Labor unions at America West and United, hit with reports of a merger or acquisition, are holding their opinions until they know what form a deal would take. "We don't want to speculate until we've heard something conclusive from America West," said Yvette Freeman, America West Air Line Pilots Association spokeswoman. She said the union will make sure the pilots are "well represented" in acquisition talks.
Rep. Bud Shuster (R-Pa.), chairman of the House Transportation and Infrastructure Committee, will speak Tuesday at a luncheon meeting of the Aero Club of Washington at the Capital Hilton, Washington, D.C. For more information, call 703-327-7082.
The Avions de Transport Regional partnership placed 61 ATR aircraft with 21 operators last year, ATR reported this week. Figures are for the period following July 1, when the former AI(R) consortium, which included British Aerospace as well as ATR, dissolved.
India's Cabinet Committee for Economic Affairs (CCEA) has cleared proposals for corporatizing five major international airports - Delhi, Mumbai, Calcutta, Bangalore and Chennai, and for setting up a regulatory authority for airports separate from the existing Airport Authority of India. The five airports together account for nearly 75% of the country's air passenger traffic, which totaled 46.4 million passengers last year, including 12.7 million foreign nationals.
Continental's profit machine kept chugging through 1998, albeit a little slower, as fourth quarter net profits dropped 9.6% to $66 million and annual earnings 0.5% to $383 million. The company set a record for the fourth straight year for pre-tax profits, at $770 million, and its $1.4 billion cash balance made early-1990s bankruptcy troubles seem distant. The quarterly earnings per share of $1.08 were lower than the year-earlier period but exceeded Wall Street's consensus estimate. Operating margin rose to a record 10.4%.
Sterling, Va.-based Saab Aircraft Leasing during 1998 placed 24 used Saab aircraft, the company said. In its first year as a dedicated leasing company, SAL leased aircraft as follows: Air Ostrava, one 340A; Business Express, two 340As; Cityjet, two 2000s; Kaiken, one 340A; Lithuanian, two 2000s; Macair, two 340Bs; Kendell Airlines, one 340; Regional, six 2000s; Chautauqua, one 340, and unannounced, six 340Bs. Saab during the year also completed previously arranged deliveries to Mesaba with 22 340s, SAS with two 2000s, and Medair with two 2000s.
Used Regional Aircraft Transactions October 1998 Previous Carrier No. Type Engines Operator Aero Cuahonte 1 Metro III TPE331-11U- Berry Aviation 611G Ages Aircraft 1 DHC-7-102 PT6A-50 Paradise Island Int'l
Wexford Management has reduced its orders for Embraer regional jets. The Greenwich, Conn., financial firm that owns US Airways Express Chautauqua Airlines has halved its firm order for 20 ERJ-145s but retained options for 20 additional 50-seaters. It also canceled a letter of intent for 20 37-seat ERJ-135s plus 20 options. It was thought that a number of those airplanes would be put out on lease to other carriers and that a number would be placed with Chautauqua.
United yesterday posted fourth quarter earnings of $156 million, down from $222 million a year earlier, as weak yields took a bite out of profits throughout the quarter and during the December holiday rush. "In the second half of December the yield picture was very gloomy," as fare sales hurt pricing, said Senior VP Planning Rono Dutta. Yield declined 3% in the quarter and 2% for the year, and Dutta said "yield is the question" - not bookings or load factor - for early 1999. After a 12.2% pre-tax margin in 1998, United is targeting 11.8% this year.
Atlantic Southeast pilots long have yearned for a "flow-through" agreement with Delta, whereby they would move up to the mainline to fill vacancies - an advantage recently gained by Continental Express pilots (although COEx is wholly owned). Delta traditionally has turned a deaf ear to such an arrangement but apparently has changed its tune. Some pilots now think that the change in attitude may amount to a "flow-back" policy - if an economic downturn leads to a down-gauge trend to regional jets on mainline routes, Delta pilots could take ASA jobs.
Colgan Air, requesting eight slot exemptions at New York LaGuardia, told DOT that access to LaGuardia is "especially critical to Colgan's ability to continue to provide service to Charlottesville [Va.] and Nantucket [Mass.]." The carrier said it "would consider expansion of service to other small/medium communities, including Roanoke, Va., and would explore the use of regional jets." The carrier, turned down for LaGuardia slots under this docket (DAILY, April 22, 1998), said "all of Colgan's markets will be jeopardized" if it cannot obtain assured access, through per
Canadian Airlines reported a 2.4% increase in traffic on 2% more capacity systemwide for December, pushing the load factor up 0.2 percentage points to 66%. The carrier flew 1.3 billion revenue passenger miles on 2 billion available seat miles. Domestic RPMs dropped 7.7% to 394 million on 2.3% fewer ASMs, 605 million, which reduced the load factor 3.9 points to 65.1%. International RPMs grew 1.8% to 851 million and ASMs 3.9% to 1.3 billion, boosting the load factor 1.9 points to 67.2%.
America West Holdings yesterday reported the best fourth quarter and annual profits in its history, and it managed to raise yields as well just as yields are falling at other airlines. Fourth quarter net income reached $20.2 million, up 0.3%, and annual profits were $108.6 million, up 45%. "This was a very good quarter in a really fantastic year," said Doug Parker, chief financial officer. For the first time, America West's annual revenue topped $2 billion, growing 5%.
FedEx pilots have voted down a dues assessment extension their union said it needed to keep the special contract information office open and make up a negotiations committee shortfall. The assessment, for one hour of pay per month, runs out at the end of January. Pilots voted 1,082 for and 1,318 against the extension. The union has formed a subcommittee to look at alternative funding plans and offer recommendations.
Don Carty, chief executive of AMR Corp. and American, will speak Jan. 27 at an International Aviation Club luncheon at the Marriott Metro Center, Washington. For information and reservations, call John Ash, 202-457-0212.
DOT needs to determine whether there is a "sufficient basis" to meet next month on even an informal basis with U.K. aviation representatives, DOT Deputy Assistant Secretary Patrick Murphy said yesterday at a Senate Commerce Committee hearing. Casting uncertainty on informal U.S.-U.K. talks scheduled Feb. 17-19 in Washington (DAILY, Jan. 12), Murphy said lack of viable slot access to London Gatwick Airport for US Airways and Continental service from Charlotte and Cleveland, respectively, poses "hurdles" for the first U.K. negotiations since the U.S.
FAA is considering a number of increases in passenger facility charges (PFCs) for the fiscal 2000 budget but has not received Clinton administration endorsement yet, an FAA executive testified yesterday. David Traynham, assistant administrator for policy, planning and international aviation, told the Senate Commerce Committee that FAA is "considering a variety of PFC increase proposals." Traynham hedged on whether any of the PFC proposals will make it into the administration's budget, which is scheduled to go to Congress in less than two weeks.
U.S. National and Regional Carriers Traffic December, 12 Months 1998 December December % 1998 1997 Change Air Wisconsin Revenue Passenger Miles (000) 87,661 51,168 71.3 Available Seat Miles (000) 127,807 84,875 50.6 Load Factor (%) 68.6 60.3
PEAR Industries said yesterday it has developed an aircraft insulation material that exceeds FAA standards by a two-to-one margin. The company, anticipating an FAA rule requiring insulation retrofits, sees "a potential $2.4 billion marketplace." Under proposals expected from FAA, newly manufactured aircraft "will also be required to use these materials, representing significant additional market potential."
American asked DOT for exemption authority for scheduled combination service between the U.S., via points in Fiji and New Zealand, and Sydney, Melbourne, Brisbane, Cairns and Perth, Australia, and beyond to points in New Zealand. The carrier wants to integrate the exemption with existing authority to serve Australia, Fiji and New Zealand, and use it to expand its code share with Qantas, which applied separately for amended authority.
Continental will begin daily nonstop New York/Newark-Tel Aviv service in August, pending Israeli government approval, using new 777 aircraft. Continental VP-International Barry Simon said the service is the carrier's first to the Middle East "and marks a major step in the further development of our hub at Newark International Airport." The 777 will carry 48 BusinessFirst and 235 coach passengers. BusinessFirst features extra-wide electronic sleeper seats with laptop computer outlets, telephones and personal entertainment systems.
Spanish pilots union Syndicato Espanol de Pilotos de Lineas Aereas (Sepla) called for 15 days of strikes between Jan. 26 and March 26 at Iberia's regional subsidiary, Aviaco. Sepla is protesting Aviaco's failure to hire new pilots, as agreed in an accord reached last April 22. The airline replied publicly that the only reason it has not hired pilots so far is that the union representatives at Aviaco failed to agree with those of Iberia on a common promotion system that would be compatible with the group-wide system defined last year.
Garuda Indonesia has deferred delivery of four 737-300s and two 737-500s until 2001. The aircraft, the last in an order of 17 737s placed in 1996, initially were to be delivered on a staggered basis from November through March 2000. Five -300s and one -500 were delivered Jan. 2, and the other five aircraft were delivered in December 1997. The new aircraft will serve domestic and regional routes, including Kuala Lumpur, Singapore and Hong Kong.
Taxes took a bigger bite out of US Airways Group's profits in 1998 than in 1997, resulting in a fourth quarter net profit of $104 million, down 78.3%. The company's results were affected by a 40.3% tax rate, up from 15.8% in 1997. Excluding one-time and unusual items, net income still fell 15.8%, however, and operating profits rose 20.9%. US Airways' net margin for 1998 fell 1.3 percentage points to 6.2%, excluding non-recurring events.
Senate Majority Leader Trent Lott (R-Miss.) has joined opposition to a hike in passenger facility charges.In remarks posted in the Jan. 19 Congressional Record, Lott said he is "not a fan of user fees....These are taxes, period. The goal of this Congress is to cut taxes, not increase them." Lott said higher PFCs would force people to reconsider travel plans.
