Aeroflot said its "prompt steps to balance income and expenditures" during the first quarter, along with favorable exchange rates, helped it post a RUB713.1 million ($22.7 million) net profit. It flew 5.39 billion RPKs in the quarter, down 3.8% year-over-year, on a 10.9% drop in passenger numbers. It said its April and May performance "revealed an upward drift in carriage."
News from Travel Technology Update: Virgin Blue, the Australian low-cost carrier, will migrate to Navitaire's New Skies platform later this year. Virgin Blue has been using Navitaire's Open Skies system since its launch.
A "collapse in demand" contributed to a MYR694.8 million ($196.8 million) first-quarter loss for Malaysia Airlines compared to a MYR120.5 million profit in the first three months of 2008. An operating loss of MYR137.9 million, reversed from a MYR132.9 million profit in the year-ago period, was the revitalized company's first since the 2006 third quarter and resulted from a "triple squeeze--overcapacity, extreme fuel volatility and a global slump which hit passenger and cargo demand," MAS said.
IATA said April international premium traffic fell 22% year-over-year, a steeper decline than the 19.2% reported in the first quarter and a number distorted by the shift in this year's Easter holiday to April, which often depresses business traffic. The number of passengers traveling on economy tickets inched up 0.3% year-over-year. "It is too soon to say whether April marked a turning point in the current down cycle of air travel," IATA said. "Unfortunately, fares and yields are falling at an increasing rate so even if traffic volumes are stabilizing, revenues are not."
SAS Group flew 2.29 billion RPKs in May, down 18.1% from the year-ago month. Capacity fell 16.7% to 3.2 billion ASKs and load factor dropped 1.2 points to 71.5%. SAS Scandinavian Airlines flew 2.11 billion RPKs, down 19%, against a 17.5% fall in ASKs to 2.93 billion. Load factor was down 1.3 points to 72%. Alaska Airlines flew 1.5 billion RPMs in May, a 7.5% drop year-over-year. Capacity fell 6.3% to 1.95 billion ASMs and load factor was down 1 point to 76.8%.
Air Canada announced tentative agreements on its 21-month pension funding moratorium with some 3,200 pilots represented by the Air Canada Pilots Assn. and approximately 6,700 flight attendants represented by the Canadian Union of Public Employees, giving the airline the consent of all five Canadian unions and allowing it to move forward with its effort to seek new funding ( ATWOnline, June 10).
Iberia flew 4.02 billion RPKs in May, an 11.4% drop from the year-ago month. Capacity fell 9.6% to 5.15 billion ASKs, lowering load factor 1.6 points to 78%. SkyWest Airlines and Atlantic Southeast Airlines flew 1.47 billion RPMs in May, down 1.2% year-over-year. Capacity fell 2.8% to 1.83 billion ASMs and load factor rose 1.2 points to 80.1%. Hawaiian Airlines flew 682.6 million RPMs in May, down 2% year-over-year. Capacity rose 0.9% to 819.5 million ASMs and load factor dropped 2.4 points to 83.3%.
EgyptAir yesterday completed its move to the new Terminal 3 at Cairo International, joining six other Star Alliance carriers as part of the group's "move under one roof" initiative. "T3 brings high connectivity for us and our partners," Chairman Tawfik Assy told ATWOnline at last week's IATA annual general meeting in Kuala Lumpur. "Our membership in Star Alliance changed our image and we are getting a lot of positive response.
Citing the "slow recovery in air transport demand," Japan Airlines yesterday said it would "strive to improve profitability by adjusting capacity" and announced a reduction in its international schedule effective July 1. The company reported a ¥63.1 billion ($640.9 million) net loss in the fiscal year ended March 31 and said it expects a similar result this term ( ATWOnline, May 13).
American Airlines promoted MD-Airline Profitability and Financial Analysis Kenji Hashimoto to VP-strategic alliances and MD-International Planning Don Casey to VP-revenue management. Republic Airways Holdings promoted Finance Director Joe Allman to VP and controller.
Alaska Air Group board last week authorized a stock repurchase program worth up to $50 million. The company repurchased "nearly" $112 million of its common stock in 2007 and 2008.
Jet Airways said it will expand its Jet Airways Konnect all-economy service from today owing to "strong customer demand." It increased the domestic program by 30 daily flights over the weekend and will operate more than 100 as of today. The Konnect fleet comprises seven 737-800s and 10 ATR 72-500s ( ATWOnline, May 8).
Embraer announced the sale of an 84-seat E-175 to Japanese startup Fuji Dream Airlines for delivery next year. The Shizuoka-based carrier took delivery of its two ordered E-170s and expects to launch revenue service next month. FDA parent Suzuyo Group's original order was for two firm 170s plus one option, but the manufacturer said that deal was amended to allow for the purchase of the 175.
Rolls-Royce announced a $1.5 billion order from Gulf Air for Trent 700EP engines that will power 20 A330s. Deliveries are set to start in 2012. Deal includes a TotalCare services agreement and an extension to the TotalCare deal on Trent 700s already in service on 10 A330s. Rolls also signed a five-year extension to the TotalCare services agreement covering Condor Airlines' fleet of 13 RB211-535E4-powered 757s. Initial 10-year deal was set to expire this year; extension is worth some $150 million.
China Eastern Airlines and Shanghai Airlines have agreed on several major issues regarding their pending merger and expect to reveal further details within three weeks, CEA Chairman Liu Shaoyong said. Discussions began last Thursday when the airlines agreed to maintain the SAL brand and that no employees would be cut. Liu noted at a shareholders conference over the weekend that "the specific merger plan will have to be approved by the boards of CEA and SAL and the relevant government organs first before it can be made public."
Air India, which lost an estimated $800 million in the fiscal year ended March 31, will delay around $70 million in salary payments to its 31,500 employees for two weeks until July 15, several officials confirmed in news reports from India. Civil Aviation Minister Praful Patel said the government is considering a bailout "very actively" and that the carrier's health is the state's "responsibility," according to the Press Trust of India.
Sensis Corp.'s runway status lights were installed last week at Los Angeles International, which became the third US airport to add the safety technology. RWSL is a system of red lights embedded in runways that are triggered automatically by ASDE-X, warning pilots that it is unsafe to cross or enter a runway. Los Angeles World Airports paid $7 million for the system, which US FAA installed and will maintain.
Continental Airlines Chairman and CEO Larry Kellner said the carrier will enter Star Alliance "hours or days" after it exits SkyTeam on Oct. 24. "The difference for us between SkyTeam and Star is that we and Delta have a lot of overlap. . .whereas within Star there's a lot of open area," he said at last week's Bank of America Merrill Lynch Global Transportation Conference.
Hainan Airlines last week re-launched its Grand China Express Airlines subsidiary as Tianjin Airlines, part of its plan to focus on domestic regional market expansion this year and in 2010, according to Chairman Chen Feng. Tianjin-based GCEA has been loss-making since its June 2007 launch. The re-launched Tianjin Airlines has a registered capital of CNY1.3 billion ($190 million). Hainan will remain the controlling stakeholder and expanded its holding to more than 83% with an additional investment of CNY500 million.
Virgin America reported a first-quarter net loss of $40.3 million, narrowed from a net deficit of $52 million in the year-ago period, and the nearly two-year-old carrier said it is poised to continue growing steadily.
Aer Lingus said it has offered pilots and cabin crew unpaid leave, will cut long-haul winter seat capacity by about 25% for 2009-10 compared to the 2008-09 winter and also will trim short-haul capacity at Belfast and Dublin while adding frequencies and routes at Shannon and London Gatwick.
Delta Air Lines President Ed Bastian said last week that the company is "using the downturn to accelerate" the integration of DL and Northwest Airlines. With the carrier cutting capacity ( ATWOnline, June 12), it is able to eliminate overlapping services more quickly, he explained. "Our expectation is that by spring 2010, we will be a single company," he told the Bank of America Merrill Lynch Global Transportation Conference in New York, available via webcast.
GE Capital Aviation Services announced the promotion of Norman Liu, 51, to president and CEO. Liu will take over executive management of the business from Henry Hubschman, 61, who will take on the new role of chairman of GECAS. Changes are effective July 1. Liu is a 22-year veteran of GE Capital including 14 years at GECAS, where he most recently served as executive VP-commercial operations. Hubschman joined GECAS in 1997 and oversaw the growth of assets from $10 billion to more than $46 billion during his tenure.
Boeing yesterday said that commercial aviation is "cyclic and has a long history of declines and upturns" as it revised downward its 20-year forecast only slightly to a market demand of 29,000 new passenger and freighter aircraft worth $3.2 trillion.
