American Airlines plans to maintain a low-to-negative growth strategy for the foreseeable future even as it accelerates deliveries of 737-800s to replace its MD-80 fleet ( ATWOnline, March 29). "It's very much about replacement, not growth," VP-Corporate Development and Treasury Beverly Goulet said yesterday at the Bear Stearns 2007 Global Transportation Conference, available via webcast.
BAA announced the sale of Budapest Airport to a consortium led by Hochtief Airport for £1.31 billion ( ATWOnline, Oct. 23, 2006). The UK airports operator said the decision was driven by parent company Ferrovial's desire to focus on its seven home airports. The sale is expected to be complete at the end of this month. Leeds Bradford International Airport has been sold to Bridgepoint, a private equity firm, for £145.5 million ($289.9 million) following a decision by West Yorkshire officials.
Ryanair yesterday said that "from today, all of Ryanair's fares will be quoted inclusive of taxes" in conjunction with a seat sale that includes a promise to pay passengers double the difference between a Ryanair fare and a cheaper fare on the same route operated by a competing carrier. The LCC transported 4.1 million passengers in April, up 19% from the year-ago month. Load factor fell 2 points to 83%.
Libyan government said it will invest $1.2 billion to modernize the fleets of its two national carriers, Libyan Airlines and Afriqiyah Airways. According to the Arab Air Carriers Organization, Libyan officials plan to buy up to 12 Airbus aircraft and remain in negotiations with Boeing.
Northwest Airlines said yesterday that preliminary results indicate 96.9% of its creditors, comprising 98.4% of the dollar value of claims, voted to approve its plan of reorganization, clearing the way for the carrier's emergence from bankruptcy next month. Final voting results will be filed this week with the US Bankruptcy Court, which will hold a confirmation hearing May 16.
British Airways flew 9.46 billion RPKs in April, down 2.2% from the year-ago month. Capacity was up 0.5% to 12.3 billion ASKs, dropping load factor 2.1 points to 76.9%. Continental Airlines flew 7.85 billion consolidated RPMs in April, up 4.8% on the year-ago month. Capacity rose 5% to 9.54 billion ASMs, dropping load factor 0.2 point to 82.3%. Domestic traffic grew 5.2% against a 5.8% climb in capacity that cut load factor 0.4 point to 85.5%. International RPMs lifted 6.3%, capacity was up 6.1% and load factor rose 0.1 point to 79.6%.
TAM and LAN yesterday announced agreement on a formalized business alliance for services in South America, to be implemented "within the next months," that apparently will include codesharing, linking loyalty programs and lounge sharing. "TAM will expand its flight [offerings] in South America to include a more complete and diversified network for its passengers. In addition, clients of LAN Alliance companies will enjoy the ease of traveling routes operated by TAM and TAM Mercosur, with multiple hours and frequency options," the companies said.
EasyJet yesterday reported a narrowing of its pre-tax loss for the six months ended March 31 to £17 million ($33.9 million) from £40 million in the year-ago semester and confirmed it expects full-year pre-tax earnings to increase 40%-50% over the previous year's £94.1 million.
A significantly improved operating result helped Japan Airlines Corp. narrow its net loss for the fiscal year ended March 31 to ¥16.2 billion ($135.1 million) from ¥47.2 billion in the prior year, although the bottom line was hurt by the removal of a ¥54.4 billion deferred tax asset from the balance sheet and an extraordinary loss of ¥6 billion from a special early retirement program launched in March.
Emirates is focused on simplification and fuel efficiency as it enters the final lap of what will be a major fleet expansion program taking it to 2020. On the shopping list are more 777s, A350-900s/-1000s, 787s and 747-8Is. President Tim Clark told ATWOnline prior to his trip to Seattle this weekend that the airline is "focused on fuel efficiency" even if it means a slight drop in capability.
Flybe signed a deal with Bombardier for 15 Q400s valued at $394 million, with options for a further 15. The UK regional, which recently acquired BA Connect from British Airways ( ATWOnline, March 6), is the world's largest Q400 operator. The latest order will increase its Q400 fleet to 60. It also operates E-195s.
China's new privately run LCCs are looking to strategic investors as a method of raising capital, as it is becoming increasingly difficult to access traditional sources of bank lending owing to the airlines' less-than-stellar financial performance. Juneyao Group announced that its Juneyao Airlines subsidiary is seeking a strategic investor to aid in the carrier's long-term development. The announcement was made after Juneyao said the airline was profitable in April and expects to post a full-year profit as well. Actual results were not disclosed.
Northwest Airlines labor unions registered strong protest to the carrier's plan of reorganization after it was revealed that top executives will receive 5% of the carrier's new stock when it emerges from bankruptcy, including shares and options reportedly valued at $26.5 million earmarked for President and CEO Doug Steenland. Pilots, represented by the Air Line Pilots Assn., said in a US Bankruptcy Court filing that employees believe "the principle of shared sacrifice is dead and buried" and that top executives are making an "incredible grab" for valuable stock despite the fact that
American Airlines is reserved on the effect open skies will have on its US-EU traffic. "There has been a lot of excitement over it over the past weeks, but it is too early to tell what will happen," MD-Sales and Marketing-Europe, Middle East and Africa Maria Sebastian told ATWOnline while in Brussels to present the carrier's upgraded 767-300 business class. "I suspect it will lead to a more competitive environment, certainly at London Heathrow.
Calling it a "tipping point for performance-based navigation," US FAA Administrator Marion Blakey said at a briefing at Washington National Airport yesterday that Southwest Airlines informed the agency that it will equip its entire fleet for RNP, including retrofitting its 737 Classics. The airline confirmed the plan, which Air Transport Assn. President and CEO James May said was an indication that "the entire industry is migrating as rapidly as possible to NextGen."
Qantas shares dipped 2.97% to A$5.22 ($4.30) yesterday, one day after trading was suspended in the wake of the chaotic collapse of Airline Partners Australia's A$5.45-per-share bid for the airline. The decline was not the magnitude predicted by APA, although the consortium's indication that it may return with another offer likely helped support the share price ( ATWOnline, May 8).
Air One yesterday said it has converted options and purchase rights for 50 A320s into firm orders, boosting its commitment to the type to 90 ( ATWOnline, Feb. 12).
Kenya Airways said yesterday that the flight data recorder from the 737-800 that crashed after takeoff from Douala on Saturday, killing all 114 on board ( ATWOnline, May 8), was recovered "and appears to be in good condition," adding that "the recovery is still going on under very difficult circumstances" and that the airline is flying victims' relatives to Cameroon while working to "put measures in place to minimize disruptions on our flight schedules."
Pinnacle Airlines reported net income for the first quarter of $9.3 million, a 29.5% drop from the year-ago period, on operating revenue of $179.6 million, down 13% from the first three months of 2006. Expenses dipped 10% to $166.7 million while operating income fell 40% to $12.8 million. Pinnacle officials attributed the differences primarily to changes in the carrier's service agreement with partner Northwest Airlines ( ATWOnline, Dec. 25, 2006). The first quarter was eventful for the Memphis-based regional.
AerCap Holdings named Willis Lease Finance Senior VP-Worldwide Sales & Marketing Thomas MacAleavey to the new position of chief executive-engine leasing effective June 1.
EasyJet said unit revenues fell in April and it sees "pressure on yields in the summer against high comparatives from last year and due to continued competition." It maintained its projection of 40%-50% in pre-tax profit for the fiscal year ending Sept. 30. The LCC transported 3.1 million passengers in April, up 10% from the year-ago month. Load factor dropped 3.3 points to 83.1%. US Airways said consolidated passenger RASM fell in April.
The Boyd Group issued a report predicting that "dozens of smaller communities" could face a reduction in or even loss of commercial air service because of evolving airline economics. By May 4, some 75 applications had been filed under the US Dept. of Transportation's Small Community Air Service Development Grant Program, but only about 40 of those have "potential for success," according to the report.
Atlas Air and Polar Air Cargo parent Atlas Air Worldwide Holdings reported first-quarter net income of $6.2 million, reversed from a net loss of $3.7 million in the year-ago quarter, on a 6.1% rise in revenue to $353.6 million, the highest total it has ever generated in a first quarter.
Gulf Air will be fully owned by the government of Bahrain following the withdrawal of Oman, which signed a letter of intent to withdraw from the money-losing carrier, the Arab Air Carriers Organization announced. Oman follows the emirate of Abu Dhabi and Qatar ( ATWOnline, Sept. 14, 2005). AACO said Bahrain and Oman "have agreed to form a joint committee to assess the airline's assets and to appoint auditors and technicians for this purpose, a process expected to be finalized within six months."
