Boeing took in $5 billion more in 1998 than the Big Three airlines combined - $56.2 billion in revenue vs. a total of $51.2 billion - but its net earnings, $1.1 billion, were about the same as Delta's and $200 million less than either United's or American's.
Continental put in its bid for one of three third-country code shares available under the recently adopted annexes to the U.S.-Russia bilateral (DAILY, Jan. 27), requesting an exemption to operate service with Air France between Houston and Newark and Moscow and St. Petersburg as a new competitor in the U.S.-Russia market. Continental filed to withdraw its applications, under Docket OST-97-3092 and undocketed applications with affiliate Continental Express, for an exemption and authority to code share with Aeroflot.
U.S. aviation negotiators met with officials in three African nations during the past several days to present the U.S. open-skies program and answer questions and concerns. A first round of formal open-skies talks with Tanzania went well, according to a DOT spokesman, who said progress was made and negotiations are expected to move ahead, although a date for the next meeting has not been set. The U.S.
US Airways Express said it will increase service at Washington Reagan Airport Feb. 3 with two daily nonstop regional jet flights to Knoxville and a second daily nonstop turboprop flight between Knoxville and Philadelphia. Knoxville-Washington service will be operated with 50-seat Canadair RJs and Knoxville-Philadelphia with 32-seat Dornier 328s. The airline also will add two daily Greenville-Spartanburg-Washington nonstops Feb. 3, using 328s.
China Airlines, Mandarin Airlines and Formosa Airlines are drafting a plan that reportedly calls for completion of their merger by Aug. 1. Sources in Taipei say that, under the terms of the plan, CAL will give up its key Taipei-Kaohsiung domestic route to concentrate on international flights, including Taipei-Canada and Taipei-Australia routes currently operated by Mandarin. Mandarin and Formosa will merge into a single unit to be called Mandarin Airlines. The new Mandarin, a subsidiary of CAL, will operate domestic service.
House Transportation Committee Chairman Bud Shuster (R-Pa.) is in a bargaining mood as he begins his attempt to take the aviation trust fund off budget.Higher passenger facility charges, airline competition measures and FAA reform short of privatization are on the table, Shuster told the Aero Club of Washington yesterday. So is Senate Commerce Chairman John McCain's (R-Ariz.) bid to relax the Washington Reagan perimeter rule, which Shuster still opposes.
U.S. Major Carriers Financial Results Third Quarter 1998 Third Quarter 1998 Operating Operating Revenues Expenses (000) (000) Alaska 448,964 369,567 America West 489,308 447,861 American 4,272,361 3,717,056 Continental 1,934,309 1,776,875
Boeing officials reported profits for the fourth quarter of 1998 and the full year yesterday, compared with losses during both periods in 1997, but they said the company still needs to improve profit margins. The profit margin for Boeing Commercial was zero for 1998, but Debby Hopkins, the corporation's new chief financial officer, said she expects a commercial profit margin of 2% to 3% this year and 4% to 5% in 2000. Hopkins said this year's profit margin will not be satisfactory.
DOT, during talks last week with Russian aviation representatives, adopted annexes to the U.S.-Russia bilateral that provide long-sought third-country code shares for U.S. carriers and include first-time overflights and expansion of routes and frequencies. U.S. carriers may implement a total of five such code-share arrangements - three immediately, with two more available Jan. 22, 2000. Each U.S.
PROS Strategic Solutions yesterday announced the appointment of Bert Winemiller as president, chief executive and board member. Winemiller previously was president of American Business Information and senior VP for Automatic Data Processing. Houston-based PROS is a leader in revenue management science.
DOT believes slot controls and the Washington Reagan perimeter rule no longer are required for aviation reasons, according to recent comments by Patrick Murphy, deputy assistant secretary. But DOT is not pushing for their abolition since they serve other purposes and Congress may decide their fate, he told The DAILY yesterday.
Atlas Air reported record fourth quarter net income of $18.1 million, up from $9.1 million in the 1997 period. Operating income was $47.1 million, up from $27.8 million, while revenues rose to $145.5 million from $120.9 million. For the year, net income was $46.2 million, up from $23.4 million; operating income was $135.8 million, up from $83.1 million, and revenues were $422.2 million, up from $401 million.
Eight air traffic organizations have signed bilateral agreements establishing the terms of cooperation in support of the European Geostationary Navigation Overlay Service (EGNOS). European Space Agency (ESA) Director General Antonio Rodota signed bilateral pacts with agencies representing Spain, Portugal, France, Germany, Italy, the U.K., Norway and Switzerland. EGNOS aims to provide Global Positioning System/Glonass satellite-based augmentation services to aviation, maritime and land users in the European region.
Delta gave up yesterday on the $1-per-component fare surcharge it imposed two weeks ago on tickets for U.S. domestic travel purchased through any venue other than its web site. The surcharge, levied Jan. 11, generated an angry outcry among consumer and travel agency groups, and none of Delta's competitors matched it. Withdrawing the surcharge, Delta declined to comment on its reasons for the change in policy, and critics declared a victory for consumers.
Sabena is negotiating the purchase of Uganda Airlines on behalf of Swissair, said Sabena General Manager Paul Reutlinger, according to reports in Swiss daily Tribune de Geneve. Swissair, which owns 49.5% of Sabena, is expected to increase its stake in the Belgian airline, following the air transport agreement struck by Switzerland and the European Union at the end of last year. Other candidates for the purchase of Uganda Airlines include British Airways, Alliance Air, Air Mauritius, Aero Zambia and Kenya Airways, negotiating on behalf of KLM.
American will expand its marketing alliance with TAM-Meridionais of Brazil on Feb. 3 by placing its "AA" code on two daily TAM Sao Paulo-Miami flights.
FAA's "ad hoc, sometimes chaotic nature of software acquisition capabilities" and its "continuing serious problems" in handling its inventory place the agency's financial management program among 26 "high-risk" government programs, according to a General Accounting Office (GAO) report. The 26 programs have greater vulnerabilities to waste, fraud, abuse and mismanagement, GAO said in its report, "Major Management Challenges and Program Risks" (OCG-99-1).
China Airlines (CAL) will add 152 international flights between Feb. 11 and Feb 22 to accommodate an expected increase in traffic during the Chinese New Year holiday period. A CAL official said routes expected to receive the largest number of new flights are Taipei-Tokyo, -Okinawa and -Bali.
U.S. National Carriers Financial Results Third Quarter 1998 Third Quarter 1998 Operating Operating Revenues Expenses (000) (000) AirTran Airlines $ 115,079 120,377 Aloha 58,020 55,551 American Trans Air 232,074 209,021 Frontier 56,853 47,075
ARINC Chairman Jams Pierce said a demonstration last week proved the company will be ready for computer problems associated with the Year 2000 that could affect communications services to the aviation industry and civil aviation authorities. The demonstration was conducted in the ARINC System Test Bed, a multi-computer system that replicates most of the operational systems ARINC uses to provide critical air traffic control and aeronautical operational control communications for FAA and the airlines.
Senate Commerce aviation subcommittee chairman Slade Gorton (R-Wash.) said yesterday he "has not reached a conclusion" on increasing the passenger facility charge (PFC) but strongly hinted that he will seek an increase in the $3 fee. Gorton said he expects to reach a conclusion on the PFC before next Wednesday's Senate Commerce Committee markup of the two-year FAA reauthorization bill Committee Chairman John McCain (R-Ariz.) has introduced. Gorton tipped his hand, however.
The American Society of Travel Agents (ASTA), worried about possible anti-competitive implications of United's bid to buy America West, is asking the Justice Department to investigate the matter. ASTA President and Chief Executive Joe Galloway, noting that the merger could result in higher air fares, said, "America West's strong presence in the West and its transcontinental routes have gone a long way toward suppressing [high] air fares in the markets it serves."
All Nippon Airways has filed with the Japanese Ministry of Transport to code share with Varig on Japan-Brazil service, beginning in late March. The agreement was made possible by a new aviation treaty between the two countries, signed in December. ANA will put its code on five weekly Varig-operated flights. Four flights travel the Tokyo-Los Angeles-Sao Paulo-Rio de Janeiro route using 747-300s, and the fifth flight is routed Nagoya-Los Angeles-Sao Paulo-Rio. ANA intends to begin frequent flyer reciprocity and other cooperative elements as well with Varig.
B/E Aerospace said it is selling a 51% interest in its In-Flight Entertainment (IFE) business to Sextant Avionique, a leading supplier of avionics systems. Terms call for an initial cash purchase price of $62 million. The final price, to be determined on the basis of operating results over two years, could range from $47 million to $87 million, B/E Aerospace said. The new company, Sextant In-Flight Systems, will be headquartered in B/E Aerospace's existing facility in Irvine, Calif. B/E said it will use the proceeds to reduce bank borrowings.
Michael Levine, executive VP-marketing and international and a major power at Northwest, is leaving the company as of Feb. 1. Levine will continue as executive VP until his retirement on Feb. 28. Levine previously was president of New York Air under Frank Lorenzo and the dean of Yale University School of Management. He also was general director of the now-defunct Civil Aeronautics Board. Levine, who has been with Northwest since 1992, is credited with the company's decision to overhaul its DC-9 fleet.
