Allied Pilots Association at American, after studying the history of startup carriers since deregulation and their success rate, has concluded that they have little impact on major carriers. Faced with accepting lower wages in contract talks from management that says it must become more cost- competitive, APA says startups' track records are "dismal" - only one, ValuJet, has reported quarterly profits - and their impact on major carriers is minimal. APA included only airlines that started and intended meaningful levels of primarily scheduled jet service.
Strong international growth, coupled with healthy domestic fares and good traffic volume in the U.S., led United to a $76 million first quarter profit, a 28.8% increase from first quarter 1995 levels. On a per-share basis, the carrier had earnings of $1.99, up 32.7%. Earnings include a $29 million charge taken to pay down debt. Operating revenues jumped 12%, or $401 million, to $3.74 billion. Yield climbed 5.7% to 12.22 cents, and revenue per available seat mile was 9.57 cents, which President John Edwardson said was one of the highest in the industry.
Carriers serving Atlanta Hartsfield are firming up service enhancement plans for the 1996 Centennial Olympic Games - mostly modest equipment upgrades or increased service from major hubs. The exception is Delta, the official airline of the Olympics, which said it will offer more capacity per day than any airline ever offered to and from Olympic events - 200,000 seats.
DOT is calling for interested U.S. carriers to apply for new third-country code-share opportunities for service between the U.S. and Poland. Initialed last month, amendments to the U.S.-Poland air services agreement open the market to such services on a phased basis through 1998 with some limitations (DAILY, March 26). Between Nov. 1, 1996, and March 31, 1997, two carriers may operate the flights, providing up to 14 frequencies per week, no more than seven of which may be flown by either airline; from April 1, 1997, though Oct.
American has told its pilots union that if it accepts the company's contract proposal, the airline can move forward with its vision for the future, which includes re-entering abandoned markets, buying long-range aircraft and increasing captain and first officer positions.
Pilots at Delta approved by a wide margin a new four-year contract that cuts their wages 2%, gives them stock options and a non-voting seat on the board of directors, and clears the path for the carrier's "100-seat initiative" for low-cost flying with 737s, which will make it more competitive in Florida. Delta said only that the contract will enable it to launch the 100-seat initiative "later this year."
Rockwell said the Air Force selected it for the next generation of Navstar Global Positioning System (GPS) satellites in a contract valued at $1.3 billion for 33 spacecraft through 2012 if all options are exercised. Rockwell is teamed with Computer Sciences Corp. on the GPS Block IIF spacecraft. CSC will develop software modifications for the ground control segment and provide operational control system support, now performed by Loral Federal Systems, about the year 2000, said Chairman Donald Beall.
Airbus Industrie said yesterday that Northwest has signed a contract finalizing orders for 20 A320s valued at $1 billion, becoming the largest airline customer for the A320 with 70 in service or on firm order. Northwest will take delivery of 13 A320s in 1998 and seven in 1999, all powered by CFM International engines, Airbus said. Northwest also ordered 16 A330s, which share cockpit, systems and handling characteristics, Airbus said.
Federal Express's Air Line Pilots Association leaders are polling member and non-member pilots on what they would be willing to do to get a better contract, and the union's Strategic Preparedness Committee is analyzing options. ALPA negotiators and the company have a tentative agreement that ALPA is not satisfied with, and final contract language should be sent to members in two weeks. The Fedex Pilots Association, an ALPA rival, has authorization cards from more than half of FedEx pilots calling for a representational election.
Continental is negotiating with Boeing and lessors with the aim of firming up its 1997-1999 fleet plan in the next 90 days, Continental Chairman Gordon Bethune said Monday. The carrier wants an accelerated delivery schedule but has yet to select a mix of aircraft to replace 727s it is phasing out, Bethune said. Whatever the types chosen, they will enter the fleet as one-for-one substitutes, Bethune said in a telephone news conference outlining the carrier's record first quarter earnings (DAILY, April 23).
Top 25 Domestic City-Pair Markets O&D Passengers The Year 1995 1995 1994 Average Mkt Mkt Passenger Top Carrier Rank Rank City-Pair Per Day (% Share) 1 1 Chicago - New York 8,069 United (42.4) 2 2 Honolulu - Kahului 7,679 Aloha (53.4)
Major airlines achieved an operating profit of nearly $5.5 billion and net income of $2.2 billion in 1995, the highest in the history of commercial aviation, DOT said yesterday in its Airline Quarterly Financial Review. Every major carrier reported an operating profit, five of them the highest ever.
Air Traffic Control Association will conduct a symposium on FAA's fiscal year 1997 budget April 26 at the Hyatt Regency Crystal City Hotel. Ruth Leverenz, FAA chief financial officer, will be the moderator.
Top 25 Domestic City-Pair Markets O&D Passengers Fourth Quarter 1995 1995 1994 Average Market Market Passengers Rank Rank City-Pair Per Day 1 1 Chicago - New York 8,025 2 3 Los Angeles - New York 7,214 3 2 Honolulu - Kahului 7,181
Kiwi International Air Lines is not expected to attempt any great expansion in the near future as it continues recovery-mode operations after last year's losses.Kiwi, which made a $1.3 million first quarter profit this year, will lease its 16th aircraft in the next two months. It is talking with aircraft manufacturers about buying new airplanes in the future, however, and likely would use leased planes in the interim.
The international airline industry earned $5.2 billion last year, according to the International Air Transport Association, which predicted even larger profits this year - $6 billion, a 4.3% return on $140 billion in revenue. Last year's earnings came on revenues of $129.6 billion, for a return of 4%. "Substantial restructuring of our industry has taken place and important lessons have been learned from the last economic downturn," said IATA Director General Pierre Jeanniot.
DOT will issue today its study of the impact of new entrants on the U.S. market. The study will trace how the growth of startup carriers has led to reduced fares, and it will identify markets where competitive conditions may currently favor new entry.
The Clinton administration issued yesterday a new national parks policy that will include tighter restrictions on aircraft overflights of the Rocky Mountain and Grand Canyon national parks. DOT Secretary Federico Pena said that "within the next 90 days, and I hope sooner, I will be proposing action to protect the quiet" at the two parks.
Sun Pacific International asked DOT to eliminate the single-aircraft restriction from its certificate to operate domestic and international combination charter service. The Tucson-based carrier was granted a certificate in March allowing it to provide charter services using a Boeing 727-200 (DAILY, March 1). Planning to add a second 727-200 and possibly a third aircraft if demand warrants, it asked for exemption authority to put the aircraft in operation immediately, even as DOT considers its petition.
Mexicana launched scheduled flights April 20 on an Acapulco-Mexico City- Montreal route, using 156-passenger A320s. Mexicana, which recently added flights south to Lima, Peru, and Buenos Aires, Argentina, said it is looking to boost service north. It said it will increase frequency in the market if the Montreal service is successful.
Singapore Airlines was voted best airline for the sixth year in a row in the Travel Suppliers Awards Category of the 1996 Travel Awards. SilkAir, SIA's subsidiary, earned Best Regional Airline.
Alaska Airlines Group Inc. narrowed its first quarter loss to $7.2 million, a 55.8% drop from last year's $16.3 million. The loss was 52 cents per share, compared with minus $1.22 last year. The carrier reported an operating loss of $4.5 million, down from $18.3 million. "We keep improving on a year-over-year basis, which is very encouraging," said Alaska Group Chairman John Kelly, noting that the first quarter was the third in a row with year-over-year gains.
Aero Zambia, First Air, Gulfstream International and Maersk Air are the newest participants in the GETS Marketing Company's distribution system. GETS now has 299 participants. The company said Air Aruba has joined its list of Direct Access participants.
