Despite more than $2.3 billion in airline investment, some elements of the aviation infrastructure will not be able to handle Year 2000 computer system changeover issues, according to IATA Director General Pierre Jeanniot. Some major systems will have completed upgrades and testing as early as next month, and Jeanniot is "quite confident" that most major air routes will have no Y2K disruptions. "But airline action alone cannot ensure business continuity," he said yesterday at an International Aviation Club luncheon in Washington.
DOT approved for one year a joint request by Air Canada and Mexicana for authority to code share between Chicago and named points in each carrier's homeland. Air Canada may display Mexicana's code on flights between Chicago and coterminal points Toronto, Montreal, Ottawa and Winnipeg, and Mexicana may carry Air Canada's code on flights between Chicago and Mexico City. In each case, authority is limited to traffic moving between Canada and Mexico. United supported the application.
Boeing executives told financial analysts and reporters yesterday that each of the company's programs will undergo scrutiny on a continuing basis and that any program that does not add value will be turned around, sold or dropped. Phil Condit, chairman, and Deborah Hopkins, chief financial officer, said Boeing will adopt three principles in an attempt to prop up the sagging value of its shares.
Air Transport Association said air fares fell for the fifth consecutive month in January. The average one-way fare dropped 3% and coach-class fares were down 4.9%. First-class fares rose 4.4%. ATA Chief Economist David Swierenga said, "The airline market continues to be highly charged and extremely competitive," causing air fares to decline.
International aviation organizations and foreign airlines told FAA yesterday its planned implementation of a new security rule will cost millions of dollars without increasing protection against terrorists. FAA is adopting a rule to enforce the 1996 Hatch Amendment, requiring foreign airlines operating into the U.S. to apply U.S. security standards at their home gateway airports when U.S. carriers operate on the same route. Critics say the rule violates sovereignty, bilateral agreements and Annex 17 of the Chicago Convention requiring consultation.
European Union competition authorities' apparent "discomfort" with hub-and-spoke networks threatens the next steps toward worldwide aviation deregulation as well as current transatlantic alliances, Michael Whitaker, United VP international and regulatory affairs, said Tuesday at the European Aviation Club in Brussels. Europe and the U.S. must "come to a more common appreciation" of hubs and alliances if they are to replace bilateral agreements with a U.S.-Europe pact, he said.
Passenger-protection legislation before Congress would be "direct intrusion between the airlines and their passengers" and could have "unintended consequences," Delta Chief Executive Leo Mullin said last week. If the government forces airlines to be less efficient, "we're all going to have to seek different ways to keep [profits] up." One possibility would be higher fares.
Atlas Air posted record fourth quarter net income of $18.1 million, up from $9.1 million the same quarter in 1997. Operating income was $47.1 million, up from $27.8 million. Revenue totaled $145.5 million, up from $120.9 million. For the year, operating income was $135.8 million, compared with $83.1 million in 1997, and net income was $46.2 million, up from $23.4 million. Operating revenue amounted to $422.22 million, versus $401 million.
El Al, responding to increasing demands for flights to Great Jubilee celebrations in Rome and Jerusalem, is offering bi-weekly service between New York Kennedy and Rome with flights every Monday and Thursday. Passengers can stop in Rome on their way to or from Jerusalem at no extra charge. El Al also offers daily flights between Rome and Tel Aviv except Fridays, when the airline does not fly because of the Jewish sabbath.
International Civil Aviation Organization (ICAO), sometimes described as deliberate yet ponderous, has come a long way in the past several years and has "become more assertive," said ICAO's U.S. representative Carol Carmody, who is leaving the organization this week after five years of service (DAILY, Feb. 24). She cited ICAO's adoption of a safety oversight program and its speaking out on Europe's push to set up separate engine emission standards.
Canadian and Japan Airlines have enhanced their code-share agreement allowing expansion from two to four flights daily between Tokyo and Vancouver, starting April 4. In the spring, Canadian's operations in Vancouver will expand from one daily international bank of flights to two.
The European Union, from all indications, will approve exclusion of some hushkitted U.S. aircraft from the European market despite requests in the past few days by secretaries Richard Daley, Commerce; Rodney Slater, DOT, and Madeleine Albright, State, and Ambassador Charlene Barshefsky, U.S. Trade Representative, "not to proceed further with this regulation until we discuss the problem," David Aaron, Commerce undersecretary for international trade, told Senate Finance Committee Chairman William Roth at a hearing Tuesday.
EVA Air's profit for 1998 fell more than 91% to 75.4 million new Taiwan dollars (US$2.3 million), although the airline showed a late-year improvement that led it to call the results "a turnaround." EVA had expected Asia's recession, lower tourism figures and turmoil in nearby Indonesia to have a greater effect. The airline posted a loss in the first half of 1998 but took several steps, including a greater cargo focus, to boost second-half returns. Despite the downturn, the airline was one of the few in Asia reporting a profit.
FAA Administrator Jane Garvey shed no light yesterday on how the Standard Terminal Automation Replacement System (STARS) will fare in program and schedule decisions that are due soon (DAILY, Feb. 12), but she left no doubt about her sympathies. "I don't think we could ask anything more" from air traffic controllers and STARS personnel working to cure the program's technical problems, she told the Aero Club of Washington.
National Transportation Safety Board is recommending that FAA require operators to disassemble and inspect more than 10,000 jet engines used on nearly one-third of the U.S. commercial fleet, a requirement a longtime industry consultant estimated could approach $5 billion in cost. The board's recommendation followed discovery of broken tie rods on a Pratt&Whitney JT8D-17A engine on a 727-200 operated by a Canadian carrier, Royal Airlines.
Kitty Hawk reported record earnings for the fourth quarter and the year ended Dec. 31. Quarterly net income jumped 125% to $11.5 million from $5.1 million, and revenues were up 13% to $236.7 million. For the year, net income rose to $16.6 million from a net loss of $960,000, while revenues increased 13% to $714.9 million from $631.3 million.
All Nippon Airways has created a family of jets with liveries derived from the popular Pokemon children's game and cartoon series by Nintendo. Two 767s and one 747-400 feature characters from the series.
DOT yesterday tentatively selected Delta for a U.S.-Italy designation available April 1, stating that "only Delta's proposal would open a new gateway to Italy and provide expanded gateway services between the American South and Rome" and noting that Atlanta is the largest U.S. market without nonstop service to Italy. US Airways' Philadelphia-Milan service proposal was granted tentative backup authority. The U.S. and Italy initialed an open-skies agreement in November (DAILY, Nov.
Continental, awarded a U.S.-Romania third-country code-share opportunity that becomes available Nov. 1 in a DOT order selecting Delta, Northwest and United for three such opportunities available April 1 (DAILY, Feb. 11) is not satisfied with that consolation prize. Continental filed an objection, asking DOT to designate it for one of the April 1 opportunities.
Air Canada is offering a fare sale of up to 40% off to more than 160 destinations through March 1. Travel must be completed by June 14. Sample roundtrip fares are Los Angeles-Toronto $266, Miami-Vancouver $369 and Nashville-Calgary $333.
American's Allied Pilots Association said yesterday it will not agree to a company request that both sides submit to arbitration in the dispute over Reno because arbitration implies the bargaining process has ended and the pilots still believe they can resolve issues at the table. American also suggested calling in a mediator, which APA spokesman Drew Engleke said the union has not ruled out. "The issue of scope and who is supposed to be doing flying for AMR is resolved," he said.
Fuel Cost and Consumption U.S. Majors, Nationals and Large Regionals December 1997 to November 1998 Total Total Cost Cents Per Gallons (Dollars) Gallon 1998 January Domestic 1,126,915,906 640,594,720 56.845 International 405,264,970 254,747,776 62.860
Continental will launch daily nonstops between Newark and Amsterdam July 15, using a DC-10 configured for 38 BusinessFirst and 204 coach seats. The service, Continental's 17th across the Atlantic, is subject to Dutch government approval.
SkyMall has formed an alliance with Northwest to bring its inflight catalog to the carrier's domestic passengers and develop joint marketing programs to attract airline customers to online SkyMall shopping. The three-and-a-half-year agreement provides that Northwest make the SkyMall catalog available on domestic flights, beginning June 1, and by the fourth quarter add a link to skymall.com to the carrier's web site.
