Gulf Air named former Crossair and Swiss International Air Lines CEO Andre Dose, 49, as its new CEO. He will take office on April 1. Omani Minister of Transport and Communication Sheikh Mohammed bin Abdullah Al Harthy took over as chairman on Jan. 1.
Airline merger talk in the US market is expected to cool following US Airways' withdrawal of its offer for Delta Air Lines, particularly with many carriers posting their best earnings since the late 1990s.
THE FINAL DAYS OF 2006 SHOULD HAVE BEEN A time of quiet celebration and reflection for the employees and management of Midwest Airlines and its Skyway regional affiliate. After five years of red ink culminating in a loss of $64.9 million in 2005, the company at last appeared to be on the road to recovery, posting breakeven earnings of $1.7 million for the third quarter ended Sept. 30, much improved over a deficit of $26.9 million in third quarter of 2005.
After more than two months of back-and-forth rhetoric that spurred speculation of widespread US airline industry consolidation, US Airways yesterday withdrew its $10.2 billion offer to acquire Delta Air Lines, saying it was "now clear" the official DL creditors' committee would not back the bid "in a timely or productive manner."
Airline industry is facing the daunting challenge of training 340,000 new pilots by 2024 to meet growth and account for retirements, according to Alteon President Sherry Carbary. Speaking to ATWOnline in Sydney, Carbary said Alteon is pioneering ICAO's Multi-Crew Pilot License concept, which aims to produce first officers in just 15 months. MPL is under review by regulators around the globe and Alteon has launched a beta training program for 16 pilots at its Brisbane facility.
Assn. of Asia Pacific Airlines' 17 members released preliminary traffic results for 2006 indicating a 4.5% year-over-year rise in passenger numbers to 134 million. RPKs grew 3.9% and load factor reached a new high of 75.6%, up from 73.4% in 2005.
Virgin America announced that former US Secretary of Transportation and White House Chief of Staff Samuel Skinner will be vice chairman, which CEO Fred Reid said should "continue to demonstrate our compliance with the Department [of Transportation]'s citizenship requirements" ( ATWOnline, Jan. 19). The carrier also said that pending DOT certification, it intends to serve New York JFK, Washington Dulles, Los Angeles, San Diego and Las Vegas within nine months of launch. It is based in San Francisco.
ANA Group cited more frequencies, increased business travel and a bullish Japanese economy for a record nine-month net profit of ¥42.6 billion ($349.8 million) and record nine-month revenues of ¥1.13 trillion announced yesterday in Tokyo. Earnings represent a 42.5% improvement over the ¥29.9 billion earned in the first nine months of the previous fiscal year, while turnover rose 9.3% year-over-year. Profit for the fiscal third quarter ended Dec. 31, 2006, slipped 8.5% to ¥9.3 billion.
In a potentially damaging twist to the Qantas takeover saga, the carrier's board and members of the Airline Partners Australia consortium are under investigation for possible breaches of the country's insider trading laws, according to ABC Radio's "The World Today."
UPS reported 2006 net income of $4.2 billion, an 8.6% increase over a $3.87 billion profit in the prior year, on an 11.7% rise in revenue to $47.55 billion. Expenses grew 12.3% to $40.91 billion, leading to an operating profit of $6.64 billion, up 8%. "We anticipate another good year in our global small package business [in 2007] despite a slowing US economy," Vice Chairman and CFO Scott Davis said. "We're encouraged by the opportunities we see for our company around the globe."
Boeing reported 2006 net income of $2.22 billion, narrowed from $2.57 billion in the prior year, but pointed to a doubling of fourth-quarter net income to $969 million and a 33.2% surge in annual revenue for its Commercial Airplanes unit to $28.47 billion as evidence of "a very good year" and reason to boost its earnings guidance for 2007 and 2008.
Gol said its 2006 net income increased 10.9% year-over-year to BRL569.1 million ($266.2 million) on revenue of BRL3.8 billion. Net income for the fourth quarter was BRL92.7 million despite an estimated BRL150 million in lost revenue from "external effects," specifically the ATC disruptions that "negatively impacted load factors and yields." Fourth-quarter operating income was BRL112.3 million as traffic jumped 43.7% to 4.12 RPKs on a 56% lift in capacity to 6.07 billion ASKs. CASK decreased 11.1% in the quarter to BRL14.82 cents while nonfuel CASK lowered 5.7% to BRL9.36 cents.
Eleven private investor groups submitted expressions of interest to buy Alitalia, the Italian Economy Ministry announced late Monday. Among the interested parties, not including Air France KLM ( ATWOnline, Jan. 30), are Carlo De Benedetti's private equity fund Management & Capitali, Texas Pacific Group, AP Holding (led by Air One Chairman Carlo Toto), private equity fund MatlinPatterson Global Advisers, Italian banking group UniCredit SpA and Italian investor Paolo Alazraki.
Slovak Airlines ceased scheduled operations Tuesday after Austrian Airlines Group, which holds 62% of the carrier, took possession of its fleet, citing the Slovakian government's failure to honor a legal agreement. "One Fokker 100 and one Boeing 737-300 are the property of AAG and we have decided to immediately return the aircraft in order to guarantee that Group property is secure," an AAG spokesperson told ATWOnline, adding that one 737-200 will be left with Slovak for charter flights.
Alitalia flew 2.86 billion RPKs in December, down 2.3% from the year-ago month. Capacity fell 2% to 4.14 billion ASKs and load factor dropped 0.2 point to 69%.
Delta Air Lines secured $2.5 billion in exit financing from six financial institutions as it plans to emerge from bankruptcy as a standalone carrier in the second quarter. JPMorgan, Lehman Brothers, Merrill Lynch, Goldman Sachs, UBS and Barclays Capital each pledged financing, DL said. The funds will be used to repay the carrier's $2.1 billion debtor-in-possession credit facilities, make payments required upon exit and increase its cash balance.
In 2005 a disastrous fourth quarter dragged JetBlue Airways to its first full-year loss, while in 2006 a fourth-quarter turnaround saved the airline from what could have been another ugly 12-month result. JetBlue posted a $17 million profit in the final three months of 2006, a reversal from the $42 million hit that it took in the year-ago quarter, leaving it with a full-year deficit of just $1 million compared to 2005's $20.3 million loss.
US Airways Group reported 2006 net income of $303 million, reversed from a pro forma net loss of $335 million in 2005, results that Chairman and CEO Doug Parker said put the carrier in such a strong position that "we're not going to keep chasing" a merger with Delta Air Lines if DL's creditors' committee doesn't meet US's Feb. 1 deadline.
Alitalia Group expects to post a consolidated operating loss of about €380 million ($490.7 million) in 2006 on revenue of €4.33 billion, the company said in a statement Sunday following a request from the country's securities regulator. AZ's operating loss up to Nov. 30 was €197 million instead of the €364 million profit it had projected.
Sky Express, which is billing itself as Russia's first LCC, launched operations yesterday at Moscow Domodedovo. The startup is leasing two 737-300s and said it plans to add six more by June. According to its website, it will fly to Sochi, Murmansk, Rostov-on-Don and Tyumen. Yesterday's maiden flight was to Sochi, according to Russian press reports. The European Bank for Reconstruction and Development reportedly contributed $10 million to Sky's $48 million initial capitalization, the Associated Press reported.
British Airways was able to avert a potentially damaging two-day cabin crew strike called for today and Wednesday, plus two further 72-hr. walkouts next month, by forging a last-minute agreement with the Transport & General Workers Union after negotiating through the weekend over sick leave, pay, staffing and pensions.
Japan Airlines flew 6.94 billion RPKs in December, down 8.4% from the year-ago month. Capacity decreased 5.1% to 10.9 billion ASKs, dropping load factor 2.3 points to 63.9%.
With its $10.2 billion offer to acquire Delta Air Lines set to expire Thursday, US Airways reportedly is willing to raise the cash portion of its bid to $6 billion from $5 billion if DL's creditors committee agrees to pressure the carrier's executives to allow due diligence to begin and to postpone a key bankruptcy hearing scheduled for next week. US yesterday neither confirmed nor denied the report, published in the The Wall Street Journal Monday.
Finnair appointed Anssi Komulainen senior VP-human resources, Kristina Inkilainen senior VP-catering and Sami Sarelius VP and general counsel. British Airways promoted BA World Cargo MD Gareth Kirkwood to director of operations for the airline, effective April 2. Steve Gunning, currently BWAC's finance head, will succeed Kirkwood.
