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.
The European Commission and the US government have restarted negotiations to try to establish an Open Aviation Area between the two blocs. Are you hopeful on a positive outcome?
It would be difficult to pick a worse day than Sept. 10, 2001, to start up a new airline. Gothenburg-based City Airline had the misfortune to do just that. "It was bad timing," MD Tom Ericsson agrees. "We seriously considered closing down the operation, but we didn't."
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.
Hong Kong Civil Aviation Dept. approved the use of fuel surcharges for an additional two months through January. Airlines may raise the levy 2.1% to HKD93 ($12) on short-haul flights and 8.4% to HKD383 on long-haul flights, the Associated Press reported.
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.
IATA, citing the easing of oil prices in the current quarter, trimmed its estimate of industry losses in 2005 from $7.4 billion to $6 billion. Brian Pearce, IATA's chief economist, told ATWOnline that the organization decided the average price of oil will be in the $54-$55 per barrel range, down from the $57 price assumed in August. That reduction, coupled with "quite a strong revenue environment," produced the revised forecast. Total fuel bill for the world's airline industry still will amount to $92-$93 billion compared to $44 billion in 2003.
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.
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.
Lufthansa Systems Group will be converted into a stock corporation effective Jan. 1. The decision by the group executive board of Deutsche Lufthansa AG was confirmed by the supervisory board of Lufthansa Systems on Nov. 24. Following Cargo, Technik, LSG and Thomas Cook, the IT services segment will be the latest Lufthansa Group company to be transformed into a stock corporation. It will remain a wholly owned subsidiary of Deutsche Lufthansa.
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.
The Russian Assn. of Air Transport Operators, supported by Aeroflot, asked the government to eliminate the heavy duties imposed on the importation of Western-built aircraft by Russian airlines. According to the organization, the tariffs "have not proved their effectiveness but instead acted as a brake on development of the entire air transport industry."
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.
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.
ICAO will host a worldwide safety conference for directors general of civil aviation at the organization's headquarters in Montreal March 20-22. Main issues will include transparency and sharing of information.
Spanish government will comply with demands from the European Commission and give up its "golden share" in Iberia, Expansion reported. The government retained the right to veto strategic decisions and attempts by third parties to buy into the carrier despite no longer holding a controlling stake.
