UPS said yesterday it has entered into its first joint venture in China with Sinotrans Pekair of Beijing, a subsidiary of Sinotrans Group, a leading Chinese transportation company. UPS said the joint venture will help accelerate its growth in China. Charles Adams, VP-Asia Pacific operations, said the company also plans to establish joint ventures in Shanghai and Guangzhou by the end of the year. UPS currently delivers to 74 cities in China through the Sinotrans Group. It said the China business is growing at about 50% a year.
Evergreen International Airlines, American International Airways and Gemini Air Cargo are seeking the one designation and six weekly frequencies available to operate scheduled all-cargo service in the U.S.-Japan market. The April 1996 memorandum of understanding between the U.S. and Japan allows the U.S. to designate an additional U.S. all-cargo carrier, which may operate as many as six weekly flights and serve any point in Japan except Tokyo (DAILY, March 28). The flights may operate beyond Japan to one point in another country, but the U.S.
Northwest's senior executives do not expect labor negotiations with the carrier's three unions to turn ugly later this year, saying they anticipate a "calm, civil" environment. Employees will get healthy wage snapbacks to 1993 levels. Richard Anderson, senior VP of labor relations, said the snapbacks are a constitutional issue - the company will seek productivity increases, and to increase productivity, companies must increase salaries.
DOT has approved American's complaint against Colombia's government and airlines but has deferred action on the question of sanctions. American charged that Colombia refused to allow it to exercise existing permit authority to operate nonstop service between New York and Bogota, with continuing service to Quito (DAILY, May 6), and it asked DOT to hold up Avianca's authority to operate in the New York-Bogota market in retaliation.
Membership in the Air Line Pilots Association hit a record 45,381 in April, the union reported last week. Jerry Mugerditchian, VP-administration, told the 76th meeting of the executive board that the percentage of members in "bad standing" had sunk to the lowest level in union history. He said the membership increase is partly the result of the growth in the airline industry, but ALPA has been on an "aggressive, nonstop organizing campaign since the early 1980s." Of the 36 pilot groups now represented, 27 have been organized since deregulation in 1978, he said.
The fear that an alliance between British Airways and American would leave Air France without a partner in the important transatlantic market has spurred new talks between the French and the U.S., as well as between Air France and several U.S. airlines. After months of foot-dragging over strained U.S.-French aviation relations, the U.S. and French governments agreed to meet July 2-3 in Washington to jump-start formal negotiations. Air France has long said it has been in talks with multiple U.S. airlines over possible alliances but always declined to elaborate.
Granted orally to Korean Air Lines an exemption to operate scheduled combination service between Korea and Saipan and to integrate this authority with KAL's currently effective permit and exemption authorities...Granted orally to World Airways an exemption to operate scheduled combination service between New York and Dakar, Senegal, and beyond to Johannesburg with local traffic rights between Dakar and Johannesburg...Granted orally to United authority to conduct scheduled combination service between points in the U.S.
Three aviation industry groups took aim last week at a recent Newsweek article and subsequent comments by DOT Inspector General Mary Schiavo about aviation safety. "We ask that you make clear to the American people that the DOT Inspector General does not speak for the administration on aviation safety policy," American Association of Airport Executives President Charles Barclay, Regional Airline Association President Walter Coleman and Airports Council International-North America President David Plavin said in a May 31 letter to President Clinton.
Cleanliness over on-timeliness? Northwest Airlines, a decent on-time performer that says it is the proper size and making money on all its routes, will focus on keeping its aircraft clean. "If you're not safe and you're not clean, customers don't care if you're on time," says President and CEO John Dasburg.
Japan Air Lines selected Pratt&Whitney PW4090 engines to power the five 777-300s it has on order from Boeing. Value of the engine order was estimated at $140 million. The aircraft will enter service beginning in 1998. JAL also has ordered 10 777-200s powered by PW4077 engines. JAL's first two 777s went into domestic service on April 26.
DOT seeks industry views on the benefits of adding a second civil signal to Global Positioning System satellites. The goal is improved navigation accuracy and reliability by using the civil signals together to compensate for atmospheric effects and interference, which will increase through the turn of the century as the 11-year cycle of solar activity peaks. Currently, dual-frequency capabilities require use of the military frequency, which is subject to Defense Department use and control.
"By virtually any measure, the Port Authority's performance at New York Kennedy and LaGuardia airports has been poor," according to a preliminary report by Rothschild Inc. on behalf of the city of New York. Mayor Rudolph Giuliani retained Rothschild in January to evaluate the operating efficiency of the authority. Among its findings, Rothschild said operations and maintenance costs at LaGuardia and Kennedy airports are $149 million higher than those at other major cities, even after allowing for the inherently higher costs of operating in New York.
Jet USA Airlines Inc., which recently filed an initial public offering to finance the launch of transcontinental jet service between secondary airports, probably will have to pick another name if it gets off the ground. The company warned in a Securities and Exchange Commission filing that cargo carrier USA Jet Airlines Inc. plans to object to the use of so similar a name.
National Transportation Safety Board urgently recommended Friday that FAA require airlines to evaluate their practices on handling hazardous materials and, if necessary, revise them. The board also urgently recommended that FAA permanently prohibit transport of chemical oxygen generators if the chemicals have not been depleted, and that oxidizers and oxidizing materials be banned from cargo compartments that do not have fire or smoke detectors. The board's recommendations stem from the May 11 crash of a ValuJet DC-9, which killed all aboard.
Delta said it is removing restrictions it introduced last summer on the purchase of full coach, first-class and business-class tickets for travel to and from Atlanta and 11 perimeter cities during the 1996 Olympic Games period. Effective immediately, the carrier has dropped the requirement to buy tickets within 21 days after making reservations, and it has made fares fully refundable once again.
New York Mayor Rudolph Giuliani Friday said a new government entity, the New York Airport Authority, should buy Kennedy and LaGuardia airports from the Port Authority of New York and New Jersey to "free the airports from the Port Authority's excessive cost structure and as part of the deal to settle the dispute over back rent due the city." The proposal followed last week's release of a report by Rothschild Inc., conducted on behalf of the mayor, evaluating the port authority's overall operating efficiency. (See story on Page 370.)
Hawaiian Airlines Inc. filed a registration statement with the Securities and Exchange Commission to issue 12 million shares of common stock. A portion of the issue will be sold through a subscription rights offering related to an earlier equity investment by Airline Investors Partnership, L.P. (AIP). The company said it will distribute 8.15 million rights for shares of stock to shareholders excluding AIP. One million of the rights will go to employees and 600,000 to existing options holders.
Three industry analysts in a panel discussion predicting the future of startup airlines are skeptical about Western Pacific's ability to compete with United. "It's history," says the most bearish of them, Goldman Sachs's Glenn Engel.
Korean Air has become Airbus Industrie's first airline customer of the A330-200, ordering two aircraft for delivery in August and September 1998. Earlier, the carrier ordered seven A330-300s, with deliveries beginning in mid-1977. It holds options on 10 more aircraft of either version. Pratt&Whitney is supplying the engines.
SITA has established two VHF air communications datalink stations in the Commonwealth of Independent States. The remote ground stations, accessible by any of the more than 70 airlines using SITA's service, can be used for both airline and ATC applications, including Future Air Navigation System 1.
