Impending downturn in the economy - some think a recession - would boost the fortunes of regional airlines, analysts are saying. The carriers with regional jets, they say, would allow mainline carriers to downgrade lift in favor of their regional surrogates on routes that would no longer support larger aircraft. The fact is that regional airlines carry 70% high-yield business travelers versus the mainline carriers' 40%.
Flight attendants at America West are receiving strike authorization ballots this week that could lead to CHAOS (Create Havoc Around Our System) campaigns if contract negotiations fail. The ballots will be counted Nov. 2 in Washington, D.C. America West flight attendants, represented by the Association of Flight Attendants since 1994, have been trying for four years to negotiate their first agreement with the airline.
Canadian Airlines is honoring 15 small businesses with awards that will help them market their products and services abroad. The carrier's annual Small Business International Expansion Program has chosen businesses from across Canada to receive airfare to and accommodation at the destinations they have requested. Each winner will use the award to pursue potential business opportunities in Asia, South America and Europe.
Scope clause restrictions on regional-jet operations in major-airline pilot contracts "are a significant impediment to greater competition in the U.S. domestic market and a significant inhibitor on more and better air service for small- and medium-sized communities" according to GKMG Consulting Services Inc. The Washington, D.C., firm is proposing "Proposition RJ" to move the issue into the forefront of the current airline-competition debate through a broad-based alliance of various interest groups advocating a change in scope language (see story below).
Sabre Group reported industry-high weekly sales for its consumer-direct online travel planning sites, including Travelocity, of $7 million for the week ended Sept. 20. The sales represent a week of gross bookings at an average of $1 million per day. Travelocity registered its four millionth member in September. It reached weekly sales of $6 million two months ago.
Fairchild Dornier has repossessed Aspen Mountain Air's fleet of nine Dornier 328 turboprops. The move forced the Dallas-based carrier to suspend service in a number of markets, including Dallas-Aspen; Denver-Aspen; Denver-Bozeman, Mont., and Dallas-Chihuahua, Mexico. The carrier also asked DOT to be able to withdraw from its Essential Air Service operations from Dallas/Fort Worth so it could turn back its fleet of four Metro 23s, which were becoming high-cost items. The EAS points include Hot Springs, Mountain Home, Harrison and El Dorado, Ark.; St.
British Midland Chairman Michael Bishop, who says he takes the business approach that "it's better to be promiscuous than committed," may trim his airline's network of 17 alliance partners as it expands across the Atlantic. "As our own operations change, we may have to scale that back a bit," he told The DAILY.
Leasing companies appear to be abandoning the 100-seater offerings by Airbus and Boeing, the A318 and the B717. They say the $30-million-plus price tag must be cut by a third to make the 100-seaters viable in the marketplace. That leaves the question of the 90-seaters proposed by ATR (70- to 90-seat AIRJET), Bombardier (BRJ-X 90-seater) and Fairchild Dornier (728JET family). Chop-downs, such as the Fokker F70, were not successful. Analysts say the new generation of 70- to 90-seaters can work only if it offers new technologies based on 70-seat platforms.
Polyot Airlines applied at DOT for a foreign air carrier permit and a one-year exemption to operate charter cargo service between the U.S. and the Russian Federation. The Russian carrier intends to launch on-demand services as soon as it receives DOT authority. It told DOT it was incorporated in 1989 under Soviet law and re-incorporated under Russian Federation law in 1994. It owns two Antonov An-124-100 aircraft and specializes in outsized cargo and equipment transfer. Polyot is a closed joint-stock company owned 95% by Anatoly Karpov and 5% by Igor Boev.
American Airlines Publishing and Genesis Direct have launched The American Voyager's Collection, a co-branded quarterly catalog, putting it aboard American flights in time for the start of the holiday shopping season. The collection features American Airlines licensed merchandise and brand names such as Donna Karan, Calvin Klein and Joe Boxer, plus travel merchandise and an assortment of products from Genesis Direct's portfolio. American also plans direct mail offerings to its top consumers and is pursuing electronic commerce opportunities.
Of 24,037 commercial flights operated across Europe's skies in September, 78.4% arrived on time, according to Eurocontrol. The Brussels-based air traffic management (ATM) organization said only 9.6% of the total reported ATM-related delays of less than 15 minutes, while the balance of 12.1% of flights experienced ATM-related delays of 15 minutes or more.
Tower Air asked DOT for exemption authority to operate scheduled combination service between New York, Boston, Miami and San Juan and Santo Domingo and Punta Cana, Dominican Republic. The carrier wants to begin the operations Dec.
Continental and Continental Express will start nonstop jet service twice daily between Birmingham and their New York/Newark hub, beginning Feb. 12. Continental service will be operated with 128-passenger 737-300 aircraft and Continental Express service with new 50-passenger Embraer 145 regional jets.
Suzanne Sullivan has been named FAA assistant administrator for government and industry affairs. Sullivan, who was DOT Secretary Rodney Slater's deputy chief of staff, succeeds Bradley Mims, who was named DOT deputy assistant secretary for aviation and international affairs to replace Mark Gerchick.
Lengthy deliberations about the future of U.S.-U.K. aviation and conditions for approving the American-British Airways alliance are delaying vital reforms of European aviation, according to Michael Bishop, chairman of British Midland. Bishop, in Washington this week to ensure his carrier's inclusion in any new U.S.-U.K. route authorities, said the two countries should press for a new bilateral air agreement because the alternative is ever-rising fares in "markets closed to competition."
Interest-based bargaining is catching on with airlines as a way to negotiate contracts that labor and management can live with, according to the National Mediation Board. The method is an alternative to traditional bargaining that calls for negotiating the terms of conflicting proposals and often produces agreements that leave neither party happy. The interest-based technique "provides a more durable contract," said NMB Mediator John Schrage.
Korean Air said it will spend more than $100 million on safety initiatives, pilot training and maintenance operations. Korean Air since 1983 has had five accidents, two of them fatal (DAILY, Oct. 12). The latest, in 1997, killed 225 passengers and crew, according to the National Transportation Safety Board. John Jackson, Korean's U.S. sales manager, said, "Any airline that has been flying globally for almost 30 years hits some rough spots along the way, and these past 14 months have been ours."
AirTran Holdings started off the third quarter airline earnings reporting season yesterday with a surprising loss of $10.9 million, slightly better than its $14.6 million loss in the prior-year period. The carrier blamed DOT and Delta for its predicament, saying DOT's "reversal of their position on predatory pricing" has "encouraged our major competitor to increase their predatory activities." AirTran shares a hub in Atlanta with Delta.
Northwest customers who buy tickets online at www.nwa.com or on the Microsoft Expedia site also can purchase a companion ticket for $99. The offer is valid for online transactions through Nov. 5. Upon purchase, customers will receive an electronic mail with a special promotional code to be used for a companion ticket with the customer's next purchase on Northwest .
Kjell Fredheim today becomes president and chief executive of SAS subsidiary Air Botnia. Currently managing director of Britannia Airways, Fredheim is a career executive at SAS, where he was executive VP and chief operating officer for five years until his appointment in 1995 as president of airBaltic. SAS fully controls Air Botnia and has a 28.5% stake in airBaltic.
Lufthansa will further internationalize its electronic ticketing (etix) Nov. 1, when the service expands to 27 more foreign cities in 14 countries. Lufthansa already offers ticketless travel from German cities to 17 foreign points.
Air Canada, whose pilots went out on strike Sept. 2-14, reported a 44.4% decline in traffic on 45.5% less capacity compared with September last year, which boosted the load factor 1.5 percentage points to 74.5%. Systemwide, Air Canada logged 1.2 billion revenue passenger miles on 1.6 billion available seat miles during the month. Domestic RPMs dropped 38.5% to 447 million and ASMs 39.7% to 564 million, causing the load factor to climb 1.6 points to 79.3%.
AeroMexico was granted same-day approval by DOT to begin service between Chihuahua and Dallas/Fort Worth. The Mexican carrier asked DOT Tuesday for expedited action on its application because American code-share partner Aspen Mountain Air announced on Oct. 9 that it is terminating service in the market, which receives no other direct service. AeroMexico plans to begin service in a few days.
