Lufthansa denied rumors that it has plans to take over troubled German leisure airline LTU and transform it into a long-haul, low-cost carrier based in Dusseldorf. "That really does not fit into our concept. Lufthansa has enough capacity available, also on long-haul routes," a spokesperson told this website. LTU, which has struggled financially over the past few years, is 40% owned by Rewe, which said the airline is no longer part of its core business. It operates nine A320s, four A321s and 11 A330-200s/-300s and flies to 81 destinations.
British Airways reported a 3.3% January system traffic increase to 9.12 billion RPKs, a 3% capacity increase to 12.57 billion ASKs and a 0.2-point rise in passenger load factor to 72.5%. Delta Air Lines reported a systemwide 4.5% decline in January traffic to 8.57 billion RPMs. Capacity decreased 6.8% to 11.68 billion ASMs and load factor rose 1.7 points to 73.4%. Domestic RPMs dropped 7.3% to 6.43 billion as capacity fell 10.8% to 8.76 billion ASMs and load factor rose 2.7 points to 73.3%.
The sale of Thailand's Shin Corp., which owns 50% of Thai AirAsia, to an investment group led by Singapore's Temasek Holdings sent shockwaves through Kuala Lumpur-based AirAsia. Thai AirAsia was a joint venture between AirAsia (49%) and Shin, the telecom giant founded by Thailand's controversial Prime Minister Thaksin Shinawatra, with 50%. The remaining 1% of the discount airline is owned by Thai AirAsia CEO Tasapon Bijleveld.
Taiwanese government is facing increased pressure to agree to regular direct charter flights between China and Taiwan as the annual Spring Festival comes to a close. This year 27,000 passengers flew on 72 direct charter flights from Jan. 20 to Feb. 7 in conjunction with the Chinese New Year. Last year 10,000 passengers flew on 48 flights. According to China Daily, Pu Zhaozhou, General Administration of Civil Aviation of China director-Office of Taiwan, Hong Kong and Macao Affairs, called regular charter flights the first step toward open skies.
Bratislava-based SkyEurope nearly doubled its revenue and reduced unit costs by more than 10% in its first fiscal quarter ended Dec. 31 but saw little improvement on its bottom line, which showed a €12 million ($14.4 million) loss that was just 0.5% better than the €12.1 million deficit in the year-ago quarter. Operating revenues climbed 42.5% to €26.2 million against a 23.8% rise in expenses. Totals were not provided, but the carrier said it spent €12.3 million on aircraft and traffic servicing and €11.9 million on fuel, the latter an increase of 29%.
Although United Airlines cut its annual budget by $7 billion through its three-year Chapter 11 reorganization, its unit costs do not appear to be significantly lower than those of its network competitors with the exception of Northwest Airlines. Furthermore, on a stage-length-adjusted basis excluding fuel, UA still has among the highest unit costs in the industry. This information is contained in an 8K filed yesterday with the US Securities and Exchange Commission in which a presentation to the JP Morgan High Yield Conference is included.
Lufthansa said that a new low-fare concept introduced in Hamburg last October is off to a successful start. The carrier discussed Program Hamburg with journalists Monday. The project is designed to achieve 20% higher productivity--resulting in lower production costs--and a capacity increase in Hamburg of 40%. Similar to low-cost airlines, LH offers 20% of its seats at fares starting from €99 ($118.8) including taxes and serves 23 direct destinations from the city.
Vueling reported revenues of €136 million ($163.2 million) in 2005 and said it was profitable in the second half of the year, without providing details. The Barcelona-based LCC carried more than 2 million passengers. "With these results we have easily exceeded the company's initial business plan forecasts," CEO Carlos Munoz said.
Connexion by Boeing and Air China reached a "preliminary agreement" to provide Connexion's high-speed connectivity solution to Air China passengers traveling to and from China. The agreement covers up to 15 firm and optional retrofit installations of the product on 747-400s and other long-haul models. Financial terms were not disclosed. Installations are planned to begin in October.
Air France-KLM reported systemwide traffic of 15.74 billion RPKs in January, a 9.5% increase over the year-ago month. Capacity grew 8.1% to 19.92 billion ASKs and load factor rose 1 point to 79%. EasyJet reported 2.3 million earned seats flown in January, up 11.2% from the same month a year earlier. Load factor dropped 2.3 points to 74.2%. "Our total revenue performance this month was in line with our expectations, and our guidance for the year to September 2006 remains unchanged," CEO Andrew Harrison said in a statement.
Gulf Air's remaining shareholders, the Kingdom of Bahrain and the Sultanate of Oman, have agreed to a recapitalization of the airline that will permit fleet renewal following the withdrawal of the Emirate of Abu Dhabi as an investor ( ATWOnline, Sept. 14, 2005). The announcement was made in Oman yesterday by Gulf Air President and Chief Executive James Hogan at the conclusion of a board of directors meeting.
Former AMR Corp. Chairman and CEO Donald Carty was named chairman of startup Virgin America, which plans to launch US service this year. Carty served as chairman and CEO of AMR Corp. from 1998 to April 2003 before being forced to resign following disclosure of the existence of special compensation packages for top AMR executives at a time when other employees were being asked to take pay and benefit reductions. "I've known Don for many years, and he knows the airline business," said Virgin America CEO Fred Reid. "We feel fortunate to have someone with his expertise as our chairman."
Qantas is considering acquiring a share of Indonesian budget carrier Adam Air to strengthen its position in the high-growth Southeast Asia market. Adam Air CEO Gunawan Suherman confirmed that Qantas CEO Geoff Dixon and CFO Peter Gregg were in Jakarta last Friday to discuss the acquisition of 20%-30% of the operation. According to Gunawan, Qantas is planning to establish Jakarta as a second Asian hub after Singapore. Adam Air began flying in December 2002 with 737s and currently operates 20 aircraft to 39 destinations, including Malaysia and Singapore.
Gulf Air secured a $75 million syndicated loan that it will use to continue funding near-term development following its restructuring in the wake of the withdrawal of Abu Dhabi as a shareholder.
Ryanair posted an adjusted net profit of €36.8 million ($44.2 million) for the third quarter ended Dec. 31, an increase of 6% over the €34.8 million earned in the year-ago period, as passenger boardings grew 26% from 6.9 million to 8.6 million.
Soaring fuel costs, "adverse publicity" over recent safety-related operational events and declining demand on services to China resulting from lingering feelings about anti-Japanese protests in April all factored into another rough quarter for Japan Airlines, which reported an ¥11 billion ($92.5 million) loss for the three-month period ended Dec. 31, up from a loss of ¥3.7 billion in the previous year's third fiscal quarter.
American Airlines reported a 4.4% rise in January RPMs to 11.03 billion and a 1.9% increase in year-over-year capacity to 14.69 billion ASMs. Load factor climbed 1.8 points to 75.1%. Domestic traffic grew 3.5% to 7.19 billion RPMs as capacity dipped 0.1% to 9.48 billion ASMs and load factor rose 2.6 points to 75.8%.
Name and initial plans for a new Saudi Arabian low-fare airline announced last December and backed by Prince Bandar bin Khalid al Faisal as chairman were unveiled Sunday. The carrier, named Sama, will begin flying this summer with 737-300s. It will operate domestically initially and eventually expand to other destinations in the Middle East. CEO is Andrew Cowen, who was finance director of Go Fly prior to its takeover by easyJet and spent 10 years at British Airways before being seconded to Go. He also participated in the management buyout of Go from BA.
After reporting a net earnings decline in its second fiscal quarter, British Airways rebounded in the third quarter ended Dec. 31 thanks to increased premium traffic and a reduction in unit costs, posting a profit after tax of £123 million ($218.4 million), a 4.2% gain over the £118 million earned in the year-ago quarter.
MTU Aero Engines said MTU Maintenance Berlin-Brandenburg received EASA and FAA approval to maintain GE CF34-8 engines powering 70-90 Embraer and Bombardier regional jets and larger business jets. MTU already maintains the CF34-3.
The US Dept. of Transportation said in its "Air Travel Consumer Report" that domestic airline operational performance as measured by delays, mishandled baggage and customer complaints worsened in 2005. The 20 reporting US carriers posted an ontime arrival rate of 77.4% last year, down from 78.1% in 2004. Reports of mishandled baggage rose to 6.04 per 1,000 passengers compared to 4.91 in the previous year. Consumer complaints rose 17.2% to 8,735.
Bulgaria's government again approved a plan to privatize flag carrier Bulgaria Air ahead of opening its skies to EU airlines later this year. According to Reuters, the country will offer up to 99.99% of the carrier. The privatization has had a number of false starts. Reuters reported that SAS, Austrian Airlines and Air One expressed interest. However, Austrian CEO Vagn Soerensen previously told ATWOnline that his interest in Bulgaria Air is sinking because talks have gone on for too long and the valuation is too high.
Styrian Spirit will codeshare with Air Berlin on the Graz-Berlin route. "We also plan a new, much simpler fare structure," CEO Andreas Roesslhuber told ATWOnline. Codeshare flights may follow on the Graz-Stuttgart route. Styrian also plans to introduce daily Graz-Paris services. Additionally, the Austrian Regional is looking at renewing its fleet. It currently operates three CRJ200s and one CRJ700 and is looking for a fleet mix of three Q400s and two CRJ700s. It takes delivery of a new CRJ900 in May.
Gol unveiled Brazil's first pre-paid cargo transport service Friday. Gollog Prepaid is accessible online and allows customers to transport shipments weighing up to 1 kg. to any domestic destination at a single price.
