US Airways announced that ACE Aviation Holdings Chairman, President and CEO Robert Milton resigned from the US board of directors, as previously announced ( ATWOnline, April 12). Also, US named MD-Revenue Management Brad Beakley as VP-reservations and inventory services and Tom Trenga as VP-revenue management.
British Airways announced a "radical shakeup" in its short-haul fare structure in an apparent attempt to stay competitive with LCCs such as Ryanair and easyJet. One-way fares for flights within the UK and Europe were reduced by up to 50% to more than 65 destinations. Prices start at £29 ($51.76) and BA will allow travelers to change their flights up to midnight on the day prior to departure for £30. "This is not a short-term gimmick but a long-term commitment to our millions of customers to offer irresistible low fares every day of the year.
Southwest Airlines managed to stave off rising unit costs and a 79.6% jump in fuel expenses to record a first-quarter profit of $61 million, up 3.4% over the $59 million earned in the three months ended March 31, 2005. The carrier also announced yesterday that it will exercise options for 79 737-700s for delivery from 2007 through 2012, bringing its firm orders to 140.
Significant improvement in operational performance and a 64.5% narrowing of the first-quarter loss to $66 million ($46 million excluding special items) from $186 million in the year-ago quarter left Continental Airlines executives in a confident mood yesterday. "Our plan is working," Chairman and CEO Larry Kellner said during a conference call with analysts and media. "It's a great time to grow our network," President Jeff Smisek said, adding, "Our customers clearly prefer us over the competition."
Iberia CEO Angel Mullor is resigning "in order to take on new personal and professional projects," the airline said yesterday. He joined IB in 1996 as MD and was elevated to CEO in 2001. "I have spent ten years in Iberia, much longer than I imagined when I came to handle the company's privatization. I depart with the satisfaction of having worked with a first-rank team of people and having achieved all the objectives we set in the three strategic plans established in this period," Mullor said.
Alaska Air Group, parent of Alaska Airlines and Horizon Air, eked out a small but noteworthy profit of $2.8 million before special items in the historically challenging winter quarter, reversing an adjusted net loss of $41.7 million in the year-ago period.
Olympic Airlines Chairman Petros Papageorgiou resigned and will be replaced by Elias Karatzalis, an attorney and Olympic board member, according to a statement from the Greek Transport Ministry cited by Reuters. Papageorgiou was appointed in March 2004 but opted to leave because he opposed the Greek government's plans for Olympic, according to the report.
Connexion by Boeing said that an independent survey conducted by Burke Research on behalf of the broadand Internet provider showed that "83% of those surveyed said that the availability of Connexion by Boeing service will have an impact on future travel plans and their choice of airline carrier while 92% said they plan to use the service on a future flight and would recommend Connexion to others." The study included responses from more than 3,200 participants. Connexion currently is available on 10 airlines operating 180 routes daily.
Strong revenue performance helped to offset the rising cost of fuel in the first quarter at American Airlines as parent AMR Corp. trimmed its net loss for the three months ended March 31 to $92 million from a deficit of $162 million in the year-ago period.
Precision Conversions signed a deal with Cygnus Air of Spain for one 757-200 freighter conversion plus one option. The aircraft will enter the conversion process in July. Cygnus provides cargo services to Iberia with three DC-8s. Precision also will convert two 757s to freighters under an agreement with Babcock & Brown Aircraft Management. The contract calls for "multiple options" on future 757-200 conversions, Precision said. Operators for the aircraft were not disclosed.
American Eagle will operate six-times-weekly New York LaGuardia-Des Moines service from June 15 aboard an Embraer 135. The carrier flew 749.4 million RPMs in March, a 15.7% increase over the year-ago month. Capacity rose 9% to 1.01 billion ASMs and load factor improved 4.3 points to 74.1%.
Saudi Arabian Airlines reportedly plans to float 30% of its shares in an IPO later this year. According to the Arab Air Carriers Organization, the carrier submitted documents to Saudi Arabia's Capital Market Authority seeking to float 450 million shares. In March, the government approved Saudi Arabian's privatization as part of a series of economic reforms in the country ( ATWOnline, March 23).
Air Berlin may announce more details of its upcoming IPO tomorrow. It is expected that the carrier's stock could begin trading as early as May 5. According to German daily Boersen-Zeitung, a possible press meeting Friday will signal the start of the road show for the offering, which includes a visit by CEO Joachim Hunold to the US to attract interest from Wall Street in the German low-fare airline.
Japan Airlines, which has been subject to scrutiny following several safety-related issues, announced the establishment of a 622-sq.-m., ¥180 million ($1.5 million) Safety Development Center at Tokyo Haneda. The center will open April 24 and feature exhibits, items and documentation related to past incidents and accidents. Separately, JAL and Hainan Airlines will expand their codeshare agreement to include Hainan's daily flights from Beijing to Kunming and Xian.
Expenses surpassed revenues in a year in which Guangzhou-based China Southern Airlines continued to absorb China Northern Airlines and Xinjiang Airlines, leading to an annual loss of CNY1.85 billion ($229.8 million) compared to a CNY155 million profit in 2004.
Iberia Cargo signed a contract to be handled by Worldwide Flight Services in Building 550 at London Heathrow, which WFS took over from United Airlines in 2005. WFS also acquired UA's third-party handling contracts. This marks the first time Iberia Cargo awarded a contract to WFS directly at Heathrow.
AirTran flew 1.21 billion RPMs in March, a 23.6% increase over the year-ago month. Capacity rose 22.4% to 1.55 billion ASMs, lifting load factor 0.7 point to 78.1%. Austrian Airlines Group said March RPKs grew 12.2% to 1.8 billion. ASKs rose 11.4% to 2.4 billion, resulting in a 0.5-point gain in load factor to 72.0%.
Brazilian low-cost carrier Gol likely will emerge a much more significant force in the domestic market owing to Varig's financial problems, according to a new report from JP Morgan forecasting that Varig will reduce domestic flying 50%-100% within the year. JP Morgan's Jamie Baker pins the probability that Varig will downsize at 70%, but says a 20% probability exists that the airline will close its doors for good. Varig's capacity share of the domestic market is estimated at close to 20% currently, with Gol having 26%, TAM around 43% and other operators 11%.
CAAC and the National Development and Reform Commission announced an increase in fuel surcharges on domestic routes of less than 800 km. to CNY30 ($3.74) from CNY20 and on routes greater than 800 km. to CNY60 from CNY40. Increases went into effect April 10 and will last until Oct. 10.
Starman Bros. Auctions was awarded the exclusive right to liquidate all of Independence Air's inventory. The auction is set for April 21-22 and 27-28 at Washington Dulles.
United Airlines appointed Sean Donohue to the new position of VP-customer experience. Donohue most recently was VP-operational services for United Express and Ted. US National Transportation Safety Board Member Ellen Engleman Conners announced this week that she intends to leave NTSB on May 31, 19 months before her term expires. She joined the board in March 2003 and served a two-year term as chairman. She was renominated to the post in 2005 but Congress did not act and the nomination lapsed.
British Airways is increasing its fuel surcharge on tickets sold and issued in the UK to £35 ($61.65) per sector from £30 on its long-haul flights. The short-haul surcharge remains unchanged at £8 per sector. "Our annual fuel bill for 2005/2006 is expected to be some £1.6 billion. We estimated previously that this would rise by £400million in 2006/2007 but at these prices [above $70 a barrel], we would now expect this year's fuel bill to be £600 million higher at £2.2 billion," Commercial Director Martin George said.
