Scheduled air service to approximately 120 U.S. airports will end during the next decade, according to a new study by Aviation Systems Research's Michael Boyd. In some cases entire regions will lose access to scheduled service, the study forecast. Reasons include the retirement of 19- passenger aircraft, continued consolidation by the airlines into fewer airports and increasing airline operating costs that will encourage consumers to drive longer distances to find scheduled air service. ASR plans a conference on the issue in early December at Colorado Springs.
The U.S. District Court in Alexandria granted a motion for summary judgment filed by the Airlines Reporting Corp. regarding a lawsuit filed against ARC and TWA by Omega World Travel. The travel agency alleged that ARC's centralized reporting and settlement system violates antitrust laws, and that ARC and TWA restrained competition through the settlement system, the Area Settlement Plan, which has standardized reporting and remitting features but allows agents and carriers to enter separate payment arrangements.
SBS International, which specializes in automating airline flight crew scheduling, and Jeppesen Sanderson, which provides print and electronic flight information, will market operations control software applications jointly.
FAA has extended from Sept. 30 to Nov. 14 the comment period for special flight rules in and around the Grand Canyon National Park. The extension was directed by Congress, and Helicopter Association International also complained that the "vast changes" in the special flight rules required more time for comment. The U.S. Air Tour Association and others also asked for more time to comment.
USAir announced yesterday it is "compelled" to end its code-sharing relationship with British Airways, effective March 29, in light of the proposed alliance between BA and American. USAir, which now code shares to 72 U.S. cities with BA, will be left with no service to London. It gave up London rights from Baltimore, Philadelphia and Charlotte when it agreed to the alliance with the British carrier, but it has applied to operate its own flights to London Heathrow from Charlotte, Philadelphia, Boston and Pittsburgh.
Mesaba Holdings yesterday reported second quarter net income of $3.9 million, or 30 cents per share, on revenues of $46.7 million, for the quarter ended Sept. 30.
FAA has approved use of the Enhanced Ground Proximity Warning System, an AlliedSignal Aerospace product industry officials hope will become a powerful new tool for avoiding controlled flight into terrain, or CFIT.
Delta is supporting United's petition at DOT for a formal investigation of the proposed American/British Airways alliance and its effects on competition, but Continental is urging DOT not to waste its time. In an answer filed at DOT, Delta allowed that it may be premature to consider the issue of antitrust immunity but said there "may well be merit" to launching an investigation before formal U.S.-U.K. bilateral negotiations resume.
Jeffrey Erickson, TWA president and chief executive, said late yesterday he will resign his position in January. "I have decided that it is time for me to move on," he said, adding that he will help select a successor in the next few months and effect a transition. TWA was the only major U.S. airline to lose money in the third quarter (see story on Page 147 of the hard copy of this issue). Erickson joined TWA in April 1994 as president and chief operating officer and was named chief executive in August 1994.
System One Amadeus reached an agreement with Internet Travel Network, Palo Alto, Calif., to expand options available to travel agencies on the Internet. The new alliance coordinates efforts of both companies to customize World Wide Web sites with interactive booking capabilities.
An FAA official said yesterday in Boston that he hopes to have three or four Global Analysis and Information Network (GAIN) prototypes "up and running within a year or so." The prototypes are intended to enable the international aviation industry and military to decide whether to put together a privately owned system to disseminate de-identified information FAA believes is necessary to achieve increased safety, said Chris Hart, assistant administrator for system safety.
Net profits for Southwest dropped to $60.9 million during the third quarter, down 10.1% from $67.7 million in the same period of 1995. The carrier's income was affected far more than other carriers' after the federal 10% ticket tax was reinstated in August. Southwest did not reduce ticket prices when the 10% tax disappeared in January, but it did not increase prices 10% either, as other airlines did, when the ticket tax was restored. Operating income declined 9.8% to $103 million. Costs per ASM were up 6.5% to 7.52 cents from 7.06 cents.
Enplanements among 15 of the nation's largest regional airlines rose by only 1.1% during September, from 3.63 million to 3.67 million. American Eagle was by far the largest of the carriers with 889,203 enplanements, but that was down 8.5% from September 1995 due to the pull-down of the carrier's Nashville hub. Mesa Air Group was second with 510,647 enplanements, but that result also was down - just under 3% - from the same period a year ago. Third-place Delta Connection Comair boarded 370,295 passengers for a gain of 15.6%.
TWA, whose traffic fell after the July 17 crash of Flight 800, recorded operating income of $26 million and a net loss of $14.3 million for the third quarter. The airline canceled many domestic flights during the quarter, attributing this to "an extremely aggressive growth plan for summer flying." It adjusted its schedules in September and said future operational performance will improve. On-time arrivals increased from 67.7% in August to 75.8% so far in October.
Comair Holdings earned a net profit of $18.5 million for its second fiscal quarter ended Sept. 30, a 31% increase from the comparable 1995 period. Revenues totaled $137.5 million, up 23.6%. Expenses reached $108.7 million, a 23.1% increase. All of the regional's expenses rose or remained the same on a unit basis except salaries, depreciation and maintenance.
Canadian government's pledge this week of $87 million toward the development of the 70-passenger CRJ-X regional jet should clear the way for an official launch of the long-pending project, probably at the Nov. 25 meeting of the Bombardier board of directors. The government financial boost - normal since the government owned Bombardier units Canadair and de Havilland - must be repaid in the form of royalties.
ValuJet resumed scheduled service yesterday between Atlanta and Chicago Midway, Philadelphia, Raleigh/Durham and Mobile, with introductory fares through Oct. 31. The expansion completes the service resumption - 17 cities, 15 DC-9s and 102 daily departures - it announced Sept. 26.
Harris Corp. said net income for the first quarter of its fiscal year, which ended Sept. 30, increased 14% to $38 million from $34 million during the same quarter a year earlier. Sales rose 8% to $883 million from $817 million. Phillip Farmer, chairman, said that the company's semiconductor sector is "still impacted by a weak market, but Harris's other businesses are recording excellent growth....We expect to have another year of double- digit earnings growth in fiscal 1997, coupled with good growth in revenues."
Bob Carr, former Democratic congressman from Michigan who led the House Appropriations transportation subcommittee, and Ed Hamberger, a DOT assistant secretary for governmental affairs during the Reagan administration, will discuss and debate presidential and congressional politics and the upcoming elections this week on Aviation News Today, to be broadcast on Washington's NewsChannel 8 Sunday from 12:30 a.m. to 1 a.m. and from 1:30 p.m. to 2 p.m.
American soon will start a "modest program" to update its fleet, beginning with the replacement of its MD-11s, Chairman and Chief Executive Robert Crandall told investors yesterday. If Allied Pilots Association members ratify their tentative contract agreement, American will begin selecting a replacement for the long-range aircraft it is selling to FedEx, he said, "thus closing the loop on our strategy of replacing the MD-11s with aircraft that better fit our international route needs." The APA's board is scheduled to vote on the contract language the week of Nov. 4.
Aviation Capital Group said it acquired one MD-83 and three 737-200 aircraft leased to TWA, America West and Aloha, for $32.8 million. ACG also said it has formed a joint venture with two entities affiliated with a life insurance company and received an equity-related investment by Pacific Mutual Life Insurance Co. of Newport Beach, Calif. The company said it has obtained equity interests in 51 commercial aircraft since 1992 and sold its interest in 34 of them. ACG said it has remarketed more than 20 aircraft for third parties during the past 24 months.
Boeing yesterday reported third quarter sales of $5.6 billion and net earnings of $254 million, up from sales of $4.4 billion and net earnings of $225 million during the same quarter last year. President Phil Condit said increased sales volume and higher interest income were offset partially by higher research and development expenses on the new-generation 737 program and a higher effective income tax rate.
Dragonair ordered two A320s and signed options with Airbus Industrie for five more. The carrier also is leasing an A330-300 from International Lease Finance, bringing total A330s in its fleet to five by mid-1997. Dragonair operates seven A320s.
