FAA Chief Counsel Nicholas Garaufis told the City of New York this week that a letter and statements he made in November on the use of passenger facility charge revenues in determining rent at New York Kennedy and LaGuardia airports were advisory and not intended to be binding. The city filed two lawsuits Friday charging that FAA, via Garaufis's November opinion for the Port Authority of New York and New Jersey, failed to follow the notice and comment provisions in the Administrative Procedure Act for a legislative-type rule. The suits are filed in the U.S.
Thomas Lagow, USAir's executive VP-marketing, has "retired," effective at the end of this month. Lagow, along with colleague Rakesh Gangwal, were brought to USAir from United by USAir Chairman Stephen Wolf. Lagow, who also has worked for TWA in the past, was being considered to replace Jeffrey Erickson as chief executive of TWA. Lagow was not available for comment, but TWA's official comment is that "we have not chosen a successor for Jeffrey Erickson." Although only 55, Lagow has worked in the business for more than 20 years, USAir said.
Senate Commerce Committee, as expected, approved yesterday the selection of Sen. Slade Gorton (R-Wash.) as chairman of the aviation subcommittee in the 105th Congress. Gorton replaces Sen. John McCain (R-Ariz.), now chairman of the committee. The panel has yet to name members of its subcommittees, but McCain said he hopes to do so by the end of the week. McCain also said a confirmation hearing for DOT Secretary-designate Rodney Slater is tentatively scheduled on Jan. 29.
TWA's flight attendants, who have a choice in the current representation fight between the incumbent Independent Federation of Flight Attendants and the Machinists, could choose a third union instead. The Association of Flight Attendants started a letter-writing campaign this week to persuade the TWA flight attendants to write in AFA in the "other" blank on their ballots, which will be counted Feb. 27.
USAir Group posted net profit of $263.4 million in 1996, more than double its 1995 earnings of $119.3 million. But the fourth quarter was not as positive, as net profit fell 55% to $27 million from $60 million in the same 1995 period, partially due to one-time profit-sharing payouts. Higher fuel costs hurt the fourth quarter and annual results, as USAir's cost per gallon of jet fuel jumped 30.2% in the quarter to 72.3 cents from 55.5 cents. For the year, the airline paid 20.4% more for a gallon of fuel, or 64.1 cents. Revenues rose 8.9% to $8.1 billion.
General Electric Aircraft Engines and Pratt&Whitney, collaborating on a potential 76,000-pound engine, will continue discussions with Airbus Industrie on powering the projected A3XX airliner now that Boeing has decided to shelve plans for a stretched 747 (DAILY, Jan. 22). The two companies announced plans last September for the GP7176, envisioned as the first product of the newly formed GE-P&W Engine Alliance.
New York was the most expensive city for business travelers in 1996, according to a study by Runzheimer International. The 200-city survey, which excludes air travel costs, is based on the cost of three meals per day at business-class restaurants and a single-rate lodging in a business- class hotel. The average cost was $305 per day in New York, $255 in Washington, $239 in Chicago, $232 in San Francisco and $225 in Boston.
U.S. Major Carrier Pacific Share of Service Third Quarter 1996 Total Revenue Departures American 527 Delta 704 Northwest 6,284 United 5,982 Total 13,497 Average Number of Seats Per Departure American 231 Delta 264
Kiwi International Air Lines brought back 500 employees last week and resumed flight Monday to Newark, Chicago, Atlanta and West Palm Beach after a three-month suspension of scheduled service and a bankruptcy filing. Operating on $8.5 million debtor-in-possession financing from Edwards- Wasatch Enterprises, the carrier will fly seven 727-200 aircraft and offer $79 and $99 one-way fares until Jan. 31. Jerry Murphy, president and chief executive, said fares in Kiwi's markets increased as much as $350 one way while Kiwi was out of business.
TWA asked DOT yesterday to dismiss applications for approval of the American-British Airways alliance. "DOT should wait until an open skies agreement with the U.K. is negotiated and implemented," before considering the public interest merits of the alliance, said George Aste, TWA VP- international affairs.
U.S. National Carriers Traffic December, 12 Months 1996 December December % 1996 1995 Change American Trans Air Revenue Passenger Miles (000) 604,066 695,430 -13.1 Available Seat Miles (000) 896,736 1,052,050 -14.8 Load Factor (%) 67.4 66.1 Passengers 366,497 454,582 -19.4 Atlantic Coast
Chicago City Council has approved measures needed to carry out the city- state agreement to reopen the airport at Meigs Field. The council appropriated to the Chicago Department of Aviation an additional $968,196 for 1997 to cover costs of running the airport, approved the agreed five- year extension of the lease for airport property with the Chicago Park District, and authorized DOA to negotiate with Signature Flight Support Services to provide interim fixed-base operation services at Meigs.
Donna Kaulkin, editorial director of McGraw-Hill Aviation Week Group's World Aviation Directory and Overhaul&Maintenance magazine, has resigned, effective Feb. 7. She plans to start her own editorial services business.
Sabre Group stressed its independence from American Airlines this week in defense of Preference MAAnager, the add-on to the Sabre computer reservations system that enables travel agents to give display preference to American and American Eagle flights. Administrative Law Judge Burton Kolko is still proceeding toward summary judgment on charges brought by attorneys at DOT's Office of Aviation and Enforcement Proceedings (AEP) against American for distribution of the software.
Delta has chosen four finalists for its annual $100 million advertising account - Saatchi and Saatchi, Ammirati Puris Lintas, Ogilvy&Mather Worldwide, and incumbent BBDO. Each agency will compete in designing global recommendations for Delta's new transatlantic business class this spring. The airline will make a final selection in March.
The U.S. Court of Appeals for the District of Columbia Circuit upheld the position of the City of Los Angeles last week on all the issues addressed in its decision, including an order that DOT reconsider its rejection of the city's valuation methodology in setting Los Angeles Airport landing fees (DAILY, Jan. 21). The court said DOT's June 1995 disapproval of part of the new landing fees was based on an "erroneous assumption" - that the law prohibits the city from charging airlines based on the fair market value of the land underlying the airfield.
The European Commission said the proposed strategic alliance between American and British Airways would eliminate competition on 14 North Atlantic routes: between London and Baltimore, Charlotte, Phoenix, Pittsburgh, Tampa, Raleigh, Philadelphia and Dallas; between Birmingham and New York and Chicago; between Glasgow and Boston, New York and Chicago; and between Manchester and Chicago.
Robert Stangarone, VP-public affairs for Rolls-Royce Inc., in Washington, will join Litton Industries, Woodland Hills, Calif., next month as director of corporate communications.
The European Union's competition commissioner, Karel Van Miert said his department plans to look into the Boeing-McDonnell Douglas merger, which "raises questions about a dominant position and...deserves to be looked at in depth." The Commission reviews mergers when the combined annual revenues of the prospective partners are more than 5 billion European currency units (US$6.2 billion) worldwide and 250 million Ecus (US$310 million) inside the EU. Boeing-McDonnell Douglas revenues in the EU exceed 500 million Ecus.
SabreTech, under imminent threat of license revocation by FAA, closed its Orlando aircraft repair station last Friday. Earlier in the week, the company ceased operations at its Miami facility. FAA also is looking at the company's operations in Texas and Arizona. SabreTech, which called FAA's move against the Orlando station "precipitous," blamed the action on fallout from the ValuJet May 11 crash in the Florida Everglades.
Airbus said Friday that Fokker Aviation (Stork) of The Netherlands and Belairbus of Belgium will be involved in the study phase of the A3XX project and may become risk-sharing partners in the program to build a very large aircraft (VLC). Engineers from the two companies will be integrated into the A3XX design team in a step toward closer cooperation with the aircraft industries of the two countries.
Tower Air, competing in DOT's proceeding to choose new flag carriers for combination service to Brazil, defended itself against charges that it is a relatively insignificant carrier offering "erratic" service. Delta, which code-shares into Brazil with Varig and wants 14 weekly frequencies of its own, said granting Tower's bid for seven weekly frequencies "would represent a continued waste of valuable limited-entry international route rights. Tower's scheduled service to Brazil has been random and desultory.
Praising Continental Chairman Gordon Bethune and President Greg Brenneman as "the best executives in the airline industry," union VP Bill Borrelli said his pilots are "compensated woefully below our peers in the industry," and the Independent Association of Continental Pilots (IACP) will hold management's "feet to the fire" in upcoming contract talks. The current contract is amendable July 1, and talks can begin April 1.
Cathay Pacific Airways received 14,760 bids for its third "CyberAuction" and sold 525 roundtrip seats, the airline said of its latest online marketing of seats from the U.S. to Hong Kong. Members of the CyberTraveler program placed bids for a minimum of 387 seats (the capacity of Cathay's 747-400s) for Hong Kong getaways from either New York or Los Angeles. Bidders saved an estimated 55% off published fares in all three classes of service and most bidders involved their travel agents, Cathay said. Agents received commissions for their clients' bids.
