Air China is looking at presenting a bid for Star Alliance partner Austrian Airlines in order to establish a foothold in the West. A CA spokesperson revealed yesterday that the Beijing-based carrier recently sent a senior management and financial adviser of China International Capital Corp. to visit Austrian, which this week recommended that the government move forward with privatization ( ATWOnline, July 31). The CA spokesperson would not confirm that the visit was related to a possible bid for OS.
Austrian Airlines Group plans to phase out 12 CRJs. One will be retired, two will be replaced by Q400s acquired from SAS Group and nine will be made available for sale. Meanwhile, AAG subsidiary Austrian Technik Bratislava is targeting the F70/100 market. "ATB is the only maintenance facility beside the manufacturer in the Netherlands for Fokker jets. ATB is also JAR 145 approved," COO Peter Malanik told ATWOnline. ATB employs 130 staff and is looking to increase third-party work.
Lufthansa Group yesterday released details of its second-quarter performance, confirming both the €345 million ($541.6 million) profit that fell 21.2% year-to-year and the significant contributions of its Swiss International Air Lines subsidiary. Group revenue rose 20% to €6.47 billion and operating profit slipped 6.2% to €530 million from €565 million in the second quarter of 2007.
Philippine Airlines posted a profit of $30.6 million in its fiscal year ended March 31, down 76.6% from the $130.5 million earned in the previous 12 month period. Still, PAL called it a "noteworthy result in the escalating-fuel-price environment that has battered the aviation industry since last year." It is the restructured carrier's fourth consecutive full-year profit. Operating revenue rose 15% to $1.46 billion and expenses were up 14.9% to $1.37 billion. Operating profit increased 19.9% to $84.3 million from $70.3 million. The 2006-07 net result was boosted by special gains.
Surging revenue and relatively successful efforts to mitigate the impact of rising fuel prices helped boost LAN Airlines to a $47.2 million profit in the second quarter, up 10.7% from the $42.6 million reported in the year-ago period. It said its "strong first-half performance provides a solid base for long-term growth and profitability. As a consequence, LAN is in a position to plan for capacity expansion in response to growth opportunities, while leveraging opportunities to improve its cost performance."
WestJet reported second-quarter net income of C$30.2 million ($29.5 million), up 161.4% from an C$11.5 million profit in the year-ago period, on a 23.6% lift in revenue to C$616 million. The Calgary-based LCC conceded that last year's quarterly results were affected by one-time costs associated with scrapping installation of the aiRES reservation system; excluding those charges, second-quarter 2007 income was C$33.7 million. This year's result represented a 10.4% earnings decrease excluding special charges.
United Airlines yesterday filed a federal lawsuit seeking a preliminary injunction against the Air Line Pilots Assn., which the carrier claimed has engaged "in deliberate, organized and unlawful job actions" that have resulted in "hundreds" of flight cancellations. UA claimed the union and four specific pilots participated in "organized sick leave abuse in opposition to the company's plan to reduce its fleet size and furlough pilots" and to pressure the company to reopen collective bargaining negotiations.
Investigators examining the decompression explosion onboard a Qantas 747-400 last Friday found that a part from the suspect and missing oxygen bottle No. 4 burst into the aircraft's cabin and moved an exit door handle ( ATWOnline, July 29)."There was never any danger of the door opening," Australian Transport Safety Bureau Director Julian Walsh told media. ATSB investigators have focused on the oxygen bottles in the aircraft's forward cargo compartment as the culprit in the explosion, which tore a 1-sq.-m.
Aircraft Leasing & Management was contracted by Air Mauritius to remarket two A319-112s powered by CFM56-5B6/Ps. Aircraft will be offered for lease for up to three years.
Aeroflot will not bid for Austrian Airlines, the Russian carrier said yesterday. "The risks outweigh the reward," an SU spokesperson told Reuters. The OS board this week approved the privatization of the carrier and is waiting on a decision from the government, which controls holding company OIAG ( ATWOnline, July 30).
Frontier Airlines entered into a letter of intent to sell six of its 47 A319s to VTB Leasing, which will place the aircraft with Rossiya. The parties previously had agreed to the transfer of two A319s and two A318s ( ATWOnline, March 24). The revised agreement calls for VTB to purchase the six A319s next month. Frontier said it also has reached an agreement "on other sale/leaseback transactions that further supplement its liquidity positions." The transactions are worth approximately $80 million to the airline, it said.
Oneworld partners British Airways and Iberia yesterday confirmed that the boards of both carriers "unanimously" support negotiations "with a view to an all-share merger between the two companies."
AirTran Airways parent AirTran Holdings reported a net loss of $13.5 million for the second quarter, reversed from a profit of $42.1 million in the year-ago period, saying the "loss is primarily attributable to the effects of record high fuel costs."
Lufthansa Group yesterday reported a €402 million ($632.1 million) first-half net profit, implying a robust €345 million second-quarter return that represented a 21.2% decline from the €438 million earned in the year-ago quarter. The company earned €992 million in the first half of 2007, a figure that was fueled by large nonoperating gains related to the sale of its Thomas Cook stake.
Austrian Airlines Group, which yesterday reported an €11.7 million ($18.4 million) second-quarter profit that represented a 51.9% increase from the €7.7 million earned in the year-ago period, asked the government to grant quick approval for divestment of state holding company OIAG's 42.75% stake in the flag carrier, freeing it to pursue a strategic equity partnership.
Jet Airways reported a INR1.43 billion ($33.7 million) profit in the fiscal first quarter ended June 30, more than four times the INR309 million earned in the year-ago period. Revenue rose 46.2% to INR28.99 billion as passenger numbers climbed 18% to 3.2 million. The Indian carrier's domestic operation posted a INR5.02 billion pre-tax profit, nearly four times greater than the INR1.31 billion reported last year, while internationally the company suffered a pre-tax loss of INR2.83 billion, widened from an INR817 million deficit in the June 2007 quarter.
JetBlue Airways CEO Dave Barger will take a 50% cut in his base salary for the July 1-Dec. 31 period "in recognition of the challenges faced by the company and its employees in the current industry environment," the airline said. Barger makes $500,000 per year.
Honeywell delivered the nitrogen generation system for the 737NG, which it said "is the first fully FAA-certified fuel tank inerting solution for commercial transport aircraft." Two weeks ago, US FAA announced that within two years all new aircraft must include technology designed to reduce significantly the risk of center fuel tank explosions such as the one that is believed to have resulted in the 1996 loss of TWA 800 ( ATWOnline, July 17), and all passenger aircraft built after 1991 must be retrofitted.
Australian Transport Safety Bureau pointed to an exploding oxygen cylinder as the likely culprit in last week's Qantas 747-400 decompression and fuselage hole incident ( ATWOnline, July 28). ATSB Senior Investigator Neville Blyth told media in Manila, where the aircraft made an emergency landing, that parts of the valve of a missing oxygen cylinder and its handle were found near the 1.5-m. breach in the aircraft's hull. However, the full cylinder itself was missing.
Sichuan Airlines is preparing the launch of a new business jet joint venture with European Flight Services despite the decline in domestic demand that has accompanied surging fuel prices. Shanghai-based Genesis Investment Management also is expected to be a stakeholder in the new company, which will be named EFS Asia Pacific and will adopt the Legacy 600 as its main fleet type.
Iberia flew 4.58 billion RPKs in June, down 2.3% year-over-year, against a 0.9% lift in ASKs to 5.65 billion. Load factor fell 2.7 points to 81.1%. SAS Group airlines flew 4.13 billion RPKs in June, up 3.5% from the year-ago month. Capacity rose 5.9% to 5.53 billion ASKs and load factor fell 1.8 points to 74.7%. SAS Scandinavian Airlines flew 2.73 billion RPKs, up 3.8%, against a 7.4% lift in ASKs to 3.54 billion. Load factor fell 2.7 points to 77.1%.
Ryanair reported an 85% plunge in its fiscal first-quarter profit to €21 million ($33 million) from the €139 million earned in the three months ended June 30, 2007, as a near doubling in oil prices and falling yield overshadowed a 19% increase in passengers.
Emirates took delivery of its first A380 in Hamburg yesterday and during the handover ceremony signed a letter of intent to firm options on 30 A350 XWBs and order 30 A330-300s.
Hedging gains helped insulate Singapore Airlines parent SIA Group from the difficult operating environment during the fiscal first quarter ended June 30 as it reported a S$358.6 million ($263.5 million) profit that represented just a 15.4% decline from the S$424.1 million reported in the year-ago period. "The outlook for the airline industry remains uncertain," it said. "Under these circumstances, the companies in the group are tracking trends closely and are in a good position to react nimbly."
As Qantas continued to investigate last Friday's 747-400 incident (see next item), it continued to plan for its future with the announcement that Jetstar Airways CEO Alan Joyce, 42, will replace outgoing CEO Geoff Dixon effective Nov. 28. Joyce, a Dublin native who also holds an Australian passport, has led QF's no-frills subsidiary since 2003. He previously worked at Aer Lingus and Ansett Australia.
