AirTran Airways announced a five-year tentative agreement with the International Brotherhood of Teamsters yesterday covering approximately 50 stock clerks at its Atlanta and Orlando MRO bases. Ratification is expected in the next 10 days.
Texas Pacific Group Founding Partner David Bonderman warned of the "deeply cyclical" nature of the airline business during the CEO Forum on Shaping the Air Transport Industry at the IATA AGM in Paris yesterday. "Although disguised by high fuel prices, this is about as good as it gets," he said, predicting that in two years time "we will see everybody cancel orders for over 1,000 new aircraft." Ironically, Bonderman also is chairman of Ryanair, which has outstanding firm orders for 143 737-800s and 193 options.
Southwest Airlines will launch a daily Denver-Houston Hobby flight on July 17 (increasing to twice-daily on Aug. 4), a four-times-daily DEN-Kansas City service and daily flights from DEN to Orlando International and Nashville, all on Aug. 4, and a daily Baltimore/Washington International-Oakland service from Aug. 17. It also will add one more daily flight from DEN to BWI, Chicago Midway and Phoenix on July 17 and to Las Vegas on Aug. 4. Frequencies will be added between HOU and Tampa on July 17 and between Boise and Oakland on Aug. 17.
Continental Airlines estimated an 8.5%-9.5% year-over-year rise in consolidated May RASM and a 7%-8% increase in mainline RASM as May system traffic increased 14.6% to 7.65 billion RPMs. Capacity rose 11.9% to 9.44 billion ASMs and load factor climbed 1.9 points to a May-record 81%. Domestic RPMs increased 7.9% to 3.63 billion as capacity grew 4.6% to 4.33 billion ASMs and load factor went up 2.7 points to 83.9%. International traffic jumped 20.9% to 3.12 billion RPMs on a 20.9% climb in capacity to 3.99 billion ASMs, leaving load factor steady at 78%.
Royal Jordanian took delivery of an IAE V2500-powered A321 last month. The 167-seat aircraft is the fourth of a group of six new A320s/A321s acquired to replace older A310s and A320s. Separately, RJ licensed the PROS Airline Solutions Suite, which includes the PROS 6 Revenue Management System, the PROS Group System and the PROS Network Revenue Planning System.
SkyTeam said at Friday's Governing Board meeting in Paris that Portugalia Airlines now is a candidate to join the alliance's Associate Airline Program and China Southern Airlines "continues to make progress on fulfilling alliance joining requirements" that should be finalized next year. Air France will sponsor Portugalia's effort to join SkyTeam by 2008. It serves nearly 1 million passengers per year operating to 20 destinations in six countries in Europe and North Africa with a fleet of 17 aircraft that include eight Embraer 145s and six F100s.
US Air Transportation Stabilization Board last week announced the sale of the 3.4 million warrants it received in connection with the issuance of a loan guarantee to Frontier Airlines in 2003. Warrants were sold at auction to seven institutional investors for $6.6 million. ATSB has no current outstanding loan guarantees but does hold warrants in World Airways and has an $86 million direct loan to ATA Airlines.
US Airways Group reached a final transition agreement with the Airline Customer Service Employee Assn., an alliance between the Communication Workers of America and International Brotherhood of Teamsters representing the carrier's 7,700 passenger service and reservations employees. A tentative agreement was announced in December ( ATWOnline, Dec. 8, 2005) outlining the transition of former America West Airlines employees (IBT) to the existing US Airways (CWA) labor contract.
Ural Airlines, based at Koltsovo International Airport in Ekaterinburg, signed a letter of intent with Aughras Trading of Ireland for the lease of two A320-211s scheduled for delivery in August and September. They will be the carrier's first Western aircraft. Ural said it would have preferred to purchase the aircraft but could not secure a delivery slot prior to 2009.
American Airlines flew 12.25 billion system RPMs in May, a 3.7% rise over the year-ago month. Capacity increased just 0.3% to 15.16 billion ASMs, lifting load factor 2.6 points to 80.7%. Domestic traffic rose 2.1% to 8.02 billion RPMs against a 1.9% drop in capacity to 9.66 billion ASMs, sending load factor up 3.3 points to 83%. International RPMs climbed 6.9% to 4.22 billion, ASMs rose 4.6% to 5.49 billion and load factor increased 1.6 points to 76.8%. ExpressJet Airlines flew 909.7 million RPMs in May, a 23.1% increase over the year-ago month.
SkyEurope Airlines said Bank of Scotland will provide pre-delivery payments and long-term loan financing on the four new 737-700s scheduled for delivery in the second half of 2007. The airline last year placed an order for 16 firm aircraft and 16 options ( ATWOnline, May 11, 2005) and already has taken delivery of four. Twelve dash 700s, including those four, are to be financed under operating leases from GECAS. The aircraft financed with Bank of Scotland will be SkyEurope's first owned airplanes.
Ferrovial Group continues to push BAA shareholders to accept its hostile takeover bid and reportedly made a push Friday for a minority stake in the airports operator ahead of today's final bid deadline. Citing sources in Spain, Reuters reported that Ferrovial adviser Citigroup was purchasing BAA shares and hoped to acquire a 15% stake. Today is the deadline for the Spanish firm to make a final offer. Goldman Sachs reportedly is considering a rival bid.
Air Finland, in its third year of operation, said it earned a €1.1 million ($1.4 million) profit and carried 404,000 passengers in 2005, numbers that "exceeded all its targets." Revenues were "slightly over" €51 million. It said it expects to carry more than 500,000 passengers in 2006 and its financial result "is expected to be better than the year before."
Australian airport operators led by Melbourne and Brisbane attacked the government, claiming it is protecting Qantas at the expense of the country's tourist industry. Speaking to The Australian, Melbourne Airport CEO Chris Barlow claimed the government "has been putting money into promoting the 'Where the bloody hell are you?' global TV campaign, which is really successful," while knocking back airlines such as Emirates, which wants to double its services to Australia.
Air Pacific posted a 40% decline in net profit to $14.9 million for the financial year ended March 31 as fuel prices soared. That cost increase was reflected in a 5.7% rise in expenditure to $428.9 million while revenue was up only 2% to $449.4 million. Fuel climbed from 27% to 34% of total expenditure.
Air France this month will start deploying 777-300ERs on its routes from Paris Orly to the French Overseas Departments except French Guiana. Seven dash 300ERs in three-class configuration will gradually replace 747s, and by 2007 Fort-de-France, Pointe-a-Pitre and Saint Denis will have a dedicated fleet of 777s equipped with in-seat digital IFE. In the high season, AF operates up to 14 weekly flights between France and the French Caribbean and nine to Reunion. Some 1.4 million passengers travel on this network annually.
Alitalia said it posted a "good performance" in April that reflected a recovery after last January's strikes, particularly in the leisure segment. Traffic increased 6% on the year-ago month to 3.25 billion RPKs on a 3.3% capacity reduction to 4.3 billion ASKs. Load factor gained 6.6 points to 75.6%. Passenger boardings were up 5.1% to 2.08 million.
US Airways Group yesterday announced that Eastshore Aviation will sell 3.05 million shares of the group's common stock in an underwritten secondary offering. None of the proceeds of the offering, underwritten by Goldman, Sachs & Co., will go to US. Separately, the carrier launched a daily Philadelphia-Portland, Ore., service yesterday aboard an America West Airlines A320 and a daily Phoenix-Kalispell, Mont., flight aboard a Mesa Airlines CRJ200. From July 1 until Aug. 19 the route will be operated by a US A319.
IATA reported a 9.9% rise in international RPKs in April compared to the year-ago month. Capacity increased 5.5% and load factor was 76.5%. Strongest traffic growth was in the Middle East, which showed a 22.1% rise in RPKs against a 16.2% climb in ASKs.
Although airlines serving European airports have worked with common-use passenger handling systems for decades, US carriers have resisted the technology and US airports have been reluctant to impose it on them. Gradually this is changing. Raleigh-Durham International will build the system into its new Terminal C, making it the first airport in North Carolina to adopt it.
US deregulation of the global distribution systems market in 2004 had all the immediate impact of a whisper in the woods. At the time, most of the US Major airlines already were locked into three-year, "full-content" direct connect agreements with GDS providers that guaranteed the status quo would linger regardless of the Dept. of Transportation's decision to let the CRS rules expire (ATW, 4/04, p. 33).
The international terminal at Istanbul Ataturk International Airport is a pleasant surprise: Luxurious without being overwhelming or tacky, with modern architecture, glass curtain walls, stainless steel and ceramic panel finishes, granite flooring, plenty of space and very, very cleaneven the toilets.
One thing that can be said about Mesa Air Group Chairman and CEO Jonathan Ornstein is that he loves a challenge. Whether on the basketball court or in the boardroom, his natural instinct is to play hard and play to win. His acumen as a corporate leader is demonstrated by the Phoenix-based carrier's track record of growth and profitability during a period of financial hardship for most of the commercial aviation industryincluding some of Mesa's Regional counterparts.
