Lufthansa intends to use its call option and purchase the 50%-plus-one-share stake in bmi held by Chairman Michael Bishop, CFO Stephan Gamkow told the dpa news agency last week without providing further details. LH holds 30%-minus-one-share in the UK carrier, with the remaining stake held by SAS, which intends to divest ( ATW, April 2008). Gemkow said LH still has no interest in Alitalia, but it does see a future in the Italian market.
Frontier Airlines Holdings named Jim Young VP-distribution, sales and marketing and Tom Bacon VP-planning and revenue management. Both are new to the company.
China Southern Airlines expects to open 7-8 new international routes this year, expanding on a plan that saw it open 10 new foreign destinations in 2007 ( ATWOnline, March 11). This year's routes will originate mostly in Guangzhou and serve neighboring countries in Southeast Asia, in addition to a London flight scheduled to start in the fourth quarter, Chairman Liu Shaoyang said.
Boeing last Friday said it moved the 787 static test airframe from its Everett final assembly facility to its nearby structural test rig. Some assembly remains and will be completed concurrently with test set-up, the manufacturer said. Assembly on the third 787 will begin this week ( ATWOnline, April 10).
AirTran Airways parent AirTran Holdings is offering more than 22.3 million shares of common stock at $3.20 per share, it said Friday. It additionally will offer $65 million of 5.5% convertible senior notes due in 2015. Notes can be converted into common stock at the rate of 260.417 shares per $1,000 principal amount of notes, or $3.84 per share. Offerings are expected to close April 30 and proceeds will be used for the purchase of government securities and for general corporate purposes including retirement of debt.
American Airlines announced it will join competitors in charging domestic economy passengers $25 to check a second piece of luggage effective May 12. Policy also applies to flights on its American Eagle Airlines subsidiary. Premium loyalty program members, those purchasing full fares and those with international itineraries will not be subject to the fee, leaving it applicable to approximately 4% of domestic customers checking a second bag, AA said.
Shanghai Airlines was unable to reap the benefits related to rising demand and yuan appreciation enjoyed by its rivals in 2007 as it reported a CNY497.6 million ($70.9 million) net loss that widened considerably from a CNY6.5 million deficit the year before, although it enjoyed a slight reversal of fortune in the first quarter of 2008.
Air Berlin said it reached a 10-year salary agreement with AB, LTU and dba pilots represented by Cockpit. It also covers promotions and training programs and is effective retroactively from April 1. Separately, AB implemented mobile phone boarding passes and seat selection on flights departing from "many" German airports.
Eos Airlines became the second all-business-class carrier to shut down and the fifth US-based airline to declare bankruptcy in the past month, announcing Saturday that "some issues arose" that prevented potential investors from following through and that bankruptcy was the only option.
Continental Airlines said it will not merge with another airline, squelching speculation that it was interested in a tie-up with United Airlines, which conversely said that it would "pursue all options" and reportedly is in talks with US Airways about a possible combination.
AirAsia launched flights to Ho Chi Minh City from Kuala Lumpur (daily) and Bangkok (four-times-weekly). Thrice-weekly Kuching-Macau becomes daily May 15 and a new daily KUL-Kuantan starts June 1. Kingfisher Airlines launched flights from Mumbai to Chandigarh (daily) and Ahmedabad (twice-daily) aboard A319s as well as daily service from Delhi to Chandigarh and Goa. Dniproavia launched daily Simferopol-Moscow Domodedovo aboard a 737.
Singapore Airlines took delivery of its fourth A380 Saturday in Toulouse. It will enter service on daily flights to/from Tokyo Narita on May 20. SIA operates its other A380s to Sydney and London Heathrow and has firm orders for an additional 15 plus six options.
Regional Express Holdings (Rex) will take full control and ownership of its joint venture pilot training academy at Mangalore, the Australian regional announced. It will be renamed Australian Airline Pilot Academy. First batch of cadets is scheduled to graduate this year and commence conversion training to Rex's Saab 340s.
News from Travel Technology Update: A number of travel agency groups, including the Association of Canadian Travel Agencies, are engaged in an 11th-hour attempt to postpone the demise of paper tickets. IATA has said that after May 31, paper tickets no longer will be processed through its billing and settlement plans. The deadline does not affect travel agencies in the U.S., whose ticket sales are processed through the Airlines Reporting Corp.
In a surprise move, SkyWest Inc. made an unsolicited bid to acquire financially beleaguered ExpressJet Holdings Inc. and revealed that it had negotiated a capacity purchase agreement with Continental Airlines contingent on the acquisition taking place. ExpressJet Holdings announced Friday that it had rejected SkyWest's offer of $3.50 a share in cash, which represented a 67% premium over the April 24 closing price of $2.09 per share. It called the offer an "opportunistic attempt to acquire the company" below its true value.
ARINC and ATH Group launched the AirPlan enRoute Service aimed at reducing fuel costs. Technology is based on the Attila arrival management system and employs ACARS communications intelligence. It will be offered to airlines this summer.
Emirates will begin daily Dubai-San Francisco on Oct. 26 aboard a 777-200LR and six-times-weekly Dubai-Kozhikode on July 1 aboard 777-200s or A330-200s. CSA Czech Airlines will launch twice-weekly Prague-Almaty on May 1 using A319s.
American Airlines flew 11.6 billion system RPMs in March, down 2.8% from the year-ago month, against a 4.6% decline in capacity to 13.82 billion ASMs. Load factor rose 1.5 points to 83.9%. American Eagle Airlines flew 685.1 million RPMs, down 9.5%, and 933.6 million ASMs, down 8.6%. Load factor fell 0.7 point to 73.4%. Alaska Airlines flew 1.7 billion RPMs in March, up 10.7% from the year-ago month, against a 5.2% increase in capacity to 2.1 billion ASMs that lifted load factor 4 points to 80.8%.
TAM changed the name of its cargo business from TAM Express to TAM Cargo. The growing unit generates revenue from carrying cargo in the bellies of its 110 passenger aircraft. It said it will invest BRL30 million ($17.9 million) this year on infrastructure for domestic cargo terminals and national and international freight systems. Its gross cargo revenue totaled BRL776.8 million in 2007, up 60% over 2006, comprising 9.2% of the Brazilian airline's total revenue.
Lufthansa Group released its full first-quarter results Friday, confirming its previously announced €57 million ($90 million) net profit and record €188 million operating result and expressing confidence that it will report a full-year operating result that "matches the record figures achieved last year and intends to record further improvements."
Air China posted a net profit of CNY1.04 billion ($149.2 million) in the first quarter, up 147% from the CNY422.7 million earned in the year-ago quarter, on a 21% lift in operating revenue to CNY12.76 billion. Operating expenses jumped 15.43% to CNY12.04 billion. In addition to "stable growth in domestic demand," CA credited capacity increases and "accelerated" yuan appreciation for the improved result. It released no other details.
The European Commission last week indicated it had concerns about whether the €300 million ($473.6 million) emergency bridge loan offered by the Italian government to Alitalia constitutes illegal state aid ( ATWOnline, April 24). "We have doubts about the nature of the measures and we want to have a better understanding of the details," DG Transport spokesperson Michele Cercone said. "We want to understand if this is a commercial operation as the Italian authorities claim."
Air Line Pilots Assn. filed suit against ATA Airlines for failing to give notice prior to shutting down operations "abruptly in the early morning hours of April 3" ( ATWOnline, April 4).
Austrian Airlines Group suffered a €60.4 million ($95.3 million) loss in the first quarter, widened from a €16.3 million deficit in the year-ago period, which prompted the company to say it expected a fall in full-year adjusted EBIT "due to the time-lagged effect of measures implemented through adjustment of fares and surcharges." Despite the "continued deterioriation in market conditions," OS has not given up on expansion.
