Northwest Airlines reported bankruptcy exit aided net income of $2.32 billion for 2007, a dramatic turnaround from a net loss of $2.86 billion in 2006 when it was operating under Chapter 11 protection. The carrier's 2007 pre-tax income excluding reorganization items was $764 million, a more-than-150% improvement over $301 million on similar terms in the prior year. It posted a fourth-quarter net loss of $8 million, narrowed from a net loss of $267 million in the 2006 period.
German travel conglomerate TUI announced yesterday that it signed an MOU with Lufthansa to combine their LCC subsidiaries under one "joint and independent holding company." TUI owns TUIfly, the combination of Hapag-Lloyd Flug and Hapag-Lloyd Express, while Lufthansa partners with Germanwings and Eurowings along with Albrecht Knauf Industriebeteiligung. The latter also signed the MOU, TUI said. Agence France Presse said a mid-2009 timeframe for finalization is TUI's target.
Air Transport Assn. said the US airline cost index in the third quarter of 2007 was up 0.2% from the year-ago period. The consumer price index rose 2.4% over the same period, ATA said. Fuel, which accounted for 25.9% of expenses, rose 1.6% to $2.11 per gal. Unit operating cost per ASM was unchanged at 12.49 cents. "The slowing economy and sky-high fuel prices are putting tremendous pressure on US airlines to reduce nonfuel costs.
Singapore announced the conclusion of bilateral open skies agreements with Denmark, Norway and Sweden. The agreements provide for "unlimited hubbing rights" for cargo carriers as well as conventional open skies conditions. Singapore now has open skies arrangements with 13 EU countries.
A year that begin with much-publicized operational problems and ended with a fourth-quarter loss still was a positive one for JetBlue Airways, which reported net earnings of $18 million for 2007, reversed from a $1 million loss in the prior year and its first full-year profit since 2004.
Emirates SkyCargo and Dubai Customs signed an MOU to explore greater use of electronic correspondence in transactions between the airline and the agency and also in dealings with other supply chain partners. In addition, the initiative will allow importers and exporters to perform 51 customs transactions electronically without having to visit customs centers physically.
China's State-owned Assets Supervision and Administration Commission of the State Council has emerged as the controlling shareholder of the country's new large commercial aircraft manufacturing concern, according to Shanghai Securities News. Other stakeholders include AVIC I and AVIC II--which will hold the second-largest stake jointly--local government, Baosteel Group and Aluminum Corp. of China.
Lufthansa flew 8.73 billion RPKs in December, up 5.5% from the year-ago month. Capacity rose 4.3% to 11.9 billion ASKs, lifting load factor 0.8 point to 73.4%.
EgyptAir will undertake an enormous effort in an attempt to join Star Alliance this year, giving the grouping a boost as it attempts to counter the influence of Emirates in that part of the world. "We are trying very hard to be a member by the fourth quarter of 2008," Chairman and CEO Sherif Saad Eldin Galal told ATWOnline in Cairo.
Jet Airways, India's sole profitable major carrier, yesterday reported a INR911 million ($23.1 million) loss for the fiscal third quarter ended Dec. 31, reversed from a profit of INR400 million in the year-ago period, ending a streak of four consecutive positive quarters.
Singapore Airlines yesterday was named Air Transport World's Airline of the Year for 2008, recognized for its superb safety record, exemplary commitment to operational excellence and customer service, and strong financial performance.
El Al will receive a significant financial boost from the Israeli government to cover rising security expenses in exchange for allowing smaller rivals Arkia Israel Airlines and Israir Airlines access to previously monopolized long-haul routes, according to widespread press reports. The move was in response to increasing pressure from foreign carriers, which have increased the number of seats offered to/from the country by 45% since April 2006, according to Reuters.
Lufthansa and DHL Express yesterday announced that their 50/50 joint venture cargo airline AeroLogic will be based at Leipzig/Halle Airport and have a fleet comprising 11 leased 777Fs by 2012.
Northwest Airlines flight attendants represented by the Assn. of Flight Attendants-CWA released a set of conditions under which they would support a merger, including a labor agreement "that provides substantial improvements in compensation and work rules to the current flight attendant agreement" and continuation of a "strong hub presence" at Minneapolis-St. Paul. The union claimed that NWA executives confirmed details of their severance packages in the event of a merger prior to the airline's exit from bankruptcy, citing a 2007 filing with the US Securities and Exchange Commission.
US Airways named VP-Financial Analysis Dion Flannery as president of US Airways Express. He succeeds the retiring Robert Martens. Finnair named Alliance Director Kati Ihamaki as VP-sustainable development.
Frontier Airlines Holdings, parent of Frontier Airlines and Lynx Aviation, reported a $32.5 million net loss for its fiscal third quarter ended Dec. 31, widened from a loss of $14.4 million in the year-ago period.
Coast Air, a Norwegian regional carrier that operated eight domestic routes as well as international service to Copenhagen and Gdansk, shut down last week, according to press reports.
Lufthansa Cargo will expand its foothold in China with a joint venture with Hua Yu Air Cargo Terminal Co. at Tianjin Binhai. A new 90,000-sq.-m. air cargo center is expected to become operational this year and will offer the capacity to handle 360,000 tons of cargo annually. LHC will own a 46% stake in HYACT while Taiwanese investor Hwa-Hsia International Holding will hold 49% and Tianjin Airport International Logistics will have the remaining 5%.
American Airlines introduced a mobile version of its website that will allow users to check in and confirm their itinerary and schedule/status in addition to other features. Booking, reservation changes and loyalty program features will be available this spring.
Emirates Chairman and CEO Ahmed bin Saeed Al-Maktoum confirmed the airline's intention to float a 20%-30% stake in a wide-ranging interview with Emirates Business 24/7 in which he also said EK continues to target a $1 billion profit for the fiscal year ending March 31.
Air New Zealand slashed its standard domestic fares 9%-27% to stimulate travel and tourism. The changes, effective from Feb. 23, are for lead-in "smart saver" fares on 40 domestic routes. These will be introduced alongside reductions of 20%-30% in top-end fares on a number of regional routes popular with business customers and cuts of 15% in top-end fares on main trunk routes. The restructuring comes after a two-year, NZ$350 million ($268.6 million) buildup of the regional fleet that has seen average seat capacity increase 46%.
Chinese carriers are expecting airport charges to rise for international operations following Friday's CAAC announcement that it will adopt a new policy on March 1. The regulator intends to eliminate the discrepancy between the charges paid by domestic airlines and their foreign counterparts. Under the new policy, Chinese carriers will see an increase in the fees they pay to operate internationally while foreign airlines are expecting a reduction in their charges. Currently they are forced to pay 2-3 times more at Chinese airports.
India and Saudi Arabia signed an air services agreement that will more than double the number of available seats per week between the countries to 20,000 from 8,500. Saudi carriers now can fly to Bangalore, Lucknow and Calicut in addition to the five Indian cities already permitted. Indian airlines will have access to Madina, their fourth destination in Saudi Arabia. Cargo flights will have no restrictions.
Air India, Jupiter Aviation and Airbus signed an MOU last week to establish a three-way JV MRO facility in India to perform work on all types of Airbus aircraft operated by AI and other Indian airlines. Air India told The Economic Times that it will develop a business plan for the MRO over the next two months to be submitted to its board for approval. The deal was reached during French President Nicolas Sarkozy's visit to India last week.
Aviation Capital Group said it concluded 48 aircraft lease and acquisition transactions in 2007. It also placed orders for 45 A320 family aircraft, 30 737s and five 787s worth more than $5 billion at list prices and arranged 19 aircraft sale/placement transactions.
