DOT approved a one-year renewal of American's authority to code share with Canadian Airlines International (CAI) on flights between the U.S. and points in Central America and the Dominican Republic over the objections of United, which urged the department to defer the request pending U.S.-Canada talks scheduled in March. United said it understood that Canadian delegation members "raised the issue of Canada's 'protectionist policy'" during bilateral talks last November.
Express Airlines I, the Northwest Airlink affiliate wholly owned by Northwest, posted a 22.5% traffic decline to 28.1 million revenue passenger miles in December, as capacity dropped 25.8% to slightly more than 50 million available seat miles. The resulting load factor - 56.1% - was 2.3 percentage points higher than the prior December's 53.8%. In August 1997, Express I transferred flying at Minneapolis/St. Paul to sister Airlink affiliate Mesaba Aviation, consolidating its own flying at the Memphis hub.
A DOT order extended for a second 30-day period the obligation of Mesa Airlines, d/b/a United Express, to provide essential air service to seven Western U.S. communities. Mesa filed 90-day notices on Oct. 1 of its intention to terminate service to Alamosa, Colo.; North Platte and Scottsbluff, Neb.; and Laramie, Riverton/Lander and Rock Springs, Wyo., which it is required to serve through March 6. On Oct. 7, Mesa filed to terminate operations to Worland, Wyo., which will receive service from Mesa through March 6.
American's petition for a proceeding on Northwest/KLM antitrust renewal asks that DOT require alliances to bear equal regulatory burdens and calls attention to constraints at Amsterdam Schiphol Airport that did not exist in 1992. The petition includes a Freedom of Information Act request for correspondence between DOT and Northwest.
Sources said MOU frequencies now loom as the biggest issue in U.S.-Japan talks after a surprising U.S. bid for 56 new frequencies in addition to the 90 nominally agreed to by both sides. The diversion of unused FedEx slots has not yet been the focus of discussion - possibly because it appears relatively settled - but same-country code-sharing remains a sticking point. Japanese negotiators are trying to determine whether the 56 frequencies are a bluff, sources said, though one observer suggested Japan might be willing to expand the number somewhat past 90.
Southern Air Transport said it has taken delivery of a 747-200F that it purchased from Northwest. The aircraft immediately flew to New York Kennedy from Miami to begin service for South African Airways, which operates three weekly flights from the U.S. SAT said it plans to increase its 747 fleet by eight by yearend. It also maintains four DC-8-70 freighters.
Delta posted its best December and calendar year profits ever, with net income of $966 million for 1997, up 28%. The airline, hitting on all cylinders, reported record annual operating income of $1.7 billion, up 20%, record December quarter net income of $190 million, up 51%, and record operating income of $332 million, up 47%. The company recorded an operating margin of 12%, up 1.2 percentage points. Chief Executive Leo Mullin cited strong business demand and a favorable fare environment for the positive results.
American parent AMR Corp. posted a fourth quarter net profit of $195 million, excluding one-time items, which was up 60% from the prior-year period. American's yield jumped 6%, buoyed by domestic fare increases that enabled the carrier to take in about $12 more per passenger in the fourth quarter. For 1997, AMR's net profit was down 3.1% to $985 million, and annual operating profit rose 4.7% to $1.9 billion.
Tower VP Guy Nachtomi, son of Tower founder Morris Nachtomi, is leaving the airline to return to Stanford University. Morris Nachtomi, who holds a 75% interest in the company, remains chief executive. The DAILY Jan. 20 incorrectly reported the departure of the elder Nachtomi.
Fairchild Dornier's 328JET flew for the first time Tuesday, making a one- hour 55-minute flight from Oberpfaffenhofen, near Munich. The first 328JET should enter service during the first quarter of 1999.
Boeing Chairman Phil Condit said yesterday the company will take a special fourth quarter charge of $1.4 billion pretax on the commercial jetliner products of the former McDonnell Douglas Corp. (DAILY, Jan. 15). The higher-than-expected special charge will result in a net loss for both the quarter and 1997, Condit said. This follows a Boeing announcement late last year that it was taking a $1.6 billion charge for the third quarter 1997 due to production line disruptions. At the time, it forecast that it would take another $1 billion charge this year (DAILY, Oct.
Continental, one of the few carriers to institute a fuel hedge a year ago, now has put in place a hedge against fluctuations in the Japanese yen. The airline's hedge level is 118 yen in the first quarter, 127 for the rest of 1998.
US Airways Group reported a 1997 pre-tax profit of $672 million, more than double the $275.5 million pre-tax gain in 1996. But after an accounting change that resulted in the company's taking a credit of $466.9 million in the fourth quarter, US Airways posted an annual net profit of $1.02 billion. The accounting boost recognizes tax benefits the company expects to realize in the future. In the fourth quarter, without one-time changes, net earnings were $137.5 million, and operating profit was $69.9 million, up 41.5%.
Frontier and Mountain Air Express said they will start code sharing March 4 in an agreement that includes "through" fares, joint ticketing and special baggage transfer services. MAX also code shares with Western Pacific. The code sharing links Frontier and MAX at Denver International.
Air China signed a purchase agreement for five 737-800s. Boeing said the aircraft are part of a 50-aircraft order placed during the Sino-American summit last October.
Israeli Transport Minister Yitzhak Levy has ordered Tel Aviv Ben-Gurion Airport to close daily between 1 p.m. and 3 p.m. to reduce danger to aircraft from thousands of birds flocking to a nearby garbage dump, according to Israeli press reports. Safety issues outweigh the inconvenience caused by disruption of airline schedules, Levy said.
United will resume service to the Hawaiian island Kauai on June 10, operating a daily 188-passenger Boeing 757 between Lihue and Los Angeles. United also is making a $2.5 million promotional investment in Hawaiian tourism programs, in addition to a planned investment of $3.2 million in 1998. Hawaii's suspension of landing fees for two years will save United $8 million.
UAL Services said it has won its largest maintenance contract since it was formed in 1995. UAL Services said that under a five-year contract with Northwest, it will repair that carrier's Pratt&Whitney PW4056 engines at UAL's San Francisco maintenance base. UAL Services said the contract is valued at more than $100 million over its life. "Northwest elected United over competitors such as Pratt&Whitney, Volvo, Delta and Singapore Airlines," said Gene House, director-maintenance services.
Pilots looking for jobs had a banner year in 1997, according to a survey by Atlanta-based AIR Inc. The company reported more pilots were hired in 1997 than at any other time in history, with 11,936 pilots finding work. Major airlines hired the most pilots, 32%, or 3,854, and national carriers hired 3,194. Jet operators added 1,946 employees to the payroll and non-jet operators 1,762. December was a strong employment month with 178 of 227 carriers hiring. Eight of the 14 major airlines produced 269 new pilot jobs in December.
European Commission yesterday adopted a policy it said will ensure a "full European role" in developing a Global Navigation Satellite System (GNSS). European Union Transport Commissioner Neil Kinnock said the market is "developing so fast that we need to develop now a strategy for the future" or be "locked out of a market estimated to be worth $50 billion by 2005." The commission needs to "decide whether to go it alone or to cooperate with our international partners," Kinnnock said. "We would greatly prefer to cooperate but only under the right conditions."
Northwest's Air Line Pilots Association Master Executive Council gave its negotiating committee authority to commence negotiations on a code-share pact with Continental as part of ongoing contract talks. It did not approve a deal. The DAILY erroneously attributed the action to ALPA's national organization (DAILY, Jan. 21).
Croatia Airlines has taken delivery in Hamburg of the first of six A319s, becoming the first operator of the aircraft in central Europe. The aircraft, powered by CFM56-6 engines, was named "Zadar" after the first aircraft ever manufactured for Croatia and after the city on the Croatian coast.
Although FAA expresses confidence that the computers controlling the air traffic control system can be modified to work in the year 2000, the company that built them is warning that they should be replaced before the turn of the century (DAILY, Jan. 20). An IBM official told Lockheed Martin, FAA's ATC systems integrator, that he had earlier expressed concern to FAA about the 1970s vintage 3083 computer systems. FAA said this week that Ray Long, who heads the effort to prepare the computers for 2000, is "too swamped" to talk.
FAA said yesterday that 91% of the affected foreign and domestic 737 horizontal stabilizers have been inspected for missing or loose bolts with no instances of any impact on flight safety.
