The U.S. government must proceed with a strategic and pragmatic approach to opening the U.S.-Asia market, and progress is being made, says Mark Gerchick, DOT deputy assistant secretary for aviation and International affairs. Speaking at the 5th Annual Phoenix International Aviation Symposium last week, Gerchick said five or six Asian nations, such as Malaysia and Korea, are moving toward opening their markets. It will not come close to open skies, but is a move in the right direction, he said. Gerchick was not keen on the idea of moving toward a multilateral system.
Midwest Express Holdings Inc. reported strong first quarter earnings, while its former parent, Kimberly-Clark Corp., said it will divest itself of its 20% stake in the carrier. Kimberly-Clark's remaining 1.29 million shares will be offered through a public offering that will be completed in the second quarter of this year. Kimberly-Clark took its airline subsidiary public in an initial offering in September. At the time, the company said it was shedding some operations to focus on its core business.
El Al reported a net profit of $15 million for fiscal 1995, the carrier's 10th consecutive year of profitability. Revenue grew 17.5% to $1.22 billion from 1994 levels. The number of passengers carried rose 18% to 2.93 million, while cargo went up 6%, or 210,000 tons. Aircraft utilization increased 2% for the year and employee productivity 14%. The overall load factor was 73.8%. During the year, the carrier launched service from Tel Aviv to Milan, Newark and Los Angeles. It also linked its Carmel computer reservations system with American's Sabre CRS.
Air Line Pilots Association is holding talks with representatives of Canadian pilot groups about a merger, ALPA President Randolph Babbitt said. Such a move, although difficult because of labor laws and a number of other practical issues, would enable ALPA to widen its representation net while giving Canadian pilots greater resources in dealings with their airlines.
El Al appointed Michael Gat general manager-North and Central America. American International Freight named Debra Yates regional marketing director-central region.
U.S. will hold talks in Washington with Singapore and Colombia this week. Negotiations with the former are expected to be positive, addressing the possibility for open skies, while the latter talks may be more difficult, said a U.S. official, pointing out that Colombia's aviation system has been rated Category 2 by FAA and U.S. carriers are doing well in the market.
Granted orally to American, Executive, Flagship, Simmons, Wings West, Canadian Airlines International, Ontario Express, Time Air and Inter Canadien renewal of the joint applicants' authority to operate code-share services in various transborder markets, as well as behind U.S. gateways to interior U.S.
New equipment, including a power conditioning unit and a standby engine generator, will be installed by May 15 at St. Louis Lambert Field to eliminate recent equipment outages, FAA said last week following a meeting of FAA Administrator David Hinson, DOT Secretary Federico Pena and House Democratic Leader Richard Gephardt of Missouri. The power conditioning unit will "condition" raw commercial power, removing the fluctuations that can cause air traffic control systems to experience problems, and the generator will provide an added measure of safety, FAA said.
AMR Corp. said it will redeem all outstanding 6 1/8% Subordinated Quarterly Income Capital Securities due 2024. The carrier set the call for redemption for May 20. The company, which has $1.02 billion in debentures outstanding, will pay $1,045.23 for each $1,000 in principal. Holders of the debentures have the option before May 17 to convert their holdings into AMR Common Stock at a price of $79 or 12.658 common shares. AMR also announced the call for redemption May 20 of all outstanding $500 Series A Cumulative Convertible Preferred Stock.
One problem with the failure of United's interactive entertainment systems installed on its 777s is that it also leaves the in-seat telephone system inoperable, says Gordon McKinzie, project manager for the 777.As a result, United has had to mount phones on the bulkheads of its jets, which makes the service a lot less convenient.
The Taipei Tax Bureau has demanded that air express companies serving Taiwan pay millions of dollars in value-added import taxes that, bureau officials say, have remained unpaid since Taiwan's value-added tax went into effect seven years ago. A bureau official said taxes owed by DHL, Federal Express, United Parcel Service and Airborne Express total more than NT$1.6 billion, or US$59 million. Express companies have argued that as they only assist in bringing goods into Taiwan and do not sell the imports, they should not be required to pay the value-added tax.
Earnings rose 11% to $1.5 billion on 13% stronger sales of $17 billion at General Electric, the company reported yesterday, propelled by acquisitions and "the growth of after-sale services." Revenues rose at 10 out of 12 GE businesses, and profits rose at seven. Together, GE's operating units generated $1.2 billion in free cash flow during the quarter, more than double the year-ago performance. Overall operating margins now approach 14%.
Canadair Regional Jet will be operated over 109 city-pair segments in North America this summer, covering 48,591 route miles averaging 455 miles in length. The longest segment is 839 miles, operated by Air Canada between Toronto and Kansas City; the shortest is Comair's 44-mile Cincinnati-Dayton route. Air Canada is operating the aircraft in 27 city- pairs, Comair 59 - including head-to-head with Air Canada on Nashville- Toronto - and SkyWest 23. Eleven of the total city-pairs are non-hub- related, point-to-point markets.
Secretary of Defense William Perry has asked each military service to review equipment carried by its passenger airplanes and identify additional safety systems that might be needed, a senior Air Force official said this week. The move was prompted by the fatal crash of a U.S. Air Force T-43 transport that killed Commerce Secretary Ron Brown in Croatia. Perry specifically tasked the services to check the prevalence of Global Positioning System equipment, cockpit voice recorders and flight data recorders, the official said.
America West will file a lawsuit today asking a Phoenix court to challenge a representation election held Wednesday in which 82% of eligible mechanics voted for representation by the Teamsters union (DAILY April 18). Of those eligible to vote, 587 opted for representation by the Teamsters, while 135 voted against it. The suit will be filed in federal district court in Phoenix. America West is seeking to have the National Mediation Board election invalidated because it believes that 400 former employees of the airline should not have taken part in the election.
Delta Connection Comair will upgrade one of its four flights in the Roanoke, Va.- Cincinnati market with Canadair Regional Jet service, effective July 1. Comair and senior partner Delta together operate more than 450 flights from Cincinnati each day to more than 95 destinations. Comair operates 89 aircraft to 76 cities in 25 states and three countries.
United Express affiliate Atlantic Coast Airlines this week posted more than a $4 million earnings turnaround, reporting a net profit of $862,000, or 10 cents per share, for the first quarter of 1996, compared with a nearly $3.2 million net loss, or 38 cents per share, for the comparable 1995 quarter. Total operating revenues jumped 23.4% for the period to $37.9 million from 30.7 million, while operating expenses rose just 9.8% to $36.7 million
Jets made by the companies that specialize in the lower-seating- capacity end of the jet market - British Aerospace, Avro, Fokker and Bombardier Regional Aircraft, which makes the Canadair Regional Jet - together accounted for 18% of the 1991-1995 jet deliveries to European airlines, according to statistics compiled by Avitas. Fokker held 8% of the market; Canadair, 4%; Avro, 4%, and British Aerospace, 2%. See table of unit deliveries below. On the other hand, McDonnell Douglas accounted for 16% of the European-airline deliveries; Boeing, 44%, and Airbus, 22%.
...Congressional Budget Office believes that certain aspects of the air traffic control fees proposed in S.1239 may undercut the goal of having the fees treated as "offsetting" receipts, which could be credited directly to FAA and used by the agency, rather than as "governmental" receipts, which essentially would be taxes.
USAir has reduced advance-purchase summer fares by as much as 60% in 1,200 markets in the U.S. and Canada, the carrier said. Tickets must be purchased by today, and all travel must be completed by Sept. 9. Examples are Denver-Boston for $238 roundtrip during off-peak hours, $298 for Washington National-Phoenix and $272 for Toronto-Los Angeles.
Carnival Air Lines' March traffic rose 44.8% from March 1995 to 228.8 million revenue passenger miles on 36.2% more capacity. Available seat miles totaled 347.5 million, and the load factor was 65.8%. For the first three months of the year, traffic was up 38.6% to 635.1 million RPMs, and ASMs rose 35% to 1.001 billion. The load factor for the period was 63.4%.
The political action committee operated by American has contributed far more to federal candidates and committees than any other PAC run by a combination airline so far this election cycle. While American's is the largest combination carrier PAC, it is dwarfed by the PACs operated by multi-modal carriers United Parcel Service and Federal Express. Between Jan. 1, 1995, and Feb. 29 this year, American's PAC gave $266,510 to federal candidates and committees. UPS PAC and FedEx PAC contributed $1.06 million and $510,00, respectively.
House yesterday passed 293 to 133 the conference report on the terrorism prevention bill (S.735), clearing the measure for the President. The Senate passed the conference report 91 to eight earlier this week. Among other things, the bill orders FAA to require identical security measures for non-U.S. carriers serving airports in the U.S. as for U.S. carriers. In addition, the bill amends laws on aircraft piracy to provide extraterritorial federal jurisdiction for aircraft piracy if a U.S. national is on the plane, if the perpetrator is a U.S.
The new Pan Am has named its key management group, President Martin Shugrue said this week. "We have put together a group of experienced staff and operations executives who provide the right blend of airline knowledge and forward thinking to make Pan Am - The New Airline truly the best and most innovative flying experience available today," he said.
Continental Express could take up to 50 Canadair Regional Jets, Embraer 145 regional jets or Saab 2000 high-speed turboprops in its fleet- replacement program. The company recently acquired up to 20 ATR 42-500s (eight orders plus 12 options) on extremely favorable terms, but has 27 ATR 42s plus a large number of Embraer Brasilias to replace. Deliveries are expected to begin by the end of the year. Part of the deal, however, is that the contract winner will have to find a home for the 27 ATRs, with less than two years left on their leases.
