 106.7% and capacity 101.5%, growing the load factor 2.1 points.
American filed a supplement yesterday to its reply on U.S.-Russia applications (see story, Page 100) calling reports that Delta may sign a code-share agreement with Aeroflot "yet another reason" for DOT to deny Delta's bid for a third-country code-share designation with Air France. Delta flies its own aircraft in the market and code shares with Swissair. (Dockets OST-99-5286, 98-4522, 98-4328)
DOT should designate American immediately for U.S.-Russia third-country code sharing with Finnair and defer selection of Continental or Delta for the second available designation until Air France has chosen between them as its long-term alliance partner, American told the department. Air France's decision, expected this year, will leave one of the two carriers without its Russia code-share partner when the designation becomes effective in January 2000.
Construction of a parallel runway at Tokyo Narita Airport is running into problems and the project may be suspended. Kurono Masahiko, Japan's deputy transport minister, said the ministry still believes it is possible to begin construction this year. But two farming families living in an area where the runway is to be built still are rejecting requests by the ministry to talk about a possible move. The ministry seems to have decided on a cooling-off period but says it never will give up entirely on the runway program.
London Gatwick-based CityFlyer Express has signed to acquire an eighth AVRO RJ100 quadjet, British Aerospace said. The aircraft, configured for 110 seats, will be delivered in spring 2000. The British Airways franchisee, which already has five of the aircraft, will take delivery of its sixth and seventh RJ100s in July and August this year. CityFlyer foresees a need for additional RJ100s, with which it will replace smaller turboprop aircraft at Gatwick, BAe said.
KLM, with 66.9% of Amsterdam's total seat capacity, dominates its hub more than other European airlines dominate theirs.Next come SAS in Copenhagen, 63.7%, and Air France at Paris Charles de Gaulle, 63.1%. But no European carrier approaches the level of U.S. airline domination, such as US Airways' 90.8% of seats at Charlotte and 87.6% in Pittsburgh, and Delta's 90.8% at Cincinnati.
China Eastern Airlines, confident after the success of recent Shanghai-Paris cargo and passenger additions, intends to convert another MD-11 passenger aircraft into a freighter during the next six months. China Cargo Air, the airline's joint venture with shipping firm Cosco, eventually will manage all of China Eastern's freight capacity.
Regional airline revenue passenger miles grew by an average of 30.2% in March, based on a survey of 16 of the nation's largest regional carriers. Available seat miles increased an average 27.4% year over year. United Express Air Wisconsin, which assumed some of the Denver markets previously served by Mesa Air Group, was by far the leader, with a 93% jump in traffic and a 79.5% increase in capacity. The carrier has added Dornier 328 turboprops and CRJs to its existing 18 BAe 146 quadjets.
FAA yesterday issued its screening-based proposal to strengthen security of domestic checked baggage, a key recommendation of the Commission on Aviation Safety and Security. The proposal would require airlines to apply additional security to the checked baggage of some customers, but the agency said the Justice Department has determined that criteria for determining whose baggage is checked are not discriminatory.
Delta exceeded analysts' expectations yesterday by posting a net profit of $216 million for the first three months of 1999, up 10.8%, versus a $195 million profit in the March quarter of 1998. The airline saved $26 million in jet fuel expenses in the first quarter, and without the savings profits would have been flat. Still, Delta's operating margin increased 0.2 points to 10.2%, above that of many competitors. Without fuel benefits, the operating margin would have decreased to 9.2%.
The list of prerequisites identified by a Johns Hopkins study before satellite navigation can provide sole means/sole service is so extensive that it amounts to a "significant system redesign," according a Litton paper. For the Wide Area Augmentation System, "almost every major component is impacted - the number of ground stations, the number of satellites, the ground receivers, the avionics and the correction algorithms," according to Victor Strachan, director of strategic development, Litton Aero Products.
Some 87% of FAA's mission-critical systems - 370 of 422 - are ready for Year 2000 operations, and the agency has "consistently met or exceeded deadlines" for ensuring compliance of all National Airspace System components by its self-imposed deadline of June 30, DOT Deputy Secretary Mortimer Downey told the Special Senate Committee on the Year 2000 Technology Problem.
Malaysia Airlines is investing US$135 million to enhance its interactive inflight entertainment system (IFE) and its communications system facilities for its 777 and 747 aircraft. Senior VP-Marketing Services Shamin Ahmad said the upgrade will be carried out in two phases over eight years. The first phase, already started, involves 12 aircraft - eight 777s and four 747-400s - and the second seven 777s and six 747-400s. Another feature is an in-seat fax service that transmits keyed-in messages to fax machines in any part of the world.
Delta said yesterday it will defer delivery of four 777-200s scheduled to arrive between December 1999 and April 2000 because it has been unable to reach a timely agreement with its Air Line Pilots Association unit on pay for flying the aircraft. Delta said it was obligated to tell Boeing this week whether it would take delivery or defer.
Regional jets and small airports are "not exactly bread and butter," says analyst Michael Boyd. "In fact, RJs can have and will have, and will continue to cause reduced service at small airports." He was critical of consultant GKMG claims that small towns are missing RJ service because of union scope clauses. "That is sheer...nonsense." He said the intended RJ mission has not changed. They are used where their capacity and performance make sense to generate revenue. "Small airports that can barely support Saab 340s are not much in the picture," he added...
Improved operating margins in all operating units helped Boeing achieve "solid and clearly improving performance" during the first quarter, Phil Condit, chairman and chief executive officer, said yesterday. The company reported earnings of $469 million in the quarter on sales of $14.4 billion, versus year-earlier sales of $12.9 billion and profits of $50 million following a $219 million after-tax forward loss on the next-generation 737 program.
India's finance ministry has approved in principle a proposal from national carrier Air-India to raise up to $100 million through one or more securitization deals in foreign capital markets, Air-India sources said yesterday. The approval also confirmed that the B-plus rating assigned to the proposal by international credit-rating agencies is adequate. Roadshows for raising the funds will start in May, after Air-India receives formal approval from the ministry, carrier officials said.
A U.S. envoy will visit Europe next week carrying a promise to work with European Union nations on pushing a Chapter 4 engine noise limit through ICAO if the EU will back off its determination to ban hushkitted aircraft when its transport ministers vote on the issue April 29. The compromise is contained in a letter to European officials from the secretaries of Commerce, Transportation and State and the U.S. Trade Representative.
...Boyd points out that American Eagle is dropping all turboprop service from Chicago O'Hare to Wausau, Wis., and those O'Hare slots and other turboprop slots are being used to initiate long-haul RJ service to Pittsburgh, Baltimore, and other larger markets. American Eagle also is abandoning O'Hare service to Montgomery and Shreveport, points it has been serving with exemption slots. "Small airports are not going to be saved by RJs, with or without legislation or studies on union scope clauses.
Great Lakes Aviation received a 146% boost in essential air service (EAS) subsidies during 1998 and a 328.6% increase from 1996, according to the carrier's annual 10K filing with the Securities and Exchange Commission. The 1998 amount was $15 million, compared with $6.1 million in 1997 and $3.5 million in 1996. As of Dec. 31, Great Lakes served 29 EAS markets with subsidy.
Continental yesterday posted a first quarter net profit of $84 million, up 3.7% from the year-earlier period, as both domestic and international revenue outpaced its capacity-adjusted growth. The airline's 16th consecutive quarterly profit grew out of a revenue gain of 10.9% to $2.1 billion. Operating income increased 6.7% to $160 million. Continental gained $19 million in the quarter from American's labor troubles, $15 million domestically and $4 million from Latin America. "I think we got some long-term benefit from this," said Chairman Gordon Bethune.
