A profitable carrier at this time last year, Malaysia Airlines was unable to handle rising costs during the fiscal second quarter ended Sept. 30, posting a net loss of MYR367.7 million ($97.3 million) that reversed earnings of MYR132.7 million in the year-ago quarter.
Oneworld member Finnair and soon-to-be-member Japan Airlines agreed to codeshare on JAL's domestic routes and Finnair's European routes starting this month. Finnair's code will be added to JAL's routes between Osaka and Sapporo, from Fukuoka to Osaka and Tokyo and from Tokyo Haneda to Osaka. JAL's code in turn will be added to Finnair's Helsinki-Amsterdam and Helsinki-Frankfurt routes. Both companies will explore possibilities to codeshare on Finnair's routes to Japan and JAL's routes from Japan to other Asian destinations.
SkyEurope Holding AG, parent of the Bratislava-based LCC, in its first financial report since completing an initial public share offering last September, reported an annual loss for its fiscal year ended Sept. 30 of €28.6 million ($33.5 million), or €26.8 million adjusted to reflect the phase-out of its Brasilias. This compares to a loss of €10.1 million in the 2003-04 fiscal year.
Far Eastern Air Transport of Taiwan said US insurance giant American International Group intends to sell its 18% stake in the airline, likely to China Development Financial Holding Corp., which already holds 13% of FAT, the Associated Press reported.
New British Airways CEO Willie Walsh has begun executing his game plan to streamline the airline, announcing plans to cut management staff by 35% by March 2008, the month that BA moves into London Heathrow's new Terminal 5. The move should save the carrier £50 million ($85.6 million) annually and is part of its larger goal to achieve £300 million in cost reductions by March 2007.
SkyTeam members Delta Air Lines, Northwest Airlines and Continental Airlines announced that their club members will have access to each others' airport lounges beginning today. The three carriers have more than 90 lounges worldwide.
Mexicana will be sold to the Grupo Posadas hotel company for $165 million plus the assumption of $294 million in debt and $997 million in aircraft lease obligations in the first stage of Mexico's long-anticipated airline privatization. The largest hotel operator in Mexico, Grupo Posadas also has hotels in the US, Argentina and Brazil. Its brands are Fiesta Americana Grand, Fiesta Americana, Fiesta Inn, Caesar Park, Caesar Business and The Explorean.
American Airlines will begin charging $2 per bag for curbside check-in at Dallas-Ft. Worth in December, a move that will reduce annual costs by $10-$30 million, according to The Dallas Morning News. AA already charges for the service at more than 20 airports.
FAA Administrator Marion Blakey on Monday asked for federal mediation of the ongoing contract negotiations between the agency and its controller workforce, represented by the National Air Traffic Controllers Assn., charging that the two sides remain far apart on a new agreement. But NATCA said talks are showing progress. Both sides must agree to mediation. FAA claims that NATCA's contract proposal will raise average total compensation for controllers to more than $200,000 within four years, up from $166,000 today including benefits. NATCA disputes the numbers.
Frontier Airlines plans to sell $80 million worth of unsecured convertible debentures due in 2025. In addition, it will grant its underwriters, led by Morgan Stanley and co-manager Citigroup Global Markets, the option to purchase an additional $12 million in debt.
China Airlines purchased 20% of China Aircraft Services Ltd. of Hong Kong and said it will switch its Hong Kong MRO and ground service from HAECO to CASL in January. CAL bought 13.33% of CASL from China National Aviation Corp. and 6.67% from Hutchison Whampoa.
Innovative Solutions & Support and ABX Air, the former air arm of Airborne Express that now operates independently, have teamed up to offer operators of 757s and 767s a flat panel display retrofit. The two achieved an FAA STC for the conversions. Under a partnership, ABX will provide installation and pilot training while IS&S will supply the LCDs and STC.
Kingfisher Airlines bid to take over 100% of Sahara Airways, parent company UB Group head Vijay Mallya revealed, according to media reports. Mallya said the offer was lower than the $750 million-$1 billion Ernst and Young said Sahara was worth. In addition, he told reporters that UB Group plans to raise $400 million, half of which will come through an IPO for Kingfisher.
Australian Airlines, Qantas's international low-fare airline unit, will introduce a Premium Economy cabin in mid-2006 featuring more spacious seating, priority boarding and priority food service. The current all-economy, 271-seat cabins of its 767s will be reconfigured to feature 28 premium and 238 economy seats. Separately, the carrier said it will begin twice-daily service between Cairns and Tokyo next year, replacing Qantas. Weekly capacity on the route will increase by 500 seats.
THY Turkish Airlines CEO Temel Kotil told ATWOnline he is confident the carrier will maintain the profitability reached in the first nine months of the current fiscal year ( ATWOnline, Nov. 29), which included a net margin of 5% and an EDITBAR margin of 19%, despite a plan to increase seat capacity 30% by 2008.
Northwest Airlines was given permission to reject leases on 15 CRJ200s operated by Pinnacle Airlines by a US bankruptcy judge, who ruled in favor of the bankrupt carrier yesterday in a dispute with lessor Wells Fargo. The judge also permitted NWA to sell assets worth no more than $7 million without approval, the Associated Press reported.
TNT will launch passenger flights from Liege beginning in April, TNT Airways MD Niky Terzakis told La Libre Belgique. The integrator already offers passenger service from Brussels with 737-300s in QC configuration. Terzakis said TNT has contracts with several major tour operators including Thomas Cook, Club Med and Interconfort for its Brussels service. It has transported about 160,000 passengers from BRU this year. Liege destinations will include Barcelona, Ajaccio, Monastir, Palma and Ibiza.
El Al Israel Airlines earned $52.2 million for the third quarter ended Sept. 30, up 10.1% over $47.4 million netted in the year-ago period. Revenues rose 17% to $485.2 million. The strong quarterly performance pushed nine-month earnings to approximately $63 million, the carrier said, the highest total for El Al in any nine-month period over the past decade.
Air Canada parent ACE Aviation Holding is preparing to sell a share of its Regional subsidiary Jazz through an initial public offering of units of Jazz Air Income Fund, which will hold a minority interest in the carrier with ACE retaining majority control. CIBC World Markets and RBC Capital Markets are acting as joint bookrunners for the IPO, which follows a favorable ruling by the Ottawa government with regard to tax treatment of income trusts.
Japan Airlines chose the GEnx to power up to 50 787-3s and dash 8s, comprising 30 firm and 20 option aircraft. JAL receives its first Dreamliner in 2008. GE valued the firm engine order at more than $700 million. Separately, JAL said it will "temporarily resume" normal flight operations between Japan and Indonesia over the Christmas and New Year holiday period. It reduced flight frequency and changed routings on its Japan-Indonesia flights at the end of October owing to a significant decrease in passenger demand following the Oct. 1 Bali terrorist attack.
SAS and Star Alliance signed a two-year global travel agreement with Volvo AB, "which means that Volvo has selected SAS and the Star Alliance as its main supplier of air travel," according to SAS. It is the largest such agreement that the automaker has signed with an airline alliance, according to SAS, and was completed after a year of tough competition with SkyTeam. It covers 12 of Star's 16 alliance members.
TRAX USA was selected by Air Plus Comet to implement the TRAX maintenance software, becoming the 48th operator to choose TRAX. Air Plus Comet operates a fleet of 747-200s, 737-300s and A310-300s.
East Star Airlines, a Wuhan-based startup, signed a letter of intent yesterday for the purchase of 10 A320s directly from the manufacturer plus a firm lease deal with GE Commercial Aviation Services for an additional 10. The agreements reportedly are worth $1.48 billion. The 10 purchased aircraft will be delivered in 2009-10. The carrier will begin taking delivery of the leased A320s in the second quarter of next year. All of the aircraft will be powered by CFM56-5Bs.
Atlas Air Worldwide Holdings President and CEO Jeffrey Erickson said in London yesterday that Atlas is looking to go into the passenger ACMI business using 747-400s. Speaking at the Air Cargo Seminar that opened the Future of Air Transport Conference, Erickson said the company hopes to build on its business relationships with cargo ACMI customers, grow its ACMI base and add a new revenue stream.
