Recent deferrals and cancellations of aircraft orders by Air France, Continental, USAir and All Nippon led Boeing last week to cut production to 16.5 aircraft per month by December and eliminate 7,000 jobs during the year (DAILY, Feb. 2). By the end of 1995, 737 and 767 production rates will fall, and the 747 rate will rise in 1996. Some 6,500 commercial aircraft workers in Washington state will lose their jobs, as will 500 in Wichita, Kan., and 800 in Philadelphia. Total layoffs will be offset by about 800 new jobs resulting from Boeing's work in the U.S.
American's moves to reduce flying by leasing gates and marketing frequent flyer programs jointly - as with Midway at Raleigh/Durham and Reno Air at San Jose - is not helping contract negotiations with its Allied Pilots Association unit. APA believes the deals are attempts to "outsource" flying and direct assaults on the scope clause, which basically ensures that revenue from flying will come from service in which American pilots are at the controls.
Lufthansa will resume service to Lima and Quito July 1 after a two-year interruption. It will fly to each city three times a week with A340-200s, Lima beyond Caracas and Quito over Bogota. Lufthansa's A310 operations to North America will end this summer, when it switches an A340 into the Dusseldorf-New York market.
Boeing Friday blamed the failure of an air conditioning duct clamp for the rapid cabin depressurization during a 777 test flight Thursday, and said that while it still is evaluating the impact of the incident on the airplane, there no reason to believe that the event will affect the overall 777 program or delay delivery of the first aircraft. The aircraft, WA002, is slated to be the first one delivered to launch customer United. The airline, which will take delivery in mid-May, had no comment on the incident.
USAir Express carrier Allegheny Airlines will reinstate nonstop service April 2 between Allentown, Pa.'s Lehigh Valley Airport and Boston, following Midway Airlines' decision to drop its subsidized service to Allentown in March. Midway's plan to operate at least 42 daily departures from Raleigh/Durham by June 15 requires it to relocate assets from Allentown to RDU. USAir Express will offer one nonstop to Boston and two nonstops returning, and it hopes to increase flights on May 7. The carrier will use 37-passenger Dash 8 turboprops.
London Gatwick, a money-loser for British Airways in 1993, was described as a "thriving hub" last week by BA Chairman Colin Marshall. The airline has opened 30 new destinations from Gatwick in the past two years.
Eastwind Airlines founder and President James McNally says he has what it takes to run a successful airline - experience as a bankruptcy and turnaround consultant with Price Waterhouse.
Air Transport Association has told consultants for the Clinton administration that airline revenue assumptions used in developing the air traffic control corporation proposal "seem appropriate and conservative." The corporation's financing is based on revenue growth projections of 7.2% through 1998 and 6.4% thereafter.
Transportes Aeromar is asking DOT for permission to add scheduled combination service between San Antonio, Texas, and Chihuahua, Mexico, to its transborder operations. Earlier, the carrier asked the department to renew its authority to fly scheduled service between San Antonio and two points in Mexico - Monterrey and San Luis Potosi - and charter services between the U.S. and Mexico (DAILY, Nov. 1). Aeromar plans to operate ATR-42 aircraft configured for 46 to 48 seats. (Docket 46771)
Continental has been voted best North American airline for travel across the Atlantic by British magazine Executive Travel. Continental attributes the award to its BusinessFirst product, introduced on transatlantic flights in 1992. BusinessFirst has won several industry awards, and was voted the top business class to Europe by Conde Nast Traveler.
The inability to secure interim and long-term financing forced startup USAfrica Airways last Friday to suspend operations indefinitely. The airline said operations were suspended pending efforts to complete refinancing of the company, and that it is unable at this time to set a date for the resumption of operations. "USAfrica has been actively seeking to raise additional financing, both long-term and interim," said Gregory Lewis, chief executive.
Two European countries, one in the European Union and one not, are interested in joining the open skies initiative between the U.S. and nine European countries, an administration official said.Among the nine, "Switzerland is raring to go," the official said, but he noted that the U.S. is trying to get all nine talks on track. "The goal is critical mass," the official said.
UAL Corp. on Friday filed a registration statement with the Securities and Exchange Commission offering to exchange up to $600 million of new subordinated convertible debentures for up to all of its outstanding 6.25% Series A preferred stock. UAL said it wants to make the swap to improve the company's after-tax cash flow. The interest payable on the new debentures, whether paid currently or deferred, is tax-deductible as it accrues, according to the registration statement. Dividends payable on the Series A preferred are not deductible.
DOT's reorganization plan has renewed the debate on whether to turn the nation's air traffic control system over to a government corporation. National Business Aircraft Association President John Olcott said his group applauds DOT's decision "to maintain aviation as a distinct entity" under the restructuring plan. NBAA was part of the National Aviation Associations Coalition, the group of 24 major aviation organizations that lobbied hard for the modal format (DAILY, Feb. 2).
Mercury Air Group's December quarter net earnings increased nearly 50% from the previous year to $1.2 million, or 23 cents per share, on sales and revenues of $49.17 million, up more than 80% from a year ago. In the December 1993 quarter, Mercury Air Group had net income of $817,000 on sales and revenues of $26.67 million. The December quarter is the second of the company's fiscal year.
DOT Inspector General Mary Schiavo told Congress that Secretary Federico Pea's "zero accidents" mandate creates an enormous challenge - to ensure that existing oversight "does not lessen as organizations and functions are consolidated, downsized and, in some cases, eliminated" in DOT's reorganization.
Midway Airlines, headquartered in Chicago and named for its Midway Airport base, will operate only one daily flight out of the airport by March 5 because of its deal with American to lease gates at Raleigh/Durham, where it will open a hub. The only Midway flight? Chicago-Raleigh/Durham.
Pratt&Whitney's PW4084 engine chief Tom Davenport was named last week to organize and launch the Mid-Thrust Family Engine program, intended to develop an engine that would be suitable for 75- to 100-passenger aircraft. MTFE, a joint project with Germany's MTU, is supposed to replace the venerable JT8D powerplant with a 55-inch-fan, 20,000 pounds' thrust- class engine. Joining Davenport as deputy program manager is MTU's Rainer Schwab.
Aroostook Aviation is seeking certification to provide scheduled air service as a commuter carrier with Cessna 402s at four communities in Maine. Organized in 1990 and based in Frenchville, Maine, Aroostook is currently registered as an air taxi operator at Frenchville's Northern Aroostook Regional Airport, where it also provides flight instruction.
Shanghai Airlines has replaced its manual reservations processing with a reservations network based on Stratus Continuous Processing Systems from U.S.-based Stratus Computer. The Stratus system enables the airline's sales offices and independent travel agents to book, sell and ticket flight reservations electronically. The network is based on client/server distributed computing, instead of the mainframe computers that operate traditional centralized reservations systems.
A Frequent Flyer February editorial asks readers, "Are You Scared Yet? They rumble, whine and bump. They don't deserve to fly...They're the airborne equivalent of shuttle buses. And, they are multiplying like cockroaches...." The subject, of course, is regional turboprops that "a record number of travelers must now fly..." Editor Laurie Berger talks of "strapping your bodies into flying Tonka toys" and concludes: "It's now an undeniable reality: Commuter Airlines are not as safe as major carriers." The editorial solicits faxed comments on the issue.
CBS Television's "48 Hours" this week visited SkyWest Airlines for a reportedly "positive" segment on the carrier by correspondent Erin Moriarty. Brasilia Capt. Charlie Wanlass is the subject and will be shown going through simulator training and flying the line. It also will include an interview with Executive VP Ron Reber. The Delta Connection carrier, which officially opened its new Concourse E at Salt Lake City Tuesday, was selected by "48 Hours because it trains in a simulator, although it is not required to do so. The segment will air in February.
