Aspen Mountain Air (AMA) has sought protection under Chapter 11 of the U.S. bankruptcy code, though the carrier vows to maintain its current operation serving 22 cities with 15 turboprop aircraft. Chief Executive Ron Stone said AMA has "secured interim funding" to continue operations. The company requested and received approval from the U.S. Bankruptcy Court in Dallas for an interim financing package with an unidentified investor. Aspen Mountain's agreements with travel agents and other airlines remain in effect.
Korean Air is negotiating to defer next year's Airbus and Boeing widebody deliveries until 2001 due to soft traffic in the region.The move would affect 11 747s, 777s and A330s on order. KAL still intends to take delivery of four 777-300s and four A330-300s scheduled in 2000.
British Airways posted a 24% rise in quarterly operating profits to #173 million (US$287.9 million), as poorer Asian results were offset by stronger traffic to continental Europe and North America. The airline's net profit, #131 million ($218 million) was lower because year-ago comparisons were unfavorable due to a one-time gain of #129 million from the sale of stock in former partner US Airways.
Predicting when DOT's proposed competition policy will be adopted is hard to say, according to DOT Special Counsel Steven Okun, partly because the department assumes it will face an injunction attempt by major airlines the moment it is enacted. Okun on Friday told travel agents belonging to the Commonwealth Business Travel Group, meeting in Arlington, Va., that other uncertainties include continued resistance from some quarters in Congress.
TWA's flight attendants have told the head of the carrier's pilots union that they have misgivings over the pilots' tentative contract agreement and suggested the IAM, which represents the carrier's cabin crew, would not have agreed to the terms. The critical remarks, expressed in a letter by International Association of Machinists District Lodge 142 President Sherry Cooper to Air Line Pilots Association unit Master Executive Council Chairman Joe Chronic, has raised the hackles of TWA ALPA leadership.
Reno Air has signed an agreement with Express Vacations, a newly formed tour company based in Reno, in which Express Vacations will operate QQuick Escapes, beginning Aug. 17. Travel agents and consumers will continue to contact Reno Air to make vacation package agreements. QQuick Escape Vacations currently offers packages to Southern California, Las Vegas, Reno/Lake Tahoe, Tucson and Vancouver.
Genesis computer reservations system is headed toward for-profit status, U.S. Travel Agent Registry President Bruce Bishins said yesterday, thanks to what he called airline reluctance to cede control over distribution channels. Bishins said he received only $25,000 in committed funding - from Reliable Insurance Co. of Canada - of the $50 million required to make Genesis non-profit. Bishins said vendors declined to commit to funding until an airline backed Genesis, and airlines declined because of the terms of the Genesis settlement plan.
Malaysia Airlines is evaluating the possibility of trimming its work force early next year to cut rising overheads. According to a MAS official, negotiations between management and the MAS Employees Union have started. The official said if the carrier's financial situation does not improve in the next five months, it will have no alternative but to lay off some of its 20,000 employees. An earlier proposal to introduce a voluntary retirement plan was abandon after review of the compensation MAS would have had to pay out.
United Airlines Cargo dedicated a 58,000-square-foot cargo transfer facility at Honolulu Airport as part of an overall investment of $30 million systemwide to improve cargo services.
American Eagle has inaugurated jet service between Shreveport and Chicago O'Hare, operating two daily roundtrips with new 50-passenger Embraer ERJ-145 regional jets, using O'Hare slots awarded by DOT in April.
Xiamen Airlines (XAL) of China will embark on a fleet modernization program over the next five years to meet demands of air travel in the next millennium. A XAL official, Chung Kuo, says a US$850 million loan secured from the Bank of China will be used to purchase new aircraft to meet its expansion plans and the anticipated increase of air travel in China. Chung declined to identify the type or number of aircraft that XAL is evaluating, although sources said it is keen on the 737-700 and the -800. Orders are imminent, the sources said.
American and the Allied Pilots Association have settled their contract language dispute, resolving conflicts over American's code share with Canadian Airlines. The union is suggesting that pilots who feel so inclined should feel free to fly overtime voluntarily. APA "reminded" pilots earlier that overtime flying was voluntary, and American had to cancel some flights in July because of a pilot shortage, an APA spokesman said.
TWA has agreed to pay a $50,000 civil penalty and $110,000 in legal costs to the California attorney general and Los Angeles County district attorney, who challenged the airline offer of training through its own academy to California reservations sales agents. TWA provided jobs and let applicants pay for training through payroll deductions. The state said providing training and jobs in this fashion violated California law. TWA admitted no wrongdoing.
AOM, the second largest French airline, is on the sales block, according to an announcement late last week. AOM is controlled by Consortium de Realisation (CDR), a holding company, which plans to sell its 99.5% stake in the carrier by the end of the year. CDR already has invited several major airlines to make an offer. So far, only Swissair has publicly declared that it is interested. The Swiss carrier, which signed a commercial cooperation agreement with AOM last September, said on April 27 that it wanted to purchase 20% of the French carrier.
New Zealand and Chile last week signed a broadly liberalized aviation agreement that falls just short of the common definition of open skies, since it requires both countries to approve the use of traffic rights from third countries. Airlines from both nations can operate freely between New Zealand and Chile and to points beyond without route or capacity restrictions. Code sharing, including third-country code shares, also is permitted; airlines do not have to ask for fare approval but may be required to notify governments of the fares they are charging.
US Airways yesterday said it will defer startup of Charlotte-London Gatwick until it can obtain "commercially viable slots." The move follows months of contentious negotiations with DOT. But the carrier will use its new slots to operate a second daily Philadelphia-London Gatwick flight, beginning Nov. 1. The first daily flight, begun April 1, has been "extremely successful," the airline said.
A General Accounting Office official expressed concern last week about consistency among FAA regions in issuing emergency revocations and the time they spend taking such action. Gerald Dillingham, GAO associate director for transportation issues, told the House Transportation aviation subcommittee that FAA issued emergency orders in about 3% of all enforcement cases, 3,742 out of 137,506, during fiscal years 1990-97. Only 1% of the revocations were overturned on appeal, he said.
National Transportation Safety Board said yesterday that the number of people killed in aviation accidents dropped to 976 in 1997 from 1,093 in 1996 "despite a large increase involving aircraft not registered in the United States." The 42,000 highway fatalities accounted for more than 94% of the total 44,603 transportation fatalities last year in the U.S. and its territories, the board said. There were 41,907 highway fatalities and 44,619 total fatalities in 1996, it said.
Office of Fair Trading Director General John Bridgeman's advice on the American-British Airways alliance on issues other than slots generally agrees with remedies proposed by European Union Competition Commissioner Karel Van Miert, with minor disagreement or calls for further discussion in areas such as travel agent commission overrides and airport facility transfers. None of the disagreements is as stark as the OFT's support for - and Van Miert's opposition to - compensation to American-BA for slot transfers (DAILY, Aug. 10).
FAA has awarded information technology contracts valued at $1.25 billion to 14 small or disadvantaged businesses in its "largest such outreach effort," the agency said Friday. DOT Secretary Rodney Slater said the awards give these firms an "opportunity to compete for federal contracts," and FAA Administrator Jane Garvey said the companies "bring superior talent and resources to the FAA." The contracts cover computer services ranging from help desk operations to investment analysis support.
Nashville, with less than half the population of Pittsburgh, has 25.6% more origin-and-destination traffic thanks to dominant carrier Southwest's influence on fares, says Morten Beyer&Agnew. US Airways dominates Pittsburgh.
LanChile reported a net loss of $3.9 million for the second quarter, which it described as the weakest quarter for for airlines in the Southern Hemisphere. Chief Executive Enrique Cueto said the second quarter results were in line with analysts' expectations. He said the loss was the result of a decrease in operating margin to 0.4% from 5.3% in the same quarter last year. Operating income rose 20% to $273.3 million.
America West's board authorized purchase of up to five million shares of publicly traded Class B common stock and all 5.4 million outstanding publicly traded warrants.
On Friday DOT, for fifth time, extended for 30 days the period for taking action on the US Airways' allegation that the U.K. violated the U.S.-U.K. bilateral. DOT said "not all issues have been fully resolved" for US Airways to begin Charlotte-London Gatwick service. DOT Secretary Rodney Slater approved British Airways' Denver-Gatwick service, expressing DOT's "satisfaction that US Airways had obtained competitive access to London's Gatwick airport" (DAILY, July 24). US Airways vehemently denied that all its slots are commercially viable.
