A DOT official yesterday told the House Transportation aviation subcommittee that, to his knowledge, there is no evidence that safety has been compromised because of the new requirement that airlines include mechanical delays in their on-time performance reporting. Mechanical delays have always been excluded from airlines' reporting, but under a September 1994 rule change airlines were required, beginning in January, to include them. Citing potential safety concerns, DOT in June issued a proposed rule to reverse that decision (DAILY, June 2).
Atlantic Southeast has not yet said on which Atlanta routes it will place its BAe 146 quadjets when they begin arriving later this year, but analysts believe they will serve relatively short markets. Top choices are Birmingham, 134 miles; Chattanooga, 105 miles; Gainesville, 302 miles; Jacksonville, 277 miles, and Savannah, 215 miles. Those route lengths would average nearly 207 miles, compared with about 450 miles and 500 miles, respectively, for Canadair Regional Jets operated by fellow Delta Connection carriers Comair and SkyWest.
Atlantic Coast Airlines' financial turnabout masks a trend toward deeper involvement by airframers in the operations of their customers. Both British Aerospace at ACA and Saab at Business Express stepped in to force new business plans and detailed profit-and-loss route analyses under the veiled threat that the carriers' fleets could be repossessed. "The only alternative was bankruptcy," said one source. At ACA, the result was a standardized fleet of Jetstreams, a Florida pullout, improved maintenance, new work rules and "more bucks in every seat."
Delta Connection carrier Atlantic Southeast Airlines' (ASA) second quarter net earnings declined 9.7% from the previous year to nearly $15 million, or 45 cents per share, and its operating profit fell 12.5% to $23.3 million from $26.6 million in the June quarter a year ago. ASA said it net earnings include an after-tax accrual of $2.6 million, or eight cents per share, associated with the company's stock appreciation rights plan (SARs) and the unusual size of the expense accrual was due to the impact of a 63% jump in the company's stock price during the quarter.
DOT has extended CCAIR's essential air service obligation at Danville, Va., through Aug. 30 or until a carrier that can provide reliable replacement service begins operations. Operating as USAir Express, CCAIR had filed a notice in June last year of its intention to suspend service at Danville by Aug. 30, 1994. However, while seeking replacement service, DOT has repeatedly extended CCAIR's service obligation (DAILY, May 12). The carrier is operating three roundtrips between Danville and Charlotte, N.C. - two nonstop, one via Winston-Salem, N.C.
United Express carrier Atlantic Coast Airlines (ACA) this week reported record second quarter operating and net profits that it attributed to its fleet restructuring plan, an increase in yield and continued strong passenger demand. ACA, which feeds United at Washington Dulles, posted a second quarter operating profit of nearly $5.7 million, and net earnings of $5.1 million, 52 cents per share on a fully distributed basis.
American's Allied Pilots Association is scheduled to present its settlement proposal on contract issues to the company Aug. 1, barring a last-minute hold-up because of pilot concerns over code sharing with Canadian Airlines International (CAI). An APA official said the union has been unhappy with American's response to its fears that the best flying would go to CAI, and that code sharing may prevent American from seeking service in its own right. At issue is potential code sharing from Vancouver to Hong Kong, Manila, Japan, Vietnam and Taiwan.
AirTran Airways has signed a letter of intent to purchase a 737-200 - its eighth - from Orlando-based NSJ Corp. The 130-passenger aircraft will be placed in service in October. The airplane is powered by Pratt&Whitney JT8D-17 engines equipped with Stage 3 hushkits.
June load factors averaged 52.7% for 13 regional airlines tracked by The DAILY. That compares to 52.2% in June 1994 for an increase of one-half of a percentage point. Three Delta Connection carriers reported declines, however. Business Express lost 5.1 points to 45%, SkyWest 4.9 points to 49.7%, and Atlantic Southeast 0.9 points to 49.5%. Other decliners were USAir Express CCAIR, down 7.2 points to 46.2%, and Horizon, off 5.5 points to 61%. Horizon, the traditional group leader in load factors, fell behind Air Wisconsin in June, which was up 3.8 points to 61.5%.
Delta yesterday reported record quarterly net earnings of $251 million, or $3.21 per share on a fully diluted basis, and an operating profit of $449 million for the June quarter, the fourth of the airline's fiscal year. In the June quarter last year, Delta suffered an operating loss of $321 million, including $414 million in restructuring charges, and a net loss of $250 million. For the year ended June 30, Delta reported an operating profit of $661 million and net earnings of $408 million, or $6.43 per share, including $1.42 gained from an accounting change.
Summary of U.S. National Carriers Systemwide Revenes and Expenses Fourth Quarter 1994 (In Dollars) Total Operating % Passenger Carrier Revenues Change Revenues Alaska 256,022,000 13.40 206,204,000 Aloha 53,533,142 (3.31) 42,972,786
Add Delta to the list of U.S. carriers interested in serving South Africa with a code-share partner. The most likely candidates are Swissair and Sabena, both of which serve South Africa now, said a Delta official. Northwest and United have applied for South Africa service with their respective code-share partners, KLM and Lufthansa.
Aircraft Owners and Pilots Association is opposing an FAA proposal to replace its standard half-page flight plan form with the full-page International Civil Aviation Organization format. AOPA President Phil Boyer said FAA has "provided no compelling reason to force the majority of the world's pilots here to use the more complex international form." The FAA proposal claimed that a single standard flight plan would make it easier for pilots to file anywhere in the world and reduce the costs of software development for datalink and other flight equipment, Boyer said.
Air Ontario will enhance its Indianapolis-Toronto service Sept. 17 by offering three daily week-day nonstop flights. The Canadian carrier had been operating one-stop service via Columbus. President Stephen Smith said the airline will continue to look toward adding other U.S. destinations now that the U.S. and Canada have an open skies agreement. Air Ontario uses the newly renovated Terminal 2 at Toronto Pearson Airport, where it links its flights to Air Canada's. It operates a fleet of 23 Dash 8 aircraft.
SkyWest Inc. reported net income of $3.1 million in the first quarter of 1995, down from $5.4 million realized in the same 1994 period. SkyWest, the holding company of Delta Connection carrier SkyWest Airlines, said operating revenue was up 2.6% to $60.4 million during the quarter. Noting that the carrier has made significant financial improvements, Executive VP Bradford Rich said, "However, in being very simple and straightforward, we have much more yet to accomplish.
Only two weeks after it was named one of seven companies qualified to bid for FAA's Standard Terminal Automation Replacement System (STARS) contract, Hughes Information Systems has dropped out of the prime contractor competition, according to DAILY affiliate ATC Market Report. While Hughes had no comment on the decision, industry sources said it is in discussions with Raytheon Co. about being part of the Raytheon STARS team. Raytheon confirmed the talks but said it has not yet selected partner companies.
America West has applied for authority to operate combination service between Phoenix and Puerto Vallarta and Manzanillo, Mexico. If approved, the carrier plans to begin daily service to Puerto Vallarta and four weekly flights to Manzanillo about Oct. 29, using 737-200 or other aircraft.
Regional airframers are trimming back on sales support personnel by moving them into direct sales and not replacing them. British Aerospace, Fokker and Saab are doing it, and ATR has never had a sales support team in the U.S., relying solely on the factory in Toulouse, France. It is an excellent way to downsize, said one marketer, while placing experienced analysts into front-line sales jobs. The problem, as he sees it, is that there are no new faces coming in. When people leave, as a number from those companies have done recently, they are hard to replace.
A just-published study finds that exports have "taken on a new urgency" for U.S. aerospace companies and that the Uruguay Round of the General Agreement on Tariffs and Trade (GATT) strengthened the dispute process by setting strict time schedules. Another finding is that limits placed on the technology that U.S. companies can bring to a joint venture make U.S. participation less attractive to potential partners and customers. The study, After the Cold War: The U.S.
Continental Express is focusing on a potential $750 million deal with Dornier for 75 30-passenger Do 328s and 48-passenger 328-stretch aircraft. The carrier just completed a fly-off against its Brasilias on real-time scheduled flights, achieving 10% more speed against a 5% increase in fuel consumption, The DAILY is told. Although Dornier has not announced a go- ahead for the 328 stretch, the company said that deliveries could begin in about 18 months. The company believes it can replace its Brasilias and ATRs with a single type.
Continental and Alitalia have asked DOT to renew their code-share arrangement for two years. Under the pact, approved last October, the carriers gained authority to operate between Newark and Rome/Milan and between Houston and Rome (DAILY, Oct. 24, 1994). The latter service continued beyond Houston to Mexico City. The airlines also are seeking renewal of the authority granted to Continental and Continental Express in March to operate domestic and Newark-Mexico City code-sharing service with Alitalia.
The Tourism Policy Council (TPC) yesterday unveiled the first coordinated federal strategy to promote U.S. tourism through the efforts of 13 federal agencies and Amtrak, and define the roles of government and the private sector. One key initiative is to garner more private-sector support for travel programs and leave most of the activities associated with international travel to the federal government. International tourism is the growth market as standards of living rise worldwide but the government is behind in marketing efforts. The U.S.
China Airlines is adding extra sectors and charter service to cope with an expected 8% increase in summer traffic. The airline expects the greatest growth to come in short-haul markets, particularly to countries in Southeast Asia. From Taipei, CAL has added 13 flights to and from Phuket, 10 in the Okinawa market, and two to Fukuoka. It plans four additional Kaohsiung-Okinawa charters. CAL launched Taipei-Zurich and Taipei-Rome service earlier this month.
By Oct. 30, when the White House Conference on Travel and Tourism convenes, the tourism industry necessarily will become familiar with its formidable economic impact as key statistics are cited again and again: Tourism accounted for 6% of GDP in 1994; is the second largest employer, after health care, with 6.4 million workers; generated $58 billion in tax revenues in 1994, and is the largest services exporter with $78 billion in international travel receipts and a $2 billion travel trade surplus.
Overseas visitors to the U.S. continue to outspend U.S. residents traveling abroad - by $19 billion in 1994. Foreign travelers spending in the U.S. accounts for 40% of all service exports for the U.S., according to the U.S. Travel and Tourism Administration.
