AirNet Systems said it has executed a letter of intent to acquire a "domestic and international small package forwarder with a national presence." It declined to identify the company before it executes a definitive deal, but it said the price will be about $2.1 million in AirNet common stock. Jerry Mercer, AirNet chairman, said the company "will be adding about 1,800 customers and 1,000 nightly shipments to our systems while growing our revenue base by $4 million per year. This move...will help AirNet Systems penetrate the marketplace internationally."
Admitted "poor decisions" on revenue management and operational issues and a $65 million writedown for revising an aircraft order led America West to a net loss of $46 million in the third quarter, Chief Financial Officer Doug Parker said Friday. The second major to lose money in the quarter - TWA was in the red by $14.3 million - America West said its results were affected by "untimely revenue decisions" made in June and July, higher fuel prices, "industry capacity increases," aggressive fare sales and operational problems throughout the summer.
Granted orally an exemption to Condor Flugdienst for scheduled service from points behind Germany, via Germany and other intermediate points, to points in the U.S. and beyond through Oct.
FedEx Pilots Association Friday beat out the incumbent union, the Air Line Pilots Association, in a representation election at FedEx. ALPA recently concluded tortuous contract talks with the company that resulted in an agreement that the membership rejected. FedEx said the National Mediation Board counted 1,589 ballots in favor of the independent union and 1,133 for ALPA. The company said it will work with the new union to establish a "realistic negotiating schedule."
General Accounting Office plans to issue an airport privatization report this week or next, concluding that the prohibition against revenue diversion remains the key obstacle. Publication was delayed slightly to enable GAO to assess the effects of the FAA reauthorization act, which sets up a pilot program privatizing as many as five airports.
Lufthansa Cargo will evolve during the next few years - with the help of future partners - into a "leading supplier of logistics services in the global air cargo market," Lufthansa Chairman Jurgen Weber told The 13th German Logistics Congress in Berlin. As a consequence of increasing globalization of the world economy, the air cargo industry is confronted by growing demand from customers for high-quality, fast, faultless transportation services, Weber said, and Lufthansa Cargo is repositioning its core business to satisfy demand for complete logistics service chains.
Delta and Korean Air Lines have applied jointly at DOT for code-sharing, blocked-space service between Boston and Seoul via New York. Korean operates the flights with 747-400s. The carriers asked DOT to approve the request by Nov. 1 and said they will poll all interested carriers to find out whether there will be any objections. Delta and Korean already hold code-sharing authority for KAL flights from Seoul to Atlanta, Chicago, Washington, New York and Honolulu, and on Delta flights between Honolulu and Los Angeles. They propose to begin flights to Boston Dec.
Shuttle By United, whose recent six-city expansion still keeps it in the western U.S., may yet stretch eastward. Shuttle VP Amos Kazzaz said in an online conference with employees that Shuttle expansion to the East "clearly is one of our sustained and long-term goals."
Jane's Aircraft Upgrades 1996-1997 by Simon Michell provides a comprehensive examination of aircraft being upgraded, companies doing the upgrading and upgrade equipment being installed. Published by Jane's Information Group, $290 hardcover, $795 CD-ROM. To order, call 800-243- 3852, or in Virginia 703-683-3700.
IATA believes that airlines around the world will move quickly to international electronic ticketing and expand to electronic interline ticketing just as fast. To ensure industry compatibility, IATA has adopted new standards for such ticketing, including provisions on how to provide the contract of carriage, usually printed on the ticket; what documentation will be needed for security, Customs and Immigration, and how to prevent fraud.
McDonnell Douglas said Friday that Herbert Lanese has left the company following irreconcilable differences with Harry Stonecipher, president and chief executive, over "management and leadership styles." Lanese was president of McDonnell Douglas Aerospace and former chief financial officer of McDonnell Douglas. Stonecipher said that "although Herb and I were in total agreement regarding business objectives and strategy, we had sharp differences involving management and leadership styles.
Continental has promoted Barry Simon to senior VP-international. He was in charge of Europe for the carrier, but his new post will enable him to seek out opportunities in Latin America as well. President and Chief Operating Officer Greg Brenneman said Continental has the "highest profit margins in the industry" in Europe and sees "many profitable growth opportunities in South America." Ralph Schulz, joins Simon as VP-Latin America and Caribbean-marketing and sales, from Continental Micronesia.
Overcoming a 27% increase in the price it paid for jet fuel, Alaska Airlines converted a big traffic increase into a record third quarter net income of $32.8 million. The profit, 20% higher than in the same period in 1995, resulted in a fifth consecutive quarter of year-over-year improvement in results. Traffic swelled 14.5% on a capacity gain of 7%, which pushed the load factor up 4.6 percentage points to a record 70.6%. Operating revenues increased 10.8% to $465 million but expenses grew 11.3% before extraordinary items.
Recent SH&E survey found that "peak aircraft orders and deliveries very closely precede or actually coincide with economic recessions," according to VP Donald Garvett.
Japan Airlines and other elements of the JAL Group are forming JAL Aviation Consulting Company Ltd., an Asia-based consulting company to focus on civil aviation projects. The venture is designed to tap into the expertise of each of JAL Group's 17 companies involved in civil aviation projects, especially in South Asia and China. The company has initial capital of 11.5 million yen and will be headed by Hiroyuki Funayama, currently VP- JAL's Airport Administration. It will be located at JAL's headquarters in Shinagawa, Tokyo.
Flying High: The Story of Boeing and the Rise of the Jetliner Industry by Eugene Rodgers traces the boom-and-bust pattern of the company founded by Bill Boeing, from 1916 to present day. Published by Atlantic Monthly Press, $27.50. For more information, call 212-614-7892.
Low-fare niche carriers all face fundamental issues that could affect their long-term survival, said Dillon Reed analyst John Pincavage."All of them under-earned in the [third] quarter," he said, as larger carriers cross- subsidized increasingly lower advance fares with higher walk-up fares. Low-fare carriers also have been hurt by major airlines' Internet fare sales, which are targeted at cost-conscious travelers. "If it's a cold winter and fuel prices rise again, many of the niche carriers could be history," Pincavage said.
Just as the world's international airlines thought decades-old restrictions on passenger liability limits were being lifted, conditions imposed by DOT granting antitrust immunity to airlines to raise the limit have sparked opposition from both foreign and U.S. carriers. An International Air Transport Association agreement waiving the Warsaw Convention's liability limit for passengers and their families in cases of death or injury on international flights was to go into effect Nov. 1.
U.S. government officials will meet Wednesday and Thursday in Washington with European Union officials who have a mandate to discuss only "soft" issues - computer reservations system, competition issues, and the like, as they explore prospects for a U.S.-EU aviation regime. The conversations are not a negotiation, and they will not come close to covering everything the U.S. wants to discuss.
Despite withdrawing from scheduled passenger service, World Airways still posted a profit for the third quarter. The airline recorded 9% lower net earnings of $3.1 million, compared with $3.4 million in the same quarter last year. World lost $18.8 million in the first nine months of the year, however, versus a profit of $10.5 million a year earlier. Operating earnings for the third quarter totaled $2.9 million, down 36% from last year's $4.5 million.
Aloha selected Karl Freienmuth VP-maintenance and engineering. America West appointed Patricia Nistorenko station manager, Boston. British Airways World Cargo appointed Geoff Corpe general manager- worldwide sales and marketing. Delta named Gayle Bock VP-consumer marketing.
As budgets tighten, FAA is looking to airports as a source of funds for billions of dollars in current costs. Steve Zaidman, director of FAA's system architecture and program evaluation office, suggested at last week's Air Traffic Control Association meeting in Nashville that airports pick up the tab for approach lighting. FAA spends $2.5 billion a year to operate and maintain approach lighting systems, he said.
Kal-Aero, Battle Creek, Mich., has been approved by Europe's Joint Aviation Authorities as a repair station for European-operated aircraft and components. The company describes itself as a service and maintenance center for airframe and engine support, paint and interior work, avionics, instrument repair and installation, and accessory overhaul.
