Lufthansa suspended talks regarding a possible takeover of SAS Group ( ATWOnline, Sept. 24), Germany's dpa news agency reported, citing sources close to the negotiations who said a steep loss at SAS subsidiary Spanair is a primary reason for the retreat. An LH spokesperson contacted by ATWOnline would not comment on the report.
FedEx said yesterday that it intends to reduce carbon dioxide emissions from its aircraft fleet by 20% by 2020. It said it already has reduced CO2 emissions by 3.7% per ATM since 2005. Key to the increased efficiency will be the replacement of its 90 727Fs with at least 87 757-200 converted freighters by 2016. The 757s will reduce "fuel consumption up to 36% while providing 20% more payload capacity," it said.
CAE won orders for full-flight simulators and related CAE Simfinity training devices valued at C$63 million ($52.6 million) from American Airlines, Air New Zealand, Suzuyo and Embraer CAE Training Services. AA purchased a CAE 7000 Series 737NG FFS and CAE Simfinity 737NG Integrated Procedures Trainer. ANZ ordered a 787 FFS and a 777-300 FFS as well as a suite of CAE Simfinity training devices for each aircraft type including IPTs and virtual simulators. Suzuyo bought a CAE 7000 Series E-170 FFS and an E-170 IPT. ECTS committed to a CAE 5000 Series Phenom 100/300 FFS.
Cathay Pacific Airways CEO Tony Tyler said the current industry downturn will last longer than the one associated with SARS in 2003 but that there will be little, if any, cross-border consolidation, particularly in Asia, as a result. "It's already looking difficult and the question is how long and how deep it will be," Tyler told ATWOnline at the Australian Airports Assn. national convention in Perth. But relief will not come through consolidation, which did not occur during the 1997 Asian financial crisis or SARS, as many analysts predicted.
Fuel costs and the weakening won combined to drag Asiana Airlines to a KRW47.9 billion ($36 million) loss in the third quarter, reversed from a KRW37 billion profit in the year-ago period.
The world's first commercial aviation test flight powered by a sustainable second-generation biofuel will take place on Dec. 3 on an Air New Zealand 747-400 with a jatropha blend powering one of the Rolls-Royce RB211 engines.
LAN Airlines signed a contract for four 767-300s for delivery in 2012 plus two options, according to a Nov. 10 stock market filing cited by both Reuters and the Associated Press. Neither Boeing nor the carrier confirmed the order, which LAN said was worth approximately $636 million. It has 26 787s on order.
Aegean Airlines reported net income for the first nine months of 2008 of €26.5 million ($34 million), down 21% from €33.4 million in the year-ago period, saying the results were "solid" given "unprecedented" oil prices earlier this year and "deteriorating economic conditions." The carrier did not provide quarterly results, but ATWOnline calculated that it posted a €21 million third-quarter profit on €205.5 million in revenue. Earnings were hurt by valuation losses on US dollar aircraft loans and fuel hedges.
IBM reached a deal with TAM for technology services, including installation of IT infrastructure and associated help desk and field support. Contract is expected to improve the carrier's server as well as its check-in system and tickets and reservation software.
Air Arabia reported a AED214 million ($58.2 million) third-quarter profit, up 29.7% from the AED165 million earned in the year-ago period. The Sharjah-based LCC enjoyed a 69% year-over-year increase in revenue to AED625 million on a 34% rise in passengers to 978,794. Load factor was level at 87%. Nine-month profit of AED374 million was up 34% from AED280 million in the first three quarters of 2007. The airline celebrated its fifth anniversary two weeks ago.
Tunisair, SITA and Medsoft, a Tunisian IT company, have launched Aviation IT Services Africa, which will provide all information and computer technology services (both administrative and operational) to the airline over the next 10 years using adapted SITA solutions. The venture has launch capital of $3 million and will be held jointly by Tunisair (50%), SITA (49%) and Medsoft (1%). "This is the largest outsourcing deal SITA has ever signed with an airline," CEO Francesco Violante said at the recent Arab Air Carriers Org. meeting in Tunis.
Aer Lingus yesterday said its full-year operating loss will be "closer" to the lower end of the projected €20-€30 million ($25.7-$38.5 million) range forecast previously but that it expects another operating loss in 2009. Operating loss through the first half of 2008 was €22.3 million.
American Airlines flew 10.51 billion system RPMs in October, an 8.8% decline from the year-ago month. Capacity fell 7% to 13.3 billion ASMs and load factor was down 1.5 points to 79%. American Eagle flew 641.7 million RPMs, down 15.5%, against a 10.8% fall in ASMs to 921.3 million, dropping load factor 3.9 points to 69.6%. US Airways Group flew 4.89 consolidated RPMs in October, a 3.5% decrease year-over-year, against a 5% fall in ASMs to 6.02 billion. Load factor increased 1.3 points to 81.3%.
Emirates blamed fuel prices for an 88% plunge in fiscal first-half profit to AED284 million ($77.3 million) from the AED2.36 billion earned in the six months ended Sept. 30, 2007. Chairman and CEO Ahmed bin Saeed Al-Maktoum said the semester "has been very tough for the airline industry" and that EK "has worked hard to manage the impact of high fuel prices on our unit costs while continuing to grow our business."
TAM suffered a BRL112.7 million ($52.2 million) loss in the third quarter, reversed from a BRL48.5 million profit in the year-ago period, despite a 40.5% surge in operating revenue to BRL2.9 billion. The Brazilian carrier's costs grew 36.2% to BRL2.73 billion but BRL301.5 million in financial charges, owing mainly to losses on fuel hedges, dragged its operating result into the red. Operating loss was BRL152.9 million compared to a BRL78.3 million profit last year. Passenger numbers rose 17% to 7.9 million as RPKs jumped 25.2% to 10.41 billion.
WestJet reported third-quarter net income of C$54.7 million ($46 million), down 28.1% from C$76.1 million last year, saying it was hurt by high fuel costs and "the beginning of a more challenging environment for demand." Nevertheless, President and CEO Sean Durfy touted the Calgary-based carrier's continued capacity expansion, which included 20.1% growth in the third quarter, as "purposeful and profitable" at a time when many airlines are reducing capacity and losing money.
DHL yesterday pulled the plug on its five-year push to become the "third alternative" to UPS and FedEx in the US express shipping market, announcing that all domestic US services will cease early next year as it focuses exclusively on international operations to/from 15-20 US metropolitan areas. "The basic reason is that the US is a highly concentrated duopoly market and the reality is. . .UPS and FedEx's scale, market reach and brand awareness have made it impossible for us to make it economically viable," DHL Express CEO John Mullen told reporters in a conference call.
Austrian Airlines Group will run out of cash by mid-2009 at the latest if it is unable to find a new owner or secure funding from the Austrian government, which was asked by Lufthansa to take responsibility for a significant portion of AAG's debt in exchange for a German takeover ( ATWOnline, Oct. 28). Analysts from Austrian banks now predict a 20% chance of bankruptcy.
Having already sealed a codeshare deal giving it access to Canada, Southwest Airlines yesterday announced a partnership with Toluca-based Volaris that will give the world's largest LCC a foothold in Mexico for the first time.
Alma de Mexico suspended operations and filed for bankruptcy last Friday, citing the "crisis" in the industry and global economy. The Guadalajara-based LCC operated 19 CRJ200s and had two CRJ900 NextGens on order ( ATWOnline, Aug. 9, 2007). It said "historic" high fuel prices, low occupancy and the peso's fall against the US dollar were key factors in its demise.
Qatar Airways secured $500 million in financing for the purchase of three 777-300ERs. Twelve-year arrangement is with Bank of Tokyo-Mitsubishi UFJ, BNP Paribas, Deutsche Bank, Standard Chartered Bank (facility agent and security trustee) and Sumitomo Mitsui Banking Corp. Europe.
Thai Airways reported a THB426.2 million ($12.1 million) profit in the third quarter, reversed from a THB971.1 million deficit in the year-ago period, according to a company statement cited by Reuters. A foreign exchange gain of THB4.73 billion was the difference and compared to a THB3.36 billion forex loss in the third quarter of 2007. Operating result swung to a THB3.2 billion loss from a THB2.43 billion profit as passenger revenue rose 10% year-over-year to THB43 billion while fuel costs soared 68.2%.
British Airways reported a consolidated net loss of £49 million in its fiscal first half ended Sept. 30, which implied a steep second-quarter deficit of £76 million, a reversal from earnings of £333 million in the three months ended Sept. 30, 2007.
