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Etihad Airways orders from both Airbus and Boeing, becomes the biggest 787 customer

Etihad 777X and 787 (Boeing)(LRW)

Etihad Airways (Abu Dhabi) today announced an order for 56 Boeing widebody airplanes with options and purchase rights for 26 additional airplanes at the start of the 2013 Dubai Airshow.

In addition, the airline has ordered 30 787-10s, the newest and largest member of the 787 Dreamliner family. When today’s order is combined with the carrier’s previous order for 41 787-9s, Etihad Airways becomes the world’s largest airline customer for the Dreamliner family with a total of 71 787s on order. The order includes options and purchase rights for an additional 12 787-10s.

Today’s announcement also marks the 1,000th order for the 787 Dreamliner family since its launch in 2004. The 787 has reached this milestone faster than any other twin-aisle airplane in aviation history.

Etihad’s order also includes one additional 777 Freighter for its cargo fleet, with options for two additional 777 Freighters.

According to Boeing, advanced technology including a new composite wing, all-new engines and superior aerodynamics will result in the incredible fuel efficiency promised by the 777X family.

The 777-9X, with around 400 seats, will be the largest and most efficient twin-engine commercial jet in the world with 12 percent lower fuel consumption and 10 percent lower operating costs over the competition. It will have the lowest operating cost per seat of any commercial airplane and no competitor in its market segment.

The 777-8X will be the most flexible commercial jet in the world with breakthrough economics and greater range capability than today’s 777.

The 787-10 is the third and longest member of the super-efficient 787 family. With its greater passenger and cargo capacity, high degree of commonality and its passenger-pleasing features, the 787-10 will complement the family while setting a new benchmark for fuel efficiency and operating economics. The 787-10 will be 25 percent more efficient than airplanes of its size today and more than 10 percent better than anything offered by the competition for the future.

Final assembly and flight test of the 787-10 are set to begin in 2017, with first delivery targeted for 2018.

In addition, Etihad Airways also ordered from Airbus. Etihad Airways also announced a firm order for 50 A350 XWBs, 36 A320neo aircraft and one A330-200F as part of its fleet modernization strategy. The contract was signed today at the 2013 Dubai Airshow by James Hogan, Etihad Airways CEO and Fabrice Brégier, Airbus President and CEO.

The order comprises 40 A350-900s, ten A350-1000s, one A330-200F, 26 A321neo’s and 10 A320neo’s. Etihad currently operates a fleet of 23 A320 Family aircraft, 25 A330s and 11 A340s. The new aircraft will fit seamlessly into the airline’s existing long-haul fleet delivering operational efficiencies and cost savings.

The A350 XWB (Xtra Wide-Body) is an all-new mid-size long range product line comprising three versions. The new Family, whose fuselage cross-section is optimized to accommodate Airbus’ 18-inch economy seat-width for long range passenger comfort, will also bring a 25 percent step change in efficiency compared with existing aircraft in this size category. Scheduled for entry-into-service in 2014, the A350 XWB to date has already won 764 firm orders from 39 customers worldwide.

The A320neo is offered as an option for the A320 Family and incorporates new more efficient engines and large “Sharklet” wing tip devices, which together will deliver up to 15 percent in fuel savings. At the end of October 2013, firm orders for the NEO stood at 2,487 from 44 customers, making it the fastest selling commercial airliner ever and underlining its market leadership position.

The A330-200F is the all-freight version of the best-selling A330 Family. It is the world’s most modern mid-size freighter and can carry 70 tons of payload with a range capability of up to 4,000 nm. To date, Airbus has won more than 1,280 orders for the various versions of the A330, with over 1,010 aircraft currently flying with more than 100 operators worldwide.

Images: Boeing (above) and Airbus (below).

Etihad Airways: AG Slide Show

Etihad A320-200neo (03)(Flt)(Airbus)(LRW)

Etihad A350-900 (03)(Flt)(Airbus)(LRW)

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Emirates orders 50 additional Airbus A380s

Emirates Airline (Dubai) has placed an additional order for 50 Airbus A380 aircraft. The order was signed at a ceremony at the 2013 Dubai Airshow witnessed by His Highness Sheikh Ahmed Bin Saeed Al-Maktoum, Chairman and Chief Executive Emirates Airline and Group and Fabrice Brégier, Airbus President and CEO.

Following delivery of their first A380 in July 2008, Emirates has now taken delivery of 39 A380s. Their 39th A380 is on Airbus’ static display at the 2013 Dubai Airshow. All Emirates’ A380s are powered by Engine Alliance GP7200 engines.

Since first entering service in 2007, the A380 has joined the fleets of ten world class carriers. The aircraft flies 8,500 nautical miles or 15,700 kilometres non-stop, carrying more people at lower cost and with less impact on the environment. The spacious, quiet cabin and smooth ride have made the A380 a firm favorite with both airlines and passengers, resulting in higher load factors wherever it flies.

The total A380 fleet has accumulated over one million flight hours in almost 140,000 commercial flights. To date some 50 million passengers have already enjoyed the unique experience of flying on board an A380. Every five minutes, an A380 either takes off or lands at one of the 34 airports where it operates today and the network is constantly growing.

On this historic “airline order milestone” day, Emirates issued this statement:

Emirates airline has again rewritten all records in civil aviation with an order for 150 Boeing 777X, comprising 35 Boeing 777-8Xs and 115 Boeing 777-9Xs, plus 50 purchase rights; and an additional 50 Airbus A380 aircraft.

Emirates Media Player

Left to Right: His Highness Sheikh Hamdan bin Mohammed Al Maktoum, Crown Prince of Dubai; Fabrice Brégier, Airbus President and CEO; Tom Enders, Chief Executive EADS; Sheikh Mohammed bin Rashid Al Maktoum UAE Vice President, Prime Minister and Ruler of Dubai and His Highness Sheikh Ahmed bin Saeed Al Maktoum, Chairman and Chief Executive, Emirates Airline and Group.
Together, the Boeing and Airbus orders, excluding purchase rights, are worth an estimated $99 billion (US) at list prices. This is the largest ever aircraft order in civil aviation and also Emirates’ largest order announced at any event to date.

The agreement was signed today (November 17) at the Dubai Air Show by His Highness (H.H.) Sheikh Ahmed Bin Saeed Al-Maktoum, Chairman and Chief Executive, Emirates Airline and Group, with Jim McNerney, Boeing Chairman, President and CEO, and Fabrice Brégier, Airbus’ President and CEO. The signing was witnessed by H.H. Sheikh Mohammed bin Rashid Al-Maktoum, UAE Vice President, Prime Minister and Ruler of Dubai.

Emirates’ Boeing 777X order is the single largest aircraft order by value in the history of U.S. commercial aviation, and the additional A380 order cements Emirates, already the largest operator of this aircraft type, as the principal customer for the A380 worldwide. These latest orders bring Emirates’ total firm order book to 385 aircraft (excluding options or purchase rights), comprising 214 Boeing 777s, 101 Airbus A380s, and 70 A350s, at a total estimated value of US$ 166 billion.

Emirates’ Boeing 777X

“The announcement today includes the purchase of 300 GE9X engines from General Electric, to power the 150 Boeing 777X aircraft ordered. Taking into account the U.S. Government jobs multiplier (every $1 billion in US aerospace exports supports 5,747 American jobs), today’s historic order will protect and support over 436,000 jobs in U.S. aerospace manufacturing – not only at Boeing and GE facilities, but with hundreds of other suppliers,” said Sheikh Ahmed.

Emirates’ 777-8X and 777-9X will be a combination of two and three-class configurations, with the 777-8X potentially seating 342 passengers in 3 classes, and the 777-9X seating over 440 passengers in 2 classes.

“Emirates today operates more than one in every 10 Boeing 777 aircraft built. It is the workhorse of our fleet. What the 777X does, is offer us a flying range comparable with the 200LRs and 300ERs, but with more passenger capacity at potentially up to 18% more fuel efficiency,” said Tim Clark, President Emirates Airline.

Emirates’ unwavering commitment to the Boeing 777 dates back to 1996. Today, Emirates is already the largest operator of the 777 with 131 in operation, and the only airline to fly all variants in the 777 family. At the 2011 Dubai Air Show, Emirates ordered 50 Boeing 777-300ERs with options for 20 more at a total value of US$ 26 billion (AED 95.4 billion). It was then a record breaking aircraft order– the single largest by any airline with Boeing in dollar value.

Emirates’ Airbus A380s

Emirates currently operates the world’s largest fleet of A380s with 39 in service.

Its order for 50 additional A380 aircraft today brings Emirates’ total A380 order book to 101 aircraft, worth US$ 45 billion. A combination of two and three-class cabin configuration, the first 25 of these latest A380 aircraft orders are scheduled to be delivered before the first quarter of 2018.

Emirates has been associated with Europe’s largest passenger aircraft since April 2000 when it became the first airline to announce plans to purchase the super jumbo. As the largest customer for the A380, Emirates is therefore the largest supporter of European aerospace manufacturing jobs tied to the A380 programme which is spread across Airbus’ manufacturing centres in France, Germany, England and Spain.

Follow-up article: From Reuters: Emirates was concerned that Airbus was considering slowing down A380 production because of lagging new orders and took a look at how many additional A380s it could physically take at its Dubai base and stated it could have ordered 10 more! This order now ensures the A380 production rate will continue and probable A380 profit for Airbus in 2015 or 2016. Read the full article: CLICK HERE

Analysis: Can other airlines, especially European and North American carriers, compete against the fast growing Gulf carriers? CNN Money explores this question: CLICK HERE

Copyright Photo: Karl Cornil/AirlinersGallery.com. Emirates’ Airbus A380-861 A6-EEC (msn 110) with special “Expo 2020 Dubai UAE” stickers completes its final approach into London (Heathrow).

Video: An inside look at the Emirates Operations Control Room, Dubai.

Emirates: AG Slide Show

Boeing launches the 777X today with orders from Lufthansa, Etihad Airways, Qatar Airways and Emirates

Boeing 777-9X (Boeing)(LR)

Boeing (Chicago) today formally launched the 777X program at the 2013 Dubai Airshow with a record-breaking number of customer orders and commitments for the newest member of its twin-aisle product family. Agreements for 259 airplanes from four customers across Europe and the Middle East provide a strong foundation to support development and production of the airplane.

Representing the largest product launch in commercial jetliner history by dollar value, 777X orders and commitments include Lufthansa with 34 airplanes; Etihad Airways with 25; Qatar Airways with 50 and Emirates with 150 airplanes. The combined value of the agreements is more than $95 billion at list prices.

The 777X builds on the passenger-preferred and market-leading 777, which today commands 55 percent of market share in its category in terms of backlog, and 71 percent of the in-service fleet worldwide. The 777X family includes the 777-8X and the 777-9X, both designed to respond to market needs and customer preferences.

The 777X builds on the best-in-class dispatch reliability from today’s 777, as well as offering more market coverage and revenue capability that surpasses the competition. The 777-8X competes directly with the A350-1000, while the 777-9X is in a class by itself.

Opening new growth opportunities for airlines, the 777-9X offers seating for more than 400 passengers, depending on an airline’s configuration choices. With a range of more than 8,200 nautical miles (15,185 km), the airplane will have the lowest operating cost per seat of any commercial airplane.

The second member of the family, the 777-8X, will be the most flexible jet in the world. The airplane will seat 350 passengers and offer an incredible range capability of more than 9,300 nautical miles (17,220 km). In addition, the airplane will have unmatched takeoff and payload capability compared to the competition.

The 777X introduces the latest technologies in multiple places, including the most advanced commercial engine ever – the GE9X by GE Aviation – and an all-new high-efficiency composite wing that has a longer span than today’s 777. The airplane’s folding, raked wingtip and optimized span deliver greater efficiency, significant fuel savings and complete airport gate compatibility.

Like the 787 Dreamliner which was launched as the 7E7, the 777X will be formally named at a later date. Design of the 777X is underway and suppliers will be named in the coming months. Production is set to begin in 2017, with first delivery targeted for 2020.

Boeing 777X Comparsion Chart

According to Reuters, Boeing will firm up the configuration of the aircraft in 2015 and plans to have a detailed design by 2016.

Production will begin in 2017, with the first test flight scheduled for 2019 and first delivery in 2020.

The Launch Customers:

Emirates 777X (Boeing)(LR)

Etihad 777X (Boeing)(LR)

Lufthansa 777X (Boeing)(LR)

Qatar 777X (Boeing)(LR)

Videos:

The first ATR 72-600 is delivered to Garuda Indonesia

Garuda Indonesia (Jakarta) on November 15 accepted its first ATR 72-600. The pictured ATR 72-212A (ATR 72-600) F-WWEH (msn 11158) was handed over to the carrier as PK-GAA.

24 additional copies will be the delivered to the flag carrier.

Copyright Photo: Globalpics/AirlinersGallery.com. F-WWEH taxies at Toulouse on November 7.

Garuda Indonesia: AG Slide Show

Garuda Indonesia logo

Route Map. Garuda Indonesia flies to 40 domestic destinations.

Garuda Indonesia 11.2013 Domestic Route Map

 

LATAM swings to a net profit of $52 million in the third quarter

LATAM Airlines Group (LAN Airlines and TAM Linhas Aereas) (Santiago and Sao Paulo) swung to the black in the third quarter with a net profit of $52 million versus a loss of $49 million a year ago for the same period.

Read the full report: CLICK HERE

Read the analysis by Reuters: CLICK HERE

Copyright Photo: Rodrigo Cozzato/AirlinersGallery/com. LAN Cargo’s (LAN Airlines Chile) Boeing 777-F16 N778LA (msn 41518) departs from Viracopos Airport near Sao Paulo.

LAN Airlines: AG Slide Show

TAM Linhas Aereas: AG Slide Show

Upcoming Airline Collectible Shows

Airline Shows 11.2013

Avianca Holdings reports adjusted net income of $99.1 million in the third quarter

Avianca Holdings S.A. (Avianca) (Bogota) for the third quarter of 2013 reported a consolidated adjusted net income of $99.1 million (all amounts in US dollars) excluding FX effects related to liabilities denominated in Colombian Pesos and on the gain on sale of assets. This represents an increase of 151.3% over the same period in 2012. Avianca´s adjusted net profit margin increased by 450 basis points reaching 8.5%. Including the aforementioned effects on net income, Avianca Holdings S.A. and its subsidiaries generated a net income of $39.9 million.

Operating revenue came in at $1.182 million, representing an increase of 9.6% over the same period of 2012. Said increase is the result of a rise of 9.4% in passenger income resulting from a growth of 3.5% in carried passengers. Cargo and other revenues grew by 10.9%. This increase is mainly driven by the cargo and loyalty program business unit.

Revenue per Seat Kilometer (RASK) grew 3.6% whereas the Cost per Available Seat Kilometer (CASK) in 3Q 2013, grew from USD$10.3 cents to USD$10.4 cents, an increase of 1,5% with respect to the same period in 2013.

EBITDAR (earnings before interest, tax, depreciation, amortization and aircraft rentals) increased 23.1% with respect to 3Q 2012. The EBITDAR margin reached 20.1%.

Operating income (EBIT) for 3Q 2013 rose to $132.2 million, a 32.2% increase with respect to the $100.0 million reached in the same period in 2012. The operating margin in 3Q 2013 came in at 11.2%, increasing by 1.9pp with respect to 3Q 2012. Said rise was generated by an increase in operating revenue as well as by cost control measures.

Capacity, measured in ASKs (Available Seats per Kilometer) grew by 5.87% throughout 3Q 2013. This growth is driven by the expansion of Avianca’s operations in its core markets, the incorporation of larger aircraft as well as an improvement in operating cycles of 1.1%. Traffic measured in RPKs (Revenue Passenger Kilometer) grew 5.9%, resulting in a Load Factor of 82.0% representing an increase of 20 basis points with respect to the Load Factor of 3Q 2012.

In accordance with the fleet renovation and modernization plan, between July and September 2013, the company through its subsidiary Avianca S.A., took delivery of one Airbus A320 aircraft equipped with Sharklets (see above), one ATR 72-600 and one A330-200 freighter. As a result, Avianca Holdings S.A. subsidiaries ended the quarter with a consolidated operating fleet of 154 aircraft.

With these third quarter results, Avianca Holdings S.A. reports a consolidated net income for the last 9 months of $183.4 million, reaching accumulated net margin of 5.4% year to date.

During the remainder of 2013, the company expects to continue with a capacity expansion in its key markets, as a result the company forecasts ASK growth between 7% and 8% for the full year 2013 compared to 2012. In terms of passenger traffic, the company expects a sustained growth during the remainder of 2013. Passenger numbers are expected to increase between 9% and 10% for the full year 2013 and as a result the load factor should stand between 79% and 80%.

Avianca Holdings S.A. is an investment firm that serves as an instrument for the execution of the shareholders agreement which resulted in the integration process known as AviancaTaca and acts as the controlling company for the integrated operation of various airlines that operate both domestically and internationally: Aerovías del Continente Americano S.A. Avianca (Avianca), Tampa Cargo S.A. incorporated in Colombia, Aerolíneas Galápagos S.A. Aerogal incorporated in Ecuador, and the companies that make up the TACA Group: TACA Internacional Airlines S.A., incorporated in El Salvador; Líneas Aéreas Costarricenses S.A., LACSA, incorporated in Costa Rica, Trans American Airlines S.A. TACA Peru incorporated in Peru, Servicios Aéreos Nacionales S.A., SANSA incorporated in Costa Rica, Aerotaxis La Costeña S.A., incoporated in Nicaragua and Isleña de Inversiones C.A. de C.V. ISLEÑA incorporated in Honduras.

Copyright Photo: Gerd Beilfuss/AirlinersGallery.com. The pictured Airbus A320-233 D-AXAS (msn 5840) was handed over to Avianca (Colombia) as N603AV on November 5.

Avianca (Colombia): AG Slide Show

Westjet to fly its first trans-Atlantic route to Dublin, Ireland

WestJet (Calgary) starting on June 15, 2014* will be offering its first trans-Atlantic service from St. John’s, Newfoundland to Dublin, Ireland, with connecting service from several other Canadian destinations.

St. John’s is actually closer to Dublin than Calgary.

Schedule highlights:

Route Frequency Dates^
St. John’s – Dublin Daily June 15, 2014 to
October 5, 2014
Toronto (direct same plane) – Dublin** Daily June 15, 2014 to
October 5, 2014
Calgary, Edmonton, Halifax, Hamilton, Kelowna, Montreal, Ottawa, Thunder Bay, Vancouver, Victoria, Winnipeg – Dublin** Daily June 15, 2014 to
October 5, 2014

*Subject to government approval.
^Schedule is subject to change without notice.
**Available daily through connections. Guests flying from Toronto will stop in St. John’s but will have the same plane to Dublin.

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-8CT WL C-GKWA (msn 39089) arrives in Las Vegas.

WestJet: AG Slide Show

Reuters IAM Interview: “If Boeing wants to do a retest, talk to us. The ball is in their court.”

Boeing logo

The International Association of Machinists and Aerospace Workers (IAM), representing 31,000 Boeing workers in Washington State, as previously reported voted down the latest Boeing contract extension offer to build the proposed 777X in the Seattle area by a 2 to 1 margin. According to this interview and report by Reuters, IAM President R. Thomas Buffenbarger said it was up to Boeing to resubmit a new offer to the workers. The union chief voiced concern in the interview that work in the Seattle area will dwindle down after the current contract expires in 2016.

Several states are now putting together incentive packages to bring the 777X to their area. Boeing’s board had recently voted to speed up the the 777X. Boeing is likely to announce the formal launch of the new jet at Dubai Airshow with an order from Emirates.

Read the full report: CLICK HERE

Air North to expand eastward to Yellowknife and Ottawa

Air North (Whitehorse) today announced the addition of Yellowknife, Northwest Territories and Ottawa, Ontario.

The Yukon and NWT capitals haven’t been connected in over three years, and never before by scheduled Boeing 737 jet service.

The expansion adds Ottawa and Yellowknife to the list of Air North’s gateway cities to the Yukon, which also includes Vancouver, Kelowna, Calgary, and Edmonton (see map below).

Air North’s growth is particularly pleasing to the Vuntut Gwitchin Limited Partnership, which invested in the airline more than 12 years ago. “Our original investment has grown in strength and reach, along with our people,” said Pauline Frost, President of the Vuntut Gwitchin Limited Partnership. “We are all very pleased that Yukon’s airline has grown from a small local carrier to one that serves our nation’s capital, providing northerners with an important connection to Yellowknife and Ottawa.”

Service to both cities will begin during the first quarter of 2014, with the schedule and introductory fares to be announced once a number of regulatory and logistical hurdles have been overcome.

Copyright Photo: Tony Storck/AirlinersGallery.com. Air North’s Boeing 737-48E C-FANB (msn 25764) arrives at the traditional southern terminus of Vancouver.

Air North: AG Slide Show

Air North (Canada) logo

Current Route Map: The expansion eastward to Yellowknife and Ottawa will bring new traffic to the Yukon.

Air North 11.2013 Route Map

 

The “new American” to operate under the umbrella of the American Airlines Group Inc.

AMR Corporation (Dallas/Fort Worth), whose principal operating subsidiary is American Airlines, Inc. (Dallas/Fort Worth), and US Airways Group, Inc. (Phoenix) today announced that they have applied to list the common stock of the combined company on the NASDAQ Global Select Market. Upon closing of the merger and AMR’s emergence from Chapter 11, the combined company will be renamed American Airlines Group Inc. and will use the ticker symbol “AAL.” Additionally, the common stock of both US Airways Group, Inc. and AMR Corporation will be cancelled and shareholders will receive equity interests in American Airlines Group Inc. per the terms of the Merger Agreement and Plan of Reorganization.

Copyright Photo: Ken Petersen/AirlinersGallery.com. American Airlines’ Boeing 777-323 ER N721AN (msn 31546) prepares to touch down in New York (JFK).

American Airlines: AG Slide Show

Boeing and Gol to work on a sustainable biofuel in Brazil

Boeing (Chicago) and Gol Linhas Aereas Inteligentes S.A. (Gol Transportes Aereos) (Sao Paulo) will work together to speed the research, development and approval of new sources of sustainable aviation biofuel in Brazil. Their collaboration will support Gol’s plans to use this lower-carbon jet fuel on more flights during upcoming major sporting events and also will benefit long-term development of a new sustainable aviation biofuel industry in Brazil.

Paulo Sergio Kakinoff, chief executive officer of Gol, and Van Rex Gallard, vice president of Sales for Africa, Latin America and the Caribbean, Boeing Commercial Airplanes, signed a memorandum of understanding for biofuel collaboration at the Latin America and Caribbean Air Transport Association (ALTA) Airline Leaders Forum 2013.

Gol plans to use sustainable biojetfuel on 200 flights during the major sporting event in Brazil in 2014 and to incorporate biofuel into 20 percent of its flights during the major sporting event taking place in Rio de Janeiro in 2016. Boeing will work with Gol to identify and select the most promising feedstocks and refining technologies and then will play a leading role in the approval process for new fuel pathways to ensure the fuel meets safety and performance standards.

The agreement between Boeing and Gol is a significant new step in efforts to advance an aviation biofuel industry in Brazil. On October 23, Brazil’s Aviator’s Day, Gol conducted Brazil’s first commercial biofuel flight in a Boeing 737-800 powered in part by sustainable aviation biofuel made from waste cooking oil and blended by Petrobras, with support from the Inter-American Development Bank (IDB). Following the flight, aviation industry stakeholders including Gol and Boeing, as well as Brazilian officials and research institutions, announced a national effort called the Brazilian Biojetfuel Platform to establish a sustainable biojetfuel industry with research and development in several regions of the country. If the Platform is successful, Brazil, which has already established a biofuel industry could be the first nation to establish a sustainable aviation biofuel industry from biomass production to flight.

Copyright Photo: Rodrigo Cozzato/AirlinersGallery.com. Gol’s Boeing 737-809 PR-GIT (msn 28403) in the striking Smiles special livery departs from Sao Paulo (Guarulhos).

Gol: AG Slide Show

The first Airbus A321 is painted for American Airlines

American Airlines (Dallas/Fort Worth) will soon take delivery of its first Airbus A321-200. The first, the pictured A321-231 with the temporary registration of D-AVZK (msn 5834), has been pulled out of the paint shop at the Airbus facility in Hamburg (Finkenwerder). The first airframe will be delivered as N101NN.

American plans to take delivery of 130 current generation Airbus aircraft from the A321 and A319 variants and up to 100 Boeing 737-800s through 2017. American plans to configure some of the A321s for use on trans-continental flights and intends to use the remaining A321s, as well as all of the A319s and new Boeing 737-800s to retire aging aircraft in its existing fleet.

The A321 aircraft will be equipped with V2500-A5 engines from International Aero Engines (IAE), a joint venture between Pratt & Whitney, Rolls-Royce, MTU and JAEC.

American intends to take delivery of the A321s beginning in November 2013 through 2014. The A321 trans-continental aircraft will replace American’s existing fleet of Boeing 767-200s and fly between New York’s John F. Kennedy International Airport (JFK) and San Francisco International Airport (SFO), and JFK and Los Angeles International Airport (LAX).

American intends to replace its fleet of domestic Boeing 757-200s and DC-9-82/83s (MD-80s) with A321s, A319s and Boeing 737-800s.

Beginning in 2017, American expects to begin taking delivery of 130 aircraft from the A320neo (New Engine Option) family featuring next-generation technology. The new aircraft are about 15 percent more fuel efficient than today’s models. American is scheduled to be the first network airline in the U.S. to deploy this new technology. Engine selection for the A320neo family aircraft will be made in the future.

The new type provide a three-class layout for trans-continental flights on its new Airbus A321s – which includes these full lie-flat beds in business class (all photos from Airbus).

Inside American Airlines’ new A321s – which are equipped with Sharklets – passengers will benefit from Wi-Fi connectivity throughout the cabin, as well as inflight entertainment (IFE) and 100v AC power outlets and USB jacks at every seat.

The first class cabin offered in American Airlines’ new Airbus A321s will feature full lie-flat beds for coast-to-coast direct service initially between New York and Los Angeles, followed by a New York-San Francisco route.

Top Copyright Photo: Gerd Beilfuss/AirlinersGallery.com (all others by Airbus).

Have you seen the “new look” AirlinersGallery.com photo library website?

American Airlines: AG Slide Show

United Express service is coming to Atlantic City, New Jersey

United Airlines (Chicago) today announced the airline will inaugurate service at Atlantic City International Airport, offering customers daily nonstop flights to United’s hubs at Chicago O’Hare International Airport and Houston’s George Bush Intercontinental Airport beginning on April 1, 2014..

From Chicago, United’s flight to Atlantic City will depart at 8:10 a.m. (0810) daily, arriving at 11:17 a.m. (1117). The return flight will depart Atlantic City at 11:52 a.m. (1152) and arrive in Chicago at 1:10 p.m. (1310).

From Houston, United’s flight to Atlantic City will depart at 7 p.m. (1900) daily, arriving at 11:20 p.m. (2320). The return flight will depart Atlantic City at 6 a.m. (0600) and arrive in Houston at 8:49 a.m. (0849).

United Express carrier ExpressJet Airlines (Atlanta) will operate the Atlantic City flights with 50-seat Embraer ERJ 145 aircraft.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. ExpressJet Airlines’ Embraer ERJ 145XR (EMB-145XR) N12136 (msn 145719) arrives at the Chicago O’Hare hub.

United Airlines: AG Slide Show

United Express-ExpressJet: AG Slide Show

 

Delta wants to expand operations at Dallas’ Love Field

Delta Air Lines (Atlanta) plans to add 18 daily nonstop flights to five destinations from Dallas Love Field in October 2014.

According to the airline, Delta’s planned expansion will enhance competition at the airport with new nonstop service to New York-LaGuardia, Los Angeles, Detroit, and Minneapolis-St. Paul. Delta also will add two daily flights to its existing Atlanta service.

Delta will require access to gates at Love Field in order to operate its expanded schedule. Delta has asked the U.S. Department of Justice to allow it to bid on Love Field gates as part of the divestiture of airport assets under a proposed settlement agreement with American Airlines and US Airways.

Currently at Love Field, 16 of the 20 gates and more than 95 percent of available seats are controlled by one airline, Southwest Airlines, which transports more passengers in the U.S. than any other carrier. Love Field has one of the highest concentrations of operations controlled by a single airline among the nation’s large airports.

The expanded Love Field service builds on Delta’s recent growth at Dallas/Fort Worth International Airport, where it currently operates 45 peak-day flights to eight destinations. Last year, Delta added new nonstop service between DFW and New York-LaGuardia. It also operates nonstop flights from DFW to Atlanta, Minneapolis-St. Paul, Detroit, Salt Lake City, Cincinnati, Memphis and New York-JFK.

When the expansion is complete, Delta would operate a total of 68 daily flights in the Dallas/Fort Worth region, including flights at both DFW and Love Field.

Delta’s expansion will be implemented following changes to the Wright Amendment, which previously restricted Love Field service to Texas, adjacent states and Missouri, Alabama, Kansas and Mississippi. Those restrictions are scheduled to end in October 2014.

Copyright Photo: Brian McDonough/AirlinersGallery.com. Boeing 737-732 N302DQ (msn 29648) prepares to land at Dulles International Airport near Washington.

Delta Air Lines: AG Slide Show

Vueling to create a new base at Brussels with seven new routes

Vueling Airlines (Vueling.com)  (Barcelona) will open a new base in Brussels in May 2014. The airline stated it would launch seven new routes from BRU to Ibiza, Lisbon, Oporto, Palma de Mallorca, Rome, Santiago de Compostela and Venice bringing the Brussels total to 11 routes.

Copyright Photo: Tony Storck/AirlinersGallery.com. Vueling’s Airbus A320-214 EC-LVP (msn 5587) with Sharklets in the “Linking Europe” special scheme arrives at London Heathrow.

Vueling Airlines: AG Slide Show

Alitalia’s board approves the new plan, Air France-KLM vote against it

Alitalia’s (2nd) (Rome) board of directors yesterday approved a revised business plan, promising “severe cost cuts” to make the Italian airline more profitable but did not include specifics according to this report by Reuters.

Air France-KLM Group, which owns 25 percent of the Italian carrier, voted against the plan but it did not address the long-term debt issue.

Read the full story: CLICK HERE

Copyright Photo: Ton Jochems/AirlinersGallery.com. Alitalia’s Boeing 777-243 ER EI-ISB (msn 32859) turns on the taxiway at Los Angeles International Airport.

Alitalia: AG Slide Show

Delta expands service at Boston

Delta Air Lines (Atlanta) will increase service at Boston’s Logan International Airport with daily year-round and seasonal service to the following seven destinations, including three new markets.

  • New daily service to Jacksonville, Florida and Richmond, Virginia, operated by Delta Connection carrier Endeavor Air using 76-seat, two-class Bombardier CRJ900s, effective March 3, 2014 and March 6, 2014
  • New service to Las Vegas with three flights per week operating a Boeing 737-800, effective March 6, 2014
  • Expanding service to Los Angeles with one additional flight for a total of two daily operating a Boeing 737-800, effective April 7, 2014
  • New Saturday-only summer seasonal service to Nassau, Bahamas, operated by Delta Connection carrier Shuttle America using 76-seat, two-class Embraer ERJ 175s as well as the Providenciales, Turks and Caicos Islands using an Airbus A320, effective March 8, 2014
  • Extended service to Cancun, previously scheduled to end April 26, 2014, now ending Aug. 30, 2014

Delta and joint venture partner, Virgin Atlantic, recently announced they will coordinate schedules and retime their respective Boston to Heathrow flights to offer customers more convenient and flexible travel options.

Delta currently operates 70 peak-day departures from Logan International Airport to 16 nonstop destinations. Delta’s new Boston service offers customers the option of First Class, Economy Comfort or economy seating, along with in-flight Wi-Fi on domestic flights.

Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 737-832 WL N3771K (msn 29632) is pictured in action at Los Angeles International Airport.

Delta Air Lines: AG Slide Show

Will the Boeing 777X be moved out of the Seattle area after the IAM members vote down a long-term contract extension?

Boeing logo

Boeing’s (Chicago) machinists rejected an eight-year labor contract extension yesterday that would have let Boeing build the company’s newest jetliner in Washington State. The IAM members voted down the extension by 67 percent. The extension would have secured an estimated 20 years of work building the proposed 777X. This vote may now permanently alter the relationship between Boeing and the Seattle area. The vote will now open a new opportunities for non-union areas like Charleston, South Carolina and other areas to build the new jetliner.

The driving issue for the union was the preservation of their pensions.

Boeing Commercial Airplanes quickly issued a statement from President and CEO Ray Conner after a long-term contract extension was voted down by the International Association of Machinists & Aerospace Workers District 751.

“We are very disappointed in the outcome of the union vote. Our goal was two-fold: to enable the 777X and its new composite wing to be produced in Puget Sound and to create a competitive structure to ensure that we continue market-leading pay, health care and retirement benefits while preserving jobs and our industrial base here in the region. But without the terms of this contract extension, we’re left with no choice but to open the process competitively and pursue all options for the 777X.

I’d like to thank Governor Jay Inslee and the Washington state legislature for all their efforts in this process. We had hoped for a different outcome.”

Read the analysis by Reuters: CLICK HERE

Xiamen Air takes delivery of its 100th Boeing jet

XIAMEN AIRLINES RIBBON CUTTING

Xiamen Air (Xiamen Airlines) (Xiamen) has reached a significant milestone. On November 12 in Seattle, Boeing delivered a brand new 737-800 airplane to Xiamen Airlines, a SkyTeam member. It is the 100th plane in the airline’s all-Boeing fleet. Boeing 737-85C B-5688 (msn 41792) was handed over at the special event (pictured).

Xiamen Airlines commenced service in 1985 with two Boeing 737-200s serving three cities. The carrier is now China’s sixth-largest, serving 218 domestic routes as well as 26 international and regional routes. With delivery of the Boeing 737-800, Xiamen Airlines’ fleet now consists of 100 aircraft. It is China’s only all-Boeing fleet and one of the world’s youngest, with an average age of 5.08 years.

Over the next two years, Xiamen Airlines plans to add 30 more Boeing 737-800s and six more Boeing 787s, expanding its fleet to 136 airplanes, and to expand globally by gradually forming a route network that radiates across the Asia Pacific region and connects with Europe and the U.S.

Xiamen Airlines’ expects to keep growing of its Boeing fleet beyond 2016. The carrier has just signed Letters of Request to buy 70 Boeing 737NGs and Boeing 737MAXs. By 2020, the fleet will grow to more than 200 airplanes.

Xiamen Airlines’ rapid growth is a testament to the tremendous growth of China’s airline business. In 1972, China established the Civil Aviation Administration of China (CAAC) as the only player in aviation, with only nine registered aircraft in the fleet. At the end of 2012, China had more than 40 airlines, with an industry-wide fleet exceeding 2,000 aircraft.

Boeing projects investments of nearly $800 billion in China for the purchase of 5,580 new commercial aircraft during the next 20 years. It would account for 16% of global demand, and reflects an average requirement of nearly 200 single-aisle and over 60 wide-body aircraft each year.

Top Copyright Photo: Boeing.

Xiamen Airlines: AG Slide Show

Bottom Copyright Photos: Ivan K. Nishimura/Blue Wave Group. B-5688 passes through Honolulu on the long delivery flight.

Second Photo: A close-up of the special markings.

Vanilla Air takes delivery of its first Airbus A320

Vanilla Air A320 and Personnel (Vanilla Air)(LR)

Vanilla Air (formerly AirAsia Japan) (Tokyo-Narita), Japan’s newest low-cost carrier has taken delivery of its first A320 (A320-216 JA01VA, msn 5844)  in Toulouse, France, on lease from AWAS. The airline will start commercial services on December 20 from Tokyo’s Narita International Airport to Okinawa and Taipei, gradually expanding services to Sapporo and Seoul (Incheon) and international holiday resort destinations

Vanilla Air’s A320 is configured with 180 seats in a high comfort all economy layout. The aircraft is equipped with Sharklet fuel saving wing tip devices and powered by CFM56 engines.

Copyright Photo: Vanilla Air.

Germania takes delivery of its first Airbus A321

Germania logo

S.A.T., the holding company of Germania Fluggesellschaft (Berlin), has taken delivery of its first out of two A321s on order. A321-211 D-ASTD (msn 5843) was handed over on November 12. Both aircraft are equipped with Airbus’ wing tip fuel saving devices, called Sharklets. The airline has already been operating eight A319s successfully since 2011.

The new Germania A321 will operate exclusively for Alltours, one of Germany’s biggest travel agencies and will be painted in a special Alltours livery. The airline has chosen a spacious single class cabin layout for 208 passengers. The cabin will be equipped with a state-of-the-art entertainment system, featuring video screens and in-seat audio channels. The aircraft will be powered by CFM engines.

Germania: AG Slide Show

Alitalia planned job cuts unlikely to persuade Air France and KLM to put in more cash

Alitalia (2nd) (Rome) is facing a major decision today at its board meeting. According to this report by Reuters, Alitalia’s CEO Gabriele del Torchio, a turnaround specialist, is expected to unveil his plan. The drastic measures may include up to 2,000 job cuts and salary cuts.

However the cuts are unlikely to persuade major shareholder and board member Air France-KLM to put any more capital into the failing flag carrier. Alitalia needs a $400 million infusion to keep flying. The group has already zeroed-out its investment.

Read the full report: CLICK HERE

Copyright Photo: Dave Glendinning/AirlinersGallery.com. Alitalia’s Embraer ERJ 190-100LR EI-RNB (msn 19000479) taxies at London (Heathrow).

Alitalia: AG Slide Show

 

easyJet, Airbus and Nicarnica Aviation complete the final stage of testing of the AVOID volcanic ash detection system

easyJet logo

EasyJet (UK) (easyJet.com) (London-Luton) has issued this statement:

During the experiment the test team successfully:

  • Generated an artificial ash cloud over the bay of Biscay by releasing a tonne of volcanic ash using an Airbus A400M aircraft.
  • Measured the ash concentration with a small aircraft flying through the ash cloud
  • Flew an Airbus A340-300 fitted with the AVOID sensor towards the ash cloud and successfully identified the ash from distances of 60km as well as accurately measuring its concentration
  • easyJet plans to continue development with a view to mounting stand-alone units on some of its current fleet of aircraft by the end of 2014 thereby providing a solution which would mean we should not encounter the widespread air space closures of 2010 again

EasyJet, the UK’s largest airline, along with its partners Airbus and Nicarnica Aviation, has successfully completed the final stage of testing for the AVOID (Airborne Volcanic Object Identifier and Detector) volcanic ash technology through a unique experiment involving the creation of an artificial ash cloud.

An A400M Airbus test plane (below) dispersed one ton of Icelandic ash into the atmosphere at between 9,000 ft and 11,000 ft thereby creating conditions consistent with the 2010 eruption. A second Airbus test aircraft, an A340-300, with the AVOID technology fitted, flew towards the ash cloud identifying and measuring it from around 60 km away.  The experiment also used a small aircraft, a Diamond DA42 from Dusseldorf University of Applied Sciences, to fly into the ash cloud to take measurements which help to corroborate the measurements made by the AVOID system.

The ash cloud produced during the test was between 600 ft and 800 ft deep measuring 2.8 km in diameter. To  begin with the ash cloud was visible to the naked eye but dissipated quickly becoming difficult to identify.

The AVOID volcanic sensor detected the ash cloud and measured its density  which ranged from 0.1 to 1 g m-2 – or concentrations of 100 to 1000 µg m-3. This is within the range of concentrations measured during the Eyjafjallajokul ash crisis in April and May 2010.

Copyright Photo: Airbus.

Airbus A400M (Volcanic Ash)(Airbus)(LR)

Video:

EasyJet: AG Slide Show

JetBlue endorses the DOJ settlement, adds two new destinations in the Caribbean

JetBlue Airways Corporation (JetBlue Airways) (New York) has released the following statement from CEO and President Dave Barger in regards to the United States Department of Justice (DOJ) proposed settlement, that would permit American Airlines and US Airways to proceed with their merger plans:

“On behalf of the 15,000 crewmembers of JetBlue Airways, New York’s Hometown Airline™, I applaud the Department of Justice’s pro-consumer proposed settlement and we look forward to participating in the divestiture process. JetBlue is eager to increase our low fare service in communities across the country and particularly at Ronald Reagan Washington National Airport and New York’s LaGuardia Airport.”

In other news, JetBlue has announced its expanded winter schedule in the Caribbean, featuring more flights than ever before. With the planned launch of service to two new island destinations, JetBlue will serve the Caribbean region this winter with an average of 200 daily flights.

In addition to its own network growth, JetBlue also announces the signing of two new interline agreements in the Caribbean, with LIAT and Seaborne Airlines, and a growth of its existing partnership with Cape Air. This expands the single-ticket options for JetBlue customers into a number of additional Caribbean destinations.

Two new cities and five new routes planned

JetBlue has announced five new Caribbean routes that will launch in the coming months, including service to two new destinations: Port-au-Prince, Haiti and Port of Spain, Trinidad and Tobago (a). New routes include:

  • Chicago (ORD) – San Juan, Puerto Rico (starts Nov. 20)
  • Fort Lauderdale-Hollywood – Port-au-Prince, Haiti (starts Dec. 5) (a)
  • Fort Lauderdale-Hollywood – Port of Spain, Trinidad and Tobago (starts May 1) (a)
  • New York (JFK) – Port-au-Prince, Haiti (starts Dec. 5) (a)
  • New York (JFK) – Port of Spain, Trinidad and Tobago (starts Feb. 24) (a)

Five destinations to see added capacity with larger aircraft

JetBlue plans to meet peak winter demand this winter by deploying its brand new Airbus A321 aircraft to a variety of Caribbean destinations. The A321 is outfitted with 190 seats, featuring the most legroom in coach (b), and boosting the number of seats per departure by 40 compared to JetBlue’s current 150-seat A320 aircraft. The following destinations will see select flights to/from New York (JFK) operated by the larger A321:

  • Bridgetown, Barbados
  • Nassau, Bahamas
  • San Juan, Puerto Rico
  • Santiago, Dominican Republic
  • Santo Domingo, Dominican Republic

Additionally, JetBlue will offer even more frequencies between New York (JFK) and Barbados during peak holiday times, including President’s Day and Easter.

JetBlue’s A321s will be operating fresh from the factory and will not yet have in-flight television, radio or movies.

More destinations with new and expanded interline partnerships

JetBlue has added two new interline agreements, with LIAT and Seaborne Airlines, and expanded its existing partnership with Cape Air, bringing a number of new Caribbean destinations within reach for JetBlue customers.

LIAT now offers JetBlue customers connections to several new destinations including Antigua, Grenada, St. Kitts, and Saint Vincent and the Grenadines, when transferring at Barbados and St. Maarten. Founded in 1956, LIAT is one of the largest and most experienced carriers in the Caribbean region. Tickets are now available for sale through travel agencies.

Seaborne Airlines also opens up several new destinations for JetBlue customers, including St. Kitts, Dominica, and Guadeloupe and Martinique in the French Caribbean, all via San Juan, as well as connections to La Romana, Dominican Republic on a daily basis. In addition, Seaborne will offer more flight options for customers connecting at San Juan to/from both the U.S. and British Virgin Islands. Seaborne’s regional network includes 11 destinations from San Juan and a total of 625 weekly departures. JetBlue-Seaborne itineraries are now available for sale through travel agencies.

JetBlue’s longstanding partnership with Cape Air also expands this winter, with new destinations available via San Juan: Culebra, Puerto Rico, and Virgin Gorda in the British Virgin Islands. With service to these two unspoiled island destinations, which is expected to kick off in early 2014, Cape Air will serve a total of nine destinations from San Juan including options like Anguilla and Nevis.

Copyright Photo: Ken Petersen/AirlinersGallery.com. The new JetBlue Airways Airbus A320-232 N615JB (msn 2461) in the special FDNY – Fire Department New York taxies past the camera at the JFK hub.

JetBlue Airways: AG Slide Show

Allied Pilots Association endorses the DOJ settlement and merger of American and US Airways

Allied Pilots Association logo

The president of the Allied Pilots Association (APA), certified collective bargaining agent for the 10,000 pilots of American Airlines, issued the following statement in response to news that the Justice Department has settled its lawsuit with American Airlines and US Airways regarding the airlines’ pending merger.

“The Allied Pilots Association leadership is pleased the DOJ and the two airlines have found a mutually acceptable way to address concerns about the merger. As we have said since the lawsuit was filed, this merger is pro-competition,” said APA President Capt. Keith Wilson. “Merging with US Airways will remedy American Airlines’ longstanding network shortfalls and put American on equal footing with Delta and United. With the merger, American will offer travelers a viable alternative to Delta and United.

“Today marks the culmination of an aggressive and unconventional strategy APA began pursuing early last year. Our primary goals were to help ensure American would survive and thrive, thereby ensuring long-term career stability for our pilots. This merger will accomplish both goals.

“With the DOJ settlement, American now has the opportunity to return to a position of industry preeminence. We look forward to working with our colleagues at the US Airline Pilots Association as we shift our focus to negotiating a joint collective bargaining agreement.”

Delta welcomes the settlement agreement between the DOJ and AMR-US Airways Group

Delta Air Lines (Atlanta) issued the following statement in response to the settlement of litigation brought by the U.S. Department of Justice challenging the merger of American Airlines and US Airways.

“Delta welcomes the settlement agreement and looks forward to the opportunity to acquire slots that will be divested under the agreement, particularly at Washington-Reagan National Airport. Delta is the airline best positioned to continue competitive nonstop flights from Reagan National to small- and mid-sized cities that could otherwise see service reduced or eliminated, which should be a strong consideration in the divestiture.”

Copyright Photo: Bruce Drum/AirlinersGallery.com. Delta’s Boeing 757-232 N6713Y (msn 30777) is pictured in action at Seattle-Tacoma International Airport.

Delta Air Lines: AG Slide Show

 

American and US Airways settle with the Department of Justice giving up 52 DCA slot pairs and 17 LGA slot pairs, paving the way towards a merger

AMR Corporation (Dallas/Fort Worth), the parent company of American Airlines, Inc., (Dallas/Fort Worth) and US Airways Group, Inc. (US Airways) (Phoenix) today announced that the airlines have settled the litigation brought by the U.S. Department of Justice (DOJ), the States of Arizona, Florida, Michigan and Tennessee, the Commonwealths of Pennsylvania and Virginia, and the District of Columbia challenging the merger of AMR and US Airways. The companies also announced an agreement with the U.S. Department of Transportation (DOT) related to small community service from Washington Reagan National Airport (DCA).

Tom Horton, chairman, president and CEO of AMR, and incoming chairman of the board of the combined company, said, “This is an important day for our customers, our people and our financial stakeholders. This agreement allows us to take the final steps in creating the new American Airlines. With a renewed spirit, we are about to create the world’s leading airline that will offer, along with our oneworld® partners, a comprehensive global network and service by the best people in the business. There is much more work ahead of us but we’re energized by the challenge and look forward to competing vigorously in the ever-changing global marketplace.”

Doug Parker, chairman and CEO of US Airways, and incoming CEO of the combined airline, said, “This is very good news and we are grateful to all who have made it happen. In particular, we are thankful to our employees, who throughout this process continued to believe in a better future as one airline and who voiced their support passionately and consistently. We also want to thank the elected officials in the states and communities we serve, the business leaders in our hub cities, and the thousands of customers who endorsed and supported this effort. Thank you as well to the U.S. Department of Justice, the state attorneys general and the U.S. Department of Transportation. We are pleased to have this lawsuit behind us and look forward to building the new American Airlines together.”

Under the terms of the settlement, the airlines will divest 52 slot pairs at Washington Reagan National Airport (DCA) and 17 slot pairs at New York LaGuardia Airport (LGA), as well as certain gates and related facilities to support service at those airports. The airlines also will divest two gates and related support facilities at each of Boston Logan International Airport, Chicago O’Hare International Airport, Dallas Love Field, Los Angeles International Airport, and Miami International Airport. The divestitures will occur through a DOJ approved process following the completion of the merger. Despite the divestitures, the new American is still expected to generate more than $1 billion in annual net synergies beginning in 2015, as was estimated when the merger was announced in February.

After completion of the required divestitures, the combined company expects to operate 44 fewer daily departures at DCA and 12 fewer daily departures at LGA than the approximately 290 daily DCA departures and 175 daily LGA departures that American and US Airways operate today. The divestitures required by the settlement are not expected to impact total employment at the new American.

To ensure much of the service currently operated by the carriers to small- and medium-sized markets from DCA is maintained, the new American has agreed with the DOT to use all of its DCA commuter slot pairs for service to these communities. The new American intends to announce the service changes that will result from the divestitures in advance of the sale of the DCA and LGA slots, so that the airlines acquiring those slots have the opportunity to maintain service to those impacted communities.

In the settlement agreement with the state Attorneys General, the new American has agreed to maintain its hubs in Charlotte, New York (Kennedy), Los Angeles, Miami, Chicago (O’Hare), Philadelphia, and Phoenix consistent with historical operations for a period of three years.  In addition, with limited exceptions, for a period of five years, the new American will continue to provide daily scheduled service from one or more of its hubs to each plaintiff state airport that has scheduled daily service from either American or US Airways. A previous settlement agreement with the state of Texas will be amended to make it consistent with today’s settlement.

Completion of the merger remains subject to the approval of the settlements by the U.S. Bankruptcy Court, and certain other conditions. The companies now expect to complete the merger in December 2013.

Copyright Photo: Andi Hiltl/AirlinersGallery.com. American Airlines’ Boeing 767-323 ER N376AN (msn 25445) touches down in Zurich.

American Airlines: AG Slide Show

US Airways: AG Slide Show

Virgin America posts net income of $33.5 million in the third quarter

Virgin America (San Francisco) today reported its financial results for the third quarter of 2013 with operating income of $44.4 million and net income of $33.5 million on total revenue of $387.3 million.   The airline posted an operating margin of 11.5 percent – a 7.2 point improvement for the third quarter, driven largely by a 9.4 percent growth in revenue per available seat mile (“RASM”) over the year-earlier period.

Third Quarter 2013 Financial Highlights

  • Virgin America reported $33.5 million in net income compared to a year-ago loss of $12.6 million, an improvement of $46 million.
  • The Company significantly outpaced all U.S. carriers with year-over-year RASM growth of 9.4 percent on a 3.9 percent decrease in capacity.   Virgin America has now led the industry in RASM growth every month since October 2012.
  • Load factor increased by 0.9 points and yield increased by 7.4 percent year-over-year.
  • Operating revenue was $387.3 million, an increase of 5.2 percent from the third quarter of 2012.
  • Cost per available seat mile (CASM) excluding fuel increased by 4.5 percent year-over-year, largely due to the airline’s expansion into major airports like Newark Liberty International Airport (EWR), increased labor costs, and decreased utilization of the fleet as part of the Company’s plan to improve unit revenue.
  • Year-to-date, Virgin America has generated operating income of $57.3 million, an increase of $94.1 million from the first nine months of 2012.
  • Unrestricted cash was $156.9 million as of September 30, 2013, an increase of $80.9 million since December 31, 2012.

Since taking a pause in its fleet and network expansion, Virgin America is now experiencing improved revenue and profitability performance across its network. Virgin America took delivery of one aircraft in the first quarter of 2013, increasing its total operating fleet to 53 aircraft.  The Company does not plan to increase its fleet again until the second half of 2015, when aircraft on order from Airbus are scheduled for delivery.

Virgin America completed a restructuring of the majority of its debt with investors during May 2013, eliminating more than $300 million of existing debt and accrued interest.  As a result of this restructuring, Virgin America expects its interest expense to substantially decline to approximately $10 million per quarter through 2014.  Had the May 2013 restructuring been completed prior to the beginning of the year, Virgin America’s year-to-date net income would have been approximately $30 million higher.

Copyright Photo: Brian McDonough/AirlinersGallery.com. Virgin America’s Airbus A320-214 N836VA (msn 4480) completes its final bank on the River Approach into Washington’s Reagan National Airport.

Virgin America: AG Slide Show

How to repair a damaged Boeing 787-8

Boeing (Chicago) is currently repairing the damaged Ethiopian Airlines Boeing 787-8 ET-AOP (msn 34744) at London’s Heathrow Airport. As previously report, the new airliner was damaged by fire on July 12, 2013.

According to this report by The Seattle Times, Boeing’s repair team is gluing a giant composite plastic skin patch inside a temporary building surrounding the rear section of the aircraft. The tail has been removed.

Boeing builds the fuselage as a single piece so this repair is very delicate and intricate for this new technology. The repairs should take five weeks.

Read the full report: CLICK HERE

Read the initial report of the fire: CLICK HERE

Follow-up report on the fire by the AAIB: CLICK HERE

Copyright Photo: Antony J. Best/AirlinersGallery.com. ET-AOP is undergoing this delicate repair inside this specially-designed and fabricate housing which surrounds the rear fuselage.

Bearskin Airlines Metro III crashes on approach into Red Lake, Ontario, five dead

Bearskin Airlines (Sioux Lookout, ON) Fairchild Swearingen SA227AC Metro III C-FFZN (msn 785) being operated as flight JV 311 crashed on approach with five passengers and two crew into Red Lake Airport in northwest Ontario on November 10. The airliner burst into flames when it hit the ground. Five people were killed and two survived. The flight had departed Sioux Lookout, Ontario bound for Red Lake.

The airline is celebrating 50 years of flying in 2013. John Hegland founded the company on July 17, 1963, naming it after Bearskin Lake, a remote First Nations community located 270 miles northeast of Sioux Lookout.

Video: Flying on the Metroliner and landing at Red Lake:

Video: Report on the crash:

Read the full report from the Calgary Herald: CLICK HERE

Bearskin logo-1

Route Map:

Bearskin 11.2013 Route Map

FAA will not review California Pacific’s application until next year, CPA furloughs all employees

California Pacific Airlines (Carlsbad) is becoming the poster child as the hard-luck airline wannabe that could not fly because  of the FAA’s inability to review and approve their Part 121 AOC application. The terrible saga continues. The company has suspended operations and furloughed all employees after receiving an official notification from the Federal Aviation Administration (FAA) that it cannot review their AOC application until at least next year according to this report by U-T San Diego. The would-be airline had until September 13 to resubmit its application which it did. The dream of CPA’s founder, Ted Vallas, 91, is slowly getting away from him. Vallas proposed the airline in 2010 and had raised at least $11 million from investors.

Read the full report: CLICK HERE

Copyright Photo: James Helbock/AirlinersGallery.com. Meanwhile the pictured Embraer ERJ 170-100LR N760CP (msn 17000006) arrived in Nashville, TN in late July from Arizona.

California Pacific: AG Slide Show

Flybe to cut another 500 jobs as it becomes profitable again in the first half

Flybe (Exeter) plans to cut another 500 jobs after it posted its first half-year profit in two years.

Read the full report from Reuters: CLICK HERE

The company issued this financial statement:

Results for the six months to September 30, 2013:

Flybe announces a significantly improved financial performance under its new management team.  In addition, a new phase of efficiency improvements announced today will secure a strong base for future growth.

Key financial highlights
      H1 2013/14£m          H1 2012/13£m               Change%
Total revenue under management * 477.3 396.3 20.4
Less: joint venture revenue (126.2) (55.5) 127.4
Group revenue 351.1 340.8 3.0
Adjusted profit/(loss) before tax, restructuring and surplus capacity costs and revaluation on USD aircraft loans ** + 12.2 (2.3)                     N/M
Adjusted profit/(loss) before tax and restructuring *** + 17.1 (1.6)                     N/M
Profit/(loss) before tax + 13.8 (1.6)                     N/M
Profit/(loss) after tax + 13.6 (1.6)                     N/M

*   Includes Flybe’s joint venture, Flybe Finland.

** Adjusted profit/(loss) before tax, restructuring and surplus capacity costs and revaluation on USD aircraft loans defined as profit/(loss) before tax, restructuring and surplus capacity costs of £4.1m (2012/13: £nil) and revaluation gains on USD aircraft loans of £5.7m (2012/13: £0.7m).  Surplus capacity costs represent the costs incurred in H1 2013/14 relating to capacity that is considered by management to be surplus as a result of the restructuring decisions.

***      Adjusted profit/(loss) before tax and restructuring defined as profit/(loss) before tax and restructuring costs of £3.3m (2012/13: £nil).

+   H1 2012/13 has been restated for the impact of adopting the revised requirements of IAS 19 Employee Benefits as detailed further in Note 2 to the condensed financial statements. The replacement of the interest cost and expected return on plan assets with a new interest charge on the net defined benefit liability led to a £0.3m increase in the reported loss for that period.

Results summary

1. First two phases of the Turnaround Plan on track to deliver savings of £40m this year and £45m in 2014/15.

2. A 20.4% increase to £477.3m (H1 2012/13: £396.3m) in revenue under management (including Flybe Finland, the joint venture with Finnair) largely driven by increased contract flying activity in Finland.

3. A 3.0% increase in group revenue to £351.1m.

4. A £13.8m profit before tax (H1 2012/13: loss of £1.6m).

5. A £10.5m operating cash inflow before increase in restricted cash and restructuring costs (H1 2012/13: £1.6m)

Operational highlights (H1 2013/14)

UK Airline:

-    6.2 million scheduled seats flown, in line with last year.

-    5.6% increase in passengers to 4.3 million.

-    3.6ppts increase in load factor to 68.6%.

-    0.9% increase in passenger revenue per scheduled seat to £50.35 (H1 2012/13: £49.92).

-    1.3% increase in total revenues to £328.2m.

-    1.3% decrease in costs per seat to £51.30.  On a constant currency and fuel price basis, costs per seat decreased by 3.1%.

-    4.7% increase in UK regional sector share for the Flybe brand to 55.1%.

Flybe Finland:

-    26.4% of Flybe’s revenue under management (H1 2013/14: £126.2m; H1 2012/13: £55.5m).

-    £110.6m contract flying revenue (H1 2012/13: £36.7m)

-    84.6% increase to 2.4 million in total seats flown, of which white label flying totalled 2.0 million (H1 2012/13: 0.8 million).

Turnaround update

Flybe aims to become the best local airline in Europe delivering unrivalled regional connectivity.

Flybe will have two engines of growth:

A regional branded airline giving a nimble and customer-friendly, scheduled service for both business and families.  This brings people together within a country and connects people in the regions to international carriers at metropolitan airports.

A regional white label model where Flybe will become the leading regional provider for mainstream European airlines.

The already announced Phase 1 and 2 cost savings are being successfully implemented.

Major management and organizational change: new Chairman and Chief Executive Officer have been appointed.  Senior executive appointments well advanced, including a new Chief Commercial Officer already in place.

Flybe’s operations have been reorganized into a single management structure.

An Immediate Action plan is being announced today and is already being implemented with three elements:

1.   Optimise configuration: rationalise route network, review fleet mix, remove surplus capacity and improve aircraft and crew utilisation.

2.   Reduce costs further: all aspects of the business are being reviewed to drive further savings.

3.   Improve commercialisation: optimise pricing and revenue management, refocus network development, strengthen route management, step change marketing impact and develop trading partnerships.

This will deliver further benefit of £7m this year and £26m next year with around 500 proposed redundancies and estimated one-off and surplus capacity costs of £14m this year plus a further £27m in 2014/15.

Finnair JV is now profitable; further improvements are being targeted by enhancing operational delivery, reducing scheduled risk flying losses and embedding ‘lean manufacturing’ techniques.

Update: According to Reuters, majority shareholder Rosedale Aviation Holdings has sold its entire 48.1 percent stake in the airline to institutional investors.

Read the full report: CLICK HERE

Copyright Photo: Antony J. Best/AirlinersGallery.com. Embraer ERJ 190-200LR (ERJ 195) G-FBEB (msn 19000057) lands at Southampton.

Flybe: AG Slide Show

Norwegian to open a new base at Madrid next summer

Norwegian Air Shuttle (Norwegian.com) (Oslo) continues its expansion in Europe and opens new base in Madrid for the summer of 2014. Norwegian will open six new routes from Madrid to Stockholm, Oslo, Helsinki, Hamburg, Warsaw and London.

The base in Madrid is Norwegian’s fifth Spanish base along with Alicante, Malaga, Las Palmas and Tenerife.

Six new routes from Madrid from June 2014: 

Norwegian will have two Boeing 737-800 aircraft at the base in Madrid. In addition, 100 employees will be recruited locally and six new routes launched.

Madrid – Stockholm
Four times a week on Mondays, Wednesdays, Fridays and Sundays, starting June 4, 2014

Madrid – Oslo
Three times a week on Tuesdays, Thursdays and Saturdays, starting June 3, 2014

Madrid – Helsinki
Three times a week on Mondays, Wednesdays and Fridays starting on June 4, 2014

Madrid – Hamburg
Four times a week on Mondays, Wednesdays, Fridays and Sundays, starting June 4, 2014

Madrid – Warsaw
Twice a week, on Tuesdays and Saturdays, starting June 3, 2014

Madrid – London
Daily from June 2, 2014

Madrid – Copenhagen
Increases from three to four times a week between April and June 2014. As of July 2014 there are flights daily between Madrid and Copenhagen.

Copyright Photo: Richard Vandervord/AirlinersGallery.com. Boeing 737-86N LN-NOQ (msn 32658) departs the runway at London (Gatwick).

Norwegian: AG Slide Show

Delta and Virgin Atlantic outline their schedule plans for the summer of 2014

Delta Air Lines (Atlanta) and Virgin Atlantic Airways (London) today outlined details of a new joint venture flight schedule beginning summer 2014, aligning their services and offering more flight choices for travelers on both sides of the Atlantic.

The two airlines are putting the customer at the forefront of their partnership with the new schedule that starts March 30, 2014, combining their slots at London Heathrow to offer maximum customer convenience, particularly for business travelers.

Beginning, April 2, 2014, Delta will move its arrival and departure terminal for several important business markets to join Virgin Atlantic in Heathrow Terminal 3. This includes its London to New York-JFK, London to Boston, and new London to Seattle/Tacoma services and means the two airlines will co-locate on all its New York and Boston flights to London Heathrow. The move will allow for convenient connections and a seamless customer experience for customers flying with Virgin and Delta, including access to Virgin Atlantic’s award winning Clubhouse for all business class passengers.

Delta, in cooperation with Virgin Atlantic, will also operate a second daily service between London Heathrow and Detroit Metropolitan Airport effective June 1, 2014. The service will be particularly appealing to corporate customers needing an early morning arrival into London while offering more schedule choice for customers between London and the U.S. Midwest.

This additional flight will complement Delta’s previously announced new West Coast route between Seattle/Tacoma and London Heathrow, which will launch on March 29, 2014.

Virgin Atlantic is also making significant schedule changes. It is moving its VS1 Heathrow to Newark service from a late afternoon departure to a morning departure. This flight will be particularly attractive to business travelers: it will allow ‘same-day meetings’ to be held in the New Jersey area, while an earlier departure on the return flight means passengers can be in central London for the start of the working day.

This service is part of nine daily flights between London Heathrow and the New York area by the joint venture partners. The new schedule will include departures every 30 minutes during the early evening peak and then hourly until 10.30 p.m. from New York-JFK to London Heathrow and a spread of seven daily flights from London Heathrow to New York-JFK, including two late afternoon and early evening departures.  It also includes two conveniently timed departures to and from Newark.

Virgin Atlantic has also retimed its Heathrow to Boston service to depart two hours later in the afternoon. This offers more flexibility for the two airlines’ customers with Delta’s Heathrow to Boston service departing in the morning. Virgin Atlantic’s evening departure from Boston will also move two hours later, giving greater schedule choice to travelers.

In September, Delta and Virgin Atlantic welcomed the decision by the U.S. Department of Transportation (DOT) to approve the carriers’ joint venture by granting antitrust immunity on routes between North America and the UK. This ruling confirmed the clear consumer benefits of the partnership, enabling the airlines to deepen their cooperation, offering more flight choices for travelers on both sides of the Atlantic and improving the travel options for business customers in the New York to London market.

Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. Delta’s Airbus A330-223 N855NW (msn 621) arrives in Los Angeles.

Delta Air Lines: AG Slide Show

Virgin Atlantic Airways: AG Slide Show

Bottom Copyright Photo: Eddie Maloney/AirlinersGallery.com. Virgin Atlantic Airways’ Boeing 747-443 G-VROS (msn 30885) lands in Las Vegas.

Is Evergreen International Airlines planning to close its doors on November 30? The company says no but is exploring other options

Evergreen International Airlines (McMinnville, Oregon and Marana, Arizona) despite a public denial by its founder and CEO that the rumors are false, it has been reported in the local Oregon media as planning to lay off 131 employees and ceased operations on November 30. The company recently sold off its helicopter division as we reported as it attempts to reorganize and seek new “strategic alternatives” and partners.

It is unclear if the Evergreen Wings and Waves Waterpark and the Evergreen Aviation and Space Museum would also be affected if any final decision is made.

Read the full report from the The Oregonian: CLICK HERE

The company is privately held and issued this statement:

As has been previously reported in the press, Evergreen’s business has been adversely impacted over the past several years by decreased demand in military spending and weakness in global economic markets. Management has moved to aggressively address these challenges, including through the divestiture of businesses and assets and the significant reduction of secured debt. Evergreen is in discussions with its significant constituencies and is exploring available strategic alternatives with those constituencies. While Evergreen generally does not comment on market rumor or conjecture, rumors that a decision has been made to cease operations at this time are false. Evergreen remains committed to continuing to address the current business environment with its customers.

Delford M. Smith
Chief Executive Officer,
Evergreen International Aviation, Inc.

Copyright Photo: Stefan Sjogren/AirlinersGallery.com. Evergreen International Airlines’ Boeing 747-230F N490EV (msn 24138) touches down in Stockholm (Arlanda).

Evergreen International Airlines: AG Slide Show

Air Armenia starts passenger flights after adding an Airbus A320 and a Boeing 737-500

Air Armenia A320-200 (13)(Flt)(Air Armenia)(LR)

Air Armenia (Yerevan) commenced operations as a cargo airline on March 18, 2003 with Antonov An-12s. With the demise of Armavia, the airline commenced scheduled passenger flights on October 27 from Yerevan to Moscow (Vnukovo) with a Boeing 737-500 (737-505 EK73797, msn 26297, delivered on September 29). Local charter flights were started previously on October 23. The airline has also added an Airbus A320 (A320-214 EK32039, msn 1439, delivered on November 4).

Read the full report from ArmeniaNow.com: CLICK HERE

Images: Air Armenia. Air Armenia has also added a new look with the new jet aircraft.

Video: EK73797 arrives in Yerevan.

Air Armenia logo

Lufthansa Cargo takes delivery of its first Boeing 777F freighter, will enter service on November 19 to New York

Lufthansa Cargo 777F D-ALFA (03)(Ldg) FRA (Lufthansa Cargo)(LR)

Lufthansa Cargo (Frankfurt) finally accepted its first Boeing 777F freighter, the pictured 777-FBT D-ALFA (msn 41674) on November 8. D-ALFA arrived at the Frankfurt base the following day. The new freighter will enter revenue cargo service on November 19 with nonstop service to New York (JFK).

Copyright Photo: Lufthansa Cargo.

Video: Behind the scenes at Lufthansa Cargo (in German):

Lufthansa Cargo: AG Slide Show

Ethiopian Airlines takes delivery of its first Boeing 777-300 ER via GECAS, enters service today

Ethiopian 777-300 ET-APX (03)(Tko)(Ethiopian)(LRW)

Boeing (Chicago) has delivered a 777-300 ER (Extended Range) jet to GE Capital Aviation Services (GECAS) for lease to Ethiopian Airlines (Addis Ababa). The 777-300 ER is now the largest airplane in the Ethiopian flag-carrier’s fleet and will provide it with increased capacity and improved operating economics on key routes from its base in the Ethiopian capital, Addis Ababa.

The pictured 777-36N ER ET-APX (msn 42101) was handed over on November 7 as scheduled.

Ethiopian’s first 777-300 ER will seat nearly 400 passengers in a two-class configuration and perfectly complements its existing fleet of six 777-200 LR (Longer Range) airplanes by providing additional capacity and flexibility on popular routes, such as Guangzhou, Washington, D.C. and Dubai.

The 777-300 ER can fly up to 7,825 nautical miles (14,490 kilometers) and is equipped with GE90-115B engines, the world’s most powerful commercial jet engine. Ethiopian’s 777-300ER also features the Boeing Signature Interior that offers wider seats, wider aisles, more headroom and more seating flexibility.

Ethiopian currently serves 76 destinations across five continents and was recently awarded African Business of the Year at the annual African Business Awards. The carrier’s partnership with Boeing stretches back over six decades, with a current fleet of nearly 50 Boeing airplanes that includes Next-Generation 737s, 757s, 767s, 777s, and 787 Dreamliners and a cargo fleet that includes 757s, 777 Freighters and a MD-11.

The airline issued this statement:

Ethiopian Airlines, the fastest growing and most profitable African airline, took delivery of the first of its four Boeing 777-300 ERs on November 7, 2013. The Boeing 777-300 ER is the largest aircraft in the airline’s fleet with 400 passengers seating capacity.

Ethiopian Boeing 777-300 ER will operate in its dense routes such as Guangzhou, Washington D.C., Dubai and Luanda. The aircraft is scheduled to serve the Addis Ababa – Luanda route three times a week, as of November 10, 2013, and three times a week on the Addis Ababa – Guangzhou route, as of November 15, 2013.

Ethiopian, which is a multi-award winning Pan-African carrier as the Passenger Choice “Best Airline in Africa” and the SKYTRAX “Best Staff Service in Africa” of 2013, will phase in three additional B777-300ERs in January 2014, May and June 2015.

Copyright Photo: Ethiopian Airlines.

Ethiopian Airlines: AG Slide Show

Zagrosjet acquires its first Airbus A321, starts passenger flights

Zagrosjet A321-200 YI-AQU (13)(Ldg) ARN (Zagrosjet)(LR)

Zagrosjet (formerly Zagros Air) (Erbil, Iraq) is the airline in the autonomous Kurdistan region of northern Iraq. The carrier is partly owned by Atlasjet (Istanbul) of Turkey. The company was established in October 2005 as Zagros Air by the Zagros Group. The Kurdish airline adopted the current Zagrosjet name in August 2013 and as of October 2, 2013 is operating an Airbus A321-231 (YI-AQU) on routes from Erbil to Adana, Amman, Ankara, Beirut, Gaziantep, Istanbul and Stockholm (Arlanda).

The company issued this statement:

Zagrosjet, the first and only Kurdish carrier in history proudly announces its official flights to different destinations in Middle East, Turkey and Europe, which include Amman, Beirut, Stockholm, Ankara, and Adana in the first phase.

On October 2, 2013, we celebrated the first departure of our Airbus A321-200 from Erbil International Airport directly to Ankara, Republic of Turkey. Followed by scheduled flights according to the official timetable and will be in two configurations: Business and Economy class.

Thanks to the Iraqi Federal Government and Kurdistan Regional Government for all their support and assistance. With this event, we will not only develop our milestone, as we believe, we are also writing the preface in Kurdish aviation history, keeping air transportation development parallel to all other developments in all other sectors achieved in Kurdistan during the last few years.

Zagrosjet was established in October 2005 by Zagros Group and licensed as an Air Carrier by Ministry of Transportation – Iraq on June 2013 to perform scheduled and unscheduled passenger and Cargo flights.

By 2014, Zagrosjet will commence flights to Umrah and Hajj followed by several other destinations in Europe, as we aim to connect Kurdistan Region and Iraq to the world and to be the most preferred carrier in the country.

Aside from network expansion, we will be opening our own flight academy in the near future to train Kurdish pilots and establish our own technical department for aircraft maintenance and services.

Video:

Copyright Photo: Zagrosjet.

Zagrosjet logo

Aer Lingus reports a third quarter operating profit of $126.8 million

Aer Lingus Group (Aer Lingus) (Dublin) for the third quarter reported an operating profit of €94.9 million ($126.8 million) which is 4.4% ahead of last year.

Read the full financial report: CLICK HERE 

Read the analysis by Irish Times: CLICK HERE

Copyright Photo: Stephen Tornblom/AirlinersGallery.com. Aer Lingus’ Airbus A330-302X EI-ELA (msn 1106) lifts off the runway at New York’s John F. Kennedy International Airport.

Aer Lingus: AG Slide Show

 

Alaska Airlines to allow its passengers to use PEDs starting today

Alaska Passengers using PEDs (Alaska)(LRW)

Alaska Airlines (Seattle/Tacoma) passengers on flights today (November 9) can begin enjoying the use of their tablets, book readers, games and other personal electronic devices from gate to gate.

Passengers on Alaska Airlines flights operated by Horizon Air are expected to be able to use their electronic devices during all phases of their flight next week and on flights operated by SkyWest Airlines soon after, pending FAA approval.

Under FAA rules, passengers need to place their electronic devices in airplane mode. Cell phones may not be used for calls and all devices must be turned off in rare cases when instructed by crew members. Laptops and other larger devices must be stowed during takeoff and landing so they do not pose a safety hazard. Customers will be able to connect to Wi-Fi once the aircraft reaches 10,000 feet.

Copyright Photo: Alaska Airlines. Alaska Airlines will start flying its first aircraft with 110-volt and USB power outlets at every seat next month. Most of the fleet will be equipped with power outlets by the end of 2014.

Alaska Airlines: AG Slide Show

Air Canada reports 3Q adjusted net income of C$365 million

Air Canada (Montreal) today reported adjusted net income of $365 million or $1.29 per diluted share in the third quarter of 2013 compared to adjusted net income of $229 million or $0.82 per diluted share in the third quarter of 2012, an increase of 59.4 per cent.  Third quarter 2013 EBITDAR amounted to $626 million compared to EBITDAR (excluding benefit plan amendments) of $551 million in the third quarter of 2012, an increase of $75 million . On a GAAP basis (which includes special items), Air Canada’s net income was $299 million or $1.05 per diluted share compared to net income of $359 million or $1.28 per diluted share in the same quarter of the previous year, during which Air Canada recorded a special operating expense reduction of $127 million in Benefit plan amendments relating to changes to the retirement age under one of its collective agreements. No comparable operating expense reduction was recorded in the third quarter of 2013.

“I am extremely pleased to report Air Canada’s best quarterly performance in the Corporation’s history, surpassing previous records for adjusted net income and EBITDAR,” said Calin Rovinescu, President and Chief Executive Officer. “Our operating leverage for the quarter was significant, as we achieved a 59.4 per cent improvement in adjusted net income based on increased total revenues of 4.6 per cent for the quarter.  These results underscore the momentum that has been achieved in executing on the foundations of our transformation strategy – sustainable profitability and positioning Air Canada as a stronger national and global competitor.

“In the quarter, we announced a series of significant developments in achieving our priorities: We successfully completed the $1.4 billion refinancing of our 2010 notes, significantly lowering our cost structure, strengthening our balance sheet and improving our credit profile.  We completed the transfer of all 15 Embraer 175 aircraft to Sky Regional, our Air Canada Express partner, an important step in Air Canada’s regional diversification strategy and our ongoing cost transformation program.  We finished construction of a new state-of-the-art Operations Centre that is designed to significantly improve operational capabilities and efficiencies of our global network.  To further develop Toronto Pearson as a truly global hub and even stronger North American gateway, we recently concluded an enhanced cooperation agreement with the Greater Toronto Airports Authority (GTAA).  In addition, we implemented an expanded commercial agreement with Air China, to serve additional points in China on a codeshare basis with our Star Alliance partner.

“I am particularly pleased to see the stock market’s endorsement of the strategy that our team has developed. This was reflected in our stock price more than tripling over the past year.  Moreover, our commitment as a progressive employer and investment in the well-being of our employees has also been recognized with the recent naming of Air Canada as one of Canada’s Top 100 Employers.

“Looking ahead, we will take delivery of the final three of five new Boeing 777-300ER aircraft by February 2014 , and we are actively preparing to begin integrating the first six of 37 Boeing 787 aircraft into our widebody fleet in 2014.  For the summer of 2014, we announced a major European expansion as these new widebody aircraft enter Air Canada’s international fleet allowing for the transfer of current aircraft to Air Canada rougeTM in order to operate in leisure markets on a more cost competitive basis.

“Our operational performance has also shown continued improvement. On-Time Performance (OTP) for the quarter improved over 20 percentage points compared to the previous year, the third consecutive quarter of significant year-over-year gains.  I would like to thank our employees for their on-going focus on taking care of our customers while operating a safe and efficient airline.  Their professionalism, collaboration and dedication, combined with Air Canada’s award-winning product has once again been recognized by this year’s Ipsos Reid Business Traveller Survey, released in September, that confirmed that Canada’s frequent business travellers recognize Air Canada as their preferred airline by a growing margin – the widest margin versus our domestic competitors since 2008,” concluded Mr. Rovinescu.

Third Quarter Income Statement Highlights

Third quarter 2013 system passenger revenues were $3,177 million , an increase of $148 million or 4.9 per cent over the third quarter of 2012, on a 2.9 per cent growth in traffic and a 2.0 per cent improvement in yield.  Passenger revenue per available seat mile (RASM) increased 1.8 per cent from the third quarter of 2012 on the yield growth.  Air Canada reported a passenger load factor of 86.2 per cent for the third quarter of 2013, 0.1 percentage points below the third quarter 2012 record load factor.  In the premium class cabin, passenger revenues increased $12 million or 2.1 per cent on yield growth of 3.8 per cent as traffic declined 1.7 per cent from the third quarter of 2012.

Operating expenses increased $160 million or 6 per cent from the third quarter of 2012.  As a result of changes to the terms of the ACPA collective agreement related to retirement age, which are not subject to regulatory approval, Air Canada recorded an operating expense reduction of $127 million in Benefit plan amendments in the third quarter of 2012 related to the impact of those amendments on pension and other employee benefit liabilities.  No such operating expense reduction was recorded in the third quarter of 2013.

Air Canada’s adjusted cost per available seat mile (adjusted CASM), which excludes fuel expense, the cost of ground packages at Air Canada Vacations and unusual items, decreased 3.4 per cent compared to the third quarter of 2012.  The 3.4 per cent reduction in adjusted CASM was in line with the adjusted CASM decrease of 3.0 per cent to 3.5 per cent projected in Air Canada’s news release dated October 3, 2013 .

In the third quarter 2013, Air Canada recorded operating income of $416 million compared to operating income of $423 million in the same quarter in 2012.  As discussed above, an operating expense reduction of $127 million was recorded in Benefit plan amendments in the third quarter of 2012 while no such operating expense reduction was recorded in the third quarter of 2013.

Financial and Capital Management Highlights

At September 30, 2013 , unrestricted liquidity (cash, short-term investments and undrawn lines of credit) improved to $2,412 million or 20 per cent of 12-month trailing revenues ( September 30, 2012 – $2,135 million or 18 per cent of 12-month trailing revenues).

Adjusted net debt amounted to $4,104 million at September 30, 2013 , a decrease of $33 million from December 31, 2012.   Despite adding US$285 million of debt related to the two Boeing 777-300 ER aircraft delivered in June and August 2013 , Air Canada was able to reduce net debt by maintaining positive cash from operations.

In the third quarter of 2013, negative free cash flow of $249 million declined $96 million from the third quarter of 2012, largely due to the addition of one Boeing 777 aircraft, partly offset by an increase in cash flows from operating activities due to better operating results.

For the 12 months ended September 30, 2013 , return on invested capital (“ROIC”) was 10.8 per cent versus 7.7 per cent at December 31, 2012.   Air Canada has targeted achieving an ROIC of 10 to 13 per cent by 2015.

Current Outlook

For the fourth quarter of 2013, Air Canada expects its system ASM capacity, as measured by available seat miles (ASMs), to increase in the range of 3.0 to 4.0 per cent when compared to the fourth quarter of 2012.

Air Canada expects its full year 2013 system ASM capacity and domestic ASM capacity to increase in the range of 2.0 to 2.5 per cent when compared to the same periods in 2012 (as opposed to the increase of 1.5 to 2.5 per cent disclosed in Air Canada’s news release dated October 3, 2013 ).

For the fourth quarter of 2013, Air Canada expects adjusted CASM to decrease 2.0 to 3.0 per cent when compared to the fourth quarter of 2012.

For the full year 2013, Air Canada continues to expect adjusted CASM to decrease in the range of 1.5 to 2.0 per cent from the full year 2012, consistent with the revised outlook provided with the October 3, 2013 traffic release.

Air Canada continues to expect its full year 2014 system capacity to increase by 9.0 to 11.0 per cent when compared to the full year 2013.  This projected increase in capacity, which is being deployed primarily on international markets, is consistent with the fleet plan discussed in Air Canada’s Third Quarter 2013 MD&A.  The projected capacity increase is due to the addition of five high-density Boeing 777-300 ER aircraft (the first two having been delivered in June and August 2013 , respectively, and the remaining three scheduled for delivery between November 2013 and February 2014 ), the scheduled arrival in 2014 of the first six Boeing 787 aircraft, and the planned growth from Air Canada rougeTM.

Air Canada’s outlook assumes Canadian GDP growth of 1.25 to 1.75 per cent for 2013 and Canadian GDP growth of 2.0 to 3.0 per cent for 2014.

Air Canada also expects that the Canadian dollar will trade, on average, at C$1.03 per U.S. dollar for the fourth quarter of 2013 and the full year 2013 and that the price of jet fuel will average  89 cents per litre for the fourth quarter of 2013 and the full year 2013.

The following table summarizes Air Canada’s above-mentioned outlook for the fourth quarter and full year 2013 and related major assumptions:

 

Fourth Quarter 2013 versus 
Fourth Quarter 2012
Full Year 2013 versus 
Full Year 2012
Current Outlook
Available seat miles (System) Increase 3.0% to 4.0% Increase 2.0% to 2.5%
Available seat miles (Canada) n/a Increase 2.0% to 2.5%
Adjusted CASM (1) Decrease 2.0% to 3.0% Decrease 1.5% to 2.0%
(1) Excludes fuel expense, the cost of ground packages at Air Canada Vacations and unusual items
Major Assumptions -
Fourth Quarter 2013
Major Assumptions -
Full Year 2013
Major Assumptions
Canadian dollar per U.S. dollar 1.03 1.03
Jet fuel price – CAD cents per litre 89 cents 89 cents
Canadian economy 2013 Annualized Canadian GDP
growth of 1.25% to 1.75%
Canadian GDP growth of
1.25% to 1.75%

 

For the full year 2013, Air Canada continues to expect:

  • Depreciation, amortization and impairment expense to decrease by $115 million from the full year 2012.
  • Employee benefits expense to increase by $70 million from the full year 2012.
  • Aircraft maintenance expense to decrease by $40 million from the full year 2012 level, which includes a favourable maintenance return provision adjustment of $32 million in the fourth quarter of 2012.

The following table summarizes the above-mentioned projections for the full year 2013:

Full Year 2013 versus 
Full Year 2012
Depreciation, amortization and impairment expense Decrease $115 million
Employee benefits expense Increase $70 million
Aircraft maintenance expense Decrease $40 million

 

The outlook provided constitutes forward-looking statements within the meaning of applicable securities laws and is based on a number of additional assumptions and subject to a number of risks.  Please see section below entitled “Caution Regarding Forward-Looking Information.”

Non-GAAP Measures

Below is a description of certain non-GAAP measures used by Air Canada to provide additional information on its financial and operating performance.  Such measures are not recognized measures for financial statement presentation under Canadian GAAP and do not have standardized meanings and may not be comparable to similar measures presented by other public companies.  Refer to Air Canada’s Third Quarter 2013 MD&A for reconciliation of non-GAAP financial measures.

  • Adjusted net income (loss) and adjusted net income (loss) per diluted share are used by Air Canada to assess its performance without the effects of foreign exchange, net financing expense on employee benefits, mark-to-market adjustments on derivatives and other financial instruments recorded at fair value and unusual items.
  • EBITDAR is commonly used in the airline industry and is used by Air Canada to assess earnings before interest, taxes, depreciation, amortization, impairment and aircraft rent as these costs can vary significantly among airlines due to differences in the way airlines finance their aircraft and other assets.
  • Adjusted CASM is used by Air Canada to assess the operating performance of its ongoing airline business without the effects of fuel expense, the cost of ground packages at Air Canada Vacations and unusual items, such as impairment charges and benefit plan amendments, as such expenses may distort the analysis of certain business trends and render comparative analyses to other airlines less meaningful.
  • Free cash flow is used by Air Canada as an indicator of the financial strength and performance of its business because it shows how much cash is available for such purposes as repaying debt, meeting ongoing financial obligations and reinvesting in Air Canada.
  • Adjusted net debt is a key component of the capital managed by Air Canada and provides a measure of the airline’s net indebtedness.  Adjusted net debt is calculated as the sum of total long-term debt and finance lease obligations and capitalized operating leases less cash and cash equivalents and short-term investments.
  • Return on invested capital is used by Air Canada to assess the efficiency with which it allocates its capital to generate returns. Return is based on Adjusted net income (loss) (as discussed in the section above), excluding interest expense and implicit interest on operating leases. Invested capital includes average long-term debt, average finance lease obligations, the value of capitalized operating leases (calculated by multiplying annualized aircraft rent expense by 7) and the market capitalization of Air Canada’s outstanding shares.

Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 777-333 ER C-FRAM (msn 35250) approaches Tokyo (Narita) for landing.

Air Canada: AG Slide Show

US Airways joins the PED airline list

US Airways (Phoenix) customers as of yesterday (November 7) can now use certain portable electronic devices (PEDs), including e-books, tablets and smartphones, during taxi, takeoff and landing while in “airplane mode” – a departure from the previous Federal Aviation Administration (FAA) restriction on use below 10,000 feet.  Customers on US Airways domestic mainline flights will now be permitted to use small PEDs during all phases of flight.

In approving the use of PEDs, the FAA ensured that all US Airways mainline aircraft are equipped to safely handle implementation of the new recommendations.  US Airways continues to work with all partner airlines operating as US Airways Express to ensure timely implementation of their individual programs which require separate FAA approval.

Travelers should keep in mind the following details with regard to the new policy:

  • The FAA’s new recommendations regarding onboard PED use apply only to domestic flights flown by US Airways mainline aircraft.
  • Phone calls are not permitted once the main cabin door is closed or before a flight attendant makes an announcement upon arrival.
  • Customers should adhere to all crewmember safety instructions and refrain from using PEDs during pre-flight safety announcements.
  • During takeoff and landing, customers are now permitted to secure items lighter than two pounds by holding them (with the option of securing them in seatback pockets).  PEDs heavier than two pounds must be secured for taxi, takeoff and landing in an overhead bin or underneath the seat in front of them.
  • PEDs must be operated in “airplane mode” or with cellular services disabled.
  • In-flight Wi-Fi is available on most aircraft once it reaches an altitude of 10,000 feet and an onboard announcement has been made.

US Airways’ adoption of the new policy is the latest step in the company’s effort to upgrade its customers’ in-flight experience.  Earlier this year, the airline installed Gogo Wi-Fi In-flight internet on 270 Airbus A319, A320, A321 and Embraer 190 aircraft along with 58 Embraer 170 and 175 US Airways Express aircraft – outfitting 90 percent of the company’s domestic aircraft with wireless internet capabilities.  US Airways’ Airbus A319, A320 and A321 planes are equipped with Gogo’s ATG-4 (air-to-ground) technology, which strengthens the wireless internet capacity and increases the available data rate for customers.

Copyright Photo: Jay Selman/AirlinersGallery.com. Airbus A321-211 N195UW (msn 3633) arrives at the Charlotte hub.

US Airways: AG Slide Show

Spirit launches new routes from Minneapolis/St. Paul and Phoenix

Spirit Airlines (Fort Lauderdale/Hollywood) yesterday (November 7) started daily nonstop seasonal service between Minneapolis-St. Paul International Airport (MSP) and four new cities, including Los Angeles (LAX), Orlando (MCO), Phoenix Sky Harbor (PHX) and Tampa (TPA). In addition, Spirit’s nonstop seasonal service from MSP to Fort Lauderdale and Fort Myers has also resumed.

Spirit has continued to grow since starting service at MSP in June 2012. The ultra-low fare airline now offers nonstop service from MSP to Chicago, Dallas/Fort Worth, Denver (summer seasonal) and Las Vegas, as well as nonstop winter seasonal service to Fort Lauderdale, Fort Myers, Los Angeles, Orlando, Phoenix and Tampa.

Spirit’s Minneapolis/St. Paul (MSP) — Los Angeles (LAX) seasonal schedule effective November 7, 2013:
Depart Arrive Flight # Stops Frequency
Minneapolis/St. Paul — Los Angeles 4:15 PM 6:15 PM 323 0 Daily
Los Angeles — Minneapolis/St. Paul 8:05 AM 1:45 PM 424 0 Daily
Spirit’s Minneapolis/St. Paul (MSP) — Orlando (MCO) seasonal schedule effective November 7, 2013:
Depart Arrive Flight # Stops Frequency
Minneapolis/St. Paul — Orlando 7:50 AM 12:05 PM 135 0 Daily
Orlando — Minneapolis/St. Paul 12:55 PM 3:25 PM 250 0 Daily
Spirit’s Minneapolis/St. Paul (MSP) — Phoenix Sky Harbor (PHX) seasonal schedule effective November 7, 2013:
Depart Arrive Flight # Stops Frequency
Minneapolis/St. Paul — Phoenix 9:25 AM 11:50 AM 345 0 Daily
Phoenix — Minneapolis/St. Paul 3:10 PM 7:15 PM 342 0 Daily
Spirit’s Minneapolis/St. Paul (MSP) — Tampa (TPA) seasonal schedule effective November 7, 2013:
Depart Arrive Flight # Stops Frequency
Minneapolis/St. Paul — Tampa 3:00 PM 7:10 PM 427 0 Daily
Tampa — Minneapolis/St. Paul 7:55 PM 10:20 PM 428 0 Daily

Additionally, Spirit Airlines started daily nonstop seasonal service from Phoenix Sky Harbor International Airport (PHX) to three new cities, including Chicago O’Hare (ORD), Denver (DEN) and Minneapolis-St. Paul (MSP).

Spirit also recently started daily nonstop service between Phoenix Sky Harbor and Dallas/Fort Worth on October 24, 2013.

Spirit’s Phoenix Sky Harbor (PHX) — Chicago (ORD) seasonal schedule effective November 7, 2013:

Depart Arrive Flight # Stops Frequency
Phoenix Sky Harbor — Chicago O’Hare 1:25 am 5:50 am 168* 0 Daily
Chicago O’Hare — Phoenix Sky Harbor 9:15 pm 12:10 am +1 167 0 Daily

*effective 11/8/13

Spirit’s Phoenix Sky Harbor (PHX) — Denver (DEN) seasonal schedule effective November 7, 2013:

Depart Arrive Flight # Stops Frequency
Phoenix Sky Harbor — Denver 12:35 pm 2:23 pm 906 0 Daily
Denver — Phoenix Sky Harbor 12:40 pm 2:30 pm 939 0 Daily

Spirit’s Phoenix Sky Harbor (PHX) — Minneapolis/St. Paul (MSP) seasonal schedule effective November 7, 2013:

Depart Arrive Flight # Stops Frequency
Phoenix Sky Harbor — Minneapolis/St. Paul 3:10 pm 7:15 pm 342 0 Daily
Minneapolis/St. Paul — Phoenix Sky Harbor 9:25 am 11:50 am 345 0 Daily

Copyright Photo: Ton Jochems/AirlinersGallery.com. Spirit Airlines has changed its website URL from Spiritair.com to Spirit.com and the aircraft are now starting to reflect this change. Airbus A320-232 N620NK (msn 5624) with Sharklets and the new web address lands at Las Vegas.

Spirit Airlines: AG Slide Show

Seaborne Airlines to expand to St. Kitts, will add four more SAAB 340Bs in 2014

Seaborne Airlines (Christiansted, St. Croix, U.S. Virgin Islands) announced that they will launch a new route between Luis Munoz Marin International Airport in San Juan, Puerto Rico (SJU) and St Kitt’s Robert L. Bradshaw International Airport (SKB), with continuous service to Nevis’ Vance W. Amory International Airport (NEV), beginning Wednesday, January 15th, 2014. The flights will operate daily.

Seaborne will operate 34-seat SAAB 340B aircraft with two pilots, a flight attendant and the outstanding in-flight service Seaborne is known for.  Whether for local Puerto Rican visitors or connecting customers from the states, Seaborne’s schedule makes Caribbean travel easy.

        Departing from SJU: 3:25 PM Arriving SKB 4:50 PM
        Departing from SKB: 5:10 PM Arriving NEV 5:30 PM  (Customers stay on the plane at SKB)
        Departing from NEV: 7:00 AM Arriving SKB 7:20 AM  (Customers stay on the plane at SKB)
        Departing from SKB: 7:50 AM Arriving SJU 9:00 AM

Seaborne also announced the addition of four more 34-seat SAAB 340B aircraft in the first half of 2014.  “These planes will increase our Caribbean fleet to thirteen aircraft, providing travelers throughout the Caribbean with even more travel options and the service they deserve”, said Gary Foss, President and Chief Executive Officer of Seaborne Airlines.

Copyright Photo: Raul Sepulveda/AirlinersGallery.com. SAAB 340B N353SA (msn 351) in the Pacific Coastal colors awaits the next assignment at the San Juan hub.

Route Map:

Seaborne 10.2013 Route Map

JetBlue begins operations at Worcester

JetBlue Airways (New York) yesterday (November 7) began flying from the Worcester Regional Airport to Fort Lauderdale/Hollywood and Orlando, as the airline continues to grow its foothold in New England. JetBlue now offers 256 daily flights in and out of New England and is the exclusive commercial airline to operate at the Central Massachusetts facility.

JetBlue’s schedule between Worcester (ORH) and Fort Lauderdale/Hollywood (FLL) effective November 7, 2013:

ORH to FLL: FLL to ORH:
Depart – Arrive Depart – Arrive
4:25 p.m. – 7:39 p.m. 7:32 p.m. – 10:30 p.m.

JetBlue’s schedule between Worcester (ORH) and Orlando (MCO) effective November 7, 2013*:

ORH to MCO: MCO to ORH:
Depart – Arrive Depart – Arrive
7:30 a.m. – 10:33 a.m. 1:00 p.m. – 3:38 p.m.

*= First flight from Orlando to Worcester is scheduled for November 7, 2013. First flight from Worcester to Orlando is scheduled for November 8.

Copyright Photo: Brian McDonough/AirlinersGallery.com. Embraer ERJ 190-100 IGW N353JB (msn 19000576) (Barcode) banks on its final approach into Reagan National Airport in Washington.

JetBlue Airways: AG Slide Show

Frontier to expand operations at Trenton, New Jersey with new routes to Cleveland, Indianapolis and Nashville

Frontier Airlines (2nd) (Denver) has announced it will expand its low-fare service at Trenton-Mercer Airport (TTN), in Ewing, New Jersey, with the addition of nonstop service to Cleveland, Ohio, beginning on February 13, 2014; Indianapolis, Indiana beginning on April 29, 2014; and Nashville, Tennessee beginning on April 30, 2014.

Frontier is the only airline providing scheduled service out of Trenton-Mercer Airport, the gateway to New Jersey’s state capital, all of central New Jersey, and Southeast Pennsylvania, including metro Philadelphia.

The addition of these three cities brings Frontier’s total nonstop destinations served from Trenton-Mercer Airport to 14:

  • Atlanta
  • Charlotte
  • Chicago-Midway
  • Cincinnati
  • Cleveland
  • Columbus
  • Detroit
  • Fort Lauderdale/Hollywood
  • Fort Myers
  • Indianapolis
  • Nashville
  • Orlando
  • Raleigh-Durham
  • Tampa

All Frontier flights from Trenton/Princeton will operate on 138-seat Airbus A319 aircraft.

Copyright Photo: Bruce Drum/AirlinersGallery.com. Frontier Airlines’ (2nd) Airbus A319-111 N930FR (msn 2241) taxies to the runway at Los Angeles International Airport.

Frontier Airlines: AG Slide Show

Boeing warns it will move the 777X project away from the Seattle area if the tentative agreement is rejected

Boeing (Chicago) has warned it will open negotiations with other communities if the tentative agreement with the IAM is rejected by the members on November 13. According to this report by Reuters, senior members of the IAM union were voicing opposition to the proposed contract.

Read the full report: CLICK HERE

In other news, Boeing reported the second 787-9 Dreamliner completed a successful 4-hour, 18-minute first flight yesterday. The airplane, known as ZB002, departed Paine Field in Everett, Washington, at 8:06 a.m. and landed at 12:24 p.m. local time at Seattle’s Boeing Field.

As the only 787-9 test airplane to be fitted with elements of the passenger interior, ZB002 will test systems such as the environmental control system in addition to avionics and other aspects of airplane performance. Boeing has conducted a series of ground tests on the second 787-9 since its completion in late September.

With manufacturing of the 787-9 flight-test fleet complete, the first production 787-9 in final assembly and 137 flight-test hours to date, 787-9 development is on track. 787-10 development also is progressing as planned.

First delivery of the 787-9 to launch customer Air New Zealand is set for mid-2014. Twenty-six customers have ordered 396 787-9s, accounting for 40 percent of all 787 orders.

Copyright Photo: Boeing.

Atlas Air Worldwide Holdings reports 3Q net income of $28.6 million

Atlas Air Worldwide Holdings, Inc. (Atlas Air and Polar Air Cargo) (New York-JFK) announced adjusted net income attributable to common stockholders of $28.6 million, or $1.13 per diluted share, for the three months ended September 30, 2013, compared with $33.4 million, or $1.26 per diluted share, for the three months ended September 30, 2012.

On a reported basis, third-quarter 2013 net income attributable to common stockholders totaled $23.7 million, or $0.94 per diluted share, compared with $33.9 million, or $1.27 per diluted share, in the third quarter of 2012. Free cash flow of $73.8 million in the third quarter of 2013 compared with $98.9 million in the third quarter of 2012.

“Earnings in the third quarter of 2013 were below our expectations, reflecting market factors,” said William J. Flynn, President and Chief Executive Officer. “Demand in the commercial airfreight peak season through September was less than we anticipated. Airfreight yields remained under pressure, impacting our Commercial Charter segment. In addition, a decline in military charter demand led to a reduction in AMC volumes and fewer favorable one-way AMC missions.

“Results during the quarter were supported by strength in our core ACMI operations and growth in our Dry Leasing business. Led by our new 747-8 freighters in ACMI, we saw increasing contributions during the quarter from investments to diversify our business mix, including the addition of 777 freighters with predictable, long-term revenue and earnings streams in Dry Leasing; our expanding 767 service; growing CMI operations within ACMI; and ongoing continuous improvement initiatives.

“Reflecting our commitment to enhance stockholder value, we acquired a further 3.1% of our outstanding common stock through our share repurchase program from May through August. Combined with the shares that we bought through the end of April, we have repurchased approximately 6.5% of our shares for $72 million this year. In addition, our board of directors has increased our existing authority to repurchase shares from $9 million to $60 million.”

Third-Quarter Results

Revenue, volume and profitability growth in our core ACMI business during the third quarter were driven by our new 747-8Fs, with an average of 3.3 additional -8F aircraft in service compared with the third quarter of 2012, and the continued ramp up and expansion of CMI service.

Improved ACMI segment earnings during the period benefited from higher rates per block hour and lower maintenance expense for our 747-8Fs, partially offset by the redeployment of 747-400 aircraft to other business segments.

In Dry Leasing, revenue and profitability grew following the acquisition of one 777-200 LRF aircraft in March 2013 and two 777-200 LRF aircraft in July 2013. Each aircraft was acquired with a long-term customer lease already in effect.

In AMC Charter, a reduction in cargo and passenger block hours, as well as a reduced number of one-way AMC missions and a change in the proportion of those missions from outbound U.S. to inbound U.S., led to a significant decline in segment contribution. Higher average cargo and passenger revenue per block hour during the period stemmed from an increase in the average pegged fuel price set by the U.S. military.

Segment results in Commercial Charter primarily related to a reduction in yields driven by soft third-quarter global charter-market conditions. Results also reflected a reduction in return legs due to the change in the number and direction of one-way AMC missions.

Results in the third quarter were also affected by a reduction in capitalized interest on 747-8F aircraft that entered service.

Income Taxes

Reported earnings for the third quarter of 2013 included an effective income tax rate of 31.3%, reflecting both the ongoing beneficial impact of lower taxes for certain foreign subsidiaries in our Dry Leasing business and the net impact of the resolution of certain income tax liabilities.

Nine-Month Results

For the nine months ended September 30, 2013, adjusted net income attributable to common stockholders totaled $54.9 million, or $2.13 per diluted share, compared with $78.3 million, or $2.95 per diluted share, for the nine months ended September 30, 2012.

On a reported basis, nine-month 2013 net income attributable to common stockholders totaled $63.9 million, or $2.48 per diluted share, compared with $77.5 million, or $2.92 per diluted share, in the first nine months of 2012.

Free cash flow in the first nine months of 2013 increased to $180.8 million from $154.1 million in the first nine months of 2012.

Cash and Short-Term Investments

At September 30, 2013, our cash, cash equivalents, short-term investments and restricted cash totaled $298.4 million, compared with $419.9 million at December 31, 2012.

The change in position at September 30 reflected cash provided by operating and financing activities offset by cash used for investing activities.

Net cash used for investing activities in the first nine months of 2013 primarily related to the purchase of two 747-8F aircraft as well as three 777-200 LRF aircraft for our Dry Leasing business.

Net cash provided by financing activities primarily reflected proceeds from the issuance of debt in connection with the acquisitions of these aircraft. Those proceeds were partially offset by payments on debt obligations and debt issuance costs.

Share Repurchases

Between mid-May and mid-August, we repurchased 820,276 shares of our common stock for $35.6 million. The shares were acquired pursuant to an accelerated share repurchase program with a financial institution that settled in August.

Through the nine months ended September 30, 2013, we repurchased a total of 1,723,577 shares, or 6.5%, of our outstanding common stock at December 31, 2012.

Future repurchases under our new $60 million authority may be made at our discretion, and the actual timing, form and amount will depend on company and market conditions.

Outlook

Looking to full-year 2013, we expect fully diluted earnings per share to total between $3.40 and $3.80 on an adjusted basis and $3.75 and $4.15 on a reported basis.

Our current outlook reflects a much less robust commercial airfreight peak season than previously anticipated. While commercial airfreight volumes are strengthening, airfreight yields remain volatile. In addition, military cargo volumes have declined at a more rapid rate. Together, these factors affected our third-quarter results and have reduced anticipated profitability for the fourth quarter.

Partially offsetting these challenges are increasing contributions from investments to diversify the company’s business mix, led by new 747-8 freighters in the company’s core ACMI business; the addition of 777 freighters with predictable, long-term revenue and earnings streams in Dry Leasing; an expanding 767 service platform; entry into military and commercial charter passenger operations; and continuing growth in the company’s non-asset-intensive CMI operations. Also contributing are ongoing continuous improvement productivity and efficiency initiatives.

Mr. Flynn added: “Airfreight remains a long-term growth industry despite current market challenges. We are focused on the long-term growth of our business, and we are well-positioned to capitalize on market improvements. Our business model is solid and is complemented by substantial operating leverage, strong customer relationships and a superior fleet. We continue to strengthen our competitive position and generate substantial free cash flow, which will enhance stockholder value.”

Copyright Photo: Bernhard Ross/AirlinersGallery.com. Atlas Air’s Boeing 767-38E ER N641GT (msn 25132) is pictured in action at Frankfurt.

Atlas Air: AG Slide Show

Polar Air Cargo: AG Slide Show

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