Iberia will bow to pressure from LCCs and begin to eliminate routes that do not pass through Madrid, MD Angel Mullor told Iberiavion. "These will be routes which only low-cost companies are going to be able to operate," he said, according to Reuters. "They have already thrown us out of six routes from Barcelona, and now in serious danger are our routes, for example, from Galicia to England where easyJet or Ryanair have started and we can't compete with them." He said domestic traffic also will evaporate "to a great extent."
JetStar Asia named Neil Thompson acting CEO following CEO Ken Ryan's decision to return to Australia from Singapore. Thompson was GM-customer relationship marketing at Qantas.
OzJet, the startup all-business-class carrier, canceled two of its eight daily flights between Sydney and Melbourne and cut fares through Jan. 9 by 18% less than a week after beginning operations ( ATWOnline, Nov. 29). Founder Paul Stoddart told The Sydney Morning Herald that he expected business traffic to decline during the summer months.
Continental Airlines reported strong unit revenue growth for November, with consolidated passenger revenue per ASM estimated to have increased 9.5%-10% compared to November 2004 with mainline RASM up 8%-9%. By comparison, October 2005 consolidated RASM rose 5.1% year-over-year with mainline RASM up 4%. Continental said it flew 5.6 billion RPMs in November in mainline operations, up 8% over the year-ago period. Mainline ASMs rose 6% to 7.1 billion and load factor climbed 1.4 points to 78.7%.
BAA beat out Hochtief and Fraport in bidding for Budapest Airport with an offering of more than HUF400 billion ($1.85 billion), Hungary's Nepszabadsag reported. Prime Minister Ferenc Gyurcsany said the winner will be picked after Dec. 7 and the deal closed by year end.
GATX Corp. will sell up to $450 million worth of older aircraft, or around 23% of its leasing portfolio, as part of a strategy to focus on "newer more profitable aircraft," the company said in a statement. As a result of the decision, it will take an after-tax noncash charge in the range of $110-$130 million in the fourth quarter, with incremental gains or losses possibly occurring as sales are completed through the end of 2006.
Cathay Pacific Airways' love affair with the 747-400 is set to continue for "many years yet," according to COO Tony Tyler. Speaking to this website after the selection of the 777 ( ATWOnline, Dec. 2), Tyler confirmed that the 777-300ERs ordered last Thursday will be used for "new services" that will include new destinations and increased frequencies. The longer-term 747 replacement for the heaviest routes at Cathay will pit the A380--which Airbus COO-Commercial John Leahy vows the airline will buy--against the born-again 747-8.
Atlas Air Worldwide Holdings said yesterday that it has identified potential cost savings and revenue enhancement opportunities with the help of a consultant that "if successfully realized, could benefit [it's] operating performance by more than $100 million over the next several years." While the potential cost savings and revenue enhancements would occur over several years, prospective savings and revenue enhancements that could be realized in 2006 and 2007 "would not be insubstantial," it added.
LTU German Airlines plans to grow at a rate of 3%-5% per year and add a new aircraft every year. Most of the growth will be on long-haul sectors on which the carrier earns around 50% of its total turnover. On the medium sectors, LTU wants to strengthen its position at its Dusseldorf base and continue with its low-fare segment, LTU City-Quickies, which operates to sun destinations such as the Balearic Islands. It has suspended thrice-daily service between Dusseldorf and Vienna.
Sukhoi Civil Aircraft will be the launch customer in Russia for software designed by Pacelab Mission/SCAP. Sukhoi is developing the RRJ line of regional jets in the 60/90-seat range. The software will be used in sales support for the RRJ.
United Airlines is strengthening its presence at its Washington Dulles hub, announcing service additions and expansions to 10 domestic and two international markets. Perhaps in response to recent incursions by JetBlue and AirTran ( ATWOnline, Nov. 21), UA's biggest commitment will be to its Boston service, which it will increase by five daily flights for a total of 14 beginning in February. At the same time it will boost daily service to Phoenix, New Orleans, Denver, Ft. Lauderdale, Orlando, Myrtle Beach and St. Louis.
Thai Airways concluded its fiscal year at the end of September with a net profit of 6.78 billion baht ($164.3 million), a 32.7% drop from a year-ago profit of THB10.08 billion, which the company attributed to fuel costs and a decline in tourism resulting from "unrest in southern Thailand, the terrorism in other countries and the concern of a bird flu epidemic."
As predicted by this website ( ATWOnline, Nov. 30), Cathay Pacific Airways chose the 777-300ER, stating that it will order up to 36 of the type including 16 firm aircraft that will be delivered between September 2007 and July 2010 and powered by GE90-115Bs. A Boeing statement did not refer to the deal as a final order but confirmed the numbers Cathay released. The airline said it also will take three Trent 700-powered A330-300s in 2008 for regional routes.
Northwest Airlines lost $346 million in its first six weeks in bankruptcy net of $158 million in reorganization-related charges, according to a filing with the US Securities and Exchange Commission. The Sept. 14-Oct. 31 reporting period encompasses 16 days of the airline's third quarter. NWA previously reported a loss of $475 million for the July-September period. In its SEC filing, it did not provide separate loss figures for September and October.
KLM will reduce fuel surcharges effective Dec. 21 by €1 ($1.18) to €12 per segment within Europe and by €5 per coupon to €33 within its intercontinental network. At the same time, it increased the security surcharge on all tickets by €2 to €7 per segment "to cover extra security measures that have been taken." Separately, KLM introduced an all-new catering model for European economy flights, bringing it "more in line with that of Air France's economy product," it said in a statement.
Soon after President George W. Bush put pen to paper on the transportation appropriations bill that exempts Missouri from the Wright Amendment, Southwest Airlines released details yesterday of its new service between Dallas Love Field and St. Louis and Kansas City. Four daily direct flights to each Missouri city will commence from Love Field Dec. 13. One-way fares will be $79 with a two-week advance purchase and $129 walkup.
Air Sahara will acquire seven 737-800s on lease and is negotiating the lease of two 767s, President Rono Dutta told reporters. The carrier is expanding its network with four-times-weekly flights between Delhi and London set to begin Jan. 6 and include with a transatlantic codeshare with American Airlines, plus an additional daily service to Singapore and planned service to Bangkok, Hong Kong and Kuala Lumpur.
Airbus named John O'Leary senior dir. and Bill James dir.-Airbus North America Engineering-Wichita and David Trent senior dir.-Airbus North America Engineering-Mobile. Air France Industries appointed Bruno Delile senior VP-industrial & business development, Fouad Attar VP-marketing & sales, Pierre-Yves Reville senior VP-materials & services and Ludovic Loisel VP- strategy & Air France/KLM MRO coordination. Air Jamaica tapped Michael Conway as CEO.
It may be news in North America, where record nominal fuel prices have eclipsed four years worth of financial, labor and operational restructuring efforts at US legacy carriers, but the world airline industry is feeling more bullish about the future than at any time since the end of the last millennium.
The world's most famous transport, the DC-3, was launched on the back of a single telephone call between two friends, American Airlines President Cyrus R. Smith and Donald Douglas. And in contrast to today's protocol, the contract was signed just before delivery.
Owing to record nominal fuel prices, the July-September period was going to be painful for US carriers well before Mother Nature decided to visit her fury on the refinery-rich Gulf Coast. According to the Air Transport Assn., which cited data from the US Energy Information Administration, the spot price of West Texas Intermediate reached $61 a barrel on Aug. 1 while the differential between crude oil and jet fuel prices (the crack spread) pushed the all-in cost to airlines to around $74 a barrel.
When the father of the 747, Joe Sutter, was asked by ATW about the longevity of the model on the 30th anniversary of its entry into service, he said without so much as a second's hesitation that the "Queen of the Skies" would be around for another 30 years. A bold statement indeed when made against a backdrop of the launch of the A380 and the many failed attempts by Boeing to commit to significant upgrades since the dash 400 version rolled out in January 1988.
We'll begin by statingas we have beforethat we believe that non-government-owned airlines deserve the same opportunities as other privately run businesses when it comes to attracting investment from wherever it may be available. Moving from the general to the specific, we support changes in US law to permit non-US entities to invest freely in and own US-based airlines provided those parties fully abide by all applicable US laws and regulations, including any new ones that may arise regarding participation in the US Air Mobility Command and CRAF.
Aloha Airlines' reorganization plan was confirmed by the US Bankruptcy Court Tuesday, clearing the way for the Honolulu-based carrier to exit Chapter 11 protection as early as Dec. 15. Aloha sought bankruptcy on Dec. 30, 2004. The confirmation is subject to the airline and its 270 pilots, represented by the Air Line Pilots Assn., finalizing a tentative agreement on a new five-year contract that was reached Tuesday. On a busy day, Aloha also announced that its flight attendants had ratified their agreement.
