JetBlue Airways (New York) and British Airways (London) have announced an interline agreement to connect the carriers’ networks at New York’s John F. Kennedy International Airport (JFK), Boston Logan International Airport (BOS), Orlando International Airport (MCO) and Washington Dulles International Airport (IAD), creating new possibilities for travelers.
This marks the first partnership between JetBlue and British Airways, and the 25th airline agreement for JetBlue. The carriers initially plan to interline on 18 daily trans-Atlantic British Airways flights, more than 50 U.S routes on the JetBlue network and more than 100 British Airways routes beyond London. British Airways’ intercontinental routes that are part of the interline agreement include Boston-London Heathrow (LHR), New York/JFK-London City Airport (LCY), New York/JFK- London Heathrow (LHR), New York/JFK-Paris Orly (ORY), Orlando-London Gatwick (LGW) and Washington/Dulles-London Heathrow (LHR). Tickets can be purchased through British Airways.
Customers will be able to enjoy access to a variety of British Airways destinations beyond London, including Europe, Africa, the Middle East and India, as well as non-stop access to Paris Orly Airport from New York. Meanwhile, British Airways customers can now book onward tickets to new U.S. destinations such as Burlington, Vermont (BTV); Martha’s Vineyard, Massachusetts (MVY); Nantucket, Massachusetts (ACK); and Portland, Maine (PWM).
At JFK Airport British Airways operates from Terminal 7. JetBlue operates from nearby Terminal 5, a quick ride away on the airport’s free AirTrain service.
At Boston Airport, where JetBlue is the largest carrier and offers nonstop service to 49 cities, more than any other airline, British Airways operates from Terminal E, while JetBlue operates from nearby Terminal C.
At Orlando, where JetBlue operates numerous routes to the Caribbean and Latin America, British Airways operates from Terminal B and JetBlue from Terminal A.
Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. Airbus A320-232 N645JB (msn 2900) in the Harlequin tail design lands at the focus city of Long Beach, California.
Bottom Copyright Photo: Richard Vandervord/AirlinersGallery.com. British Airways’ Boeing 777-336 ER G-STBA (msn 40542) arrives at the London (Heathrow) hub.
Airberlin (airberlin.com) (Berlin) narrowed its second quarter loss to 8.1 million euros ($10.8 million), down from a loss of 29.4 million euros for the same quarter a year ago. The airline has been downsizing, eliminating 300 positions.
The company issued this statement:
In the second quarter of 2013, Airberlin improved its operating result (EBIT) despite a difficult market environment. Airberlin was able to increase EBIT (earnings before interest and taxes) to EUR -8.1 million, an improvement of two-thirds over the corresponding quarter of 2012 (EUR -29.4 million). EBITDAR (earnings before interest, taxes, depreciation, amortization, and leasing expenses and rentals) increased by 12 percent to EUR 166.4 million (2012: EUR 148.0 million). Despite a noticeable eight percent capacity reduction, Airberlin’s total revenue at EUR 1.11 billion remained at the level of the previous year (EUR 1.13 billion). Airberlin reduced its net loss for the second quarter to EUR -38.0 million, an improvement of almost two-thirds over the previous year’s corresponding quarter (EUR -99.8 million).
Increased capacity utilization, RASK and Yield
In the second quarter, Airberlin further increased its capacity utilization, revenue per available seat kilometer (RASK) and revenue per passenger. The number of routes flown in the second quarter decreased from 520 in 2012 to 440 in the current year, while the number of route frequencies increased by 14 percent. Capacity utilization increased by four percentage points, to 83.7 percent (previous year: 79.7 percent). Revenue per available seat kilometer (RASK) increased by 4.8 percent to 7.20 Eurocents (previous year: 6.87 Eurocents). Average yield (revenue per passenger) increased to EUR 113.74 (previous year: EUR 112.85).
Presenting the second quarter results for 2013, Airberlin’s CEO Wolfgang Prock-Schauer comments: “An improved operating income, increased capacity utilization, increasing revenue per seat kilometer and stable revenue despite capacity reduction, demonstrate that important key numbers are moving in the right direction. The positive effects of our Turbine program will bear fruit later in the year. As a result of the generally muted economic conditions and the market environment, the ability to reach our targets is becoming increasingly challenging.”
Turbine implementation according to plan
The implementation of Turbine is continuously progressing according to plan, and will due to increasing challenges continue to be advanced as a matter of priority over the course of the year. The focus remains on increasing efficiency, expanding services, and negotiating with relevant stakeholders.
Airberlin has concluded new collective labor agreements with all relevant employees. This is the first time that uniform collective labor agreements have been concluded for all pilots and respectively for all cabin crew. These long-term collective agreements enable planning reliability and give Airberlin the required flexibility for further restructuring and increasing productivity. Personnel cutbacks are proceeding as planned, and by the end of July, Airberlin had eliminated 300 full-time positions.
Wolfgang Prock-Schauer comments: “The Turbine program is progressing as planned. The negotiations with our contracting partners have yielded productive results, and we are continuously optimizing our structure and our operating performance. More than 80 percent of the Turbine program’s planned contribution for 2013 has already been attained, with respect to both earnings and costs. Despite the challenging environment, we continue to strive to reach the target figure of EUR 200 million for 2013. For the coming winter flight plan, we will implement a streamlined concept of aircraft-positioning, in order to use our fleet even more efficiently.”
At the end of the first half-year, Airberlin had liquid assets amounting to EUR 436.8 million at its disposal, those assets having grown by more than one-third from EUR 315 million in the first half-year of 2012. Equity capital at the end of the traditionally weak first half-year amounted to EUR -116.3 million as at the reporting date of 30 June. As a valuation at the reporting date according to IFRS, equity capital has no impact on the economic operation of the company.
Airberlin’s Chief Financial Officer Ulf Hüttmeyer explains: “The traditionally weak earnings position in the first six months together with the non-recurring charges stemming from our turnaround program lead to negative equity capital. We expect the equity capital to increase over the following quarters. The target of reaching an equity capital ratio of 15 to 20 percent in the medium-term remains unchanged.”
Partnerships exceed expectations
In the second quarter, the strategic partnership with Etihad Airways (Abu Dhabi) again delivered strong growth in the number of Airberlin passengers stemming from the code-share flights. The number of passengers more than tripled from 75,000 in 2012 to 267,000, based on a half-year comparison. With 449,000 passengers – this includes bookings made through July – the expectations for the entire year for the common code-share routes of Etihad Airways and Airberlin have already been exceeded. Furthermore, Airberlin is benefitting from code-share agreements with partners of Etihad Airways’ “Equity Alliance”, including Virgin Australia, Air Seychelles and Air Serbia. Airberlin and Etihad Airways are also expanding their cooperation in other fields such as maintenance and procurement.
The number of passengers traveling on oneworld® alliance flights likewise exceeded expectations. In the first half of the year, 267,000 passengers had already traveled on code-share flights operated by Airberlin and its oneworld partners.
Read the analysis by Reuters: CLICK HERE
Copyright Photo: Pedro Pics/AirlinersGallery.com. Boeing 737-7Q8 D-ABBW (msn 30642) taxies at London (Stansted).
International Airlines Group (IAG) (London) has secured firm orders and options for up to 220 Airbus A320 family short-haul aircraft – up to 120 of these for its subsidiary Vueling Airlines (Barcelona). The new aircraft will enable the airline to replace some of its existing Airbus A320 fleet and expand its business.
The Vueling agreement comprises 62 firm orders – 30 A320ceo and 32 A320neo – plus 58 options. The firm orders will be delivered to Vueling between 2015 and 2020.
In addition, IAG has secured 100 A320neo options which could be used for any of the airlines in the Group – British Airways, Iberia or Vueling – for aircraft replacement requirements.
IAG chief executive, Willie Walsh, said: “Vueling has managed to successfully expand its business profitably by targeting both growth markets and those areas where weak competitors are reducing capacity. These new aircraft will enable Vueling to continue that expansion and replace some of its older fleet with modern, fuel efficient aircraft, leading to further unit cost reductions.
“The benefits that the merger brings to all our airlines are highlighted once again. In addition to the Vueling order, we have also been able to secure a further 100 A320neo options for all the airlines in the Group”.
The Vueling firm orders are subject to approval by IAG’s shareholders. This order will be reviewed alongside the recent IAG long-haul orders for Boeing 787s and Airbus A350s, at a shareholder meeting later this year.
Copyright Photo: Rolf Wallner/AirlinersGallery.com. The pictured Airbus A320-232 EC-LVT (msn 5612) with Sharklets was handed over to Vueling on May 31, 2013.
AMR Corporation (American Airlines) (Dallas/Fort Worth) and US Airways (Phoenix) in a show of unity, vowed yesterday to fight the Department of Justice’s (DOJ) lawsuit in court (along with six states and the District of Colombia). Three high-powered attorneys have been hired to fight the lawsuit. The two airlines will try to argue in court that their merger will promote competition, especially against Delta Air Lines, United Airlines and Southwest Airlines.
However the real measure being used by the DOJ and will probably be the central theme in the court, will another merger lead to lower ticket prices? With the recent Delta-Northwest, United-Continental and Southwest-AirTran mergers, ticket prices have been raised steadily (probably due more to fuel costs) along with an increasing long list of add-on charges. Airline profits are at its highest. The DOJ is using American’s and US Airways’ own pre-airline merger reports when they were arguing for a merger which states an AA-US merger would lead to higher yields permitting the lower ticket prices to be dropped on many routes where they compete adding to the bottom line for the merged company. AA-US also have a large share of the routes and traffic from slot-controlled Washington Reagan National Airport. Very few of those routes have any meaningful competition. DCA routes have some of the highest yields in the country.
At any rate the lawsuit will delay the merger decision, probably now to 2014.
Read the full report from Reuters: CLICK HERE
However for bankrupt AMR Corporation and American Airlines and its shareholders, the rejection could send its bankruptcy reorganization back to where it all started with a key question:
Can the deal be restructured again to meet the DOJ’s antitrust objections (especially concerning Washington’s Reagan National Airport) and keep some value for the creditors and shareholders? Without US Airways in the equation, a new reorganization would probably shift the company’s equity to the current creditors. The existing shareholders could get nothing in any new reorganization making it harder to “sell”.
In addition what happens to CEO Tom Horton and his nearly $20 million severance package?
Nick Brown examines the options for AMR in this article as it tries to adjust to a newer reality: CLICK HERE
Copyright Photo: TMK Photography/AirlinersGallery.com. The new 2013 livery of American is now likely to become the livery of a new American with or without US Airways as more aircraft are repainted. There is a tipping point (probably already achieved) where it becomes unfeasible to go to another look. US Airways’ CEO Doug Parker, if he becomes the CEO of the new American, may be stuck with current CEO Tom Horton’s design going forward. The controversial livery is the least of Doug’s problems right now. Boeing 737-823 N965AN (msn 29544) poses for the camera under perfect light at Toronto (Pearson).
Austrian Airlines (Vienna) has introduced a new long-haul cabin product and issued this statement:
As of now all passengers on Austrian’s long-haul flights benefit from the advantages of its new cabin. These advantages include a new level of seating comfort in Economy Class, an advanced board entertainment system offering non-stop entertainment, as well as innovative Business Class seats capable of being transformed into entirely flat beds. A total of 2,538 new seats were installed in the four Boeing 777 and six Boeing 767 airplanes belonging to Austrian’s long-haul fleet. An optimal array of seats ensures undisturbed flights. The Boeing 777’s Business Class provides four of five passengers sitting in a row with direct access to the aisle. This access is enjoyed, in fact, by every Business Class passenger in Austrian’s Boeing 767s. As before Austrian’s passengers are indulged by the prize-winning service and the first class DO and CO-catered fare. The menus provided in Business Class receive their final touches from flying chefs.
The reconfiguration of the cabins has considerably boosted customer satisfaction, which has risen substantial 31 percentage points – among passengers on long-haul flights – since the launch of the new cabin. This result places Austrian Airlines among the peak of the evaluations received by the airlines comprising the world-spanning Star Alliance.
Austrian CCO Karsten Benz states: “We are gratified by the enthusiasm shown by our customers. The significant rise in their satisfaction is proof that our investments of more than €90 million have paid off.”
Top Copyright Photos: Michael B. Ing/AirlinersGallery.com (all others by Austrian Airlines). Boeing 777-2Z9 ER OE-LPC (msn 29313) climbs away from Tokyo (Narita) bound for the Vienna hub.
FlyNonstop (Kristiansand) has announced it will add a new route from Bodø, Norway to London (City Airport) starting on October 28. The new route will be operated weekly. This will be the first international route from Bodø and is away from FlyNonstop’s base of Kristiansand in southern Norway.
Bodø is located just north of the Arctic Circle and is the largest city in Nordland County and also is the second largest city in northern Norway.
Copyright Photo: Ton Jochems/AirlinersGallery.com. Operated by Denim Air, Embraer ERJ 190-100LR PH-FNS (msn 19000616) taxies past the camera at Palma de Mallorca.
Read the full story from The Irish Times: CLICK HERE
The strike is disrupting the plans of the company for a “new beginning”.
Earlier this year the company announced a “new beginning”:
Aer Arann plans to join Europe’s top tier of regional airlines by 2015 and to double its passenger numbers to over two million in five years, the company said today.
The airline also confirmed a 32% rise in Aer Lingus Regional passenger numbers in 2012, with total passenger growth of 16% in the past two years.
Announcing a “new beginning” at the airline, Sean Brogan, Interim Chief Executive, Aer Arann outlined a package of measures to grow its customer base and route network, including:
- Successful restructuring: a successful restructuring of the company has been completed, putting the airline on a strong financial footing;
- Fleet renewal program: the airline will be taking delivery of eight new aircraft. The new aircraft, ATR 72-600s, will replace the older existing fleet of ATR 72-200s and ATR 42s. The first new plane will commence service this May, with the remaining aircraft expected for delivery over the next 11 months. The new fleet will be fully operational in time for the Summer 2014 program;
- Extension of Aer Lingus agreement: the airline has extended its franchise agreement with Aer Lingus, which will see Aer Arann operate under the Aer Lingus Regional brand until the end of 2022;
- Addition of two new routes: commencing this Summer, Aer Lingus Regional, operated by Aer Arann will add two new routes to its network, Dublin-Birmingham and Dublin-Manchester. The addition of these routes, two of the busiest on the Ireland to UK network, will increase passenger numbers by 300,000 and bring the airline’s route network to 24.
Combined with existing Aer Lingus mainline services to Manchester and Birmingham, these new services will result in a significant ramping up of frequencies to two of the busiest routes on the Ireland to UK network. Specifically, services on the Dublin Birmingham route will go from three to six services per day while services on the Dublin Manchester routes will go from three to five per day.
It also means that the airline will be operating routes to the main UK cities. The Stobart Group is also advancing plans to add routes at London Southend airport.
- Expansion of services: the airline is to increase frequencies on its Dublin Edinburgh and Dublin Glasgow routes.Specifically, services on the Dublin Edinburgh route will go from four up to six services per day while services on the Dublin Glasgow route will go from four up to six per day.
Copyright Photo: Rob Skinkis/AirlinersGallery.com. ATR 72-212A (ATR 72-500) EI-REL (msn 748) departs from Manchester in the Aer Lingus Regional brand.
UPS Airlines’ (UPS-United Parcel Service) (Atlanta and Louisville) Airbus A300F4-622R N155UP (msn 841) crashed this morning while on approach from the north to Birmingham-Shuttlesworth International Airport, Birmingham, Alabama. The crew was operating cargo flight 5X 1354 from the Louisville hub to Birmingham. There were some showers in the area at the time of the accident. The two crew members were tragically killed in the crash.
The crash scene at Birmingham (NTSB):
NTSB Final Briefing:
Bottom Copyright Photo: Ken Petersen/AirlinersGallery.com. N155UP is pictured on the cargo ramp at New York’s John F. Kennedy International Airport before the tragic accident.
Delta Air Lines (Atlanta) is planning to operate weekly Raleigh/Durham-Fort Lauderdale/Hollywood flights this winter starting on December 21 per Airline Route. The route will be flown by Delta Connection Bombardier CRJ700s. The operator is not specified (probably ExpressJet Airlines).
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Bombardier CRJ700 (CL-600-2C10) N603SK (msn 10248) arrives at Los Angeles.
The Allied Pilots Association (APA), representing the 10,000 pilots of American Airlines (Dallas/Fort Worth) has also backed management and issued this statement:
The president of the Allied Pilots Association (APA), certified collective bargaining agent for the 10,000 pilots of American Airlines, reiterated the union’s commitment to seeing the proposed merger of American Airlines and US Airways through to its fruition.
“Approving the merger is in the best interests of all concerned,” APA President Capt. Keith Wilson said. “We are disappointed that the U.S. Department of Justice has challenged the merger and look forward to the opportunity to highlight the merger’s many benefits.”
The Justice Department, six state attorneys general and the District of Columbia filed a civil antitrust lawsuit today challenging the proposed merger of the two carriers.
“The pilots of American Airlines remain fully committed to merging with US Airways, which will provide for a more secure future for the 100,000 men and women who work for the two airlines,” Wilson said. “As for the notion that the merger would be anti-competitive, the two airlines’ route structures are highly complementary with very little overlap. Combining the two carriers would significantly expand the choice of travel destinations available to consumers.
“Also, the combination of American Airlines and US Airways would create a network carrier comparable to Delta and United in terms of revenue and reach, establishing an important competitive counter balance to those two airlines.
“Consolidation has enabled our industry to stabilize after a round of Chapter 11 bankruptcies that were the result of various exogenous shocks, including terrorist attacks, fuel price spikes and pandemics. It makes no sense for the Justice Department to conclude now that airline industry consolidation is somehow undesirable.”
US Airways’ CEO Doug Parker vows to fight the decision by the DOJ. Now the real negotiations will begin on what AA-US are willing to give up, especially at Washington Reagan National. Read the interview in Forbes: CLICK HERE
The Association of Professional Flight Attendants (APFA) has issued this statement, backing up management’s response to the Department of Justice (DOJ) announcement of a lawsuit against the proposed American Airlines-US Airways merger:
The Association of Professional Flight Attendants, representing more than 16,000 Flight Attendants at American Airlines, pushed back hard against today’s announcement that the Department of Justice would file suit to block the merger of American and US Airways.
“The fact that Attorney General Holder and the Justice Department have decided to stand in the way of this merger is outrageous and the height of hypocrisy,” said APFA President Laura Glading. “Their actions are only serving to prop up the duopoly they created and they’re doing it at the expense of consumers, the industry, and the employees of American and US Airways.”
Following major mergers of their own, Delta and United have emerged as the dominant carriers in the aviation industry and their vast networks have attracted the high-value business travelers airlines need in order to be profitable. Frequent flyers have left American in droves in favor of carriers with more routes and destinations. The American/US Airways merger will give these travelers a viable third option.
“The reason American is in bankruptcy is because it couldn’t compete in the environment created by the airline mergers of the past few years, which occurred with DOJ’s blessing. Now the game is in the third quarter and they want to change the rules,” Glading said. “It’s ludicrous.”
After decades of uncertainty, including bankruptcies, liquidations, and job losses, the mergers of Delta/Northwest and United/Continental helped move the aviation industry towards a stable and healthy competitive environment. The American/US Airways merger is the final piece of the deregulation puzzle that will provide long-term stability after 30 years of tumult. Without the merger, consumers and workers should expect more uncertainty and more failed airlines.
The DOJ suit claims that American can thrive on its own which is puzzling considering that each and every interested party that has examined this deal has arrived at the opposite conclusion. In reality, the merger has the strong support of airline executives, investors, and workers because everyone knows that neither carrier can compete as a standalone. Any recent success American has enjoyed can be credited to the employees whose wages and benefits were slashed in bankruptcy and to the consumer confidence the merger plan has generated.
For Flight Attendants, the merger will provide job security for thousands of middle class wage earners. The new American is the light at the end of a long tunnel for APFA members that have lost billions of dollars during the industry’s downturn.
“We’re going to continue to fight for this merger and we’re prepared to bring the fight to federal court, the halls of Congress, and the White House, if necessary,” Glading said. “Everyone needs this merger – airline investors, workers, and the flying public especially.”
TAAG Angola Airlines (TAAG Linhas Aereas) (Luanda) is supporting the upcoming “Angola 2013″ Roller Hockey World Cup event in Angola with a large “Angola 2013 – 41st Mundial e Hoquei Patins” message emblazoned across the fuselage of this Boeing 777-3M2 registered as D2-TEG (msn 40805).
The 2013 FIRS Men’s Roller Hockey World Cup will be the 41st edition of the FIRS Roller Hockey World Cup. It will be held in Luanda and Namibe Providence, Angola from September 20-28, 2013.
This will be the first Roller Hockey World Cup played in Africa.
Copyright Photo: Pedro Batista/Flyingphotos. D2-TEG departs from Lisbon bound for Luanda with the additional markings.
The Department of Justice (DOJ) (Washington) filed an antitrust lawsuit today affectively blocking the AMR Corporation (American Airlines) (Dallas/Fort Worth) and US Airways Group (US Airways) (Phoenix) merger. The DOJ seeks to block the merger “because it would eliminate competition between US Airways and American and put consumers at risk of higher prices and reduced service”.
The DOJ just issued this statement:
The Department of Justice, six state attorneys general and the District of Columbia filed a civil antitrust lawsuit today challenging the proposed $11 billion merger between US Airways Group Inc. and American Airlines’ parent corporation, AMR Corp. The department said that the merger, which would result in the creation of the world’s largest airline, would substantially lessen competition for commercial air travel in local markets throughout the United States and result in passengers paying higher airfares and receiving less service.
The Department of Justice’s Antitrust Division, along with the attorneys general, filed a lawsuit in the U.S. District Court for the District of Columbia, which seeks to prevent the companies from merging and to preserve the existing head-to-head competition between the firms that the transaction would eliminate. The participating attorneys general are: Texas, where American Airlines is headquartered; Arizona, where US Airways is headquartered; Florida; the District of Columbia; Pennsylvania; Tennessee; and Virginia.
“Airline travel is vital to millions of American consumers who fly regularly for either business or pleasure,” said Attorney General Eric Holder. “By challenging this merger, the Department of Justice is saying that the American people deserve better. This transaction would result in consumers paying the price – in higher airfares, higher fees and fewer choices. Today’s action proves our determination to fight for the best interests of consumers by ensuring robust competition in the marketplace.”
Last year, business and leisure airline travelers spent more than $70 billion on airfare for travel throughout the United States. In recent years, major airlines have, in tandem, raised fares, imposed new and higher fees and reduced service, the department said.
“The department sued to block this merger because it would eliminate competition between US Airways and American and put consumers at risk of higher prices and reduced service,” said Bill Baer, Assistant Attorney General in charge of the Department of Justice’s Antitrust Division. “If this merger goes forward, even a small increase in the price of airline tickets, checked bags or flight change fees would result in hundreds of millions of dollars of harm to American consumers. Both airlines have stated they can succeed on a standalone basis and consumers deserve the benefit of that continuing competitive dynamic.”
American and US Airways compete directly on more than a thousand routes where one or both offer connecting service, representing tens of billions of dollars in annual revenues. They engage in head-to-head competition with nonstop service on routes worth about $2 billion in annual route-wide revenues. Eliminating this head-to-head competition would give the merged airline the incentive and ability to raise airfares, the department said in its complaint.
According to the department’s complaint, the vast majority of domestic airline routes are already highly concentrated. The merger would create the largest airline in the world and result in four airlines controlling more than 80 percent of the United States commercial air travel market.
The merger would also entrench the merged airline as the dominant carrier at Washington Reagan National Airport, with control of 69 percent of the take-off and landing slots. The merged airline would have a monopoly on 63 percent of the nonstop routes served out of Reagan National airport. As a result, Washington, D.C., area passengers would likely see higher prices and fewer choices if the merger is allowed, the department said in its complaint. Blocking the merger will preserve current competition and service, including flights that US Airways currently offers from Washington’s Reagan National Airport.
The complaint also describes how, in recent years, the major airlines have succeeded in raising prices, imposing new fees and reducing service. The complaint quotes several public statements by senior US Airways executives directly attributing this trend to a reduction in the number of competitors in the U.S. market:
- President Scott Kirby said, “Three successful fare increases – [we are] able to pass along to customers because of consolidation.”
- At an industry conference in 2012, Kirby said, “Consolidation has also…allowed the industry to do things like ancillary revenues…. That is a structural permanent change to the industry and one that’s impossible to overstate the benefit from it.”
- As US Airways CEO Parker stated in February 2013, combining US Airways and American would be “ the last major piece needed to fully rationalize the industry.”
- A US Airways document said that capacity reductions have “enabled” fare increases.
“The merger of these two important competitors will just make things worse –exacerbating current airline industry trends toward reduced service, increasing fares and increasing passenger fees,” added Baer.
As the complaint describes, absent the merger, US Airways and American will continue to provide important competitive constraints on each other and on other airlines. Today, US Airways competes vigorously for price-conscious travelers by offering discounts of up to 40 percent for connecting flights on other airlines’ nonstop routes under its Advantage Fares program. The other legacy airlines – American, Delta and United – routinely match the nonstop fares where they offer connecting service in order to avoid inciting costly fare wars. The Advantage Fares strategy has been successful for US Airways because its network is different from the networks of the larger carriers. If the proposed merger is completed, the combined airline’s network will look more like the existing American, Delta and United networks, and as a result, the Advantage Fares program will likely be eliminated, resulting in higher prices and less services for consumers. An internal analysis at American in October 2012, concluded, “The [Advantage Fares] program would have to be eliminated in a merger with American, as American’s large, nonstop markets would now be susceptible to reactionary pricing from Delta and United.” And, another American executive said that same month, “The industry will force alignment to a single approach–one that aligns with the large legacy carriers as it is revenue maximizing.” By ending the Advantage Fares program, the merger would eliminate lower fares for millions of consumers, the department said.
The complaint also alleges that the merger is likely to result in higher ancillary fees, such as fees charged for checked bags and flight changes. In recent years, the airlines have introduced fees for those services, which were previously included in the price of a ticket. These fees have become huge profit centers for the airlines. In 2012, domestic airlines generated more than $6 billion in fees from checked bags and flight changes alone. The legacy carriers often match each other when one introduces or increases a fee, and if others do not match the initiating carrier tends to withdraw the change. By reducing the number of airlines, the merger will likely make it easier for the remaining carriers to coordinate fee increases, resulting in higher fees for consumers.
The department also said that the merger will make coordination easier among the legacy carriers. Although low-cost carriers such as Southwest and JetBlue offer consumers many benefits, they fly to fewer locations and are unlikely to be able to constrain the coordinated behavior among those carriers.
American Airlines is currently operating in bankruptcy. Absent the merger, American is likely to exit bankruptcy as a vigorous competitor, with strong incentives to grow to better compete with Delta and United, the department said. American recently made the largest aircraft order in industry history, and its post-bankruptcy standalone plan called for increasing both the number of flights and the number of destinations served by those flights at each of its hubs.
The department’s complaint describes US Airways executives’ fear of American’s standalone growth plan as “industry destabilizing.” The complaint states that US Airways worries that American’s growth plan would cause “others” to react “with their own enhanced growth plans…,” and that the resulting effect would increase competitive pressures throughout the industry. The department said the merger will allow US Airways’ management to abandon these aggressive growth plans and continue the industry’s current trend toward higher prices and less service.
The department’s complaint states that executives of both airlines have repeatedly said that they do not need the merger to succeed. The complaint states that US Airways’ CEO observed in December 2011, that “A[merican] is not going away, they will be stronger post-bankruptcy because they will have less debt and reduced labor costs.” US Airways’ executive vice president wrote in July 2012, that, “There isNO question about AMR’s ability to survive on a standalone basis.” And, as recently as January 2013, American’s management presented plans that would increase the destinations it serves in the United States and the frequency of its flights, and would position American to compete independently as a profitable airline with aggressive plans for growth.
AMR is a Delaware corporation with its principal place of business in Fort Worth, Texas. AMR is the parent company of American Airlines. Last year American flew more than 80 million passengers to more than 250 destinations worldwide and took in more than $24 billion in revenue. In November 2011, American filed for bankruptcy reorganization.
US Airways is a Delaware corporation with its principal place of business in Tempe, Ariz. Last year US Airways flew more than 50 million passengers to more than 200 destinations worldwide and took in more than $13 billion in revenue.
Analysis: How American Airlines and US Airways executives wrecked their own merger proposal by Rick Newman: CLICK HERE
Meanwhile AMR and the US Airways Group responded with this statement:
AMR Corporation, the parent company of American Airlines, Inc., and US Airways Group, Inc. today announced that they intend to mount a vigorous and strong defense to the U.S. Department of Justice’s (DOJ) effort to block their proposed merger.
“We believe that the DOJ is wrong in its assessment of our merger. Integrating the complementary networks of American and US Airways to benefit passengers is the motivation for bringing these airlines together. Blocking this procompetitive merger will deny customers access to a broader airline network that gives them more choices.
“Further, this merger provides the best outcome for AMR’s restructuring. The widespread support from the employees and financial stakeholders of both airlines underscores the fact that this is the best path forward for both airlines and the customers and communities we serve.
“We will mount a vigorous defense and pursue all legal options in order to achieve this merger and deliver the benefits of the new American to our customers and communities as soon as possible.”
Benefits of the New American:
With more than 6,700 daily flights to 336 destinations in 56 countries around the world, the new American Airlines will strengthen communities nationwide through better service and travel to more destinations both domestically and internationally. Importantly, the combined airline expects to maintain current hubs of both airlines and expand service from those hubs, resulting in more choices for customers. The result for consumers is that the new American will be a highly competitive alternative to other domestic and global carriers.
Greater Long-Term Opportunities for Employees
Employees of the combined airline will benefit from being part of a company with a more competitive and strong financial foundation, which will create greater opportunities over the long term. The merger will also provide the path to improved compensation and benefits for employees.
More Choices, Increased Service, and an Enhanced Travel Experience for Customers
Customers will benefit from new flying options, more choices, increased service and an enhanced travel experience. We expect our complementary flight networks to increase efficiency and provide more options for customers. Greater connectivity with oneworld® alliance partners will give customers more options for travel and benefits both domestically and internationally.
The merger provides the best outcome for American’s restructuring with creditors and equity holders receiving nearly unprecedented recoveries and having approved the Plan of Reorganization overwhelmingly.
As previously announced, the boards of directors of both AMR and US Airways approved a plan to combine to create the new American Airlines, a premier global carrier.
Cathay Pacific Airways (Hong Kong) has announced that it will launch a new daily service from Newark Liberty International Airport to Hong Kong on March 1, 2014, subject to government approval. The new service will complement Cathay Pacific’s current four-times-daily service from John F. Kennedy International Airport (JFK) in New York. The launch of the Newark service will provide more convenience and greater flexibility for passengers traveling to and from the New York metropolitan area.
The Newark service will be operated by Boeing 777-300ER aircraft.
Newark will become Cathay Pacific’s fifth gateway in the United States, and seventh in North America. The airline currently serves Chicago, Los Angeles, New York (JFK), San Francisco, Toronto and Vancouver.
The flight schedule for Cathay Pacific’s Newark (EWR) service, effective March 1, 2014, will be as follows (all times local and subject to change):
|Flight no||From||To||Departure/Arrival||Days of operation|
Daylight saving time:
|Flight no||From||To||Departure/Arrival||Days of operation|
Cathay Pacific Airways flies daily to Hong Kong and beyond, including over 22 destinations in Mainland China, from Chicago, Los Angeles, New York (JFK), and San Francisco.
Copyright Photo: TMK Photography/AirlinersGallery.com. Boeing 777-367 ER B-KPB (msn 35299) climbs into the sky at Toronto (Pearson).
Air China Cargo (Beijing) intends to add four Boeing 757-200 freighters to its fleet. Precision Conversions has won the contract to convert the aircraft. Precision Conversions issued this statement:
Precision Conversions, LLC is very pleased to announce that the company has won a contract to provide Air China Cargo Company Ltd., a Joint Venture between Air China (Beijing) and Cathay Pacific Airways (Hong Kong), a total of four (4) full 15-cargo position 757-200PCFs. The first aircraft was inducted for modification at the Taikoo Aircraft Engineering Co. Ltd. (TAECO) maintenance facility in Xiamen on July 31. The second aircraft will commence modification in November. The remaining two aircraft are being placed in production slots for early 2014. All four aircraft will be used for express package transportation in China. Air China Cargo Company Ltd., is based in Beijing, China and operates to 36 cities in 27 countries.
To date, Precision Conversions has redelivered a total of thirty six (36) full 15 cargo position 757-200PCF freighters to customers operating in Europe, North and South America, India, Africa, and P.R. China. Precision also redelivered one (1) 757-200PCF Combi aircraft variant earlier this year.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Air China’s Boeing 757-2Y0 B-2826 (msn 26155), still carrying passengers, prepares to touch down at the Beijing (Capital) hub.
Niki (flyniki.com) (Vienna) will continue to operate three Embraer 190s (D-ARJC, D-ARJF and D-ARJG) this winter season according to ch-aviation. The aircraft were suppose to be all transferred to LGW in the Airberlin Group.
Read the full report: CLICK HERE
Copyright Photo: Paul Bannwarth/Airlinersgallery.com. Niki is currently operating four Embraer 190s. Embraer ERJ 190-100LR OE-IHB (msn 19000294) taxies at Frankfurt.
Gol Linhas Aereas Inteligentes S.A. (Gol Transportes Aereos) (Sao Paulo) issued the following financial information for the second quarter where it reduced its loss to $190.7 million.
- recorded an operating loss (EBIT) of R$35 million in 2Q13 resulting in a negative margin of 1.8%, an improvement of R$320 million and 18 percentage points over 2Q12. In the first half, GOL recorded a positive operating margin of 1.7%, in line with the margin projected for 2013, of between 1% and 3%.
- PRASK (passenger revenue per available seat-kilometer) totaled R$14.14 cents in 2Q13, 10.5% up on 2Q12. This performance fueled the 7.5% year-over-year upturn in RASK (operating revenue per available seat-kilometer), which came to R$15.72 cents in 2Q13. The continuous monthly increase in PRASK since April 2012 reflects the Company’s efforts in optimizing its offer and maximizing the profitability of its routes.
- CASK (operating cost per available seat-kilometer) totaled R$16.01 cents in the second quarter, 8.4% down on the same period last year. Fuel costs per ASK fell by 8.8%, primarily due to the 3.4% decline in the per-liter fuel price and the use of a more fuel-efficient fleet. CASK ex-fuel fell by 8% in the same period, chiefly impacted by the reduction in personnel costs.
- SMILES’ IPO during the quarter meant that the Company ended 2Q13 with its biggest ever quarterly cash position (cash, cash equivalents, financial investments and short and long-term restricted cash), totaling R$2.8 billion, equivalent to 34% of net revenue of the last 12 months (LTM).
Read the analysis by the Wall Street Journal: CLICK HERE
Copyright Photo: Rodrigo Cozzato/AirlinersGallery.com. Boeing 737-8EH WL PR-GUM (msn 35846) in the new CBF – Transportadora Oficial de Selecao Brasileira livery taxies past the camera in Sao Paulo (Guarulhos).
The International Association of Machinists and Aerospace Workers (IAM) (Washington) has issued this statement:
In a contest overseen by the Nation Mediation Board (NMB), the International Association of Machinists and Aerospace Workers (IAM) today soundly defeated the International Brotherhood of Teamsters (IBT) in an election to represent nearly 4,600 Mechanic and Related employees at US Airways (Phoenix). The IAM received 1,903 votes, or 58 percent of all votes cast in the five-week election, while the IBT received 1,418 votes, less than 42 percent.
“This victory marks an important milestone for the Mechanic and Related group at US Airways,” said IAM Transportation Vice President Sito Pantoja. “By voting for the Machinists Union our members safeguarded their pensions and seniority heading into the merger with American Airlines while rejecting the empty promises of an organization with a history of corruption.”
In addition to creating uncertainty regarding future representation, the year-long raid by IBT effectively suspended contract negotiations between US Airways and IAM, which has represented Mechanic and Related employees at US Airways since 1949.
“The election results will allow contract negotiations between the IAM and US Airways to resume without any further delay,” said IAM District 142 President Tom Higginbotham. “We remain convinced that the IBT never had support among mechanics at US Airways to get this election in the first place. We fully expect the NMB to thoroughly investigate the matter.”
In a separate IBT raid on more than 11,000 Mechanic and Related workers at American Airlines, the Transport Workers Union (TWU) presented testimony from former Teamster organizers who claimed that IBT organizing staff forged hundreds of election authorization cards. The NMB is currently investigating to determine if the IBT submitted enough valid cards to warrant an election at American Airlines.
The IAM is the world’s largest airline union and is the largest union at US Airways, representing over 14,000 Mechanic and Related, Fleet Service, Stockroom and Maintenance Training Specialists.
Copyright Photo: Bruce Drum/AirlinersGallery.com. Airbus A319-132 N826AW (msn 1534) in the special Arizona livery prepares to arrives at Minneapolis-St. Paul International Airport.
Want to see more logojets?: CLICK HERE
Boeing (Chicago) has delivered a Next-Generation 737-800 to Iraqi Airways (Baghdad), the first of 30 that the airline ordered in 2008, marking a milestone in its relationship with the airline.
With the delivery of Boeing 737-81Z YI-ASE (msn 40104) on August 12, 2013, Iraqi Airways currently has 39 Boeing airplanes on order, including 29 Next-Generation 737-800s and 10 787 Dreamliners.
Copyright Photo: Duncan Kirk/AirlinersGallery.com. Showing off the Arabic titles side, Boeing 737-81Z YI-ASE is pictured on a test flight at Boeing Field in Seattle. The delivery also ushered in a new look for Iraqi.
United Airlines (Chicago) will start weekly Denver-Fort Myers seasonal service with Boeing 737-800s on December 16, 2013. The route will go to daily service on January 7, 2014 per Airline Route. The flights will end on April 7, 2014.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 737-824 N26210 (msn 28770) in the Star Alliance livery soars into the Southern California skies from Los Angeles International Airport (LAX).
Cargojet Inc. (Cargojet Airways) (Hamilton) announced today financial results for the second quarter ended June 30, 2013 (all dollar figures are stated in Canadian dollars) .
For the Second Quarter Ended June 30, 2013:
- Total Revenues were $42.7 million , an increase of $2.2 million or 5.4% versus the previous year.
- Gross Margin was $6.3 million , a decrease of $0.9 million or 12.5% versus the previous year
- EBITDA was $4.2 million , a decrease of $0.3 million or 6.7% versus the previous year
For the Six Months Ended June 30, 2013:
- Total Revenues were $83.4 million , an increase of $2.8 million or 3.5% versus the previous year.
- Gross Margin was $11.2 million , a decrease of $1.6 million or 12.5% versus the previous year
- EBITDA was $6.9 million , an increase of $0.5 million or 7.8% versus the previous year
“Core overnight and charter revenues have shown some upward trends,” says Ajay K. Virmani, President and Chief Executive Officer. “The major challenge we continue to face is the pricing pressures from the marketplace and we will continue to ensure strict cost control and prudent financial management to ensure our margins stay on plan,” he concluded.
Copyright Photo: Ton Jochems/AirlinersGallery.com. Boeing 757-236 (F) C-FKCJ (msn 24792) waits for its evening departure from Vancouver International Airport.
Jet Asia Airways (Bangkok-Suvarnabhumi) has commenced three times weekly scheduled service from Bangkok’s Suvarnabhumi International Airport to Tianjin’s Bihnai International Airport and also to Nanjing’s Lukou International Airport.
In the past year, Jet Asia Airways has operated more than 200 charter flights to both cities combined. Tianjin and Nanjing are two of the fastest growing secondary cities in China.
“The charter flights now turned scheduled have proven to be popular with the Chinese travelers who wish to avoid stopping over in a primary city and prefer to fly directly to Bangkok. Jet Asia will continue to aggressively exercise ‘first mover advantage’ to capitalize on untapped markets between China and Thailand,” said Mr. Chairat Sangchan, Jet Asia’s Managing Director.
Chinese arrivals into Thailand reached 2.78 million passengers in 2012 and is expected to grow to more than 3.5 million in 2013.
Copyright Photo: Jay Selman/AirlinersGallery.com. Former United Airlines Boeing 767-222 HS-JAB (msn 21868) arrives back at the Bangkok (Suvarnabhumi) base.
Kenya Airways‘ (Nairobi) CEO Titus Naikumi estimates the airline has already lost around $4 million due to the August 7 fire that gutted the international arrival building at Nairobi’s Airport. The airline is suffering long delays and cancellations due to the damage. The airport has erected tents as a makeshift terminal according to this report by Reuters. Kenya Airways is currently operating at around 90 percent of its normal capacity.
Read the full report: CLICK HERE
Copyright Photo: Antony J. Best/AirlinersGallery.com. Boeing 777-2U8 ER 5Y-KQS (msn 33683) prepares to depart from London (Heathrow) bound for Nairobi.
Allegiant Air (Las Vegas) operated its last flight from Gary, Indiana (near Chicago) yesterday (August 10). The last flight was operated from Gary to Sanford, Florida (near Orlando). Gary Chicago International Airport is now without any airline service once again. The airport had tried to market itself as the Chicago area’s third airport.
Read the full report from Chicago Sun-Times: CLICK HERE
Air Niugini (Port Moresby) added a new weekly route to from Port Moresby to Bali, Indonesia on August 5.
The company is also upgrading its cabin and issued this statement:
It is with great pride that we introduce the first of our retro-fitted aircraft, Boeing 767 P2-PXW.
P2-PXW was away for about 2 and a half months being retro-fitted and now boasts a configuration of 28 Business Class and 160 Economy Class seats. Customers can expect an enhanced, sleek new look cabin interior and the most exciting feature will be state-of-the-art inflight entertainment experience. In brief this is what customers will enjoy on P2-PXW;
• An upgraded and new colour scheme mixing grey & red for the seats
• A completely new seat in Business and Economy Class
• 28 Business Class seats – Cocoon style seats with lie-flat seats
• 160 Economy Class seats – In-seat videos
• New Inflight entertainment offering in both classes – Movies on demand
Basically customers enjoy extra comfort whilst enjoying the wide range of Inflight Entertainment – TV Shows, Movies, Audio recordings and even games all from their individual in-seat screen.
We have a few preliminary pictures to share for your reference:
|Front view||Back view|
|Front view||Back view|
Additional information to note:
• The 2nd Boeing 767, P2-PXV will be leaving for the upgrade of seats and IFE. The configuration will be the same as P2-PXW.
• Both Boeing 737 aircraft will also be retrofitted with the new seats and the IFE. They depart later in the year.
Top Copyright Photo: Peter Gates/AirlinersGallery.com (all others by Air Niugini). Boeing 767-341 ER P2-PXV (msn 30341) will be the second Boeing 767 to receive the new interior. The company also has a Boeing 787-8 on order for delivery next year.
Domestic Route Map:
International Route Map:
Jet Airways reports a $59 million loss for its fiscal first quarter, Etihad Airways’ purchase of 24% of the shares approved
Jet Airways (Mumbai) reported a $59 million loss in its fiscal first quarter. This is the second quarterly loss for the carrier. Etihad Airways (Abu Dhabi) has secured regulatory approval to a 24 percent share of the carrier for $379 million.
Etihad Airways is on a buying spree to acquire minority shares of smaller carriers to code-share with and also to increase traffic for both carriers.
Read the full financial report: CLICK HERE
Read the Chairman’s Speech: CLICK HERE
Copyright Photo: TMK Photography/AirlinersGallery.com. Airbus A330-302 VTY-JWT (msn 1370) departs from Toronto (Pearson).
American Airlines (Dallas/Fort Worth) is planning to add weekly flights between its DFW hub and Roatan, Honduras starting on November 23, 2013 per Airline Route. Roatan Island is famous as an diving destination off the northern coast of Honduras in the Bay Islands.
In addition, American will also add Miami-Cozumel service commencing on November 21. The route will be operated five days a week.
Both routes will be operated with Boeing 737-800s.
Copyright Photo: TMK Photography/AirlinersGallery.com. Boeing 737-823 WL N922NN (msn 29523) approaches the runway at Toronto (Pearson).
ANA (All Nippon Airways) (Tokyo) is planning to retire the last Boeing 747-400 on March 29, 2014. The last route is tentatively schedule as a flight between Naha, Okinawa and Tokyo (Haneda) per Airline Route.
The airline is currently operating five domestic models on domestic routes in Japan.
ANA added its first Boeing 747SR-81 (JA8133) (above) on December 20, 1978 for its high-density domestic routes. ANA also added its first Boeing 747-281B (JA8174) (below) on June 25, 1986.
Top Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 747SR-81 JA8145 (msn 22291) taxies at the Haneda Airport hub.
Bottom Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 747-281B JA8181 (msn 23698) joined the ANA fleet on December 22, 1986 and migrated to NCA on May 26, 1999 as a freighter.
Finnair (Helsinki) added its first long-haul international route on May 15, 1968 from Helsinki to New York (JFK) via stops in Copenhagen and Amsterdam. The new route was opened with new Douglas DC-8-62CFs, the first having arrived in Helsinki on February 8, 1968.
Tomi Tervo on the Finnair Blog looks back at this pioneering route for the carrier:
- by Tomi Tervo
You always get that extra little buzz when it says ‘AY 005’ on the flight preparation papers. One long-haul flight out of many, but for us it’s the oldest and most traditional one. Finnair’s first long-haul destination was New York, and the route ran via Copenhagen and Amsterdam on a DC-8 aircraft. Pilots, at least, remember Charles Lindbergh crossing the Atlantic 86 years ago as a milepost in aviation history. For the pilot, crossing the Atlantic no longer means bearings twirled with a plotter as messy lines on a route map, or rough navigation with tops and hyperbolae of positions, cigarette stubs in the ashtray next to three weatherworn aviator hats. Nowadays, the route is operated with an Airbus 330, with modern equipment to enable a safe crossing of the ocean with two pilots, without navigators or aviation engineers. However, there still is something special about it from the viewpoint of the pilot.
The route to New York isn’t run of the mill. The flight planners choose the route according to favourable large air currents. Sometimes we fly from the south from above Northern Scotland. This time the route runs from above Iceland and over Greenland. Unlike on the continent, when flying above the ocean we are off the radar and beyond the reach of air traffic control’s monitoring. In addition, there are no radio transmitters in the middle of the ocean so there is no undisturbed, continuous speech connection to air traffic control. The third thing to pay attention to is the shortage of alternate airports. The pilots should always have their eye on the nearest alternate airport along the route that is located no less than two (sometimes three) hours away from the plane. On this flight, the alternate airports are Keflavik and Goose Bay. The Greenland terrain is high and mountainous. When flying above it, the pilots revise the special procedures in case a malfunction is detected in one of the engines or pressurisation and altitude has to be decreased.
Even when above the ocean, the navigation is done normally using GPS (i.e. satellite navigation). However, the waypoints are latitude-longitude coordinates, unlike anywhere else, and there are no earth stations or beacons for a backup. Instead of the magnetic north, the direction reference is the fixed geometric location of the North Pole. ‘Finnair five, cleared to New York via 65N000W, 66N010W, 67N020W….’ reads the air traffic controller for us close to the western coast of Norway. As there is no radar monitoring by air traffic control, the spacing out between the aircrafts is based on following the provided route clearances and speeds with pinpoint accuracy. After receiving the clearance, both pilots carefully cross-check the directions and nautical miles, and that they tally with the aircraft’s navigation equipment. After that, it’s ‘Have a good flight!’ Bit by bit, the voice of the air traffic controller fades beyond the reach of the VHF radios. A little bit of Charles Lindbergh in us starts to stir.
Over the Atlantic, there is a text-based messaging system with satellite connection to air traffic control. But the system is quite new and not entirely without its problems. That is why the progress of the planes is still tracked by radio operators using almost one hundred-year-old HF radio technology. The HF signal bounces between the ocean and the layers of the atmosphere far beyond the horizon, and its range is in theory thousands of miles. But at the same time, the connection is prone to the changes in the day and the sunspot rhythm. There are a lot of noise, scratching sounds and breaks in the connection. ‘Iceland radio, Iceland radio, Finnair 5, position 65N030W at 1810, request SELCAL on DM-BF…’
‘Finnair 5, on boundary…ccchhccccssshhhh… Gander on frequency… eight.. cchhcssh.. niner one….’
(You can listen to the HF radio communications live from this link. Can you make out what they’re saying?)
A new continent. The east coast of Canada, Newfoundland and the vast wilderness. The feeling of already reaching your destination when there are still around three hours to go. Moncton, Bangor, Boston. More and more planes start to circle the skies when approaching New York. We often move in on the John F. Kennedy Airport above the beautiful capes and islands of Long Island. The airport itself is one of the most intense in the whole wide world. As the silhouette of Manhattan looms in the background, the air is swarming with traffic in all directions, at all altitudes. The airport often uses up to three runways simultaneously. There are landings and takeoffs every couple of minutes. Especially during the rush hour, the air traffic controllers read the clearances at the double, with a strong east coast accent. They are tough professionals who expect quality also from the pilots. ‘Finnair five heavy turn right on juliet after landing 757 cross 22R keep rolling join alfa hold short of november charlie monitor groung point niner’, you have to hear and roger your own clearance without delay.
Snowfall and exceptional weather is a chapter of its own. The air traffic in New York may be badly disrupted then. You may be in for a long wait in the air. When the weather forecast is poor, the captain needs to prepare for various scenarios already prior departure by reserving enough fuel. Usually the cockpit receives advance information from Finnair’s New York ground personnel on the available runways, weather and congestion a few hours before landing. We know many of that crew already. One known to all was Maucca Leppälä, who was the Manager of Finnair’s New York ground services for 23 years, but recently retired. Now the operations are led by Ulla-Maija Baker. Greetings to all, it’s always nice to see you.
The hotel transportation runs smoothly in a relaxed atmosphere as the crew discusses what happened on the flight. The blocks of Brooklyn, inner city kids playing basketball and the neon signs of garages and diners blink in the windows. This nation of drivers is returning home on four lanes. Over the radio, I can make out Bruce Springsteen’s guitar, or maybe it’s just my imagination. Arrival at the hotel, saying good evening to all other crew members. Hang up the uniform and put it in the closet. The metropolis quietens down into the early evening as the sun slowly floats down and hides behind the silhouette of New Jersey. That’s us, Charles and I. A brief moment when the silver wings on the uniform’s jacket seem to shine a little brighter than usual.
Top Copyright Photo: Christian Volpati/AirlinersGallery.com (all others by Finnair). McDonnell Douglas DC-8-62CF OH-LFY (msn 46130) sits on the tarmac at Paris (CDG) in the original markings.
American Airlines (Dallas/Fort Worth) will add daily nonstop service from West Palm Beach, FL to Los Angeles starting on November 21.
The carrier will add daily seasonal West Palm Beach-New York (LaGuardia) flights from November November 21 through March 31, 2014 per Airline Route.
Both routes will be served with Boeing 737-800s.
In other news, AA will introduce its new Airbus A321 on the New York (JFK)-Los Angeles route on January 7, 2014. The new A321s will gradually replace older Boeing 767-200 ERs on the route.
Copyright Photo: Brian McDonough/AirlinersGallery.com. Boeing 737-823 N981AN (msn 29569) approaches from the south to land at Washington (Reagan National).
Swift Air LLC (USA) (Phoenix) has signed a definitive Plan Funding Term Sheet with NIMBOS LLC that provides for a substantial capital infusion and paves the way for the company to emerge from Chapter 11 by late September concluding its thirteen month reorganization. The company has filed a motion with the bankruptcy court for approval of $1.4 million in additional funding by NIMBOS as part of the steps to emerge from Chapter 11.
Swift Air LLC, has been best known for its 14 years of incident free operations, transporting presidential candidates like Senator John McCain, professional sports teams, and the world’s biggest music acts. Dealt a significant blow from the NBA lockout in the 2011-12 season, followed shortly thereafter by the NHL lockout in the 2012-13 season, Swift Air filed for bankruptcy in June of 2012 and has explored multiple exit strategies, before entering into this new arrangement with NIMBOS. The company has renewed its commitment to its sports charter line of business and is looking forward to the start of the NHL and NBA seasons, which will be the first uninterrupted seasons for these leagues in the past 2 years.
Swift Air is a certificated FAR 121 Air Carrier and operates a fleet comprised of Boeing 737 and Boeing 767 passenger aircraft.
Copyright Photo: Mark Durbin/AirlinersGallery.com. The former US Airways Boeing 737-4B7 N802TJ (msn 24874) is pictured parked at San Francisco International Airport in the current livery, available for charter work. The aircraft was formerly painted and operated for the John McCain presidential campaign.
Air Lituanica (Vilnius) on August 5 started its the third route to Berlin (Tegel), following new service to Brussels and Amsterdam.
Copyright Photo: TMK Photography/AirlinersGallery.com. Operated by Estonian Air, Embraer ERJ 170-100LR ES-AEB (msn 17000106) approaches Brussels for landing on its flight from Vilnius.
Lufthansa (Frankfurt) will introduce the relatively new Boeing 747-800 on the Frankfurt-Mexico City route on September 2, 2013 according to Airline Route.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. Boeing 747-830 D-ABYA (msn 37827) climbs away from the runway at Los Angeles International Airport.
Flybe (Exeter) is struggling to turn things around financially after reporting a loss of $63.2 million in the past fiscal year. The past year, according to the carrier, has been the most challenging year in its 10-year history. A new CEO, former easyJet executive Saad Hammad, is now closely looking at the company in great detail and bringing in new people to fill resignations.
According to its annual report, Flybe has removed 13 aircraft from the fleet and deferred another 16 aircraft. 75 percent of the fleet is now deployed on lower-risk contract flying, especially at Flybe Finland. The company is targeting a goal of over $77 million in long-term yearly cost reductions.
Read the full report: CLICK HERE
Copyright Photo: Ton Jochems/AirlinersGallery.com. Embraer ERJ 170-200STD (ERJ 175) G-FBJC (msn 17000328) taxies to the runway at Amsterdam.
Current routes from Southampton:
Air Canada (Montreal) has announced that its current seasonal flights between Montreal (Trudeau) and San Francisco will be extended to year-round flights beginning in November 2013. All flights will be operated with Airbus A319 aircraft.
Montreal-San Francisco daily year-round schedule:
|AC 781||Montreal at 17:35||San Francisco at 21:00|
|AC 780||San Francisco at 08:10||Montreal at 16:29|
Montreal-Trudeau Airport (YUL) is an important Air Canada hub serving more than 6.2 million of the airline’s customers in 2012. Air Canada, together with regional airlines operating under the Air Canada Express banner, operates more than 100,000 flights to/from YUL and 67 destinations: 21 destinations in Canada, 16 in the United States, 23 in the Caribbean and Mexico, and seven European gateways.
Copyright Photo: Bruce Drum/AirlinersGallery.com. Airbus A319-112 C-GJWF (msn 1765) in the hybrid partial 2004 livery arrives at Fort Lauderdale-Hollywood International Airport.
Nok Air (Bangkok-Don Mueang) flight DD 7411 operating from Trang to Bangkok (Don Mueang) veered and skid off the runway on takeoff at Trang Airport on August 6. The 142 passengers and crew members were uninjured. The flight was being operated with former Ryanair Boeing 737-8AS HS-DBM (msn 33594, ex EI-DLM). The incident closed the airport.
Read the full report from The Nation: CLICK HERE
Copyright Photo: Malcolm Nason/AirlinersGallery.com. HS-DBM is seen at Shannon before its delivery flight.
Shandong Airlines-SDA (Jinan, Shandong, China) on August 6 took delivery of this brand new Boeing 737-800. The pictured 737-85N B-5786 (msn 39127) is painted in a special promotional scheme for the Tenth China Art Festival.
According to the official website, the “China Art Festival is the top, largest and most influential state-level art festival in China. It is held every third year and has successfully staged nine sessions up to now. The Tenth China Art Festival will be held in Shandong in October 2013, cosponsored by Ministry of Culture and Shandong Provincial People’s Government.
With the purpose of “art event, people’s festival”, the Tenth China Art Festival takes “developing advanced culture, boosting cultural industry, promoting civilization progress” as the theme and “government taking lead, benefit for the people, highlighting special characteristics, mass participation, open and innovative, pragmatic and thrifty” as the principle.”
Shandong Airlines is the official airline sponsor of the event.
Copyright Photo: Ivan K. Nishimura/Blue Wave Group. Beautifully-decorated B-5786 is pictured passing through Honolulu yesterday (August 7) on its delivery routing. The airliner wears the event logo on the forward fuselage.
Norwegian Air Shuttle (Norwegian.com) (Oslo) will launch its Norwegian Long Haul Boeing 787-8 scheduled service from Stockholm (Arlanda) to both New York (JFK) and Bangkok (Suvarnabhumi) on August 15. The airline has been operating the new 787 on inter-European routes from Oslo (Gardermoen).
The Dreamliner will be repositioned to Arlanda on August 11. It is due to arrive at ARN at 1500 local time.
Copyright Photo: Duncan Kirk/AirlinersGallery.com. This dramatic view shows Boeing 787-8 EI-LNA (msn 35304) landing back at Paine Field near Everett, WA.
Air Canada to launch daily, year-round flights between Sydney, Nova Scotia and Toronto Pearson on December 18
Air Canada (Montreal) today announced that in response to growing customer demand it will launch daily, year-round service between Sydney, Nova Scotia and Toronto (Pearson) beginning on December 18, 2013 .
Air Canada and TCA has been serving Sydney and Cape Breton for 71 years.
Air Canada’s year-round, daily service between Sydney and Toronto will be operated by Jazz Aviation (Halifax) under the Air Canada Express brand using 50-seat CRJ200 regional jets. It will be the only year-round, nonstop flights operated between Sydney, Nova Scotia and Toronto .
Sydney-Toronto year-round service:
|AC 8795||Sydney at 05:55||Toronto at 07:33|
|AC 8794||Toronto at 20:50||Sydney at 00:10|
Copyright Photo: TMK Photography/AirlinersGallery.com. Jazz Aviation’s Bombardier CRJ200 (CL-600-2B19) C-FZJA (msn 7988) rests between assignments at the Toronto (Pearson) hub.
Copa Holdings, S.A. (Copa Airlines and Copa Colombia) has announced financial results for the second quarter of 2013:
OPERATING AND FINANCIAL HIGHLIGHTS
- Copa Holdings reported net income of US$74.4 million for 2Q13, or diluted earnings per share (EPS) of US$1.68. Excluding special items, Copa Holdings would have reported an adjusted net income of $85.0 million, or $1.92 per share, a 45.3% increase over adjusted net income of US$58.5 million and US$1.32 per share for 2Q12.
- Operating income for 2Q13 came in at US$97.7 million, a 34.5% increase over operating income of US$72.6 million in 2Q12. Operating margin for the period came in at 16.5%, compared to 14.1% in 2Q12, as a result of lower unit costs.
- Total revenues increased 14.8% to US$592.0 million. Yield per passenger mile decreased 4.6% to 16.4 cents and operating revenue per available seat mile (RASM) decreased 2.5% to 12.8 cents. However, adjusting for a 7.3% increase in length of haul, yields decreased 1.2% and RASM increased 1.0%.
- For 2Q13, passenger traffic (RPMs) grew 20.4% on a 17.7% capacity expansion. Consolidated load factor came in at 75.3%, or 1.7 percentage points above 2Q12.
- Operating cost per available seat mile (CASM) decreased 5.2%, from 11.3 cents in 2Q12 to 10.7 cents in 2Q13. CASM, excluding fuel costs, decreased 2.6% to 6.7 cents.
- Cash, short term and long term investments ended 2Q13 at US$848.7 million, representing 35.0% of the last twelve months’ revenues.
- During the second quarter, Copa Airlines took delivery of one Boeing 737-800 aircraft. As a result, Copa Holdings ended the quarter with a consolidated fleet of 86 aircraft.
- For 2Q13, Copa Holdings reported consolidated on-time performance of 89.3% and a flight-completion factor of 99.7%, maintaining its position among the best in the industry.
- On July 17, 2013, Copa Airlines announced it will begin nonstop service four times a week from Panama to Tampa, Fla., on December 16, 2013. Tampa will be Copa Airlines’ ninth U.S. destination and its 66th destination overall.
- On August 7, 2013, the Board of Directors of Copa Holdings resolved to change the Company’s dividend policy to increase the annual distribution to an amount equal to 40% of the prior years’ annual consolidated net income. In addition, dividends going forward will be distributed in equal quarterly installments during the months of March, June, September and December, subject to board approval each quarter. On August 7, 2013, the Board of Directors also approved dividend payments payable at the end of both 3Q13 and 4Q13, in amounts equal to 10% of the consolidated net income of 2012.
|Consolidated Financial &
|2Q13||2Q12||% Change||1Q13||% Change|
|Revenue Passengers Carried (‘000)||1,861||1,658||12.2%||1,899||-2.0%|
|Load Factor||75.3%||73.5%||1.7 p.p.||76.9%||-1.6 p.p.|
|PRASM (US$ Cents)||12.3||12.6||-2.3%||13.5||-8.9%|
|RASM (US$ Cents)||12.8||13.1||-2.5%||14.0||-8.2%|
|CASM (US$ Cents)||10.7||11.3||-5.2%||10.9||-1.5%|
|CASM Excl. Fuel (US$ Cents)||6.7||6.9||-2.6%||6.5||3.3%|
|Breakeven Load Factor (1)||61.6%||63.0%||-1.4 p.p.||58.7%||2.9 p.p.|
|Fuel Gallons Consumed (Millions)||60.0||52.1||15.0%||60.1||-0.2%|
|Avg. Price Per Fuel Gallon (US$ Dollars)||3.08||3.32||-7.3%||3.34||-7.8%|
|Average Length of Haul (Miles)||1,868||1,740||7.3%||1,859||0.5%|
|Average Stage Length (Miles)||1,126||1,063||6.0%||1,123||0.2%|
|Average Aircraft Utilization (Hours)||10.9||10.6||3.1%||11.3||-3.5%|
|Operating Revenues (US$ mm)||592.0||515.8||14.8%||641.3||-7.7%|
|Operating Income (US$ mm)||97.7||72.6||34.5%||142.6||-31.5%|
|Operating Margin||16.5%||14.1%||2.4 p.p.||22.2%||-5.7 p.p.|
|Net Income (US$ mm)||74.4||32.0||132.6%||113.8||-34.6%|
|Adjusted Net Income (US$ mm) (1)||85.0||58.5||45.3%||124.4||-31.6%|
|EPS – Basic and Diluted (US$)||1.68||0.72||132.4%||2.56||-34.6%|
|Adjusted EPS – Basic and Diluted (US$) (1)||1.92||1.32||45.2%||2.80||-31.6%|
|# of Shares – Basic and Diluted (‘000)||44,387||44,354||0.1%||44,387||0.0%|
(1)Breakeven Load Factor, Adjusted Net Income and Adjusted EPS for 2Q13, 2Q12, and 1Q13 exclude non-cash charges/gains associated with the mark-to-market of fuel hedges. Additionally, for 1Q13 excludes a US$13.9 million charge related to the devaluation of the Venezuelan currency.
Copyright Photo: Jay Selman/AirlinersGallery.com. Boeing 737-8V3 WL HP-1721CMP (msn 40362) prepares to touch down in Miami.
Philippine Airlines (PAL) (Philippines) (Manila) has taken delivery of its first Airbus A321. The aircraft was handed over at the Airbus delivery center in Hamburg (Finkenwerder), Germany on August 6 and is the first of 64 new Airbus aircraft ordered by the airline in 2012 under a major fleet modernization program. These include 44 single aisle A321s and 20 widebody A330s.
Philippine Airlines has specified a two class layout for its A321s, with 12 seats in Business Class and 187 in Economy. The airline will operate its new A321s primarily on international routes across the Asian region, as well as on selected domestic flights.
The A321 joins an Airbus fleet at Philippine Airlines that already includes 22 A320 Family aircraft flying on domestic and regional routes, as well as nine in service with its budget subsidiary PAL Express. The carrier also operates eight widebody A330s on higher capacity routes across Asia and seven A340-300s on its longest services to the United States.
Following the introduction of the A321, Philippine Airlines will take delivery of the first of its 20 new A330s in the third quarter of the year. The carrier is also currently adding four A340-300s to its fleet for deployment on new non-stop services to Europe, scheduled to begin next month.
Copyright Photo: Gerd Beilfuss/AirlinersGallery.com. The pictured Airbus A321-231 D-AZAS (msn 5715) on a test flight at Hamburg (Finkenwerder) on August 5 became RP-C9901 on the hand over the following day.
Update: PAL introduced the new A321 on August 9 between Manila and Cebu and Manila and Davao.
JetBlue Airways (New York) today announced Bags VIP, a new concierge service option, provided in partnership with Bags, Inc. This service provides hand-delivery of a customer’s checked luggage from the arrival airport to any doorstep at their destination for a minimal fee. The option is available seven days a week, including holidays.
Starting today, customers can place an order online for the Bags VIP service up to one hour prior to departure from all JetBlue domestic airports, Puerto Rico, U.S. Virgin Islands and select pre-cleared international airports arriving into Boston, Orlando and New York’s JFK airport.
For a limited time, pricing starts at $25 for the delivery of one bag, $35 for two and $40 for up to ten bags to a hotel, business, residential address or anywhere the customer chooses within a 40-mile radius of the airport.
Customers will receive an email with a confirmation number once the order has been finalized. Next, the customer checks their baggage upon arrival at the airport. A JetBlue crew member will apply a Bags VIP tag to identify the luggage. At the final destination, the customer can bypass baggage claim and go about their business. Their bags will be retrieved directly from baggage claim by a Bags VIP representative using the applied tag and customer provided information. Delivery will take place within four hours of flight arrival to locations within 40 miles of the airport and within six hours to locations 41-100 miles from the airport. Residential delivery times can also be scheduled in advance to accommodate the customer’s need.
Copyright Photo: Bruce Drum/AirlinersGallery.com. Airbus A320-232 N510JB (msn 1280) in the Dots design departs from Fort Lauderdale-Hollywood International Airport.
Sunwing Airlines (Toronto) has announced plans to retrofit the airline’s fleet of Boeing 737-800 this Winter with Split Scimitar Winglets. When applied to the existing “curved tipped” Blended Winglets, the Split Scimitar Winglet upgrade adds strengthened spars, aerodynamic ‘curved’ tips, and a large ventral fin, which improves performance and decreases fuel burn by approximately 7%. “We feel we have a responsibility as a market leader in Canada to continue investing in technology which reduces our environmental impact”, said Stephen Hunter, CEO of the Sunwing Travel Group, adding “This initiative has the added benefit of improving cost efficiency so that we can continue to provide great value for our customer’s vacation dollar”.
“We are pleased to partner with Sunwing Airlines, on this exciting initiative” said Troy Brekken, Director of Sales and Marketing at Aviation Partners Boeing. “They will be one of our first airline partners in North America to commercially fly the Blended Winglets, which reduce carbon emissions and improve fuel efficiency”. Earlier this year, APB launched the Split Scimitar Winglet program for the provisioned wing 737-800 (line number 778 and on) and 737-900 ER with an order from United Airlines. FAA supplemental type certification for the Boeing 737-800 is targeted for October 2013 and EASA certification planned for December 2013. Certification flight testing of Split Scimitar Winglets is currently underway.
Aviation Partners Boeing is a Seattle based joint venture of Aviation Partners, Inc. and The Boeing Company. Nearly 5,000 Blended Winglet Systems are now in service with over 200 airlines in more than 100 countries. APB estimates that Blended Winglets have saved airlines worldwide more than 3.8 billion gallons of jet fuel to-date.
Image: Sunwing Airlines.
Boeing (Chicago) and Travel Service Airlines (Prague) have finalized an order for three 737 MAX 8s, valued at $301.5 million at list prices. The Czech Republic-based carrier originally announced a commitment to purchase the 737 MAX in June during the 2013 Paris Air Show. This announcement brings the total number of orders to date for the 737 MAX to 1,498 airplanes.
Copyright Photo: Ton Jochems/AirlinersGallery.com. Travel Service Airlines’ Boeing 737-8Q8 C-GVVH (msn 35275) at Palma de Mallorca this summer still wears the registration used by Sunwing Airlines during the winter. Normally the airliner wears OK-TVH with Travel Service. The new 737 MAX 8s will expand the Boeing fleet.
Air Canada (Montreal) today reported adjusted net income of $115 million or $0.41 per diluted share in the second quarter of 2013 compared to an adjusted net loss of $7 million or $0.02 per diluted share in the second quarter of 2012. Second quarter EBITDAR amounted to $385 million compared to EBITDAR of $312 million in the second quarter of 2012, an increase of $73 million or 23 per cent. On a GAAP basis, Air Canada’s net loss was $23 million or $0.09 per diluted share compared to a net loss of $161 million or $0.59 per diluted share in the same quarter of 2012.
“Air Canada delivered its best second quarter financial performance in the Corporation’s history, with records reported in all three measures of operating income, adjusted net income and EBITDAR,” said Calin Rovinescu, President and Chief Executive Officer. “These results are a clear indication that we are gaining momentum in our transformation towards sustainable profitability at Air Canada and underscore our Company-wide efforts to achieve cost containment and continue to improve on our revenue and yield performance.
“Our success in the quarter was not only financial – I am also especially pleased to report ongoing improvements in operational performance for the second consecutive quarter, with a 30 per cent improvement in On-Time Performance (OTP) for the quarter compared to the previous year. This is a reflection of the professionalism, collaboration and dedication of Air Canada’s 27,000 employees in taking care of our customers while operating a safe and efficient airline. Also, we were once again recognized by global travelers as the Best Airline in North America for the fourth consecutive year, a wonderful recognition of our efforts.
“Market response to the launch of our new leisure carrier, Air Canada rouge, on July 1st has been very positive and our plans are on track for growing the Air Canada rouge fleet to serve more holiday destination markets where we can now compete on a more cost effective basis. In addition, in early July, we began operating the first of five new Boeing 777-300 ER aircraft, marking the first significant growth in the mainline wide-body fleet in ten years to support continued development of our international network and Toronto hub as our North American gateway. These aircraft also debut our new Premium Economy cabin, offering customers a high-value option for enhanced comfort and service on select international routes.
“Looking ahead, our focus remains on the execution of the Corporation’s business plan led by our four core priorities: cost transformation, international growth, customer engagement and culture change to transform Air Canada into a sustainably profitable company for its shareholders and employees,” concluded Mr. Rovinescu.
Second Quarter Income Statement Highlights
Second quarter 2013 system passenger revenues were $2,757 million, an increase of $86 million or 3 per cent over the second quarter of 2012, on a 1.6 per cent growth in traffic and a 1.5 per cent improvement in yield. Passenger revenue per available seat mile (RASM) increased 0.9 per cent from the second quarter of 2012 on the yield growth. Air Canada reported a passenger load factor of 83.0 per cent for the second quarter of 2013, 0.5 percentage points below the second quarter of 2012. In the premium class cabin, passenger revenues increased $19 million or 3.3 per cent on yield and traffic growth of 2.2 per cent and 1.1 per cent, respectively, over the second quarter of 2012.
Operating expenses decreased $42 million or 1 per cent from the second quarter of 2012. Operating expense increases in wages, salaries and benefits and capacity purchase costs were more than offset by operating expense decreases in aircraft fuel and depreciation, amortization and impairment expenses.
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 1.4 per cent compared to the second quarter of 2012. The 1.4 per cent reduction in adjusted CASM was in line with the adjusted CASM decrease of 0.5 per cent to 1.5 per cent projected in Air Canada’s news release dated June 10, 2013.
In the second quarter 2013, Air Canada recorded operating income of $174 million compared to operating income of $63 million in the same quarter in 2012, an improvement of $111 million.
At June 30, 2013, cash and short-term investments amounted to $2,107 million or 17 per cent of 12-month trailing revenues (June 30, 2012 – $2,323 million or 20 per cent of 12-month trailing revenues).
At June 30, 2013, adjusted net debt of $3,975 million decreased $162 million from December 31, 2012, mainly reflecting the impact of an increase in cash balances.
Free cash flow of $147 million decreased $86 million from the second quarter of 2012, largely reflecting 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 third quarter of 2013, Air Canada expects its system ASM capacity, as measured by available seat miles (ASMs), to increase in the range of 2.5 to 3.5 per cent when compared to the third quarter of 2012.
Air Canada continues to expect its full year 2013 system ASM capacity to increase in the range of 1.5 to 2.5 per cent when compared to the full year 2012. Air Canada also continues to expect its full year 2013 domestic capacity to increase in the range of 1.5 to 2.5 per cent from the full year 2012.
For the third quarter of 2013, Air Canada expects adjusted CASM to decrease 1.5 to 2.5 per cent when compared to the third quarter of 2012.
Taking into account Air Canada’s adjusted CASM result for the second quarter 2013, Air Canada now expects its full year 2013 adjusted CASM to decrease in the range of 1.0 to 2.0 per cent from the full year 2012 (as opposed to the decrease of 0.5 to 1.5 per cent projected in Air Canada news release dated June 10, 2013).
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, expected to be deployed primarily on international markets, is consistent with the fleet plan discussed in Air Canada’s Second Quarter 2013 MD&A and is due to the addition of five high-density Boeing 777-300 ER aircraft, the first having been delivered in June 2013 and the remainder scheduled for delivery between August 2013 and February 2014, the scheduled arrival in 2014 of the first six Boeing 787 aircraft, and the planned growth from Air Canada rouge.
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$1.04 per U.S. dollar for the third quarter of 2013 and C$1.03 per U.S. dollar for the full year 2013 and that the price of jet fuel will average 87 cents per litre for the third quarter of 2013 and the full year 2013.
Copyright Photo: Ole Simon/AirlinersGallery.com. Formerly painted in the special Vancouver 2010 livery, Boeing 777-333 ER C-FIVS (msn 35784) gracefully climbs away from Frankfurt.
Virgin America (San Francisco) today reports its financial results for the second quarter of 2013 with operating income of $27.9 million and net income of $8.8 million on total revenue of $376 million for the three months ending June 30. The airline posted an 8.6 point improvement in operating margin for the second quarter, driven largely by a 7.8 percent growth in revenue per available seat mile (“RASM”) over the year-earlier period.
Second Quarter 2013 Financial Highlights
- Virgin America reported $8.8 million in net income compared to a year-ago loss of $31.8 million, an improvement of more than $40 million.
- The Company significantly outpaced all U.S. carriers with year-over-year RASM growth of 7.8 percent on flat capacity. Virgin America has now led the industry in RASM growth in each of the past three quarters.
- Load factor increased by four points and yield increased by one percent year-over-year.
- Operating revenue was $376 million, an increase of 8 percent from the second quarter of 2012.
- Cost per available seat mile (CASM) excluding fuel increased by just 1.8 percent year-over-year.
- Earnings before interest, taxes, depreciation and amortization, and aircraft rentals (“EBITDAR”) increased 52 percent to $82.6 million from $54.4 million in the same period a year-ago.
- Year-to-date, Virgin America has generated an operating income of $12.9 million, its first-ever cumulative operating profit for the first and second quarters, and an increase of $65.6 million from the first six months of 2012.
- Unrestricted cash was $148.2 million as of June 30, 2013, an increase of $90 million since March 31, 2013.
“Our first ever second-quarter net profit and year-to-date operating income show that our company is now poised to produce meaningful profitability,” said David Cush, Virgin America’s President and CEO. “As we have reduced our growth from the 30 percent-plus level of the past few years to a more sustainable rate, our network has begun to mature into a profitable one, and our markets continue to show industry-leading RASM growth. We have always said that once people fly with us, they stick with us, and the second quarter is a testament to that and to the hard work of our team.”
Virgin America completed a major two-year growth phase during 2012, having taken delivery of 24 aircraft between the second quarter of 2010 and the second quarter of 2012, almost doubling the size of the fleet. With this major growth phase largely behind the Company, 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 size again until the second half of 2015, when aircraft on order from Airbus are scheduled for delivery. The Company expects continued strong improvement in year-over-year financial performance through the remainder of 2013.
The Company 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 in the second half of 2013 and beyond, to approximately $10 million per quarter. Had the May 2013 restructuring been completed prior to the beginning of the second quarter, Virgin America’s net income would have been approximately $18 million for the quarter. Year-to-date, Virgin America’s net loss would have been approximately $8 million after taking into account the impact of the restructuring. In addition, Virgin America completed a debt offering in May, raising $75 million. Combined with $15 million of positive cash flow during the quarter, this increased the Company’s unrestricted cash by $90 million, to $148.2 million.
In the second quarter of 2013, the airline brought a small number of strategically important new markets online by reallocating capacity from existing markets. In early April, the carrier inaugurated new nonstop service from both Los Angeles International Airport (LAX) and San Francisco International Airport (SFO) to Newark Liberty International Airport (EWR), an important destination for business travelers. Also in April, the airline inaugurated new nonstop service between Los Angeles and Las Vegas McCarran International Airport (the carrier already served Las Vegas from both San Francisco and New York John F. Kennedy International Airport). In May, the airline launched Norman Y. Mineta San Jose International Airport to LAX service, expanding its Northern California footprint beyond its San Francisco home base. Later in May the airline inaugurated daily flights from San Francisco to Austin-Bergstrom International Airport. In June, the carrier launched new summer seasonal service between San Francisco and Alaska’s Ted Stevens Anchorage International Airport.
The addition of three daily roundtrip flights between Newark and both San Francisco and Los Angeles significantly expanded Virgin America’s presence in the New York and New Jersey area. The airline had already built a following of bi-coastal flyers with its popular nonstop flights from both LAX and SFO to JFK. In three months of operations, the Newark flights are performing ahead of the Company’s forecasts, and Virgin America is achieving a revenue share in excess of its share of capacity in both markets. With the addition of Newark, Virgin America now serves nine of the top 10 business markets from SFO and eight of the top 10 business markets from LAX. Virgin America is the only airline serving the Newark-West Coast routes to offer WiFi, power outlets and live satellite TV at every seat on every flight.
Prior to Virgin America’s entry, the San Francisco-Newark route was a monopoly route and the Los Angeles-Newark route was not served by any low-fare carriers. As a result, flights between Newark and San Francisco had some of the highest average fares of any domestic US route. After Virgin America announced plans to enter the Newark market in late 2012, fares for flights between Newark and California’s two largest airports dropped by as much as one-third and the market size has grown by 75 percent in EWR-SFO and doubled in EWR-LAX.
Key milestones achieved in the second quarter of 2013 include:
- In its first year of eligibility, Virgin America in April topped the Airline Quality Rating, an annual study of airline industry performance conducted by Wichita State University and Purdue University.
- Virgin America brought its Sharklet-equipped “Jersey Girl,” its 53rd Airbus A320-family aircraft, into service.
- In April, Virgin America inaugurated service between Newark , N.J. and Los Angeles and San Francisco.
- In April, the carrier also expanded service to Las Vegas with three daily flights to Los Angeles.
- In May, Virgin America was voted “Best Airline” in a survey by Consumer Reports.
- Virgin America began service between Los Angeles and San Jose, California on May 1.
- Also in May, the carrier launched new flights from San Francisco to Austin, Texas.
- Virgin America began seasonal service between San Francisco and Anchorage, Alaska in June.
- In the second quarter, the carrier added three new interline partners: China Eastern Airlines, Etihad Airways and Scandinavian Airlines (SAS). By the end of the second quarter 2013, Virgin America had 26 interline partners, up from eight in the same in period in 2012.
- The airline’s baggage handling rate was 0.89 mishandled baggage reports per 1,000 guests in April and 1.15 mishandled baggage reports per 1,000 guests in May, placing it first among all U.S. carriers reporting to the Department of Transportation (DOT) for baggage reliability.
- In June, the carrier began releasing monthly operating results, consistent with the practice of publicly traded airlines.
Since its launch in 2007, Virgin America has created 2,600 new jobs and now flies to San Francisco, Los Angeles, New York, Newark, Washington D.C. (IAD and DCA), Las Vegas, San Diego, Seattle, Boston, Fort Lauderdale, Orlando, Dallas-Fort Worth, Los Cabos, Cancun, Chicago, Puerto Vallarta, Palm Springs (seasonal), Philadelphia, Portland, San Jose, Austin and Anchorage (seasonal).
Copyright Photo: Brian McDonough/AirlinersGallery.com. Virgin America’s Airbus A319-112 N524VA completes its final bank on its River Approach into Washington’s Reagan National Airport. Technically the “Washington DC (Va) 19-1 River Approach (visual) is conducted when weather is 3500′ and 3 miles or better. Radar vectors are provided for the final approach course. When cleared for a River Approach, aircraft may visually follow the river to the airport or may proceed via the DCA R-328 (148 degree inbound) or via the LDA Runway 18 approach to abeam Georgetown Reservior or the DAC 4 DME fix, then visually follow the river to the airport. A light on Memorial Bridge is installed to assist pilots in staying over the Potomac River during approaches from the northwest” according to a guide published by Boeing.
SkyWest, Inc. (SkyWest Airlines and Atlantic Southeast Airlines) (St. George) today reported net income of $20.7 million, or $0.39 per diluted share, for the quarter ended June 30, 2013, compared to net income of $17.0 million, or $0.33 per diluted share, for the same period last year.
SkyWest also reported net income of $24.0 million, or $0.46 per diluted share, for the six months ended June 30, 2013, compared to $16.3 million, or $0.32 per diluted share, for the same period last year.
SkyWest experienced improved financial results for the quarter ended June 30, 2013 compared to its financial results for the quarter ended June 30, 2012. SkyWest generated additional block hour production and corresponding operating revenues (after giving effect to reduced fuel and certain engine overhaul pass through revenues) as a result of increased utilization and increasing the size of its aircraft fleet between June 30, 2013 and June 30, 2012. Following are selected highlights from SkyWest’s quarter ended June 30, 2013, compared to the quarter ended June 30, 2012:
- Increased pretax income 17.8% to $33.7 million, compared to $28.6 million
- Increased fully-diluted EPS 18.2% to $0.39, compared to $0.33
- Increased block hour production 6.1% to 609,711 block hours, compared to 574,884 block hours
- Recorded approximately $28.2 million in additional revenues (net of fuel and certain engine overhaul pass through revenues), primarily related to increased block hour production
- Increased total aircraft fleet to 760 aircraft as of June 30, 2013, compared to 725 aircraft as of June 30, 2012
Commenting on the results, Jerry C. Atkin, SkyWest’s Chairman and CEO, said “We are pleased with the progress we continue to make in producing improved operational and financial performance as compared to the same period last year.” He continued, “We will remain focused on our profit improvement objectives while continuing to deal with the ever-present challenges in the airline industry.”
Financial and Operating Results
Operating revenues totaled $839.1 million for the quarter ended June 30, 2013, compared to $937.2 million for the same period last year or a decrease of $98.1 million. The decrease was due primarily to the reduction of $117.9 million of fuel and certain engine overhaul amounts which were directly reimbursed by SkyWest’s major partners and recorded as operating revenues. However, this reduction was partially offset by recording approximately $28.2 million in additional operating revenues primarily resulting from a 6.1% increase total block hours for the quarter ended June 30, 2013, compared to the quarter ended June 30, 2012.
Total airline expenses (consisting of total operating and interest expenses) decreased $103.7 million, or 11.4%, during the quarter ended June 30, 2013, compared to the same period in 2012. However, after excluding pass-through costs for fuel and certain engine overhaul expenses, total airline expenses increased $14.2 million or only 1.9% which was less than the 6.1% increase in block hours produced.
Under certain of its agreements with its major partners, SkyWest recognizes revenue at fixed hourly rates for mature engine maintenance on regional jet engines and SkyWest recognizes engine maintenance expense on its CRJ200 regional jet engines on an as-incurred basis as maintenance expense. During the quarter ended June 30, 2013, CRJ200 engine expense under these agreements decreased $3.2 million to $10.6 million compared to $13.8 million for the quarter ended June 30, 2012, as a result of decreased engine overhaul expense due to the timing of scheduled engine maintenance events. SkyWest was reimbursed approximately $12.8 million and $10.2 million for engine overhaul expense, under its agreements, in each of the periods ended June 30, 2013 and 2012, respectively.
At June 30, 2013, SkyWest had $665.6 million in cash and marketable securities, compared to $709.4 million as of December 31, 2012. The decrease in cash and marketable securities of $43.8 million was primarily the result of the payment of scheduled semi-annual lease and debt payments as well as making deposits on recent aircraft orders. Cash and marketable securities increased $34.1 million during the quarter ended June 30, 2013 compared to the balance of $631.5 as of the quarter ended March 31, 2013. SkyWest’s long-term debt was $1.38 billion as of June 30, 2013, compared to $1.47 billion as of December 31, 2012. The decrease in long-term debt for the six-months ended June 30, 2013 was due primarily to SkyWest’s payment of normal recurring debt obligations. SkyWest has significant long-term lease obligations that are recorded as operating leases and are not reflected as liabilities on SkyWest’s consolidated balance sheets. At a 4.7% discount rate, the present value of these lease obligations was approximately $1.5 billion as of June 30, 2013.
Recent Business Developments
On May 21, 2013, SkyWest announced it had entered into a Capacity Purchase Agreement (“CPA”) with United Airlines, Inc. (Chicago) to operate 40 new Embraer ERJ 175 dual-class regional jet aircraft. The CPA is for 12 years and the aircraft will be operated by SkyWest’s wholly-owned subsidiary, SkyWest Airlines, Inc. (St. George). Deliveries for these aircraft are scheduled to begin in April 2014 and continue through August 2015.
Additionally, on May 21, 2013 SkyWest announced it reached an agreement with Embraer S.A. for the purchase of 100 new ERJ 175 dual-class regional jet aircraft, 40 of which are considered firm and 60 aircraft remain conditional upon SkyWest entering into capacity purchase agreements with other major airlines. SkyWest intends to place the 40 new aircraft into service under the terms of the United CPA discussed above.
On June 17, 2013, SkyWest and Embraer jointly announced an aircraft purchase agreement covering 100 E175-E2 dual-class regional jet aircraft and an option to purchase an additional 100 of the same aircraft. Deliveries for these E2 aircraft are tentatively planned for 2020.
On August 2, 2012, SkyWest announced the award of 34 additional dual-class aircraft and the removal of 66 CRJ200 aircraft under its Delta Connection Agreements with Delta Airlines, Inc. (Atlanta) and by end of May 2013, all 34 of these dual-class aircraft had been delivered. As of June 30, 2013 SkyWest had removed 24 (22 placed in contract with another partner; other 2 removed from fleet) of the 66 CRJ200 aircraft and currently anticipates removing another 24 CRJ200 aircraft during the months of September 2013 through December 2013. These 24 aircraft have been financed by Delta and will be returned to Delta with no further obligation by SkyWest. SkyWest believes the remaining 18 aircraft will be removed at various times through 2014 and early 2015.
Copyright Photo: Michael B. Ing/AirlinersGallery.com. The CRJ200s will be totally removed from the Delta Connection contract by early 2015. SkyWest Airlines Bombardier CRJ200 (CL-600-2B19) N423SW (msn 7456) approaches Los Angeles International Airport.
NTSB: The captain took over Southwest flight 345 seconds before its hard landing at New York LaGuardia Airport on July 22
The National Transportation Safety Board (NTSB) (Washington) has issued this statement regarding the investigation of the hard landing of Southwest Airlines (Dallas) flight 345 at New York (LaGuardia) on July 22, 2013:
In its continuing investigation of the July 22 accident in which Southwest Airlines flight 345, a Boeing 737-700, landed hard at New York’s LaGuardia Airport (LGA), the National Transportation Safety Board has developed the following factual information:
- The captain has been with Southwest for almost 13 years and has been a captain for six of those years. The captain has over 12,000 total flight hours, over 7,000 of which are as pilot-in-command. In 737s, the captain has over 7,900 hours, with more than 2,600 as the pilot-in-command.
- The first officer has been with Southwest for about 18 months. The pilot has about 5,200 total flight hours, with 4,000 of those as pilot-in-command. In 737s, the first officer has about 1,100 hours, none of which are as the pilot-in-command.
- This was the first trip the flight crew had flown together and it was the second leg of the trip. The first officer had previous operational experience at LGA, including six flights in 2013. The captain reported having flown into LGA twice, including the accident flight, serving as the pilot monitoring for both flights.
- The en route phase of the flight, which originated in Nashville, was characterized by the flight crew as routine. On approach into LGA, the first officer was the pilot flying and the captain was the pilot monitoring. SWA 345 was cleared for the ILS Runway 4 approach.
- The weather in the New York area caused the accident flight to enter a holding pattern for about 15 minutes. The crew reported that they saw the airport from about 5-10 miles out and that the airplane was on speed, course and glideslope down to about 200-400 feet.
- The crew reported that below 1,000 feet, the tailwind was about 11 knots. They also reported that the wind on the runway was a headwind of about 11 knots.
- SWA 345 proceeded on the approach when at a point below 400 feet, there was an exchange of control of the airplane and the captain became the flying pilot and made the landing.
- The jetliner touched down on the runway nose first followed by the collapse of the nose gear; the airplane was substantially damaged.
At this point in the investigation, no mechanical anomalies or malfunctions have been found. A preliminary examination of the nose gear indicated that it failed due to stress overload.
Investigators have collected five videos showing various aspects of the crash landing. The team will be analyzing these recordings in the coming months.
Parties to the investigation are the Federal Aviation Administration, Boeing Commercial Airplanes, Southwest Airlines, and the Southwest Airlines Pilots Association.
This is a factual update only and no interviews are being conducted.