High-level, informal U.S.-Japan talks raised serious issues concerning slots, code sharing and beyond rights that may not be resolved after next week's formal round, set to start Monday in Washington. Chief negotiators Alan Larson, assistant secretary of state, and Jiro Hanyu, Japanese transport ministry deputy director general, discussed key issues in Washington last week but at a more general level than expected, sources said. Officials from both governments briefed U.S. and Japanese industry representatives after last week's informal talks ended.
U.S. and French negotiators made progress yesterday in Paris, according to informed sources, but a new bilateral probably will not result from this round.The two sides appear closer to agreement on code sharing, designating new airlines and a shorter transition period to broad liberalization, but they remain far apart on capacity issues. The U.S. will present a negotiating paper to France this morning, and the round may conclude later in the day.
Atlas Air's stock has been approved for listing on the New York Stock Exchange as of Nov. 11. The move from the NASDAQ market will alter the airline's stock symbol from ATLS to CGO.
America West, in a filing this week at DOT, accused computer reservations systems and travel agents of generating bogus charges and proposed protective measures for carriers that, like itself, do not control or have associations with large CRSs. American and United are shielded by such relationships - Sabre is majority-owned by American parent AMR Corp., and Apollo Travel Services Partnership, to be acquired by Galileo, is 77% owned by United, the filing said.
Rehired former PATCO controllers have expressed concern to the administration that FAA is dragging its feet getting them back to full- performance-level status. They say the agency is treating them "unevenly" in several other areas, including placing them in clerical roles, defeating the intent of President Clinton's directive to rehire qualified PATCO members.
British Airways will reinstate a fourth weekly flight to Harare, Zimbabwe, from London Gatwick, after a seven-month hiatus. The decision follows talks in recent weeks between the U.K. Department of Transport and Zimbabwe's Department of Civil Aviation.
U.S. and French negotiators meet in Paris today through Friday, resuming talks recessed without progress last spring (DAILY, April 25).The U.S. is pushing for open skies, but France's last proposal was a nine-year transition to expanded - but less than open - services. There is no current agreement, and the U.S. will not permit Air France to implement code shares with Delta and Continental until one is signed.
U.S. industry observers voiced skepticism about elements of a weekend Kyodo news service report about progress in U.S.-Japan talks, proceeding informally in advance of a formal round next week. Quoting unnamed Japanese sources, the story said the two sides are near a four-year "transitional" agreement that would let TWA start Japan service, impose limits on ANA's incumbency, add 70 weekly frequencies for U.S. carriers and limit some beyond rights for U.S. passenger carriers. The U.S. has given up its demand for third-country code-sharing, according to the report.
Eurofly, a charter joint venture set up by Alitalia and Italian electronics group Olivetti, is considering entering the long-haul market, according to Enrico Albanese, Eurofly's newly appointed general manager. The company's plans will be detailed in a three-year plan, to be unveiled later this month, he said. Eurofly, which specializes in short- and medium-haul charter operations, also will launch scheduled service between Rome Fiumicino Airport and Bergamo under a code share with Alitalia, starting Oct. 27.
DOT has given Congress its strategic plan for 1997-2002, the first required by law, and will integrate it into the budget cycle as a benchmark for the department's performance. Mortimer Downey, DOT deputy secretary, described development of the plan as an intense process involving political appointees, career officials and consultation with industry in all transportation sectors. "Every word in this document has been argued over by these people," he told reporters last week.
Lufthansa and British Midland will increase code-share service Oct. 27 between London Heathrow and Dresden, via Cologne/Bonn. This flight previously continued from Cologne/Bonn to Rome, but the airlines decided to substitute Dresden because traffic to Rome declines in the winter months. The new service will replace one of the three daily Cologne/Bonn-Dresden roundtrips currently operated by Lufthansa. It will be operated by British Midland with a 737 aircraft and carry a Lufthansa flight number.
Troubled flag carrier Cyprus Air is holding talks "with all interested parties" about a rescue plan compiled by British consultant Arthur D. Little, airline Chairman Takis Kyriakides said last week in Nicosia. He refused to comment on Cypriot press reports that the U.K. consultants suggested cutting 500 of the company's 2,000 employees, downsizing the fleet and privatizing some ground-handling services. The consultant's report suggests ways "to increase income, reduce costs, reorganize the company and reinforce its capital base," Kyriakides said.
Business Express (BEX), having invested its own funds for New York LaGuardia slots, filed against Spirit Airlines' request for an exemption from the high-density rule so it can fly two daily nonstops to Myrtle Beach, S.C. The service would replace operations shut down with the bankruptcy of Air South, which flew from Myrtle Beach to New York Kennedy. Spirit wants the slot exemption at LaGuardia, saying travelers strongly prefer Spirit on the route.
The German government priced its 143 million remaining shares in Lufthansa over the weekend and offered them for sale, the final step in the flag carrier's privatization. The bank consortium handling the sale said the issue was oversubscribed more than twice. The issue price was slightly below the shares' closing value quoted on stock markets last week. The government's 37.5% stake in Lufthansa was priced Sunday at 33.30 Deutschmarks per share, or approximately DM4.7 billion (US$2.6 billion), with all proceeds going to the government.
DOT approved a one-year initial exemption for Delta/Transbrasil code-share, blocked-space service between the U.S. and Brazil. Transbrasil will display Delta's code on flights between Brasilia and Recife; Sao Paulo and Manaus, Salvador, Iguassu Falls and Porto Alegre; and Rio de Janeiro and Salvador. Delta will carry online connecting Delta traffic to and from intermediate points but no Brazil-originating traffic. It will display Transbrasil's code on flights between Orlando and Los Angeles on a blind- sector basis.
American Airlines Vacations is adding a tour to Central and South America, featuring city stay extensions to eight destinations - Ecuador and the Galapagos Islands, Chile, Peru, Argentina, Brazil, Venezuela, Belize and Guatemala. The package comes at a variety of prices; for example, a Belize stay with breakfast and round-trip transfers starts at $132, but with extensions could range from $312 to $639 per person, double occupancy.
Private Danish carrier Maersk Air signed a code-share accord with Alitalia on routes between Italy and Scandinavia, effective Oct. 26. The routes are Copenhagen-Milan, Stockholm-Copenhagen-Rome, and Billund-Frankfurt-Milan. Maersk signed a similar deal with Air France last month (DAILY, Sept. 25).
American and Asiana asked DOT for immediate approval of their proposed code share now that opposing carriers have had the opportunity to make objections. Asiana's existing code share with Northwest will expire on Oct. 29. Opposing carriers said approval should be deferred until outstanding U.S.-Korea issues are resolved, including World Airways' inability to fly bilaterally authorized service beyond Seoul. American/Asiana said that even though an open-skies agreement with Korea has yet to be signed, DOT should allow Asiana to go ahead with the switch in its U.S.
Edzard Reuter will give up the presidency of Airbus Industrie's supervisory board "at the beginning of 1998 at the latest," the four members of the European consortium said yesterday. The mandate of Jean Pierson, chief executive, expires on March 31, 1998, which means a pair of new leaders during the last, delicate phase of its planned corporatization.
Used Jet Aircraft Deliveries July 1997 Carrier # Type Engines Previous Operator Air Europa 1 767-200ER CF6-80A2 Air New Zealand Air One 2 737-400 CFM56-3C1 Lufthansa Air Zimbabwe 1 BAe 146-100 ALF502R-5 Air Botswana Airbus Industrie 1 A310-200 JT9D-7R4E1 Sudan Airways
The trade unions of Sabena threatened their company yesterday with labor unrest if the Belgian airline chooses Airbus aircraft to replace its 13 aging Boeing 737-200s. The unions fear that the choice of Airbus will reduce the workload of maintenance subsidiary Sabena Technics to the benefit of Shannon Aerospace, the Irish maintenance joint venture managed by Swissair and Lufthansa.
Eurowings will increase service to Amsterdam Oct. 26 to feed the long-haul network of code-share partner KLM. The German regional carrier is doubling its daily Stuttgart-Amsterdam frequencies to six and will operate a fifth daily Hannover-Amsterdam flight. It also will operate five instead of three daily frequencies from Nuremberg to Amsterdam and add a fourth daily flight from Cologne and Paderborn/Lippstadt to KLM's home base.
Third quarter profits for U.S. airlines will be flat year over year, and despite expected healthy operating profits across the board, yields have been less than impressive and may have dropped slightly at most carriers, according to securities analysts. With a continued strong economy, major carriers will post roughly $2.6 billion in operating profits in the September quarter. American, the first to report, will reveal its results today and set the tone for the rest of the industry.
