Northwest Airlines said it will need $2 billion in new funding in order to exit bankruptcy protection and finance new aircraft, the Financial Times reported. NWA said it does not expect to generate "significant liquidity" from its operations until at least 2009.
Hainan Airlines is close to completing a deal for a 70% stake in Hong Kong carrier CR Airways, which made waves earlier this week with its order for 10 787s and 30 737-800s ( ATWOnline, Dec. 21). Previous reports indicated Hainan will acquire 60% of the nascent Regional, Reuters reported. It reportedly will pay HKD350 million ($45.1 million) for the stake and hold it through a company incorporated in Hong Kong. The other 30% will be held by CR Airways founder Robert Yip.
Varig creditors rejected the carrier's sale to Docas Investimentos, a fund owned by newspaper owner Nelson Tanure, who paid $112 million for a 25% stake in Varig SA and a 10-year "lease" on an additional 42% ( ATWOnline, Dec. 14). The decision drew cheers from Varig employees, according to the Associated Press. A Varig spokesperson said creditors have approved an alternative recovery plan involving investment funds and that the airline intends to put into service next year the 18 aircraft currently grounded. It has until Jan. 8 to present its restructuring plan.
Southwest Airlines and Boeing have been sued by two passengers who were aboard the 737-700 that veered off a Chicago Midway runway earlier this month ( ATWOnline, Dec. 16). A law firm representing the pair said they were injured in the accident and alleged the airline and the City of Chicago were negligent. Neither Southwest nor Boeing had seen the complaint, according to media reports.
JetWorks Leasing said it arranged the sale of two ex-Southern Winds 737-200s from PLM Worldwide Leasing Corp. to AeroDirect and the sale of a DC-8-73F from US Bank NA to Spanish cargo carrier Corporacion Ygnus Air, which had been leasing the aircraft.
Airbus announced it placed work packages for the A320, A330/A340 and A380 worth $200 million over 10 years with Russian companies Irkut Scientific Production Corp. and Voronezh Aircraft Production Assn. Deliveries of components and subassemblies from the two firms will begin at the end of 2006-beginning of 2007.
Northwest Airlines executives have been named in a class-action lawsuit filed by a New York firm alleging they engaged in insider trading prior to the carrier's Chapter 11 filing on Sept. 14. Defendants include CEO Doug Steenland, former CFO Bernard Han, Chairman Gary Wilson and former director Alfred Checchi, who were among stockholders who netted combined proceeds of approximately $30 million for trades conducted between April 21 and Sept. 14.
US FAA said yesterday that Chalk's Ocean Airways, the operator of the 58-year-old Grumman G-73T Turbine Mallard that crashed near Miami ( ATWOnline¸ Dec. 20), is voluntarily grounding its fleet in order to conduct inspections on its remaining fleet, according to media reports. The airline owns four aircraft similar to the one that crashed Monday, killing all 20 aboard.
Cyprus Airways employees have been granted 48 hr. by the airline to accept a restructuring designed to produce an immediate CYP21.8 million ($45.3 million) in annual savings. The plan would require about 500 of CY's 1,830 employees to accept voluntary layoffs, Reuters reported. Talks between the carrier and its unions dissolved last month when workers refused to endorse a plan calling for approximately 360 layoffs and pay cuts for remaining workers ( ATWOnline, Dec. 5). CY is seeking a CYP58 million government-guaranteed loan.
Japan Airlines revealed yesterday that it had been flying a 747 with the left and right outboard engines reversed for seven months, Japanese media reported. The engines were misplaced during maintenance work at ST Aviation Services in Singapore last spring.
Air Nauru, the only airline providing service to the Pacific island nations of Nauru and Kiribati, was grounded last weekend when its only aircraft, a 737-400, was impounded in Melbourne by the US Export-Import Bank. The carrier also flew to destinations in Fiji, the Marshall Islands and the Solomon Islands.
United Airlines Chairman and CEO Glenn Tilton said the carrier "disappointed" its customers Saturday "by not being prepared, as we should have been, for the extraordinary volume of passengers." The admission, contained in a taped message to employees, referred to a situation that developed at Chicago O'Hare on Dec. 17 when thousands of United customers were inconvenienced by long check-in lines and waits of up to 4 hr. or more. The terminal became so crowded that some passengers were forced to stand in lines that snaked outside, where they were exposed to subfreezing temperatures.
Delta Air Lines laid off 68 customer service employees at Seattle-Tacoma International Airport. The layoffs will take effect during the first two weeks of February, the Puget Sound Business Journal reported. Air Transat reached a tentative agreement with its pilots, represented by the Air Line Pilots Assn., that replaces a deal that expired last month and will "improve working conditions and pay the pilots a competitive salary," according to ALPA.
United Airlines and its United Services maintenance division signed a three-year, $180 million deal with Pratt & Whitney for MRO on more than 200 F117 engines powering US Air Force C-17s. Work will take place at United's facilities in San Francisco and Charleston.
Members of AITAL, the Latin American airline association, unanimously agreed at their AGM in Miami to raise airline safety standards in the region by requiring all 25 member carriers to commit to an IATA Operational Safety Audit by the end of 2006 and to complete the audit successfully by the end of 2007.
US FAA needs to increase its oversight of noncertificated aviation repair stations and should consider limiting the scope of work such facilities can perform on behalf of airlines, according to a report released last week by the US Dept. of Transportation's Office of the Inspector General.
Lufthansa wants to reduce pilot costs further to help boost profitability and meet increasing competition in the global airline market, Chief Executive Wolfgang Mayrhuber said. In an interview with Reuters, Mayrhuber questioned how long LH can continue to pay its pilots "significantly above the market rate" and said market conditions should apply to new pilots joining the company. "We have to convince the unions that lower pay is advantageous for them, as only profitable jobs are secure jobs," he said. "We have to negotiate with the unions. It is not easy.
KLM Engineering & Maintenance will perform a D check on an Aegean Airlines 737-400. SAS Component said Royal Jordanian signed a Free2Fly material supply contract covering its two Q400s. SAS Group is selling a 67% stake in its component overhaul and support business to Singapore Technologies Engineering for €80.4 million ($96 million) ( ATWOnline, Dec. 16).
Bellview Airlines, which operated the 737-200 that crashed two months ago near Lagos killing 117 ( ATWOnline, Oct. 25), was grounded yesterday by the Nigerian government pending an audit of its operations, according to media reports. Nigerian President Olusegun Obasanjo ordered the grounding of Chanchangi Airlines and Sosoliso Airlines earlier this month as part of an emergency initiative to overhaul the country's troubled aviation industry ( ATWOnline, Dec. 14). A Bellview 737 made an emergency landing Monday in Accra with hydraulic failure.
Northwest Airlines is proposing to cut medical benefits for retirees as part of its restructuring. The move will save $18 million per year, according to media reports. The new plan would ask retirees under 65 to pay 50% of the monthly premium. Current employees would pay 25%.
US passenger airlines employed 442,016 people in October, a 5.5% decline from the same month in 2004, US DOT's Bureau of Transportation Statistics said yesterday. It marked the 10th consecutive month of year-over-year decreases. The seven "network carriers," comprising the six legacy airlines plus Alaska Airlines, employed 293,767 full- or part-time workers in October, a drop of 8.6%. Low-cost carriers reported a decrease of just 0.5% to 74,425 employees while Regional airlines posted a 2.3% gain over the year-ago month with 60,274 on the payrolls.
AirAsia confirmed to ATWOnline that it has submitted a proposal to the Malaysian government to operate all but three of Malaysia Airlines' domestic routes. The plan is part of the government's review of a domestic airline system that has been a continual loss-maker for MAS. Earlier this month, AirAsia took delivery of the first of 100 A320s and announced an additional eight destinations in Indonesia from Kuala Lumpur.
Aeroflot Russian Airlines carried out successful e-ticket trials on its Moscow-Los Angeles and Moscow-Delhi routes. The tests demonstrated that from a technical perspective, Aeroflot is ready to introduce e-tickets and can comply with IATA's timetable for 100% transition to e-tickets in 2007. However, the carrier said "a practical introduction of this technology. . .is impeded by absence of regulatory and legal framework on electronic tickets circulation in Russia."
