The Business Travel Coalition (BTC) last week said continued mergers, acquisitions and code-share alliances will seriously hurt businesses and communities and further strengthen fortress hubs. BTC President Kevin Mitchell wrote DOT Secretary Rodney Slater and Assistant Attorney General Joel Kline expressing serious concerns over the pending American-US Airways alliance, which he said is a response to the pending Continental-Northwest alliance.
The breach-of-contract suit Boeing filed last September against US Airways has been resolved, the companies said Friday in a joint statement. They declined to disclose details of the accord but said it includes a payment by the airline to Boeing "in response to the breach of contract, which US Airways acknowledged." When ii filed the suit against its longtime customer, Boeing charged that US Airways breached "firm contracts" to take delivery of eight 757s and 40 737s (DAILY, Sept. 15).
Sen. Fritz Hollings (D-S.C.) said that the British government's decision to deny US Airways a timely landing slot at London Gatwick for service from Charlotte will "force" him to oppose new U.S.-U.K. passenger service by any British carrier. "U.K.-based airlines should now consider reserving cruise liners...because there will be no new airline service until this dispute is resolved," Hollings stated. US Airways postponed startup of the service for lack of useful Gatwick slots (DAILY, April 22). Sen.
Air Traffic Services should be run by a single organization headed by a single person who reports directly to the FAA administrator, the FAA Research, Engineering and Development Advisory Committee said Friday. After two days of meetings, the group made ATS organization its No. 1 recommendation to Administrator Jane Garvey. The group also called for the continuation of R&D beyond Free Flight Phase 1 to define the evolution of the National Airspace System.
Air Canada posted a C$4 million (US$2.76 million) operating a profit in the first quarter, its best showing in the period in 10 years. Despite the C$71 million year-over-year improvement, the carrier still reported a net loss of C$26 million (US$18 million). The loss compared with last year's C$81 million net profit, the result of a C$171 million pre-tax gain from the sale of Continental Airlines stock. Air Canada posted strong yield and traffic gains in the domestic and transborder markets.
Midway will begin service between Columbus and Raleigh/Durham June 15, offering three daily nonstop roundtrips using its fifth Canadair Regional Jet. The carrier also will add a sixth daily Raleigh/Durham-Boston nonstop roundtrip. It operates the Boston flights with A320s and Fokker F100s.
Smaller-community advocates remain unconvinced that only the free market should determine what kind of air service, if any, non-hub cities receive. Sen. Ron Wyden (D-Ore.) said last week, "There's a sense where 20% of the country should be national sacrifice zones." Sen. Byron Dorgan (D-N.D.) bemoaned his state's status - it is served by only one jet airline, Northwest, down from five in 1978.
Although US Airways and American may take time obtaining pilot approval for a mainline code share, the regional airline links that both sides will start immediately are extensive. Together, the two carriers own or have relationships with 15 regional airlines, with four wholly owned by American and three by US Airways. American's regional bases stretch from New York Kennedy to Miami, Dallas, San Juan, Chicago, Boston and Los Angeles.
Airport Authority of Washoe County said it plans to appoint Miles Crafton interim director-administration and Richard Bennett acting executive director upon the departure of current executive director, Robert White, July 1.
Complaints over airline competition and small-community access from numerous members of Congress at last Thursday's House Transportation aviation subcommittee hearing (DAILY, April 17) illustrate growing pressure for government intervention. But the competing interests of congressional districts and disputes over the incidence of predation, voiced at Thursday's Senate Commerce aviation subcommittee hearing, will hobble attempts at adopting legislation.
Alaska Air Group posted record first quarter profits of $13.3 million, a turnaround from the customary loss, which was $5.7 million last year. Revenue rose 9.5% to $416 million. "The first quarter traditionally has been our toughest, so we're thrilled to be starting 1998 in such a strong fashion," said Chairman John Kelly. Alaska Airlines benefited from strong yields and low fuel prices, while regional subsidiary Horizon Air chopped unit costs and grew traffic more than capacity.
Delta Chief Executive Leo Mullin's inability to gauge pilot response to a major alliance with United is "incomprehensible," said PaineWebber analyst Sam Buttrick. "It's the second high-profile foul-up since he's been there, and if he assumed the pilots would roll over on code sharing, it's hard to believe. It reflects poorly on the chief executive."
United reduced fares for travel this spring between Los Angeles and seven domestic points. The roundtrip fare is $297 to Newark or Washington Dulles, $289 to Boston, $301 to Dallas/Fort Worth, $309 to Miami and $319 to Fort Lauderdale. The sale fares are non-refundable and require a 14-day advance purchase and a Saturday-night stay. Travel must be completed by June 14. Roundtrip travel to Honolulu, $250, requires a seven-day advance purchase and must be completed by June 12.
Southwest cut fares between Las Vegas and Los Angeles, Burbank, Ontario and San Diego to $39 each way with a seven-day advance purchase. The fare, good for travel through Sept. 9, is limited and may not be available for flights during heavy travel and holiday periods. Travel must be roundtrip and include an overnight stay. The fare is subject to change until ticketed, and tickets are non-refundable but may be applied toward future travel.
Frontier and an institutional investor closed a transaction announced April 6 that will give the airline $14.2 million. The unnamed investor bought 4.4 million shares of common stock. Frontier will use the funds to add aircraft and to improve its current fleet of 14 Boeing 737s.
Delta pilots, whose contract subjects any domestic code share to their approval, held up the planned alliance with United last week before it could be concluded. The pilots told management their conditions for approval, and MEC Chairman Denny Dolan told pilots Friday the union will communicate with members before any decisions are made - a process that starts this week. "The best interest of Delta pilots will be protected," Dolan said. "Period."
Approved a one-year exemption renewal for Aeromexico to conduct scheduled combination service between Ixtapa/Zihuatanejo, Mexico, and Dallas/Fort Worth, and between Mexico City and co-terminal points Boston, Detroit and Philadelphia...Approved 10 roundtrip cargo charter flights by Florida West International Airways between points in the U.S. and points in Brazil April 22-30...Approved a charter by Class Travel Worldwide using an Allegro 727, MD-83 or DC-9 for 117 roundtrips carrying 165 passengers from points in the U.S. to Cancun/Mazatlan/Zihuatanejo Feb.
U.S. and Russian negotiators "made important progress" on updating the U.S.-Russia aviation accord during three days of talks in Washington last week, but "differences still remain," according to a DOT spokesman, who commented that much of the discussions centered on the current agreement's annexes, which expired in May 1997.
Northwest's maintenance staff continues to work "by the book," withholding more aircraft than normal from service. This has forced the cancellation of dozens of flights in Detroit and Minneapolis. The airline has responded by moving heavy maintenance to other domestic markets and to Asia.
