Continental Airlines concluded its best quarter since 2001 with a net profit of $198 million, nearly double the $100 million earned in the second quarter of 2005. "After five years of challenges and hard work, it's great to see a payoff for everyone's efforts. But, even with the progress made, we must continue our focus on eliminating unnecessary costs," Executive VP and CFO Jeff Misner said.
Austrian Airlines Group is looking for further cost-cutting measures and is considering reducing or ending service to Australia. According to a source close to airline management, Austrian pays €400,000 ($500,600) in operational costs for each one of its nine weekly 777-200ER rotations to Australia, where it serves Sydney six-times-weekly and Melbourne thrice-weekly. The route is being pressured by high fuel prices and fierce competition from Middle Eastern carriers operating between Europe and Australia.
ARINC and Bird Consultancy Services announced the introduction of GLOBALink VHF data link communications at Chennai, Delhi, Kolkata, and Mumbai airports. Separately, ARINC was selected by Atlantic Southeast Airlines to provide integrated air/ground communications services. Full installation of the required avionics on ASA's fleet of more than 140 Bombardier jets will not occur until summer 2007. ARINC called the deal "the most advanced package of data applications ever specified by a US Regional carrier."
NAV Canada said this week it is taking the "first step" toward moving to ADS-B satellite-based positioning technology for air traffic control. The first NAV Canada ADS-B deployment will be in northern Canada and cover 250,000 sq. nm. of airspace over Hudson Bay. Cost of the deployment is $10 million. "The initial deployment alone promises to save customers well over $200 million in reduced fuel costs over 15 years through more flexible and fuel-efficient routes," NAV Canada President and CEO John Crichton said.
HEICO Aerospace Holdings acquired Arger Enterprises and "related companies" from Melrose PLC for cash considerations. Arger, based in Nevada, designs, manufactures and distributes approved aircraft and engine parts.
Boeing named Joy Romero president of Boeing Canada Operations and GM of Boeing Winnipeg. Romero had been running Boeing's Salt Lake City components manufacturing site.
Varig may not be well, but it is alive; three days after its bid was rejected by the airline's creditors, freight and logistics company VarigLog, the former Varig subsidiary purchased this year by a consortium led by Volo do Brasil, was the sole and winning bidder at a public auction.
WestJet finalized an agreement yesterday with Singapore Aircraft Leasing Enterprise for three 737-700s and one 737-800, with deliveries scheduled for late 2007 and the first half of 2008. The deal also includes options for three more dash 700s and one additional dash 800, which would be delivered in 2009. By the end of 2008, WestJet's fleet will number 76 aircraft.
Finnair will resume service to Lisbon with thrice-weekly flights from Helsinki beginning March 29 aboard A320s. In June, Finnair flew 1.55 billion RPKs, a 7.8% increase over the year-ago month. Capacity rose 2.9% to 1.97 billion ASKs and load factor climbed 3.5 points to 78.7%.
Varig was granted one more lifeline by a Rio de Janeiro bankruptcy court, which is putting the airline up for sale a third time at an auction scheduled today. Creditors rejected VarigLog's offer on Monday ( ATWOnline, July 19), and an initial bid from an employee-led consortium collapsed when it was unable to make a cash down payment.
AirAsia will have the lift to match its ambition after signing a contract with Airbus for 40 A320 family aircraft and 30 options, the manufacturer announced yesterday. The deal is worth approximately $2.7 billion, according to press reports. AirAsia Group, comprising the Malaysian mainline, Thai AirAsia and AirAsia Indonesia, is replacing its 737 fleet. It currently operates 21 737-300s and seven A320s, with another 53 already on order. Thai AirAsia has nine dash 300s.
United Airlines flew 10.76 billion system RPMs in June, a 2.3% rise over the year-ago month. Capacity increased 2.2% to 12.18 billion ASMs and load factor inched up 0.2 point to 88.3%. Alitalia flew 3.39 billion RPKs in June, a 0.5% increase over the year-ago month, as capacity fell 4.2% to 4.59 billion ASKs. Load factor rose 3.7 points to 73.9%. ExpressJet flew 947.8 million RPMs in June, up 17.6% from the year-ago month. ASMs increased 9.4% to 1.15 billion, lifting load factor 5.7 points to 82.4%.
Thales will supply two A320 full flight simulators and one ATR full flight simulator to Kingfisher Airlines in a deal valued at more than $24 million. Contract also includes an A320 maintenance/flight training device and a turnkey maintenance support package.
El Al issued a profit warning yesterday indicating that hostilities in the Middle East, increased competition and rising fuel costs will lead to a full-year loss, according to press reports. The carrier earned a record $64.1 million in 2005 ( ATWOnline, April 3). "The company does not have a clear forecast as to the amount, especially because of the uncertainty regarding the security situation and its consequences," it said in a statement cited by Reuters.
Reaping the benefits of capacity cutbacks by its legacy competition, Southwest Airlines enjoyed record revenues in the second quarter ended June 30 and more than doubled its net income to $333 million from earnings of $144 million in the year-ago quarter. More good times are ahead, according to CEO Gary Kelly, who said the carrier is "excited about our near-term growth opportunities and pleased with our earnings momentum" and that "assuming continuance of the current healthy revenue environment, we expect to easily exceed our 15% 2006 annual earnings growth goal."
Northwest Airlines filed documents with the US Bankruptcy Court Tuesday related to the refinancing of $1.1 billion in existing bank obligations at more favorable terms, offering the carrier access to $250 million in incremental liquidity. NWA asked the court to allow it to convert the funds to permanent exit financing it said will secure part of the debt financing needed to emerge eventually from Chapter 11 bankruptcy protection.
American Airlines parent AMR Corp. earned $291 million in the second quarter ended June 30, widened from a profit of $58 million in the same period last year and only the carrier's second profitable quarter in the last 5.5 years.
US Airways Group flew a combined 5.87 billion RPMs in June, a 5.8% drop from the year-ago month. Capacity fell 8.6% to 7 billion ASMs and load factor rose 2.5 points to 83.8%. Domestic RPMs declined 7.6% to 4.69 billion against an 11% fall in capacity to 5.6 billion ASMs. International RPMs rose 2.1% to 1.18 billion and ASMs increased 2.2% to 1.41 billion.
AirTran Airways launched a twice-daily Rochester (N.Y.)-Boston service, a daily Indianapolis-San Francisco flight, daily Tampa-Gulfport/Biloxi service and a second daily flight from IND to Los Angeles. It flew 1.30 billion RPMs in June, 25.6% higher than the year-ago month. ASMs increased 25.4% to 1.62 billion and load factor rose 0.1 point to 79.8%.
Alaska Airlines announced the ratification of two four-year labor deals covering more than 3,700 clerical, customer service and ramp workers represented by the International Assn. of Machinists and Aerospace Workers. Agreements were reached in May ( ATWOnline, May 31). Separately, Alaska will launch thrice-weekly Los Angeles-La Paz service from Oct. 30 aboard 737-400s and thrice-weekly San Francisco-Cancun flights on Oct. 28 running through April aboard 737-800s.
Rolls-Royce projects that 114,000 jet engines will be required to meet global demand for 51,000 commercial aircraft ranging from business jets to long-haul passenger planes over the next 20 years. That adds up to a worldwide market for jet engines through 2026 potentially valued at $600 billion, the engine-maker said in its long-term forecast released this week. Underpinning the demand will be 6.6% annual growth in Asia/Pacific air traffic over the 20-year period, Rolls said.
