Fairchild Aerospace is leaning toward issuing bonds rather than an initial public offering to help finance development of the 728JET family of new regional jets. But nothing will happen before the first of the year, according to a source familiar with the deal. "We are not leaning toward an IPO. We are looking at a recapitalization for working capital, but we are leaning more toward debt than equity," the source added, noting that the company is spending $50 million in R&D this year, which will affect earnings during the next few years.
Arinc and Oricon Technologies entered an agreement for joint marketing, installation and support of the Ground Safety Tracking and Reporting System (GSTARS) to civil and military airports and airfields in the U.S. and other countries. The system is being demonstrated at the Long Beach Municipal Airport and is planned for installation this fall at MacDill Air Force Base near Tampa.
Air traffic control inefficiencies and delays cost Association of European Airlines members as much as 2.5 billion European currency units (US$2.5 billion) per year, AEA said in its 1998 Yearbook. The association said 19.5% of its members' European flights were delayed by more than 15 minutes in 1997, up one percentage point from 1996 and back at the "crisis" levels of the late 1980s. And unlike 1996 and 1995, 1997 delays were high throughout the year, not concentrated during winter months. The 1997 peak was in July-September.
Austrian Airlines will inaugurate weekly service today to Astana, the new capital city of Kazakhstan, serving the route with Airbus A310 aircraft. Austrian said it will be the first European airline to serve Astana, formerly named Akmola. It intends to resume three-times-weekly service to Alma Ata, the former capital of Kazakhstan.
Malcolm Field, chairman of the U.K. Civil Aviation Authority, and Ministry of Defense Air Chief Marshall Richard Johns announced an agreement to form a single board to assess "airprox" (near midair) incidents. The U.K. Airprox Board will be launched later this year, and applicants to be its director are being sought. Currently, near-collision reports filed by pilots are assessed by the Joint Airprox Working Group, while reports from air traffic controllers are weighed by the Joint Airprox Assessment Panel.
Senate Commerce Committee Chairman John McCain delivered on his pledge to ask for only a 30-slot increase in daily Chicago O'Hare operations, down from the 100 he first proposed in the Senate FAA reauthorization (DAILY, July 20). The bill retains more slots and changes to the perimeter rule at Washington Reagan Airport, though bargaining continues on that front, and alterations to Airport Improvement Program allocations.
Mercury Air Cargo, a subsidiary of Mercury Air Group, said it has been certified as a Part 135 air carrier by FAA for domestic cargo operations. "We have finally achieved a long-held dream to be categorized as a certified air carrier," said Seymour Kahn, chairman of Mercury Air Group. As a certified air carrier, Mercury will be able to expand and add services to its existing cargo space logistics and charter services, Kahn said.
Northwest's Air Line Pilots Association unit leadership met yesterday with Minnesota Gov. Arne Carlson to discuss the labor situation and possibility of a strike. Northwest and its pilots union, who will return to the bargaining table Aug. 17, face a possible strike or lockout if they do not reach a tentative agreement by Aug. 29. Carlson and governors of six other states wrote President Clinton this week, asking him to intervene if pilots walk off the job (DAILY, Aug. 5).
FlightSafety Boeing Training International said yesterday it has selected two sites in London as finalists for a proposed $85 million European training hub, its first outside the U.S. and part of a global network of large-scale training centers. The facility, scheduled to open in the first quarter of 2000, will be located at London Gatwick or London Heathrow Airport, the company said. Dick James, president, Boeing Europe, said FlightSafety has been working for four months with representatives of several European countries to review sites for the new hub.
British Airways has resumed service between London and Lagos, Nigeria, and is offering special roundtrip fares from its 22 U.S. gateways through the end of September. The fares represent savings of 48% to 87% off the regular air fares for this period, depending on the gateway. A minimum five-day stay is required, and a maximum of two months is allowed. Stopovers in London cost $99 extra. Bookings must be completed by Aug. 14.
Rolls-Royce said yesterday it will offer a 95,000-pounds-thrust derivate of its Trent 892 engine. The Trent 895, to be certificated in 1999, will be capable of 180-minute extended-range twin-engine operations from entry into service in 2000, Rolls said. The company intends to increase the temperature margins that are cleared in the current engine design.
New Aircraft Orders And Options May 1998 Last 12 Months Firm Orders Options Orders Options Carrier # Type # Type Engines Del. Dates # Type # Type Aer Lingus 6 A320-200 - CFM56-5B4/P Jun00-Jul02 9 A321-200 - Aer Lingus - - - - 1 A320-200 - Air Berlin 2 737-800 2 737-800 CFM56-7B 00- - - Air
Northwest and its International Association of Machinists and Aerospace Workers unit will resume negotiations following rejection of four of five tentative contracts by the IAM rank and file. The results, projected in exit polls during the past several days and made formal yesterday, were hailed as "the most striking display of solidarity in recent years" by the IAM.
Dimensions International and SkySource announced a cooperative agreement to develop air traffic management and information exchange systems. The agreement focuses on developing commercially available services and tools to support the exchange of information, particularly terminal area information that will enable airlines to manage hub operations better, they said. The companies plan to provide services using a fee-for-service concept aimed at reducing significantly the time and cost of a standard government procurement program.
DOT granted Voyageur Airways an initial two-year exemption to conduct scheduled combination service between any points in Canada and any points in the U.S., passenger and cargo charter operations between Canada and the U.S., and other passenger and cargo charter operations. The Canadian carrier may use only small aircraft for services authorized under the exemption, a restriction Voyageur agreed to in its application (DAILY, July 24). It intends to display Air Canada's code on its scheduled U.S.-Canada services, using Beech 1900D aircraft. (Docket OST-98-4149)
China Airlines and Singapore Airlines have announced the signing of a Memorandum of Understanding (MOU) for the formation of a strategic alliance aimed at upgrading the competitiveness of the two airlines on the international market. The MOU, which calls for setting up a long-term multi-dimensional cooperation between the two companies, was signed Tuesday Taipei by CAL Chairman Hung-i Chiang and SIA Chief Executive Cheong Choong Kong. A legally binding formal contract will be signed within six months.
President Clinton said he intends to nominate Peter Basso to be DOT assistant secretary for budget and programs, replacing Louise Stoll, who left DOT. Basso has been Stoll's deputy.
American objected "strongly" to DOT's decision to award the "lion's share" of Tokyo Narita slots to cargo carriers, arguing that the department stressed the primacy of passenger service when it announced the new bilateral agreement with Japan. American received two of 22 available while cargo carriers Polar and UPS got 16 and two, respectively.
Continental reported a 12.6% increase in systemwide traffic on 11.3% more capacity in July 1998 from July last year, which boosted the load factor 0.9 percentage points to 77.2%, the highest in company history. Domestic revenue passenger miles rose 9.5% and available seat miles 8.8%, which boosted the load factor 0.5 points to 77.2%. The biggest increases came in international traffic, where RPMs jumped 19% and ASMs 16.7%, creating a 77.2% load factor. Jul 98 July 97 7 Mths 98 7 Mths 97
Tower Group International has signed an agreement with Trans Global Logistics, its Hong Kong-based air freight partner, to create Tower Group Asia, a service that will operate to 30 cities in 17 countries, from the Indian Ocean to the Pacific Ocean. Donald Woo, former president of Trans Global Logistics Hong Kong Ltd., will lead the organization.
Airlines Reporting Corp. said travel agency burglaries increased in the Midwest in July, and it is posting a photograph of the suspect on its web site, www.arccorp.com. The suspect, who operates under many aliases, has an arrest record for burglary and attempted theft in several states.
U.S. airlines are "much more financially fit" to withstand a downturn than they were in 1988, when they peaked on the way to four years of catastrophic losses, according to Merrill Lynch. The spread between average and breakeven load factors is bigger, near-term plans for capacity growth are more modest and hub dominance is greater, the company says in its quarterly industry review.
The American Society of Travel Agents, responding to an advisory from Northwest, is telling members to prepare for a pilot strike at the carrier by issuing paper tickets and booking on other airlines if clients have special needs or are traveling with small children. Carriers have no legal obligation to do anything for the consumer if a strike occurs, said ASTA Consumer Advocate Ed Perkins. Minneapolis/St. Paul, Detroit, Memphis and Tokyo will be hit hardest if Northwest pilots strike, Perkins said.
House Transportation aviation subcommittee will hold a hearing today on FAA's procedures for emergency revocation of pilot licenses. Room 2167, Rayburn, 9:30 a.m.
