Continental Airlines reported a 2009 net loss of $282 million, improved 51.9% from a $586 million deficit in the year-ago period, and pointed to a fourth-quarter profit of $85 million as a sign that it is "holding the line on costs and working more efficiently." Chairman, President and CEO Jeff Smisek warned that CO and the US airline industry "likely have a long and slow road to recovery ahead," though he noted, "A long and slow recovery is better than what we had in 2008 and 2009."
Ryanair will further reduce its capacity at Dublin Airport this summer and focus on "higher-yield, outbound, peak-month, summer sun routes, rather than stimulating year-round inbound tourism with low-access fares." It cited "high and rising" airport charges and the Irish government's €10 ($14.18) "tourist tax" ( ATWOnline, June 18, 2009). The LCC will cut its Dublin-based fleet from 18 aircraft last summer to 15 and trim weekly rotations by some 19% from more than 600 to fewer than 500.
China Southern Airlines has committed to purchasing 20 A320 aircraft for delivery in 2011-13. The carrier said it would pay less than the $1.54 billion catalog value for the aircraft and that the fleet expansion will increase ATKs by 4.5%. Aircraft are part of the order for 110 A320 family aircraft and 40 A330s that the Chinese government placed with Airbus in November 2007.
American Airlines parent AMR Corp. kicked of the US airline industry's full-year reporting season yesterday by announcing a $1.47 billion net loss for 2009, improved 30.7% from a $2.12 billion deficit in 2008, on a 16.2% decline in revenue to $19.92 billion.
Gulfstream International Airlines parent Gulfstream International Group will convert $1.5 million of subordinated debt to convertible preferred stock under an agreement with Gulfstream Funding II, a lender that issued the loan in October.
US Air Transport Assn. said members' December passenger revenue fell 4% year-over-year, the 14th consecutive monthly decline, and 2009 full-year revenue plunged a record 18%. December passenger traffic was down 3% and the average price to fly 1 mi. dropped more than 2%. Full-year passenger volume was down 6% from 2008, with a 13% fall in the average price to fly 1 mi.. The largest previous full-year revenue decline was the 14% slip from 2000 to 2001.
LOT Polish Airlines has three bidders interested in participating in the carrier's privatization, according to reports from Warsaw. A Polish treasury spokesperson said a major airline and a financial investor are among the suitors. Air France KLM denied reports that it is participating, and Aeroflot denied interest when asked by Bloomberg News. The treasury spokesperson said the sale is unlikely to happen this year. The treasury holds 68% of the carrier.
ANA President and CEO Shinichiro Ito yesterday expressed concern over the Japanese government's heavy involvement in Japan Airlines' bankruptcy restructuring. Between the Enterprise Turnaround Initiative Corp. of Japan and the Development Bank of Japan, both of which are government-backed institutions, JAL will receive ¥900 billion ($9.9 billion) to ensure it does not collapse as it goes through the court-monitored process ( ATWOnline, Jan. 20).
OnAir will go live with its Internet and VPN connectivity service next month but sees a profitable future for its phone and PDA inflight connectivity service, with CEO Benoit Debains telling ATWOnline yesterday, "We are, and we remain, a phone company." The Airbus/SITA joint venture provided no further details concerning Internet OnAir's launch but Debains insisted that the company's Mobile OnAir service and Internet are complementary. "Contrary to what people believe," he said, "it's not phone versus Internet."
Ethiopian Airlines CEO Girma Wake yesterday announced that the carrier placed orders for 10 737-800s this month while achieving a long-sought objective to create a West African hub with the launch of ASKY Airlines, a Lome-based carrier operating a pair of 737s leased from ET. First flights for the new airline on Jan. 15 were from Lome to Abidjan and Banjul ( ATWOnline, Dec. 9, 2009).
CAE announced the sale of A320 and A330 CAE 7000 series full flight simulators to China Eastern Airlines subsidiary Shanghai Eastern Flight Training. Simulators are valued at C$30 million ($29.2 million) at list prices and will be delivered in 2011. SEFT currently operates six CAE FFSs: Four A320s, one A330/A340 and one 737. CAE said it also has received the cancellation of an unidentified simulator order placed last year.
Tiger Airways Holdings defied analysts' skepticism and raised S$247.7 million ($178.2 million) through its IPO that closed yesterday, of which about S$233.3 million will go to the airline to fund its expansion. Its market capitalization will be S$780 million when it lists on the Singapore Exchange on Jan. 22 ( ATWOnline, Jan. 18).
Bmi will cease offering business class on flights from London Heathrow to destinations in the UK and Ireland from Jan. 27. In addition, passengers purchasing higher Flexible Economy fares will be able to change tickets without a fee and will have access to lounges, reserved seats at the front of the aircraft and free food and beverages onboard. It also announced the launch of twice-daily London Heathrow-Vienna service on March 28 using an A320. Star Alliance partner and fellow Lufthansa subsidiary Austrian Airlines will codeshare.
SIA Engineering Co. broke ground for a non-OEM provider of MRO services by purchasing a stake in Pratt & Whitney's PW1000G engine "risk-revenue sharing program" in exchange for a key role in Pratt's MRO network. SIAEC, a member of Singapore Airlines Group, will hold a 3% stake in the engine RRSP for the Bombardier CSeries and a 1% stake in the Mitsubishi Regional Jet engine RRSP.
Continental Airlines will record $77 million in fourth-quarter special charges and $145 million for the full year, as well as a noncash income tax benefit, it said. The fourth-quarter items comprise $36 million in aircraft-related charges, $29 million in pension plan settlement charges and $12 million in route impairment charges. Full-year totals are $89 million, $29 million and $22 million respectively in addition to $5 million in severance payments.
Japan Airlines yesterday filed for bankruptcy protection in Tokyo under Japan's Corporate Rehabilitation Law, initiating a restructuring process that it said will include major cost cuts and structural changes with the aim of returning to profitability by March 2012.
American Airlines will increase its charge for the first checked bag on domestic flights to $25 and the second bag to $35 effective Feb. 1, matching the raises announced by Continental Airlines, Delta Air Lines, United Airlines and US Airways ( ATWOnline, Jan. 14). Premium passengers and loyalty program members are exempt.
Bombardier Commercial Aircraft President Gary Scott yesterday said the manufacturer is in "advanced discussions with some customers" for CSeries orders and that he would "be surprised if we don't announce another order in the first half of next [fiscal] year," beginning Feb. 1. Scott was speaking to reporters in Dublin. Lufthansa and Lease Corp. International are the only customers so far and have ordered a combined 50 firm aircraft and 50 options.
Aer Lingus announced the departure of Deputy CEO and COO Niall Walsh, effective immediately. EI CEO Christoph Mueller will assume Walsh's duties temporarily with assistance from Chief Engineer Fergus Wilson, the airline said. A search for a new COO is underway.
Iberia's merger with British Airways could be concluded next month, according to Caja Madrid Chairman Miguel Blesa. The head of IB's largest shareholder (23%) told reporters, "We're on the right track. I think February will be decisive for the deal. There's not much left that needs agreeing to, if anything at all. I don't know if it will be [signed] in February but it won't go past March," according to Reuters. The merger MOU was signed in November ( ATWOnline, Nov. 13).
Irish air traffic controllers at Dublin, Cork and Shannon represented by Impact plan to strike for 4 hr. this afternoon. The Irish Aviation Authority said controllers are demanding a 6% pay increase and that it already has suspended 12 who "stopped doing work on a number of ongoing projects." IAA said the 6% increase would cost the authority €6 million ($8.6 million) per year and would be passed on to airlines.
Airbus announced the promotion of Executive VP-Customer Services Charles Champion to head of engineering, effective April 1. He will succeed the retiring Patrick Gavin. Turkish Airlines promoted Head of Marketing and Sales Faruk Cizmecioglu to VP-sales & marketing.
AeroLogic, the joint cargo venture between Lufthansa and DHL Express, added two 777-200Fs in December, doubling its fleet to four of the type. It will launch weekend service from Frankfurt to both Atlanta and Chicago O'Hare during the current winter schedule, as well as daily Leipzig-Hong Kong service (nonstop four-times-weekly). It plans to take delivery of additional 777Fs in June, July, September and December. "Demand for Europe to Asia and Europe to US remains stable, despite the weakened world economy, and is expected to increase in the mid-term," AeroLogic said.
US Air Transport Assn. reported that its third-quarter airline cost index fell 36% year-over-year to 185.3, a decline that compares to the 1.6% fall in the US Consumer Price Index. The average price paid for fuel slid to $1.94 per gal. from $3.51 in the third quarter of 2008, although the average cost of a fulltime-equivalent worker climbed 7.6%. Fuel and labor accounted for nearly 50% of airline operating expenses, ATA said.
Japanese Transport Minister Seiji Maehara said Friday that the government-backed Enterprise Turnaround Initiative Corp. of Japan will announce Japan Airlines' restructuring plan on Tuesday, while the troubled carrier tapped into an emergency credit line to allow it to maintain operations in the meantime.
