That cliche about the three most important things in real estate being location, location, location is equally true for the airline industry these days.
We are not the first to suggest that at this stage in its evolution, the commercial air transport manufacturing industry appears to have become a zero sum affair, a game of seesaw in which one side has to sink down in order for the other to rise up. Thus as Airbus confronts a wave of bad news including extensive new A380 delivery delays and potentially harmful operating restrictions when the aircraft enters service, uncertainty regarding the A350, and slack sales across its product line (see NewsBriefs, p. 9, and Farnborough Preview, p.
Air New Zealand named Cam Wallace GM-New Zealand & Pacific Island sales replacing Roger Poulton, who becomes GM-Americas. Air Pacific elected Nalin Patel chairman. American Airlines selected Arthur Pappas as VP-Chicago. Aviation Partners Boeing welcomed Jerome C. David as CFO. Aviareto appointed Niall Greene MD. Boeing tapped Judge J. Michael Luttig as senior VP & general counsel succeeding Douglas G. Bain, who retired.
Waiting on a Plane ALTHOUGH AIRBUS MIGHT HAVE PREFERRED otherwise, it certainly will have the center stage at this month's Farnborough International Airshow (July 17-23). Alas, the A380's first visit to this storied event has been overshadowed by news of further delays to the program.
In the U.S., the same people who navigate the nation's air transport system without a second thought are sometimes clueless when it comes to rail travel, particularly if they live outside the Northeast, California's Capitol Corridor or other areas where rail commutes are commonplace. So in designing the latest incarnation of its Web site, Amtrak put a lot of thought into answering questions raised by the uninitiated. It offers a primer for first-timers.
Boeing announced it will record $915 million-$1.1 billion in charges in the second quarter related to delays in its Airborne Early Warning & Control surveillance program for Australia and Turkey and a previously announced settlement with the US Justice Dept. from criminal cases involving its hiring of a former Air Force weapons purchaser and its acquisition of proprietary information belonging to Lockheed Martin. Reuters reported that the charges likely will wipe out the company's second-quarter profit, which analysts forecast at $967 million before interest and taxes.
Haruka Nishimatsu was confirmed yesterday as JAL Group's new president and CEO, with former group CEO Toshiyuki Shinmachi confirmed as group chairman. Shinmachi was pressured to relinquish the CEO title four months ago ( ATWOnline, March 2). Nishimatsu, 58, formerly was senior VP-finance and purchasing and has spent most of his working life at JAL. "I adored aircraft. I had watched planes fly over Hamamatsu between Tokyo and Osaka since I was a small boy and was fascinated by them," he said.
Copa Airlines said yesterday that it has priced Continental Airlines' offering of 6.56 million Class A nonvoting Copa shares at $21.75 per share. It added that underwriters will have a 30-day option to purchase an additional 984,375 Copa shares from Continental to cover overallotments, if any. CO will continue to hold a 12.3% interest in Copa once the share sale is completed, or a 10% interest if the overallotment option is exercised in full.
Next Generation Air Transportation System, as the program to modernize the US air traffic control system is now known, will revolutionize the airways in the same way that construction of the US interstate highway system changed how people and goods move on the ground, outgoing Secretary of Transportation Norman Mineta said Wednesday at a forum on NGATS in Washington.
India and Kuwait agreed to increase airline seats per week from Kuwait by 1,300. Kuwait Airways will maintain its current 5,200 weekly seats while Jazeera Airways will operate the added 1,300. The expansion is part of a broader agreement expected to be finalized during bilateral talks scheduled for next month.
AeroMexico will lease three 787-8s from International Lease Finance Corp., with deliveries beginning in 2010. The aircraft will replace 767s on leases set to expire and will be used on flights to Europe and Asia. ILFC has 20 787s on firm order. AeroMexico recently took delivery of two 777-200ERs. "With similar speeds, mission capabilities and cockpit commonality, the combination of the 787 with the 777 will provide AeroMexico with optimum fleet flexibility on long-range missions," said Boeing Commercial Airplanes VP-Sales, Latin America and the Caribbean John Wojick.
Assn. of European Airlines members collectively posted a provisional operating profit of $755 million in 2005, up 82.8% from $413 million the previous year, according to data released yesterday in AEA's Yearbook 06. Operating margin of the 30 carriers edged up to 0.9% from 0.4% in 2004, which AEA said "must be regarded as unsatisfactory still for a year in which most of the fundamentals were favorable--strong demand, economic growth, low interest."
Berlin Airports, which manages the city's three airports, finalized a €350 million ($439.7 million) bridge loan with an international consortium of banks headed by Commerzbank in another step toward transforming Berlin Schoenefeld into the larger and more modern Berlin Brandenburg International Airport. The consortium also includes Helaba, KfW/IPEX and Sumitomo Mitsui Banking Corp. as co-arrangers. Other members are the investment banks in the states of Berlin and Brandenburg.
Hawaiian Airlines filed a motion seeking a court order to stop Mesa Air Group from issuing inter-island tickets for its new startup carrier go!, which began service June 9. According to the Associated Press, Hawaiian claims to have proof that Mesa's CFO used "highly confidential documents and trade secrets obtained from Hawaiian in April 2004." At that time, Mesa was among a group of potential bidders for the bankrupt island carrier. In February, Hawaiian filed suit against the Regional and Mesa responded a month later with a countersuit charging Hawaiian with violating antitrust laws.
Air Arabia announced that Information Systems Associates, its joint venture with John Keells Holdings, developed a new reservation system dubbed AccelAero for low-cost airlines. According to the Arabian Air Carrier Assn., the system provides selling channels through the Internet, travel agencies and call centers. Air Arabia is the launch customer.
Etihad Airways will boost Abu Dhabi-Riyadh service to four-times-weekly from July 10 and will operate eight weekly flights on the route during the winter. The carrier currently operates thrice-weekly service. The added flight will use a 777-300ER. Frontier Airlines yesterday launched five-times-daily service between Los Angeles and San Francisco aboard A319s. Germanwings will start a thrice-weekly Hamburg-Moscow Vnukovo service from Oct 31. The LCC now flies to Moscow from Cologne/Bonn, Berlin Schoenefeld and Stuttgart.
Unisys Corp. announced that its subsidiary in Germany signed a contract with Hahn Air Systems, the IT subsidiary of Hahn Air, for implementation of Unisys Airline Core Systems Solutions. Hahn will offer the AirCore functions as an ASP. The company is an IATA member and handles worldwide sales and distribution of flight tickets for non-BSP participating carriers. Mercator completed a major IT project for Middle East Airlines with the successful installation of its RAPID passenger revenue accounting solution.
Savvion announced that Southwest Airlines deployed its Savvion BusinessManager 6.5 to provide business process management tools for employee records management and project financial controls.
ExpressJet took delivery of its 275th ERJ under a contract signed 10 years ago with Embraer. The Regional operates a fleet of ERJ-135s/-145s under a codeshare agreement with Continental Airlines. In January, CO notified its partner that it would take 69 aircraft out of service after the two sides failed to reach a financial deal on their continued deployment. ExpressJet CEO Jim Ream plans to retain the aircraft, which are leased from CO, in hopes of finding another suitable partner ( ATWOnline, May 8).
VarigLog deposited an additional $1.8 million Tuesday and Wednesday to keep Varig afloat, according to press reports, while a Rio de Janeiro bankruptcy court, prosecutors and creditors analyzed the freight and logistics company's $500 million bid for the airline ( ATWOnline, June 28).
Bmi Chairman Michael Bishop celebrated bmi's role in European aviation liberalization and 20 years of scheduled services to Europe yesterday with a call for continued deregulation, particularly between the US and London Heathrow. On June 29, 1986, bmi Flight BD101 left LHR for Amsterdam, marking "the first scheduled flight between Heathrow and a major European city by any independent airline. Until that date, only the respective national airlines, or so-called flag carriers, were able to operate cross-border scheduled services on major routes," Bishop noted.
Jet Blue Airways will launch a daily New York JFK-Tucson service from Sept. 28 and a daily JFK-Sarasota/Bradenton flight starting Sept. 21, both aboard A320s. Tucson and Sarasota/Bradenton are new destinations for the carrier, which earlier this week announced plans to serve Houston Hobby. US Airways will operate a daily Reagan Washington National-Sarasota/Bradenton service from Aug. 15 aboard a Republic Airways Embraer 170. US was awarded the slot exemptions two weeks ago ( ATWOnline, June 14).
TAM signed an MOU yesterday with Airbus to acquire 37 aircraft, boosting both the manufacturer's flagging fortunes and the airline's hopes for domestic dominance as Varig lingers on the verge of shutdown.
Lufthansa Technik will provide Total Component Maintenance and Total Engine Support packages to ATA Airlines for 10-year terms in what is its second largest deal with a US carrier. The TCM agreement covers more than 3,200 part numbers on three 737-300s, 25 737-800s, 20 757-200s/-300s and four L-1011-500s. The power-by-the-hour contract also includes a sale and leaseback of ATA's existing inventory to LHT. The exclusive engine deal is a power-by-the-hour agreement and covers CFM56-7s powering ATA's 737-800s. LHT also will provide access to spare engines.
