United Airlines late Monday announced that it has reached a new tentative agreement outside of bankruptcy court with its mechanics, represented by the Aircraft Mechanics Fraternal Assn. Terms of the five-year deal were not released, but it reportedly includes a 3.9% pay cut as well as reductions in sick time and holiday benefits and will save the carrier $96 million a year. United previously had sought $101 million from the group.
TAP Portugal and Varig confirmed Monday that they have signed an MOU to hold exclusive talks aimed at a recapitalization of Brazil's failing flag carrier. "TAP may be able to become a shareholder of. . .up to 20% of Varig's capital, which is the maximum permitted by the Brazilian legislation," the Portuguese carrier said in a statement. TAP CEO Fernando Pinto, who served as CEO of Varig prior to joining TAP, stressed that a merger is "out of the question" and that both companies will "remain independent."
Thomas Cook Airlines UK plans to create two new engineering hubs at Glasgow and Birmingham. The company already maintains its own aircraft at Manchester, Stansted, Gatwick and Newcastle. "Our departures from Glasgow and Birmingham have grown considerably over the past few years and we felt it was the right time to take control of maintenance rather than subcontract this work," said Engineering Director Chris Hubbard. Thomas Cook Airlines UK currently has three aircraft based at Glasgow and two at Birmingham.
CAE was awarded a contract to provide an A320 full flight simulator to Lufthansa Flight Training Berlin, representing the 25th simulator Lufthansa Group has ordered from CAE since 1980. According to CAE, the simulator, which is scheduled for installation at the facility in spring 2006, has a list price of C$14 million ($11 million).
Indonesia's Lion Air expects to make a decision by the end of May on an order for up to 60 737-800s/-900s or A320s to replace its MD-80 fleet. Earlier this year, the carrier signed an MOU for up to 40 737-900s but Airbus made a counteroffer ( ATWOnline, March 1).
ANA and Shanghai Airlines have applied to the Japanese government for permission to extend their existing codeshare arrangements from June 15. ANA is looking to place its code on Shanghai Airlines' seven weekly flights between Shanghai and both Chengdu and Chongqing, while the Chinese carrier hopes to begin codesharing on ANA's four weekly flights from Shanghai to Nagoya.
India's Jet Airways has taken leases on four A330-200s from ILFC for delivery in 2006 and 2007 to complement the three A340-300s it leased from South African Airways that it will use to launch services to London on May 23. Those flights will be operated in a codeshare with United Airlines, with Jet codesharing on United's flights to the US ( ATWOnline, April 29).
Arrow Air installed and implemented Cargo Data Management's hosted browser-based booking, tracking and revenue accounting system Easy Track II under a new five-year contract.
EasyJet yesterday announced that Ray Webster will step down as CEO of the low-cost carrier and Stelios Haji-Ioannou, its founder and largest shareholder, is rejoining the airline's board. "Ray's leadership of the easyJet team for almost 10 years has underpinned this sustained achievement. However, his strong personal commitment to the company has been at considerable personal cost. Given that he planned to retire in 2006, he felt the succession process should be accelerated," Chairman Colin Chandler said.
Global ePoint announced that new German charter carrier Blue Wings installed its Cockpit Door Surveillance System to meet regulations that went into effect in April requiring any German-registered aircraft with more than 66 seats to be equipped with a system allowing pilots to observe any party attempting to gain access to the cockpit area and providing surveillance of the forward area of the cabin.
US airlines flew 40.31 billion domestic RPMs in February, up 3.2% over the year-ago period, according to the US Dept. of Transportation. Domestic capacity climbed 0.9% to 56.32 billion ASMs and load factor gained 2.9 points to 71.6%. Southwest Airlines carried 6.1 million domestic passengers during the month, the most of any carrier. Delta Air Lines at 6 million and American Airlines at 5.4 million ranked second and third respectively.
Alitalia reported a consolidated operating loss of €119.6 million ($147.7 million) in the first quarter ended March 31 compared with a €189.7 million operating loss in the prior-year period.
Alaska Airlines contracted with Menzies Aviation to provide ramp handling services at Seattle-Tacoma International, which will result in the loss of 472 ramp service jobs at the carrier. The airline, which currently contracts with outside companies to provide ramp services in 41 of the 56 cities it serves, expects to save roughly $13 million a year through the move.
European Court of Justice last week ruled in favor of the European Commission and said the Greek government made insufficient efforts to recover from Olympic Airways €41 million ($52.5 million) in restructuring aid and €153 million in new operating aid, which was found unlawful and incompatible with the Common Market rules on state aid. The court also found that the transfer of all the assets of Olympic Airways free of all debt to the new Olympic Airlines made it impossible to recover the funds in question.
Lufthansa Systems announced an agreement with Thai Airways International to implement the SAP Aerospace & Defense industry solution to optimize Thai's MRO planning processes.
DBA said it made a profit of €1-€2 million ($1.3-$2.6 million) in the 2004-05 business year ended March 31. It had turnover of €265 million and transported 3 million passengers. DBA merged with low-cost airline GEXX earlier this year. For the current year it expects to carry 4.3 million passengers and generate turnover of €400 million. It operates a fleet of 27 737-300s and F100s and offers 125 flights a day.
British Airways reported a net profit of £251 million ($464.2 million) for the financial year ended March 31, a 93.1% increase compared to a net profit of £130 million during the 2003-04 fiscal year. Net debt fell by £1.2 billion to £2.9 billion, its lowest level since 1993, while operating margin improved 1.5 points to 6.9%, the airline's best margin since 1997.
Mesa Air Group reached a five-year agreement with United Airlines to add 30 more 50-seat RJs into the United Express codesharing program beginning in the fall. Mesa did not disclose where the aircraft will come from, but a senior official indicated they will not come from US Airways Express operations currently performed by the carrier. With the new deal, Mesa will operate up to 70 aircraft under the UA designator: 45 CRJ200s, 15 CRJ700s and 10 Dash 8s. It has the right to convert up to 15 CRJ200s to CRJ700s through April 2010.
Luxair Group increased its net profit for financial year 2004 to €13.4 million ($17 million) from €3.6 million in 2003. Operating result progressed from a loss of €4.1 million in 2003 to a €3.9 million profit last year. Total operating income rose 6% to €323.6 million and operating expenses increased 3.3% to €319.7 million. Luxair posted a 3.1% gain in operating income to €177.6 million, while income from other services, including passenger and cargo handling, climbed 10% to €128.4 million.
Union representing UPS pilots, which has been negotiating a new contract with management for more than three years, said more than 99% of its members voted to give its five-pilot executive board authority to call a strike. Of the 2,371 that participated in the vote, just 15 voted against it, according to the Independent Pilots Assn. "The overwhelming outcome of this vote is both a show of IPA unity and a clear signal to UPS management that our crewmembers are serious about closing out this contract over the next two weeks in Baltimore," IPA President Tom Nicholson said.
Singapore Airlines refuted suggestions by Airbus that the delay in its first A380 delivery is by mutual agreement and the airline now is seeking compensation.
President Bush nominated Edmund Hawley as the next head of the Transportation Security Administration to succeed David M. Stone, who announced last month that he will leave the department in June. Hawley currently serves as a supply chain technology consultant and is a member of FAA's Air Traffic Services Committee. Earlier, he was VP-Transportation Services for the Union Pacific Railroad and served in a senior role at US DOT.
United Airlines' successful termination of its defined benefit pension programs will give it a substantial cost advantage over other hub-and-spoke carriers and could lead to further bankruptcies as those rivals strive to achieve the same level of cost savings, according to Standard & Poor's analyst Philip Baggaley. Absent the terminations, United would have had to make at least $4.5 billion in payments over the next five years, or around $900 million per year, equal to 18% of 2004 labor costs and 5% of total operating costs, Baggaley noted.
Despite the challenges created by high fuel prices and a proliferation of new entrants in the local market, Singapore Airlines Group announced a net profit attributable to shareholders of S$1.39 billion ($839.7 million) for the fiscal year ended March 31.
