New Airbus CEO Louis Gallois arrived in Toulouse yesterday to meet company officials and begin charting the manufacturer's turnaround, warning that "painful" job cuts are on the horizon. He said his position as co-CEO of EADS will allow for "a simpler and more unified command structure" that will make implementing cost-cutting initiatives easier.
Continental Airlines said it is contributing an additional $70 million to its pension plans, bringing its 2006 contributions to $246 million, a total it said exceeded the minimum funding requirement. "I'm pleased that we have achieved a solid record for making our required contributions, plus some," Chairman and CEO Larry Kellner said. Air Line Pilots Assn. President Duane Woerth requested that the National Mediation Board send the stalemate between pilots at Atlantic Southeast Airlines and parent SkyWest Holdings to arbitration.
ACE Aviation Holdings, parent of Air Canada, said its shareholders overwhelmingly approved a statutory arrangement under the Canada Business Corporations Act giving ACE's board the authority to make "one or more special distributions to shareholders" of up to C$2 billion in capital, including units of its Aeroplan Income Fund subsidiary. It is expected to be completed by year end. The measure passed with 95.5% approval and was approved by Quebec Superior Court. The Air Canada Pilots Assn.
Alaska Air Group said yesterday in a filing to the US Securities and Exchange Commission that it expects a 38% year-over-year jump in third-quarter unit costs at Alaska Airlines and a 21% increase in CASM at Horizon Air due to rising fuel costs and special items.
Ryanair will base three new 737-800s at Madrid Barajas and open 14 routes from the airport beginning Nov. 22, making it its second Spanish and 18th European base. The LCC will fly daily to Dublin, Eindhoven, Faro, Porto, Marseille and Paris Beauvais. It will fly thrice-weekly to Bournemouth, Gothenburg, Malmo and Shannon and four-times-weekly to Billund, Brussels Charleroi, Nottingham East Midlands and Oslo Sandefjord. Approximately 1 million passengers will travel each year on the new routes, Ryanair said.
Delta Air Lines will launch service from Trenton to Boston (thrice-daily) and Atlanta (daily) on Dec. 18. Both routes will be operated by Comair aboard 50-seat CRJs. Delta also will start thrice-weekly flights from Mexico City to Orlando and Salt Lake City on Dec. 1 and a twice-weekly Atlanta-Pointe a Pietre service on Dec. 13, all aboard 737-800s. It will begin flights from Los Angeles to Managua (twice-weekly from Dec. 16) and Puerto Vallarta (daily from Dec. 15) and increase LAX-Guatemala City service to four-times-weekly from weekly on Dec. 17.
Ryanair's surprise bid for newly listed Aer Lingus ( ATWOnline, Oct. 6) prompted its pilots to lodge a pay claim with Ireland's Labor Relations Commission to bring their salaries closer to those of their counterparts at EI. "Ryanair's bid to take over Aer Lingus substantially strengthens the union's claim for a closer alignment of pilots' remuneration and working conditions," the Impact union said. According to Impact, Ryanair management rejected a similar claim last month.
Tarom may be partially privatized soon, according to Romanian media reports indicating that the government is planning to float 49% of the carrier. But the government said the move is not a high priority and that it is taking care to avoid the fate that befell Bulgaria Air, whose privatization process faced several delays Tarom operates a fleet of five 737-300s, four 737-700s and seven ATR 42s and has grounded two A310-300s.
Etihad Airways named former Gulf Air President and CEO James Hogan as its new CEO effective immediately, replacing Robert Strodel, who stepped down in May after less than a year on the job. Hogan announced his resignation from Gulf Air in July and concluded his four-year tenure on Sept. 30 ( ATWOnline, July 11).
Wizz Air will launch six new routes from Katowice for the summer schedule, increasing capacity from the airport by 50%. The carrier will base a new A320 there from May 2007. New services are to Belfast and Eindhoven (both thrice-weekly from May 29), Bourgas and Heraklion (both weekly from June 2), Bournemouth (thrice-weekly from July 14) and Coventry (thrice-weekly from July 28). Summer flights to Athens and Barcelona also will resume. Lufthansa Cargo will launch a twice-weekly MD-11F service from Frankfurt to Los Angeles via Chicago O'Hare on Oct 29.
MAIR Holdings last week asked the US Bankruptcy Court in Minnesota to issue a declaratory judgment that $122.2 million in dividends and fees paid by bankrupt subsidiary Mesaba Aviation from 2002 through 2005 "were wholly proper and appropriate under law" and should be shielded from Mesaba employees and creditors. The suit is in response to a ruling last week that authorized Mesaba creditors to pursue claims against the parent company.
American Airlines flew 10.6 billion system RPMs in September, a 1.4% dip from the year-ago month. Capacity fell 0.5% to 14.03 billion ASMs and load factor was down 0.7 point to 75.5%. Domestic RPMs declined 3.8% to 6.74 billion, capacity fell 2.4% to 8.88 billion ASMs and load factor dropped 1.2 points to 75.8%. International traffic rose 3.1% to 3.85 billion RPMs against a 3% capacity increase to 5.15 billion ASMs, lifting load factor 0.1 point to 74.8%.
Northwest Airlines yesterday announced a tentative agreement with its striking mechanics, represented by the Aircraft Mechanics Fraternal Assn., which will conduct a ratification vote during the next month. NWA said the deal offers one week of layoff pay per year of service up to five weeks, or up to 10 weeks of separation pay for those leaving the company. Employees accepting layoff would remain on furlough status for two years and may apply for open positions, NWA said.
Gol 737-800 crash investigators have concluded that the ExcelAire Legacy 600 had its transponder switched off before colliding with the passenger aircraft, Estado de Sao Paulo reported. The transponder, which alerts air traffic controllers to a plane's position, apparently was turned on after the midair collision. The Legacy's two American pilots, who are being held in Brazil for questioning, have denied turning off the transponder ( ATWOnline, Oct. 5).
EADS co-CEO Louis Gallois, the former Snecma chairman and CEO, was named Airbus CEO yesterday following the resignation of Christian Streiff after just three months on the job. Gallois becomes the third Airbus CEO since mid-2005 and will remain as EADS co-CEO in addition to his new responsibilities. "The new management structure will allow, on the one hand, a leaner, more efficient corporate governance and, on the other hand, additional cost savings within the EADS group," EADS said in a statement. The company soon will own 100% of Airbus.
British Airways Commercial Director and board member Martin George resigned yesterday after admitting that "inappropriate conversations" concerning the setting of fuel surcharges on long-haul tickets occurred in his department ( ATWOnline, June 26). BA Head of Communications Iain Burns also resigned. Both executives had been on leave since June, when the UK Office of Fair Trading and the US Dept.
Air Malta called the fiscal year ended March 31 "a very difficult one" and said its operating loss increased to MTL6.4 million ($18.6 million) from MTL5.7 million in the year-ago period. Revenues fell 2.6% to MTL99.2 million. The airline said its operating result "would have shown a marked improvement" if not for "significant" fuel cost increases. Passenger numbers decreased 2.4% to 1.9 million.
Airlines serving Dallas/Fort Worth will benefit from the airport's deal with Chesapeake Energy Corp. to mine the natural gas produced on DFW's 18,000 acres. The "monumental deal," as DFW CEO Jeff Fegan characterized it, includes an initial payment of $185 million and a 25% royalty on the value of the gas. Fegan said nonaviation revenue will reach "new highs for the next couple of decades," which will "help keep costs lower for airlines, making DFW a more attractive market, and create new airline competition." Natural gas production is expected to begin within two years.
Alitalia Group acknowledged last week that its airline unit will not break even this year as it predicted in its business plan ( ATWOnline, Sept. 4 and admitted that survival will be difficult despite this year's state-guaranteed €1.3 billion ($1.7 billion) recapitalization. "In the current context, the national carrier cannot generate a profit even from capital already invested," AZ noted in a report obtained by Il Sole 24 Ore.
Embraer will deliver fewer planes than predicted this year owing to an ongoing problem with its supply chain and suppliers. "We will deliver 135 aircraft rather than the 145 that we had foreseen," CEO Mauricio Botelho said during a conference call Friday. "We are postponing deliveries of 10 aircraft this year but we are getting the situation under control."
Boeing had another robust week, with orders for an additional 16 747s, four 767s and one 787 listed on its website. The customers are unidentified. ATWOnline understands that 14 of the 747s are dash 8Fs going to two customers while the remaining two are VIP aircraft listed as Boeing BBJs along with the order placed in June for one 747-8 Intercontinental ( ATWOnline, June 12). The single 787 also is a BBJ, bringing VIP orders to four. Total orders for the year now stand at 723 net of cancellations.
Use of mobile phones onboard commercial aircraft is inevitable, a panel of experts agreed during last week's ATWOnline webcast on the future of the inflight communications market. But the emergence of cabin standards is "a major issue, and cannot be ignored," stated Wale Adepoju, CEO and chief analyst of the Inflight Management Development Center. "Travelers are positive to the concept," said David Coiley, director-marketing and strategic relationships for AeroMobile, a joint venture with ARINC and Telenor. "We are ready to go and this thing is coming.
