Delta, making inroads toward lower unit costs, may earn higher credit ratings from Standard&Poor's as a result. S&P yesterday put Delta on CreditWatch with positive implications, a move affecting $7.4 billion in securities, including ratings on Delta Air Lines Inc. senior debt, equipment trust certificates, subordinated debt and preferred stock. Delta's corporate credit is currently rated double-"B", and even with an upgrade the carrier probably will remain in the rating agency's speculative category.
The U.S.-Czech agreement, reached last Friday, clears the way for the Czech flag airline to gain a code-share agreement with a U.S. carrier, while phasing in an open skies regime by 1999. Under terms of the pact, Czechoslovak Airlines (CSA) will continue to have access through 1999 to three U.S. gateways but will be able to change the identity of those points. Currently, CSA serves New York, Chicago and Boston. More important, the pact permits CSA to work out a code-share arrangement with a U.S. carrier.
Delta's Air Line Pilots Association Master Executive Council has endorsed the company's proposal on domestic scope and the 100-seat market, clearing the way for pilots eventually to operate 54 737-200s for reduced pay in low-fare markets. In return, the company committed itself to recall 474 pilots currently on furlough by July 1997.
Uncertainty over reauthorization of aviation excise taxes "is placing airlines in an impossible position," Air Transport Association President Carol Hallett said yesterday. Taxes will expire Jan. 1 unless Congress and the White House act to extend them (DAILY, Dec. 11). Hallett said complex issues relating to amending airline computer reservations systems and tax collection and remission "are creating major headaches" for the airline industry. "Delay in resolving this matter benefits no one," she said.
Delta Chairman Ron Allen said yesterday Delta's work force has stabilized, and he has no plans for further job reductions among permanent, full-time, non-pilot personnel on the domestic system. Staffing levels may be adjusted from city to city, which can be achieved through transfers or normal attrition.
Legislation will be introduced early next year in Canada's House of Commons to turn over operation of the country's air traffic control system April 1 to a not-for-profit corporation for C$1.5 billion, Transport Minister Douglas Young and John Crichton, interim chairman of the new Nav Canada, announced. Reporting agreement in principle between the federal government and Nav Canada, Young said the reform "will help to bring air navigation in Canada into the 21st century."
McDonnell Douglas DC-10 Systemwide Aircraft Utilization Per Day Second Quarter 1995 DC-10-10 American Continental Number of Aircraft Operated 17 2 Total Fleet Operations Departures 38 1 Block Hours 169 7 Flight Hours 151 6 Miles 75,891 3,058
DOT has awarded five U.S. carriers rights to operate new service to Montreal, beginning Feb. 24, 1996 - the second year of the two-year phase- in of open skies flights to the Canadian city. The carriers gaining the service were Delta for scheduled twice-daily roundtrip service from Cincinnati, and United for daily service from Miami, as well as an additional daily Chicago-Montreal flight. The carrier obtained rights to operate two daily flights on the route earlier this year.
Success in several new Canadian markets helped lift Northwest's international traffic 20.9% in November, pushing the carrier's systemwide traffic up 11.8%. Capacity rose 6.2% over that of November 1994, while the load factor grew 3.3 points. The airline boarded 7.9% more passengers for the month, but cargo ton miles fell 4.7%. Systemwide traffic was up 7.9% for the first 11 months on a 2.6% increase in capacity, pushing up the load factor 3.5 points to 71.8%. The carrier boarded 8.7% more passengers for the period.
Hawaiian Airlines has reached agreements with its four labor unions and will give controlling interest in itself to Airline Investors Partnership (AIP) in exchange for $20 million in new equity capital. The East Coast private investors have requested that their identity remain confidential, a Hawaiian spokesman said, but more information will be published in a proxy statement they will issue this month. Hawaiian maintains that there will be no significant changes in its management, marketing strategy or number of employees.
Eight U.S. carriers have tendered bids for 316 third- and fourth-freedom flights and 126 fifth-freedom scheduled combination frequencies between the U.S. and Germany for the 1996 summer season. For the April 1-Oct. 31 period, 276 weekly roundtrip third- and fourth-freedom and 127 fifth- freedom frequencies are available.
Southwest is cutting back on flights to El Paso Airport and will consider more reductions in the future because the airport increased its landing fees and rent in one month by 327%. The carrier will drop seven daily flights April 7 and three more by fall, leaving 44 daily jet departures.
Some 21% of controllers responding to a survey by Japan's Ministry of Transport said they experienced a near-collision or conflict during the past year. The ministry sent questionnaires to all 1,725 controllers. It received 1,353 responses, and 285 of them reported an ATC incident between June 1994 and May 1995. The percentage is down 2 points from the previous year.
Frontier Airlines, trying to stimulate travel in the shoulder season, launched a fare sale that requires only a three-day advance purchase and applies to all 13 cities it serves. Sale tickets can be purchased through Jan. 15 for travel Jan. 5 through May 22. They must be purchased when they are booked. Frontier operates seven 737 aircraft from its Denver hub. Examples of the lowest fares are $39 for Denver-Phoenix, $69 for Denver- Chicago and $79 for Denver-San Francisco.
- In Federal Register dated Dec. 1...Issued an airworthiness directive on several Cessna C-series aircraft requiring inspections of the propeller hubs...Issued an AD on certain de Havilland Dash 8 series aircraft requiring inspections of the pivot tubes in the drag strut of the nose landing gear...Superseded an AD on McDonnell Douglas DC-10 aircraft concerning structural inspections. - In FR dated Dec. 4...Proposed an AD on Fokker F28-100 aircraft to require modifying the thrust reverser doors and to replace the Collins multifunction display units.
American International Airways appointed Steve Murray VP and general manager of American International Freight, its scheduled overnight cargo division.
FAA Administrator David Hinson, who expects a 25% air traffic increase in the Atlanta area during next summer's Olympic Games, says the event will be the "largest peacetime event in history in terms of people and attendance, twice the size of the Los Angeles games with twice the athletes." FAA can handle the traffic and security problems, he said.
Granted orally an exemption to Alaska Airlines to operate combination services between San Francisco and Mazatlan, Mexico; San Francisco and Puerto Vallarta, Mexico, and Los Angeles and San Jose del Cabo, Mexico...Granted orally an exemption to Japan Airlines for authority to operate for one year Tokyo-Honolulu and Tokyo-Atlanta scheduled combination services and to co-terminalize Seattle and Atlanta in conjunction with its Tokyo-Atlanta rights.
USAir, moving to replace Chief Executive Seth Schofield quickly, hopes to choose a successor early next year. While the names of several current airline executives have been mentioned in aviation circles, the search committee is casting a wider net, looking at candidates with experience in the service sector.
Midway Airlines Friday obtained two-year authority to provide combination service between Raleigh/Durham, N.C., and Bermuda. Midway plans to begin one daily roundtrip flight on or about June 1, 1996, using Airbus A320 aircraft (DAILY, Nov. 3). Midway requested the right to use other aircraft appropriate and consistent with market conditions. The carrier also operates Fokker 100s. (Docket OST-95-779&OST-95-780)
Carga Aerea Venezolana Caraven has applied for renewal of its authority to operate non-scheduled all-cargo service between Venezuela and the co- terminal points Miami, New York, Houston and San Juan, Puerto Rico. Operating as Caraven Airlines, the carrier also seeks continued authority to operate all-cargo charters to the U.S. The airline has been operating U.S. non-scheduled and charter cargo services since 1993 using wet-lease services of U.S. carriers, including Southern Air Transport, American International Airways and Millon Air.
British Airways, which has carried its country's athletic teams to most international events for 40 years, will not be transporting the U.K. team to the Olympics in Atlanta next summer. BA says Delta needs "exposure in the U.K. marketplace" and thus bid low.
U.S. and the Czech Republic reached a new bilateral agreement Friday that will phase in an open skies regime by 1999, according to an industry official. Under terms of the pact, reached after four days of negotiations in Prague, the Czech Republic agreed to permit third-country code-share service by 1997. With this agreement, 11 European countries have now committed to an open skies relationship with the U.S.
Travel agents are backing away from predictions of their demise as a result of domestic commission caps and changing roles in the new wave of distribution technologies, which some feared would cut the agent out of the reservations process. Sales data have contradicted those concerns, according to Nancy Gravatt, VP-public relations and consumer marketing for the American Society of Travel Agents. In a speech prepared for the Airports Council International's international air service seminar last week, Gravatt said travel agents are actually busier than ever.
Lufthansa Airport and Ground Services GmbH, a unit of the German airline, is negotiating to acquire 26% of Hudson General Corp.'s American Aviation Services business for $23.8 million, with an option to buy up to 49% of the company.
