China Eastern Airlines may post a net profit as high as CNY40 million ($5.3 million) for the first half of 2007, a source told ATWOnline. The carrier expects to release its financial results next month and, as a listed company, was unable to confirm the figure. China Eastern Group President Li Fenghua said this month that CEA is targeting the black following a net loss of CNY2.78 billion last year ( ATWOnline, July 4).
One day after reporting a 16.5% decline in second-quarter earnings and promising that the company will take a more cautious approach to growth, Southwest Airlines announced that Executive Chairman Herb Kelleher and President Colleen Barrett, the faces of the carrier that irrevocably altered US commercial aviation, will step down from their positions in 2008 at the conclusion of their contracts and leave the company five years later.
UPS yesterday took delivery of its first CF6-80C2B5F-powered 747-400F, which it plans to deploy on international services to the Asia/Pacific. The company will take delivery of two more -400Fs this year and five in 2008. In addition, it will acquire five of the type from other carriers by 2010, bringing its total -400F fleet to 13. The -400F has a payload of 273,300 lb. with a range of 4,400 nm. It has 30 load positions on its main deck and can carry 32 smaller containers on the lower deck. It will be the first freighter in the UPS fleet with a hinged nose.
The pilot of the TAM A320 that crashed late Tuesday at Sao Paulo Conganhas apparently tried to abort the landing and pull up as he contacted the rain-slickened, 6,365-ft. runway at Brazil's busiest airport.
Admitting it was unable to keep pace with rising fuel costs, Southwest Airlines yesterday reported a second-quarter net profit of $278 million that represented a 16.5% drop from earnings of $333 million in the second quarter of 2006.
World Air Holdings said yesterday that its stockholders "overwhelmingly indicated their support" for a merger agreement that would see WAH, parent of World Airways and North American Airlines, acquired by ATA Airlines parent Global Aero Logistics ( ATWOnline, July 13). Stockholders voted by a 98% to 2% margin to approve the transaction and WAH said it anticipated the deal will close by the end of the current quarter.
Alitalia's privatization as currently envisioned by the Italian government appears to be history following the withdrawal of Air One parent AP Holding ( ATWOnline, July 18), although reports varied on the level of interest maintained by US private equity fund MatlinPatterson. Late yesterday, Reuters reported that MP would consider a bid if sale conditions were altered, contradicting earlier statements that it had withdrawn completely.
Astar Air Cargo yesterday extended the deadline for a response from ABX Air to its "indication of interest" to acquire its fellow DHL subservice carrier for more than $450 million in cash to July 27, noting it has been assured that ABX's board will meet with legal and financial advisers on June 20 to consider the proposal and formulate a response ( ATWOnline, July 2).
Delta Air Lines reported net income of $1.77 billion for the second quarter, a striking turnaround from a $2.21 billion loss in the year-ago period, as it emerged from bankruptcy on April 30 and benefited from one-time reorganization gains in the June quarter. Excluding reorganization items, which included noncash adjustments to its revalued assets and liabilities that "significantly impacted" its balance sheet, DL posted net income of $274 million for the quarter.
Qantas board met yesterday to consider a range of issues related to the future structure of the airline following the failed Airline Partners Australia buyout. On the agenda was the appointment of a new chairman to replace the highly respected Margaret Jackson, who was forced out by ill health and the fallout from the failed bid ( ATWOnline, May 18). CEO Geoff Dixon and CFO Peter Gregg still want to move forward with a number of initiatives suggested by APA.
Unisys Corp. was selected by the US Cargo Sales Joint Venture to provide "a broad range of IT outsourcing support services" for the organization. USJV is an alliance of Delta Air Lines, Air France and Korean Air offering cargo-related services in the US. Under the terms of the contract, Unisys will provide USJV with outsourced data center, security, network and desktop management services over a three-year period.
Despite weather-related delays and cancellations and higher-than-expected fuel prices, American Airlines parent AMR Corp. posted net income of $317 million in the second quarter, up 8.9% over a $291 million profit in the year-ago period and its fifth consecutive quarter in the black following years of steep losses.
Hainan Airlines expects its profit for the first six months of 2006 to soar by an estimated 750% over the CNY20.8 million ($2.7 million) in net income it earned in the year-ago period, according to a preliminary announcement released yesterday by the Shanghai Stock Exchange. The carrier credited lower domestic oil prices and the appreciation of the yuan for the performance, but did not elaborate further.
SriLankan Airlines Group, parent of the namesake airline and SriLankan Catering, posted a net profit of LKR862.2 million ($7.7 million) in the financial year ended March 31, marking its fifth consecutive profitable year but a 50% plunge from the prior 12-month period.
Russia's S7 Airlines said it has been negotiating a potential oneworld membership with British Airways. "Members of oneworld alliance are interested in having a reliable partner in the Russian aviation market, which today is one of the most promising and rapid-growing markets," S7 said. "S7 can become such a partner, as it possesses a unique and the most developed route network in Russia." Aeroflot is a member of SkyTeam and AiRUnion, which said it intends to join an alliance by 2015 ( ATWOnline, Feb.
Australian domestic market is heading for intense price competition as Singapore-based Tiger Airways announced more domestic routes and fares for its Australian launch in late November ( ATWOnline, June 29). Tiger's latest route announcement is Melbourne-Launceston with fares starting at A$39.99 ($34.87). Its Australian operation will be based in Melbourne and destinations include Perth, Mackay, Rockhampton, Alice Springs and Darwin.
Four US legacy carriers that announced Monday their intention to compete for the right to operate new routes to China ( ATWOnline, July 17) have been joined by American Airlines, United Airlines and a surprise entrant--all-business-class carrier MAXjet Airways. AA proposed to add a daily Chicago O'Hare-Beijing flight to its daily ORD-Shanghai service beginning March 25, 2009.
Air Canada and Air Canada Jazz flew a combined 4.5 billion RPMs in June, up 2% on the year-ago month. Capacity climbed 1.8% to 5.43 billion ASMs and load factor rose 0.2 point to 82.8%. Singapore Airlines flew 7.51 billion RPKs in June, up 1.7% from the year-ago month, against a 1.4% decline in capacity to 9.11 billion ASKs. Load factor climbed 2.5 points to 82.4%.
Air One parent AP Holding late yesterday withdrew from the bidding for Alitalia, leaving the Italian government scrambling ahead of the July 23 deadline for final offers. According to an AP Holding release cited by widespread press reports in Italy, the company said it determined that turning around the flag carrier would "require different acquisition conditions that would make possible Alitalia's sustainable and competitive growth." It did not elaborate, and the government did not release a statement last night.
Continental Airlines, Delta Air Lines, Northwest Airlines and US Airways yesterday launched formal bids to operate new services to China that will become available as the result of the expanded aviation agreement with the US signed last week. The US Dept. of Transportation will award six new routes between 2007 and 2009 ( ATWOnline, May 24) and each of the aforementioned carriers filed official applications yesterday.
Magellan Group and Mercury Aviation Partners signed an MOU to create M&M Services, a 50/50 joint venture LLC that will build an operating lease portfolio of "mature aircraft subject to lease with part-out being the long-term goal for each aircraft." M&M said it plans to acquire up to $100 million worth of aircraft such as 737 Classics, 757s, 767s, A320s, ATR 42/72s, Dash 8s and Brasilias.
Chinese carriers posted a collective profit of CNY900 million ($118.7 million) in the first four months of 2007, reversed from a net loss of CNY4 billion in the year-ago period, according to CAAC statistics. CAAC cited an "effective cost-saving" policy as the main reason for the improved performance.
