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.
Tiger Airways has taken a bold gamble and ignored the less-than-enthusiastic endorsement of its IPO from regional analysts to price it at the maximum S$1.65 ($1.19) per share ( ATWOnline, Jan. 12). The potential S$246.8 million raised from the IPO that closes today will be used to pay down debt and finance new aircraft. The offering comprises 155.6 million new shares and an additional 9.6 million from investor Indigo Partners. The shares are expected to begin trading on Jan. 22.
Jamaican government said last week that Air Jamaica's acquisition by Caribbean Airlines was "expected to be consummated" over the weekend. The deal was expected to include an equity infusion but will require the government to pay JMD27 billion ($298.8 million) toward JM's 2010 capital expense budget, debts and costs required to cover "the redundancy of hundreds of employees." The government appointed a new five-member board chaired by insurance executive Denis Lalor to oversee JM's divestment and transition to Caribbean along with President and CEO Bruce Nobles.
Pinnacle Airlines announced the closure of a $10 million credit facility with Independent Bank of Memphis. The funds will provide Pinnacle with working capital until it receives a federal income tax refund estimated to be worth $38 million. The company said it also modified a $25 million spare parts loan "to reduce certain liquidity requirements."
Lufthansa Group airlines flew 13.42 billion RPKs in December, up 19.1% from the year-ago month, against an 18% lift in capacity to 17.53 billion ASKs. Load factor rose 0.8 point to 76.6%. Lufthansa Passenger Airlines flew 9.39 billion RPKs, up 4.2%, while ASKs increased 2.7% to 12.22 billion and load factor climbed 1.1 points to 76.8%. Swiss International Air Lines flew 2.31 billion RPKs in December, a 2.4% increase year-over-year. Capacity fell 3.5% to 2.85 billion ASKs, lifting load factor 4.7 points to 81%.
Aer Lingus pilots represented by the Irish Airline Pilots Assn. accepted annual pay cuts of €30 million ($43.5 million) that were recommended by an Irish Labor Relations Commission arbitrator. The reductions are part of EI's continuing effort to implement a €97 million savings program, which the airline has said is being held up by pilots' reluctance to agree to cuts ( ATWOnline, Dec. 3, 2009).
US Aerospace Industries Assn. named former FAA Chief of Staff David Mandell VP-membership and business development. United Airlines parent UAL Corp. named Global Hyatt Corp. CMO and CIO Thomas O'Toole senior VP and CMO. Cirrus Airlines promoted Director-Sales and Marketing Ingrid Jung to MD.
Arlington-Va.-based ARC reported this week that December sales through participating US travel agencies totaled $4.41 billion, representing an 8.6% increase year-over-year and the "strongest final month of the year since 2005." Total fares rose 9.2% to $3.74 billion and the number of transactions increased 6.9% to 8.9 million. Domestic fares climbed 5.1% to $1.96 billion on a 6.7% lift in transactions, while international fares surged 14.2% to $1.78 billion on a 7.5% lift in transaction. ARC had 188 participating airlines in December, up three from the prior month.
TAM announced plans to refurbish the passenger cabins across its entire fleet, both new aircraft and retrofit, including the redesign of all seats, galleys, stowage areas, lavatories and "cabin architecture, where possible." It contracted Priestmangoode of London for the three-year project, which also will feature a uniform redesign. Separately, TAM signed a long-term, full-content distribution agreement with Sabre Travel Network.
Singapore Airlines confirmed the March 28 launch of a daily A380 service to Zurich, which will replace its 12-times-weekly 777-300ER service. ZRH will be SIA's third European A380 gateway after Paris Charles de Gaulle and London Heathrow. ZRH will conduct final infrastructure tests required to attain A380 certification on Jan. 20-21.
OAG reported that January global seat capacity has increased 3% year-over-year to 294.6 million seats. It is the fifth consecutive month of growth. Frequencies will rise 2% to 2.4 million flights, boosted by a 10% lift among LCCs. North American airlines cut intra-regional flights 2.7% and seats 2.8% but grew to/from the region by 3% and 1% respectively.
Republic Airways Holdings said yesterday that all of its executive management functions, including those of subsidiaries Frontier Airlines and Midwest Airlines, will be consolidated at its Indianapolis headquarters and former Frontier CEO Sean Menke will leave the company at the end of the current quarter.
Thai Airways President Piyasvasti Amranand told reporters yesterday that the airline expects to post a net profit in both 2009 and 2010, when it expects to be THB4 billion ($121.3 million) in the black, Reuters reported. A profit in the 2009 fourth quarter will reverse a THB1.57 billion loss through the first nine months of last year, he said ( ATWOnline, Nov. 17, 2009).
Qantas yesterday said it remains confident in its 27% investment in Vietnam's Jetstar Pacific despite the emergence of a report highlighting maintenance deficiencies and the legal troubles facing several executives.
US FAA is ordering airlines to inspect 737 Classics' fuselages every 500 cycles to prevent further occurrences of an incident that took place last summer involving a Southwest Airlines 737-300 that developed a hole in its fuselage while flying from Nashville to Baltimore ( ATWOnline, July 17, 2009), according to The Dallas Morning News. FAA's notice requires carriers operating 737 Classics to conduct an inspection within the next five weeks. Inspections then must occur at least once every 500 cycles.
European Commissioner-designate for Justice, Fundamental Rights and Citizenship Viviane Reding of Luxembourg told the European Parliament at a confirmation hearing this week that the use of full-body scanners at EU airports should not be compulsory owing to privacy and health considerations. "Human beings have dignity and every measure has to be clarified first. Does it respect human dignity, does it respect privacy and does it respect health," she argued. "Our needs for security can't justify every violation of privacy. Citizens aren't objects.
Virgin Atlantic Airways cancelled its outstanding order for six A340-600s, according to Airbus's orders and deliveries list. The airline firmed its commitment for six purchased and four leased A330-300s last month ( ATWOnline, Jan. 12). It currently operates 19 A340s. There now are seven A340s in Airbus's order book, five -500s and two -600s. The VS cancellation first was reported by Air Transport Intelligence.
Kazuo Inamori, one of Japan's most prominent business figures, yesterday accepted Prime Minister Yukio Hatoyama's offer to become CEO of Japan Airlines and guide the troubled carrier through its pending bankruptcy reorganization.
Flybe and Nordic Aviation Capital concluded a sale/leaseback transaction for four new Q400s, the carrier announced. Transaction is worth approximately $100 million at list prices. Senior debt was provided by Export Development Canada. "In 2009 alone we financed the deliveries of 11 new aircraft despite the recent challenging economic and financial climate," Flybe Director-Fleet Planning David Attenburrow said. The airline currently operates 68 aircraft: 54 Q400s and 14 E-195s.
Blue Wings suspended operations yesterday, the Dusseldorf-based carrier announced on its website. "The developments of recent weeks and the tense overall economic situation in the aviation industry have forced us to take this step," the airline said. A spokesperson told German press that a re-launch was possible once "economic difficulties have been cleared." Blue Wings said last week that funds promised from investors had not arrived. It operated six A320 family aircraft ( ATWOnline, Jan. 8).
Vietnam Airlines earned a pre-tax profit of $8.1 million in 2009, down 42.1% from the $14 million reported in 2008, according to a statement cited by Agence France Presse in Hanoi. The airline cited the global recession and H1N1 flu as the primary culprits for the drop. Revenue declined 16.7% to $1.3 billion as passengers increased 5.7% to 9.3 million. It expects to carry 11 million passengers in 2010.
Airbus Executive VP-Programs Tom Williams told ATWOnline in Seville this week that the A320 final assembly line in Tianjin is performing "within our expectations." It delivered 11 A320 family aircraft last year. "We expect to deliver two A320s per month by the end of this year," he said, adding that all aircraft assembled there have been ordered by Chinese carriers.
Indian airlines carried 44.5 million passengers in 2009, up 7.9% from the prior year, the Ministry of Civil Aviation reported yesterday. Fourth-quarter traffic soared 30.5% year-over-year to 12.5 million passengers and December traffic rose 34.8% to 4.5 million.
Qatar Airways, Qatar Science & Technology Park and Qatar Petroleum announced establishment of the Qatar Advanced Biofuel Platform, which, with the support of Airbus, will carry out engineering and economic analysis into the development of a sustainable biofuel and "will also look into ways for production and supply," QR said. QABP will focus on creating a detailed engineering/implementation plan for sustainable production, a biofuel investments strategy, an advanced technology development program and market and strategic analyses.
