Philippine Airlines will be a problem for lessors as it guts its fleet to become a radically smaller carrier. Forty aircraft are being returned to lessors, including A340s to Airbus and 747-200s to American Express Leasing. Several of the dozen 737s leased through GECAS and GPA already are on their way to London, having been the lift to launch British Airways' GO operation recently.
Part of the FAA/Airport Improvement Program reauthorization approved last week by the House Transportation Committee is a five-year renewal of the war risk insurance guarantee program for civil aviation. Praised by Rep. James Oberstar (D-Minn.) as essential to troop transport for the Persian Gulf War, it enables the government to make immediate reimbursement for aircraft hull losses while an airline pursues recovery from its insurance company.
Aeroflot took delivery last week of the first of two 777-200ER aircraft from International Lease Finance Corp. The second is scheduled for delivery at yearend. The carrier will use the GE90-powered aircraft to expand service from Moscow to New York and London.
- In Federal Register dated June 19...Issued an airworthiness directive on CFM International CFM56 engines requiring inspection for cracks or gouges in certain high pressure turbine rotor disks...Superseded an AD on British Aerospace Jetstream aircraft concerning inspections of the main landing gear...Revised an AD on AlliedSignal T5313/17 series engines concerning inspections of accessory drive carrier assemblies. - In FR dated June 23...Issued special conditions on Douglas MD-80 aircraft concerning high-intensity radiated fields.
American, Continental, Delta and United filed exhibits Friday in DOT's U.S.-Brazil combination frequencies proceeding, outlining service proposals for the seven frequencies that become available to the four incumbent carriers Oct. 1. Delta has the support of the City of New York, the Port Authority of New York/New Jersey and the Massachusetts Port Authority. The City of Houston and the Greater Houston Partnership supported Continental, which is the only one of the carriers' gateways without nonstop service to Brazil. Each carrier seeks award of all seven frequencies.
Negotiations among parties to the Dallas Love Field/Wright Amendment lawsuits began Friday with former Texas Supreme Court Justice Ruby Kless Sondock as mediator, a day after Texas District Judge Bob McCoy of Fort Worth issued a temporary restraining order prohibiting for 14 days the launch of Continental Express service between Love Field and Cleveland. McCoy will hear arguments this week on a permanent injunction against the three daily EMB-145 flights, which had been scheduled to begin Wednesday.
American and British Airways already have received some benefits from collaboration they are allowed to start prior to government action on their proposed strategic alliance.With frequent flyer cooperation and enhanced interlining implemented, the carriers have interlined many more passengers this year than last, said American Chief Financial Officer Gerard Arpey.
Varig traffic for May increased 13.6% to 2.2 billion revenue passenger kilometers. The airline's passenger count grew 16.2% to 896,000 and cargo volume fell 1.9%. The passenger load factor was 68% on international routes and 56.3% domestically. Traffic has risen 9% so far this year.
British Airways and Malev are in discussions that will lead to a code-share and marketing alliance, but BA deflected speculation Friday that it will acquire a substantial equity stake in the Hungarian flag carrier. BA spokesman John Lampl said the carrier "is talking to Malev about cooperation" and hopes the agreement can be finalized soon, but he called "purely speculative" press reports that BA would acquire a 25% stake in Malev.
MetroJet will begin twice-daily nonstop service between Boston and Tampa on Sept. 9. The US Airways low-cost operation also will add service between Tampa and Hartford, Conn., and Baltimore-Washington International Airport and New Orleans, and a third flight between BWI and Jacksonville, Fla.
British Airways' London Stansted-based GO division will launch service July 23 to Lisbon, its fourth destination. GO serves Rome, Milan and Copenhagen.
DOT officials unalarmed by the prospective National Research Council airline competition update are counting on the past being prologue. NRC's 1991 study, titled "Winds of Change," found "keen" competition but warned that hub domination and other trends "create an almost inevitable drift toward single-carrier dominance at many hubs, which further reduces competition...and gives the dominating carriers an opportunity to exercise market power."
Defense Department is examining "about five different frequencies" for a possible second civil Global Positioning System signal, "and some may call for large bills," says Mike Shaw, the Pentagon's GPS coordinator. "So the question to FAA is what are the merits" of the second frequency. An FAA official, Steven Zaidman, says that "we have not given it as much thought as we should."
Atlantic Coast Airlines is committed to using Global Positioning System navigation in its operations but often finds that FAA has no processes in place to enable it to make the transition, Thomas Moore, the regional carrier's executive VP and chief operating officer, told the RTCA Spring Forum last week in Washington, D.C. Moore called for a "national forum" to address a "process for designing and implementing GPS operations." FAA "has developed all this technology but is not doing anything with it," he said.
Midway Airlines is conducting a July 4th sale to East Coast destinations. Sample roundtrip fares from Raleigh/Durham include $79 to Jacksonville, Fla.; $99 to New York LaGuardia or Newark, and $109 to Boston. Travel must begin July 4 with a return on July 4 or July 7-9.
Austrian Airlines will offer twice-weekly scheduled service to Anapa in southern Russia, beginning Sept. 14. Anapa serves the region's capital, Krasnodar, and the seaport city, Novorossijsk. The service will connect Vienna to Anapa via same-day roundtrips on Mondays and Thursdays, using a Fokker jet aircraft. The initiative is part of Austrian Airline Group's plan to expand its route network eastwards. AUA began service to Kharkiv, Ukraine, in April and Tbilisi, Georgia, in May.
Regional organizations in France, England and The Netherlands have launched Exporting Cultural Heritage Overseas, a tourism promotion initiative sponsored by the European Union. The ECHO project, designed to encourage North Americans to explore places familiar to many of their ancestors, encompasses the French Norman cities of Le Havre and Cherbourgh; Poole, Bournemouth, Portsmouth and Southampton in England, and the Golden Circle of The Netherlands.
DOT issued six U.S. carriers certificates to serve to Japan under the new U.S.-Japan agreement, consistent with authority they were granted earlier. Continental, Northwest and United received combination certificates and FedEx, Polar Air Cargo and UPS all-cargo certificates. Since the agreement "technically remains a limited-entry regime," the certificates were awarded for five years. (Dockets OST-96-1200, 96-1201, 98-3441, 96-1331, 98-3435, 98-3491, 98-3477)
The Independent Association of Continental Pilots (IACP), which represents Continental Express pilots, will ask the National Mediation Board to schedule a new round of talks between Express negotiators and management within a week to 10 days. The pilots rejected on June 19 a tentative contract agreement that would have raised salaries of about half the pilots from $15,000 to $19,000 annually. Prior to the rejection, more than 95% of Continental mainline and Express pilots had voted to strike if necessary.
House Transportation Committee's action on DOT's predatory policy turns around competition views held by key aviation figures, according to a government source, who recalled former American chief Robert Crandall's statement that "there's no such thing as predatory behavior" and former DOT Secretary James Burnley's comment that DOT lacked authority to examine domestic alliances. Rejecting those stances, the proposed bill would permit DOT to continue developing the policy and would grant the department new power to review alliances, the source noted.
Atlas Air appointed Thomas Scott general counsel. Delta promoted Brenda Barnes to VP-pricing and revenue management. Emirates named Bonnie Nichols sales executive in the Houston office. Mesa appointed Robert Hornberg Jr. manager of information services. Northwest appointed Todd Anderson director of customer service-Japan and Eric Van Horne managing director-operations performance.
Alaska Airlines is offering special fares from San Francisco, Los Angeles, Phoenix and Las Vegas to Vancouver for Canada Day celebrations on July 1. Roundtrips cost $108 from San Francisco and Phoenix, $137 from Los Angeles, and $130 from Las Vegas. Travel must originate June 29-July 1 with a return July 1-4. A minimum stay of June 30 or July 1 is required.
WestJet Express submitted a request at DOT to change its name to Allegiant Air. The California-based startup carrier, found fit to begin operations in April by DOT, is wholly owned by Chairman and Chief Executive Mitchell Allee. It told DOT it wants the name change because of "trademark and copyright conflict" with West Jet Air Center, Rapid City, S.D., a fixed base operator. DOT earlier noted the similarity of the carrier's name to WestJet Airlines Ltd. of Canada (DAILY, Jan. 28). (Docket OST-97-3270)
Southwest Airlines will offer twice-daily nonstop Albuquerque-Oakland service beginning Oct. 25 in an attempt to improve connections for passengers flying north. The carrier set a $125 one-way fare based on roundtrip travel with a seven-day advance purchase and an overnight stay. Other restrictions apply. Southwest also has added a fourth daily nonstop roundtrip between Houston Hobby Airport and Jackson.
