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AMR Corporation reports a 4Q 2012 net profit of $262 million, a $1.4 billion improvement over 4Q 2011 and a $1.9 billion loss for 2012

AMR Corporation (Dallas/Fort Worth), the parent company of American Airlines, Inc. (Dallas/Fort Worth), today reported results for the fourth quarter and year ended December 31, 2012. Key points include:

  • Revenue of $24.9 billion in 2012, the highest in company history
  • Full-year operating profit of $494 million, excluding special items, a $749 million improvement over 2011
  • Full-year net loss of $1.9 billion.  Excluding reorganization and special items, the full-year net loss was $130 million, a $932 million improvement over 2011
  • American took delivery of 11 new aircraft in the fourth quarter (nine 737-800s and two 777-300ERs) and 30 new aircraft during the full year (28 737-800s and two 777-300ERs), putting the airline on track to have the youngest, most fuel-efficient fleet among U.S. network carriers by 2017

“We have made enormous progress towards building the new American,” said Tom Horton, AMR’s Chairman and CEO. “It is remarkable what the American team has been able to accomplish, including generating record revenue and a return to an operating profit for the year while restructuring every aspect of our company. I want to thank all of our people for their dedication, hard work and commitment to serving our customers during this time. Our momentum is growing toward emerging as a strong, healthy and vibrant competitor. In fact, with what we have accomplished, we expect to show strong results beginning in the first quarter of 2013.”

In the fourth quarter, AMR reported a net profit of $262 million compared to a net loss of $1.1 billion in the fourth quarter of 2011. AMR’s fourth quarter results include $350 million of net positive reorganization and special items, which are detailed below.

Excluding reorganization and special items, the net loss in the fourth quarter of 2012 was $88 million, a $121 million improvement from the prior year. The fourth quarter of 2012 was negatively impacted by Hurricane Sandy and the early November snow storm in the Northeast and, separately, by the residual headwind on fourth quarter bookings from the operational disruptions experienced in late September and early October. The cumulative impact from these events is estimated to have reduced net profits by $142 million.

For full-year 2012, American recorded a net loss of $1.9 billion, compared to 2011′s full-year net loss of $2.0 billion. AMR’s full year 2012 results include $1.7 billion of net negative reorganization and special items, which are detailed below.

Excluding reorganization and special items, the net loss for 2012 was $130 million, a $932 million improvement over 2011. The company’s operating profit, excluding special items, of $494 million for 2012 was a $749 million improvement over last year.

Restructuring Progress

During the last year, AMR has completed the majority of its financial restructuring, including reducing debt, renegotiating aircraft leases and facilities agreements, grounding older airplanes, rationalizing the regional fleet, and renegotiating supplier relationships. AMR expects these actions to continue to increasingly improve its cost structure in 2013, as the company approaches its targeted restructuring related savings by the end of 2013.

In 2012:

  • American achieved labor cost reductions of 17 percent across all workgroups, including management, independent employees and unionized workgroups, all of which ratified agreements for six-year terms. Progress was also made at American Eagle, which achieved costs savings and reached agreements with its unionized workgroups
  • American made changes to its organizational structure to reduce management positions, making American’s management workgroup the leanest among the network carriers
  • Renegotiated the financing terms for more than 400 mainline and regional aircraft, which includes completing its financial contracts on its 216 Embraer aircraft. Improved terms on these aircraft significantly lower AMR’s aircraft ownership related costs, while also harmonizing its aircraft retirement and new aircraft delivery schedules
  • Negotiated more than 95 percent of American’s 725 facility leases
  • Evaluated and/or renegotiated over 9,000 vendor/supplier agreements – American’s suppliers have made significant contributions to its strategic plan for success, allowing AMR to meet its savings objectives as outlined in its business plan
  • Realized over $400 million in restructuring related savings in the fourth quarter, primarily from renegotiated aircraft leases, reductions to management and support staff positions, freezing the pension plans for all workgroups, and sun-setting the retiree medical program for active employees

“Throughout 2012, we have executed on all aspects of our business plan – streamlining our organizational structure, increasing unit revenues, reducing unit costs, and restructuring our balance sheet,” said Bella Goren, AMR’s Chief Financial Officer. “The strong financial foundation we are building gives us the ability to deliver returns to our financial stakeholders and make investments that create enhanced value for our customers and our people.”

Revenue Performance

For the fourth quarter of 2012, the company reported consolidated revenue of $5.9 billion, 0.3 percent lower compared to the prior year. The combined effects of Hurricane Sandy, the November snow storm in the Northeast, and the booking headwind from the earlier operational disruption, negatively impacted revenue by an estimated $155 million in the fourth quarter.

Fourth quarter consolidated passenger revenue per available seat mile (PRASM) was comparable to the same period last year, and mainline PRASM decreased by 0.4 percent. Absent the same factors that impacted revenues – described above – American estimates that PRASM would have been approximately 2.0 percentage points higher than the fourth quarter of 2011.

For full-year 2012, AMR reported record consolidated revenue of $24.9 billion, up 3.7 percent compared to 2011, on 1.0 percent less capacity. For 2012, AMR’s consolidated and mainline PRASM rose 5.8 percent and 5.6 percent year-over-year, respectively. Consolidated revenue performance was driven by a 4.6 percent year-over-year improvement in yield, or average fares paid, and record high consolidated and mainline load factors, or percentage of seats filled, of 82.2 percent and 82.8 percent, respectively. Domestic PRASM improved 5.5 percent in full-year 2012 versus full-year 2011, with PRASM increases across all five of American’s hubs.

International PRASM increased 5.7 percent in 2012 over the prior year, driven by improved yield performance across all entities and increased load factors. “We are making tremendous progress strengthening American’s global network by focusing the flying from our hubs to the most important domestic and international cities with the highest concentration of business travelers,” said Virasb Vahidi, American’s Chief Commercial Officer. “We are enhancing relationships with the best international alliance partners and creating a pipeline of industry-leading products and services, including a significant renewal and transformation of our fleet that will drive revenue performance in the coming years.”

American’s 2012 revenue improvement is a result of solid execution on its network, alliances, and product strategy. The recent revenue progress does not yet account for the benefits expected from initiatives accomplished in the restructuring.

Operating Expense

For the fourth quarter, AMR’s consolidated operating expenses, excluding special items, decreased $139 million, or 2.3 percent, versus the same period in 2011. American’s mainline cost per available seat mile (unit cost) in the fourth quarter decreased 3.3 percent versus the same period last year, excluding special items in both periods. Taking into account the impact of fuel hedging, AMR paid $3.22 per gallon for jet fuel in the fourth quarter versus $3.01 a gallon in the fourth quarter of 2011, a 6.6 percent increase. As a result, the company paid $135 million more for fuel in the fourth quarter of 2012 than it would have paid at prevailing prices from the prior-year period.

Excluding fuel and special items, mainline and consolidated unit costs in the fourth quarter of 2012 decreased 8.9 percent and 7.6 percent year-over-year, respectively, primarily driven by American’s restructuring efforts. “The significant improvement in the fourth quarter in non-fuel unit cost underscores the results we have been able to achieve in our restructuring efforts and the competitive cost structure we have put in place for the future,” said Bella Goren, AMR’s Chief Financial Officer.

Since many of the restructuring savings were implemented near the end of the year, AMR’s full year 2012 consolidated operating expenses, excluding special items, were up 0.3 percent, or $84 million, year-over-year. They also reflect a negative impact of $514 million due to higher fuel prices in 2012.  American’s 2012 mainline unit costs, excluding special items, increased 1.5 percent versus the prior year. Excluding fuel and special items, mainline unit costs decreased 0.9 percent for the same period.

An unaudited summary of full-year 2012 results is available in the tables at the back of this press release.

Cash Position

AMR ended the fourth quarter with approximately $4.7 billion in cash and short-term investments, including a restricted cash balance of $850 million, compared to a balance of approximately $4.7 billion in cash and short-term investments, including a restricted balance of approximately $738 million, at the end of the fourth quarter of 2011.

2012 Notable Accomplishments

American has made significant progress in its plan to transform the airline into an industry leader. While the restructuring process is allowing the company to achieve a competitive cost structure and strengthen its balance sheet, American also showed improvement across all aspects of its business. Key accomplishments in 2012 include:

Financial:

  • The largest annual revenue in company history
  • Unit revenue growth that outpaced the industry average in 2012 – driven by strong customer demand for American’s product. Mainline and consolidated PRASM, passenger yield and load factor in 2012 were all records for any year in AMR’s history
  • Full-year 2012 operating profit, excluding special items, of $494 million, a $749 million improvement over 2011

Fleet Renewal and Transformation:

American made substantial progress on its fleet renewal plans and is on pace to have the youngest fleet in the industry in the next five years.

  • In the fourth quarter, the size of American’s fleet of 737-800s surpassed that of its MD-80s.  737-800s offer a 35 percent reduction in fuel cost per seat versus the MD-80
  • American became the first U.S. airline to take delivery of the Boeing 777-300ER, giving the airline’s fleet additional network flexibility, while delivering a state of the art customer experience, and better operating economics
  • American has 59 new mainline aircraft slated for delivery in 2013 and is in the midst of a significant renewal and transformation of its fleet

Customer Experience Enhancements:

American has taken many steps to provide an exceptional customer experience throughout the entire travel journey.

  • Announced a redesigned interior of its international widebody aircraft, including 777-200ERs and 767-300ERs
  • Will be the first domestic carrier to offer three-class service and fully lie-flat First and Business Class seats on transcontinental flights
  • Installing Main Cabin Extra to give customers more leg room in the Coach cabin
  • Introduced new travel options and a brand new booking path on AA.com offering customers more choices to book competitive, round-trip fares, as well as select new combinations of products and services customers value most

Network and Alliances Strategy:

American bolstered its network and alliances by expanding service from its hubs to the domestic and international cities most desirable to high value customers and by enhancing existing and forging new strategic partnerships.

  • International Expansion – American announced new routes and expansion into new international markets that have strong growth prospects, including:
    • Manaus and Sao Paulo, Brazil; Roatan, Honduras; Asuncion, Paraguay; Puebla, Mexico; Bogotá, Colombia
    • Dusseldorf, Germany and Dublin, Ireland
    • Seoul, South Korea
  • Joint Businesses – The continuing maturation of American’s joint business agreements with IAG, parent of British Airways and Iberia, over the Atlantic, and Japan Airlines over the Pacific, were instrumental in driving unit revenue improvements of 5.9 percent and 9.6 percent over the Atlantic and Pacific in 2012, respectively
  • Codeshare – American expanded its long-standing partnership with LATAM Airlines group by embarking on codeshare agreements with TAM and LAN Colombia
  • oneworld® - New member airberlin and members-elect Malaysia and Qatar Airways will bolster American’s network

Reorganization and Special Items:

AMR’s fourth quarter 2012 results include $350 million of net positive reorganization and special items.

  • Of that amount, AMR recognized a $569 million non-cash income tax benefit from continuing operations during the fourth quarter of 2012 related to gains in Other Comprehensive Income
  • The company recognized a $441 million loss in reorganization items resulting from certain of its direct and indirect U.S. subsidiaries’ voluntary petitions for reorganization under Chapter 11 on November 29, 2011. These items primarily result from estimated claims associated with restructuring the financing arrangements for certain debt, aircraft leases, as well as professional fees
  • The company recognized $58 million in special charges, primarily associated with personnel related restructuring costs
  • The fourth quarter results also include a $280 million benefit from settlement of a commercial dispute

AMR’s full year 2012 results include $1.7 billion of net negative reorganization and special items.

  • Of that amount, the company recognized a $2.2 billion loss in reorganization items resulting from certain of its direct and indirect U.S. subsidiaries’ voluntary petitions for reorganization under Chapter 11 on November 29, 2011. These items are primarily from estimated claims associated with restructuring the financing arrangements for certain debt, aircraft leases, and rejecting certain special facility revenue bonds, as well as professional fees
  • The company recognized $387 million in special charges, primarily associated with personnel related restructuring costs
  • As described above, in the fourth quarter, the company recognized a $569 million non-cash income tax benefit from continuing operations, and a $280 million benefit from a settlement of a commercial dispute

Capacity Guidance

AMR estimates consolidated capacity in the first quarter of 2013 to be down 1.7 percent versus the first quarter of 2012.

Factors contributing to this estimated reduction in capacity include the absence of Leap Day in 2013, and progress American has made in implementing its Main Cabin Extra program removing seats from the coach cabin. To date, American has completed the retrofit of its Boeing 757 and 767 fleets, has completed approximately half of its 737 fleet, and will commence the retrofit of the MD-80 fleet in January 2013 with completion targeted for the second quarter.

As previously reported, American experienced an unusually high number of pilot retirements in the fall of 2011 that resulted in capacity reductions for the period November 2011 to February 2012.

Absent the impact of the capacity reductions in January and February of 2012 due to pilot retirements, consolidated capacity in the first quarter of 2013 is estimated to be down 3.4 percent year-over-year.

First Quarter Unit Costs Guidance

AMR will continue to realize restructuring related savings and estimates that in the first quarter of 2013, unit costs will improve year-over-year, despite a capacity headwind due to consolidated capacity decreasing by 1.7 percent and lapping some restructuring related savings that impacted the first quarter of last year.

Copyright Photo: Bruce Drum. The new stretched Boeing 777-300 ER aircraft are being delivered in a non-logo gray scheme pending the unveiling of a new livery. The first new Triple Seven is due to go into revenue service on January 31. Is a pending merger announcement with US Airways holding up the unveiling of the new look? Classic Boeing 777-223 ER N785AN (msn 3005) taxies at the Miami hub in the old 1968 livery.

American Airlines: AG Slide Show

 

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UPS to drop its bid to acquire TNT Express due to expected EC disapproval

United Parcel Service Inc (UPS) (UPS Airlines) (Atlanta and Louisville) will drop its bid to acquire TNT Express N.V. (Hoofddorp) because it now expects the European Commission (EC) to deny the acquisition.

On March 19, 2012, UPS announced its intention to acquire TNT Express for $6.7 billion. On September 5, 2012, UPS announced it expected to close the deal in early 2013 subject to EC approval.

UPS will pay TNT a termination fee in the amount of EUR 200 million.

TNT Airways (Liege) is a subsidiary of TNT Express. TNT is now expected to remain independent.

UPS issued the following statement:

United Parcel Service, Inc. announced today (January 14) the European Commission (EC) has informed UPS and TNT Express that it is working on a decision to prohibit the proposed acquisition of TNT Express.

UPS submitted an initial remedies proposal on November 29, 2012 and subsequently revised the proposal twice. UPS began the competitive review process with the EC in March 2012.

Scott Davis, UPS Chairman and CEO said, “We are extremely disappointed with the EC’s position. We proposed significant and tangible remedies designed to address the EC’s concerns with the transaction. The combined company would have been transformative for the logistics industry, bringing meaningful benefits to consumers and customers around the world, while supporting growth in Europe in particular.”

Upon prohibition by the EC, the Offer Condition relating to EU Competition Clearance will not be fulfilled and UPS will pay TNT a termination fee in the amount of EUR 200 million and will withdraw the Offer.

Further announcements will be made once the European Commission has issued its formal decision. The decision is expected to be adopted formally in the coming weeks.

Top Copyright Photo: Michael B. Ing. Boeing 747-44AF N572UP (msn 35669) climbs away from Anchorage International Airport (ANC).

UPS: AG Slide Show

TNT: AG Slide Show

Bottom Copyright Photo: Rainer Bexten. Southern Air’s Boeing 777-FHT N778SA (msn 39286) arrives at the Liege, Belgium sorting facility.

Philippines to fly to Toronto starting on November 30

Philippines (Philippines Airlines) (Manila) has announced it will add Toronto (Pearson) and the nonstop Manila-Toronto route on November 30. The return routing will stop at Vancouver.

Copyright Photo: Nick Dean. Boeing 777-36N ER RP-C7777 (msn 37709) is pictured at the Everett (Paine Field) factory.

Philippines: AG Slide Show

EgyptAir to launch a new route to Manchester in June

EgyptAir (Cairo) is planning to start two new routes from Cairo in June 2013 per Airline Route. Cairo-Manchester will start on June 1 and will operate five days a week with Boeing 737-800s.

Service to Toronto will be via a code-share with Air Canada via London Heathrow (correcting our previous report).

Read the full report: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-36N ER SU-GDL (msn 38284) climbs away briskly from Tokyo (Narita).

EgyptAir: AG Slide Show

British Airways to fly to Chengdu, China

British Airways (London) has announced a new route to Chengdu in China, just weeks after starting services to Seoul in South Korea.

British Airways will be the only UK carrier to offer a direct service between Chengdu Shuangliu International Airport and London Heathrow.

The thrice-weekly service will start on September 22, 2013. The route will be served by a four-cabin Boeing 777 with First, Club World (business class), World Traveller Plus (premium economy) and World Traveller (economy).

In other news, British Airways is equipping its 3,600 pilots with iPads to further improve customer service and operational efficiency levels.

According to the carrier, “the move, which follows the airline’s rollout of iPads across its cabin crew and ground operations teams, is part of the company’s £5 billion investment in new products and technology to provide the best possible flying experience for British Airways’ customers.”

By having access to additional real-time operational data, shared with ground colleagues, pilots will be able to plan the flight more efficiently using the most accurate information available pre-departure.

This means our flight crew can provide customers with faster and more accurate flight information than ever before. With the latest operational updates customers will be better informed and able to make plans if their flight time has changed for any reason.

Pilots will also be able to use historic and current data, supplied by the customer, to provide an even more personalized service during the flight.

Copyright Photo: Brian McDonough. Boeing 777-236 ER G-YMMP (msn 30315) arrives at Washington (Dulles).

British Airways: AG Slide Show

China Airlines to lease four new Boeing 777-300 ERs from GECAS, orders six from Boeing

GE Capital Aviation Services Limited (GECAS), the commercial aircraft leasing and financing arm of GE, announced today it will lease four new Boeing 777-300 ERs to China Airlines (Taipei). This is a new aircraft type for CAL.

GECAS logo

The first aircraft is scheduled for delivery in 2014 to modernize the airline’s long-haul wide-body fleet. All four leased aircraft come from GECAS’ existing order book with Boeing.

In addition, on December 21, Boeing and China Airlines announced an order for six 777-300 ERs (Extended Range) airplanes. The order is valued at approximately $2 billion at list prices.

Taiwan’s flag carrier is in the midst of renewing its long-haul fleet and plans to operate the new 777-300 ERs on new trans-Pacific flights between North America and Asia.

In November 2011, GECAS announced it will lease four new Airbus A330-300 aircraft to China Airlines. Delivery of the first two aircraft from GECAS’ existing order book with Airbus was in October and December 2012.

In addition to the four A330-300s and four 777-300 ERs scheduled for delivery in the next three years, GECAS currently leases eight Embraer ERJ 190s to Mandarin Airlines (Taipei), a subsidiary of China Airlines.

Founded in 1959, China Airlines is a full-service flag carrier of Taiwan, operating a fleet of 72 regional and international aircraft to over 112 destinations in 28 countries across Asia and to Oceania, Europe and the U.S.

Copyright Photo: Stephen Tornblom. The new Triple Sevens will partially replace the older Boeing 747-400s. Boeing 747-409 N168CL (msn 29906) taxies across the apron at New York’s JFK International Airport.

China Airlines: AG Slide Show

FedEx’s 2Q net income slips to $438 million, down 12% from last year’s $497 million, orders four Boeing 767-300 freighters

FedEx Corporation (FedEx Express) (Memphis) today reported earnings of $1.39 per diluted share for the second quarter ended November 30, compared to $1.57 per share last year. Superstorm Sandy impacted the quarter’s results by $0.11 per diluted share due to reduced shipment volumes and incremental operating costs.

Second Quarter Results:

FedEx Corp. reported the following consolidated results for the second quarter:

• Revenue of $11.1 billion, up 5% from $10.6 billion the previous year

• Operating income of $718 million, down 8% from $780 million last year

• Operating margin of 6.5%, down from 7.4% the previous year

• Net income of $438 million, down 12% from last year’s $497 million

The results of the quarter also reflect, primarily at FedEx Express, the net year-over-year negative impact from the timing lag that exists between when fuel prices change and indexed fuel surcharges automatically adjust.

FedEx Express Segment:

For the second quarter, the FedEx Express segment reported:

• Revenue of $6.86 billion, up 4% from last year’s $6.58 billion

• Operating income of $230 million, down 33% from $342 million a year ago

• Operating margin of 3.4%, down from 5.2% the previous year

Revenue increased primarily due to this year’s business acquisitions and growth at FedEx Trade Networks, as core express revenue growth was constrained by global economic conditions and the impact of Superstorm Sandy.

U.S. domestic revenue per package grew 1% as higher rate per pound was partially offset by lower fuel surcharges. U.S. domestic average daily package volume declined 2%. FedEx international export average daily package volume grew 6% driven by increases in FedEx International Economy®(IE) from Europe and Asia and by increases in FedEx International Priority® (IP) from Asia. Higher growth in international deferred services continued, with IE volume growing 14%, while IP volume increased 3% during the quarter. International export revenue per package fell 4% due to the demand shift toward lower-yielding international services and lower fuel surcharges.

Operating income and margin were lower due to the demand shift toward lower-yielding international services, the negative year-over-year impact of net fuel changes, increased depreciation expense, the effects of Superstorm Sandy and higher pension costs. These were partially offset by the favorable impact of cost containment actions.

FedEx Express has entered into an agreement to purchase four additional 767-300 freighters as part of the company’s continued fleet modernization efforts. This brings the total 767-300 orders to 50, with deliveries beginning in fiscal 2014. In concert with this commitment, two 777 freighter deliveries were deferred from fiscal 2015 to fiscal 2016 in order to better match capacity timing to global demand.

Copyright Photo: Brian McDonough. Boeing 777-FS2 N853FD (msn 37724) makes a fuel stop at Anchorage.

FedEx Express: AG Slide Show

Etihad Airways considers an investment in grounded Kingfisher Airlines

Etihad Airways (Abu Dhabi) is in talks with Kingfisher Airlines (Mumbai) about a possible minority investment in the grounded airline according to the Wall Street Journal.

Read the full article: CLICK HERE

Meanwhile the Deccan Herald of India believes Jet Airways (Mumbai) is a better investment for the Gulf carrier.

Read the full article: CLICK HERE

Top Copyright Photo: Jay Selman. Boeing 777-3FX ER A6-ETF (msn 39700) prepares to land at Bangkok.

Etihad Airways: AG Slide Show

Kingfisher Airlines: AG Slide Show

Jet Airways: AG Slide Show

Bottom Copyright Photo: Antony J. Best. ATR 72-212A (ATR 72-500) with the test registration of F-WWEG (msn 788) arrives at Farnborough. Although painted, the turboprop was never delivered to Kingfisher Airlines as VT-KAT. Instead it went to Air Botswana as A2-ABS.

British Airways unveils seating plans for its new Airbus A380s and Boeing 787-8 Dreamliners, will take delivery of more Boeing 777-300 ERs

British Airways (London) has announced the seating plans for its new Airbus A380 and Boeing 787 Dreamliner aircraft on order. The company issued this statement:

With the first of the airline’s new long-haul aircraft only six months away from delivery, British Airways has announced the cabin design and layout for its Boeing 787 and Airbus A380 aircraft.

Two hundred and fourteen customers will enjoy the comforts of the new British Airways 787 Dreamliner and the A380 will be the largest aircraft in the British Airways fleet, with 469 customers.

The 24 Dreamliners and 12 A380s will feature the elegant cabin designs fitted on British Airways’ new Boeing 777-300 ER aircraft, which have proved hugely popular with customers.

All eight 787-8s will feature a new Club World 2:3:2 layout, the latest generation World Traveller and World Traveller Plus seats. In addition, the new A380 will also have an enhanced version of First. The exact seating plans of another 16 787-9s on order have yet to be finalized, they could have three or four-cabin configurations.

British Airways is set to be the first European airline to operate both new aircraft types, with its first Dreamliner arriving in May 2013 and A380 deliveries starting in July 2013.

The British Airways Dreamliner will have 35 seats for customers in the new Club World triple configuration of 2:3:2; 25 seats in a World Traveller Plus layout of 2:3:2; and a further 154 seats for those travelling in World Traveller, with a 3:3:3 configuration.

On the British Airways A380 there will be 14 seats in First on the main deck, with extra personal and stowage space; the Club World cabin will feature 44 seats in a 2:4:2 configuration; and there will be 199 seats in World Traveller, with a 3:4:3 layout.

The A380 upper deck will feature 53 seats in the new Club World triple configuration of 2:3:2; 55 seats in a 2:3:2 World Traveller Plus layout; and World Traveller will have 104 seats in a 2:4:2 configuration.

Both new aircraft will also feature the airline’s latest Thales inflight entertainment system, which offers customers 50 percent more movies, 200 percent more TV shows and 200 percent more audio programs and music*.

Customers will also benefit from new larger screens in all cabins and an easier to use system with shortcut buttons. They will also be able to connect personal devices, such as laptops and use the in-seat power available for the first time in all cabins.

In 2013, British Airways will take delivery of nine new longhaul aircraft. The first British Airways Dreamliner will be delivered in May 2013. A further three will arrive by the end of the year. The first A380 will be delivered in July, with additional deliveries in August and October. Two additional 777-300 ERs will arrive in September and October 2013.

British Airways will announce the routes the new aircraft will operate in Spring 2013.

* Compared with the Rockwell Collins audio video on-demand system deployed on British Airways fleet of Boeing 747s, 767 longhaul aircraft and most Boeing 777-200s.

Copyright Photo: Ton Jochems. More stretched Boeing 777-300 ERs will be joining the fleet. Boeing 777-36N ER G-STBC (msn 38287) arrives at the London Heathrow hub.

British Airways logo

British Airways: AG Slide Show

American Airlines takes delivery of its first Boeing 777-300 ER, will introduce finally a new livery

AMERICAN AIRLINES FIRST CLASS CABIN

American Airlines (Dallas/Fort Worth) yesterday (December 11) accepted its first new Boeing 777-323 ER (N717AN, msn 31543). The airliner was painted without markings in a gray and silver metallic paint. American Airlines will finish painting the aircraft in a new livery. This is the first color scheme change since the current brand was first designed and painted in 1968 and introduced fleet-wide in 1969. It was the longest running airline livery in the world of a major airline. The new type will be introduced on the Dallas/Fort Worth-Sao Paulo route on January 31. American has nine more copies to come. AA issued this statement:

American Airlines on December 11 took delivery of its first Boeing 777-300 ER (Extended Range) aircraft, another step in its plan to create the industry’s most modern fleet. American is the first U.S. airline to order and take delivery of the Boeing 777-300 ER, which will give American’s fleet additional network flexibility, while delivering increased efficiency and better operating economics.

American’s 777-300 ER, was delivered without the traditional American livery, marks the beginning of the airline’s brand new fleet type and points toward the airline’s future. Inside, the cabin is configured with three classes, featuring lie-flat seats in First and Business Class.

The Dallas/Fort Worth-Sao Paulo route, scheduled for January 31, 2013, will be the first to feature the newest addition to American’s fleet. Subsequently, the aircraft is slated to fly to London Heathrow from both Dallas/Fort Worth and New York JFK.

The modern new aircraft will feature a freshly painted livery on the outside. Upon boarding, American customers will be invited inside through a dramatic archway and ceiling treatment and mood lighting, to continue the modern experience and the look and feeling of spaciousness. A walk-up bar in the premium cabin stocked with snacks and refreshments will be a first for any U.S. airline and adds another distinctive luxury feature to the 777-300 ER. Entertainment options include up to 120 movies, more than 150 TV programs and more than 350 audio selections that will be offered throughout the aircraft. Also, every seat will feature individual 110-volt AC power outlets and USB jacks for charging personal electronic devices.

Will this new livery survive a merger? If American merges with US Airways and US Airways management takes over will they see this color scheme as an emblem of the past AA management or will they want another new fresh design of their own? Stay tuned for the unveiling.

American Airlines is expected to emerge from Chapter 11 bankruptcy reorganization in January and a possible merger with US Airways could also be announced in January. January will be a watershed month for AA with at least a new brand and a new aircraft type.

Meanwhile, CEO Tom Horton wants a quick resolution of whether the company will merge with US Airways or emerge from Chapter 11 as a stand-alone carrier according to this report by Reuters.

Read the full report: CLICK HERE

Copyright Photo: American Airlines.

American Airlines: AG Slide Show

Turkish Airlines finalizes its order for 15 Boeing 777-300 ERs

Boeing (Chicago) and Turkish Airlines (Istanbul) have finalized a firm order for 15 777-300 ER (Extended Range) airplanes worth $4.7 billion at list prices. The agreement, first announced in October as a commitment, also includes options for five additional 777-300 ERs and is the largest order by value in Turkish Airlines’ history.

Turkish Airlines’ fleet currently includes 12 777-300 ERs, the first of which Boeing delivered in October 2010. Over the past two years, these airplanes have formed the backbone of Turkish Airlines’ long-haul operations. This latest order will enable the Turkish flag-carrier to continue to serve new destinations worldwide.

The 777-300 ER seats up to 386 passengers in a three-class configuration and has a maximum range of 7,930 nautical miles (14,685 km).

Turkish Airlines currently operates a fleet that includes nearly 100 Boeing airplanes and serves more than 200 destinations across 90 countries worldwide.

Copyright Photo: Michael B. Ing. Boeing 777-3F2 ER TC-JJJ (msn 40710) prepares to land at Los Angeles International Airport.

Turkish Airlines: AG Slide Show

Lufthansa and Turkish Airlines expanded relationship could impact the fast growing Gulf carriers

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Lufthansa (Frankfurt) and Turkish Airlines (Istanbul), two Star Alliance airlines, are in discussions about increasing their relationship and cooperation according to this report by the Financial Times. Turkish Airlines is a fast growing carrier and serves many destinations not served by the German carrier. Lufthansa appears to favor this approach rather than striking up a new relationship with any of the fast growing Gulf carriers. Lufthansa has been critical of the Gulf carriers which pose a threat to many European long-haul carriers. Competitor Airberlin (Berlin) now has a strong and growing relationship with Etihad Airways (Abu Dhabi) and fast growing Qatar Airways (Doha) will join the Oneworld alliance in August 2013 as previously reported.

Read the full report from the Financial Times: CLICK HERE

Read another report by Arabian Business: CLICK HERE

Top Copyright Photo: Christian Volpati. Airbus A380-841 D-AIMJ (msn 073) approach Singapore for landing.

Lufthansa: AG Slide Show

Turkish Airlines: AG Slide Show

Bottom Copyright Photo: Michael B. Ing. Boeing 777-3F2 ER TC-JJP (msn 40797) completes its final approach into Los Angeles International Airport dressed in the updated 2010 color scheme.

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Air Canada and Turkish Airlines move closer with a new codeshare agreement

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Air Canada (Montreal) and Turkish Airlines (Istanbul) announced a reciprocal code sharing agreement that will make it easy and convenient for customers to connect between the two Star Alliance partner airlines. The agreement, to take effect the beginning of the second quarter of 2013, will leverage Air Canada’s planned Toronto-Istanbul route launching this summer pending receipt of government approval.

Under the code share agreement the two carriers will each place their flight designator code on select flights making it more convenient for travelers with such benefits as a single itinerary, through-checked bags and mutual status recognition. The agreement will include Air Canada’s code on Turkish Airlines’ Toronto-Istanbul flight and several destinations beyond Istanbul, not only in Turkey but also in the Middle East and Africa region. Turkish Airlines will also code share on Air Canada’s new non-stop service between Toronto and Istanbul providing connections to domestic Canada and several points from Toronto to U.S destinations. Moreover, with the loyalty program, passengers will have the opportunity to earn and use miles both on Turkish Airlines and Air Canada flights.

Top Copyright Photo: Michael B. Ing. Long-Range Boeing 777-233 LR C-FIVK (msn 35245) of Air Canada arrives at Tokyo (Narita).

Air Canada: AG Slide Show

Turkish Airlines: AG Slide Show

Bottom Copyright Photo: Keith Burton. Turkish Airlines’ Boeing 737-8F2 TC-JFM (msn 29775) with “Turkish Football Federation” additional marking approaches London (Gatwick) for landing.

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Air Canada plans a major Asian expansion this coming summer

Air Canada (Montreal) is launching a new nonstop route between Toronto (Pearson) and Seoul (Incheon), starting service to Istanbul subject to government approval, adding seven weekly departures to Beijing from Toronto and Vancouver , and upgrading its Calgary-Tokyo Narita route to provide daily service.

Highlights of Air Canada’s 2013 summer schedule include:

  • Nonstop service to Istanbul beginning June 4 . Subject to government approval, Air Canada will begin flying three-times weekly, year-round to the historic city which also serves as a gateway to other destinations in Turkey , Central Asia, the Middle East and Africa . Flights will be operated with a Boeing 767-300 ER aircraft. It will be the only early evening departure from Toronto to Istanbul .
  • The launch on June 2 of a new Toronto-Seoul service operating three times a week, creating a fifth Asian destination from Air Canada’s Toronto hub. The year-round service, operated with a Boeing 777-300 ER aircraft, will complement existing Vancouver to Seoul service by providing daily departures from Canada to Seoul .
  • An addition of three more weekly departures between Toronto and Beijing starting June 1 , bringing the total number of departures from Toronto to Beijing to ten a week. The flights will be operated with a Boeing 777-300 ER aircraft
  • Four additional departures each week between Vancouver and Beijing starting June 1 , for a total of 11 weekly departures, including a new late night flight timed to be convenient for business travellers. The flights will be operated with a Boeing 767-300 ER aircraft.
  • The upgrading of our Calgary-Tokyo Narita service starting May 1 to offer daily departures, up from five a week last summer. The flights are operated with a Boeing 767-300 ER.

Copyright Photo: Michael B. Ing. Boeing 777-333 ER C-FIVM (msn 35251) approaches Tokyo (Narita) for landing.

Air Canada: 

United and Continental pilots have a tentative agreement, subject to an approval vote

United Airlines‘ (Chicago) and Continental Airlines‘ (Houston) pilots may finally have an integration contract agreement that will allow the two groups to be merged. ALPA has issued the following statement:

The Master Executive Councils of the Continental and United pilots, represented by the Air Line Pilots Association International, have voted to accept a tentative agreement on a joint collective bargaining agreement reached with United Continental Holdings, Inc. The agreement now goes before the pilots for a ratification vote.

Captain Jay Heppner, Chairman of the United Master Executive Council and Captain Jay Pierce, Chairman of the Continental Master Executive Council, said the following in a joint statement:

“With this step, we are closer to a new contract that will provide gains in compensation, work rules, job protections, and retirement and benefits for our pilots and their families. We will finally begin to see the benefits of the merger that were promised to us, and an end to the concessionary and bankruptcy-era contracts we have lived and worked under for more than a decade.

“This agreement represents years of determination and unity demonstrated by the pilots of both airlines during the two-and-a-half years of negotiations for a new contract following the merger announcement. Pilots from both United and Continental Airlines will now determine whether this agreement addresses their contributions to the success of the airline.

“This step is also good news for our passengers and United employees. Once there is pilot approval of a contract, the operations of the two airlines can finally begin to be integrated. We can begin to deliver on the promise of the world’s best airline.”

Integration of seniority lists for the two pilots groups will occur after ratification of the tentative agreement. The process is independent of airline management and involves negotiations between the two pilot groups. Absent an agreement, binding arbitration will be used to settle any remaining differences. The process follows a predefined timeline following contract ratification that was agreed upon by the two pilot groups shortly after the merger was announced.

Copyright Photo: Fred Seggie. Boeing 777-222 ER N784UA (msn 26951) climbs away from London (Heathrow). N784UA is painted in the 2004 livery of United. The United fleet is adopting the older 1991 color scheme of Continental Airlines.

United Airlines: 

Continental Airlines: 

Air Canada reports third quarter earnings of C$554 million

Air Canada (Montreal) today reported earnings before interest, taxes, depreciation, amortization and impairment, and aircraft rent (EBITDAR), before the impact of certain benefit plan amendments, of $554 million in the third quarter of 2012 compared to EBITDAR of $535 million in the third quarter of 2011, an increase of $19 million.  Including the favourable impact of benefit plan amendments, EBITDAR was $678 million for the third quarter of 2012. Adjusted net income (1) of $230 million increased $37 million from the third quarter of 2011. Adjusted net income per diluted share (1) was $0.82 in the third quarter of 2012 compared to adjusted net income per diluted share of $0.68 in the same quarter in 2011.  On a GAAP basis, Air Canada reported net income of $429 million or $1.54 per diluted share for the third quarter of 2012 compared to a net loss of $124 million or $0.45 per diluted share for the same period last year.  This improvement in net income was driven in large part by favorable foreign exchange gains quarter-over-quarter.

Air Canada has entered into discussions with the federal government with respect to an extension of pension deficit funding relief given that the Air Canada special funding regulations expire in January 2014. Air Canada’s Canadian-based unions support the extension request.  This is in addition to various changes to Air Canada’s pension plans that were made during the last round of labour negotiations, which remain subject to regulatory approval.

Income Statement Highlights

System passenger revenues increased $92 million or 3.1 per cent, on a 1.6 per cent improvement in yield and a 0.8 per cent growth in traffic.  Passenger revenue per available seat mile (RASM) increased 2.2 per cent from the third quarter of 2011 due to the yield increase and a 0.5 percentage point improvement in passenger load factor.

Excluding the impact of certain benefit plan amendments described below, fuel expense and the cost of ground packages at Air Canada Vacations, CASM increased 1.6 per cent from the third quarter of 2011. This 1.6 per cent CASM increase was in line with the 1.0 per cent to 2.0 per cent third quarter increase projected in Air Canada’s news release dated August 8, 2012.

In the third quarter of 2012, operating expenses decreased $65 million or 2 per cent from the corresponding quarter in 2011.   Included in operating expenses in the third quarter of 2012 was an expense reduction of $124 million related to changes made to the terms of the new collective agreement with pilots pertaining to retirement age.  This reduction is reflected under “Benefit plan amendments” on Air Canada’s consolidated statement of operations.

In the quarter, operating income of $421 million, which included the favourable impact of the benefit plan amendments, increased $151 million from the third quarter of 2011.

Liquidity Highlights

At September 30, 2012, Air Canada’s cash and short-term investments amounted to $2,196 million, $17 million higher than Air Canada’s cash and short-term investments balance at September 30, 2011, and represented 18 per cent of 12-month trailing operating revenues

At September 30, 2012, adjusted net debt of $4,268 million decreased $308 million from December 31, 2011, reflecting the impact of net debt repayments, as well as the favourable impact of a stronger Canadian dollar.

Current Outlook

In the fourth quarter of 2012, Air Canada expects its system ASM capacity, as measured by available seat miles (ASMs), to increase in the range of 0 to 1.0 per cent when compared to the fourth quarter of 2011.

Taking into account reported ASM capacity for the first nine months of 2012, Air Canada now expects its full year 2012 system capacity to increase in the range of 0.75 to 1.25 per cent when compared to the full year 2011 (as opposed to the 0.5 to 1.5 per cent ASM increase projected in Air Canada’s news release dated August 8, 2012) and expects its full year 2012 domestic capacity to increase in the range of 0.5 to 1.0 per cent from the full year 2011 (as opposed to the 0.5 to 1.5 per cent ASM increase projected in Air Canada’s news release dated August 8, 2012).

For the fourth quarter of 2012, Air Canada expects adjusted CASM (1) to decrease by 2.0 to 3.0 per cent as compared to the fourth quarter of 2011. Taking into account reported operating expense results for the first nine months of 2012, Air Canada now expects adjusted CASM for the full year 2012 to increase by 0.75 to 1.25 per cent from the full year 2011 level (as opposed to the 0.5 to 1.5 per cent increase projected in Air Canada’s news release dated August 8, 2012).

In addition, Air Canada plans to increase its full year 2013 system capacity by 1.5 to 3.0 per cent when compared to the full year 2012. This projection includes all carriers operating under the Air Canada Express banner and the expected impacts of the new leisure group and the two Boeing 777 aircraft scheduled for delivery in June and August 2013.

Air Canada’s above-mentioned outlook assumes Canadian GDP growth of between 1.5 to 2.0 per cent for 2012 and 2013.  In addition, Air Canada expects that the Canadian dollar will trade, on average, at C$0.99 per U.S. dollar in the fourth quarter of 2012 and C$1.00 per U.S. dollar for the full year 2012 and that the price of jet fuel will average 88 cents per litre in the fourth quarter of 2012 and 89 cents per litre for the full year 2012.

(1) Adjusted net income (loss) and adjusted net income (loss) per share – diluted are non-GAAP financial measures.  Refer to section 16 “Non-GAAP Financial Measures” of Air Canada’s Third Quarter 2012 MD&A dated November 8, 2012 for additional information.

Copyright Photo: Michael B. Ing. Boeing 777-333 ER C-FIVQ (msn 35240) departs from London (Heathrow).

Air Canada: 

Air China introduces “Smiling China”, its 10th new Boeing 777-300 ER

Air China (Beijing) at a ceremony held today (October 30), received a newly delivered Boeing 777-300 ER which has a special livery reflecting is name – “Smiling China”. It is also the 10th of the 19 Boeing 777-300 ERs to be delivered to Air China.

This special livery is a joint creation by Air China and Boeing. According to the airline, the special livery is “to do justice to this year which marks the 40th anniversary of Boeing’s entry into China. Featuring 40 Chinese smiling, confident faces on the fuselage, the livery is meant to get across the message that China is a confident, sincere, friendly and optimistic country, and the airline industry of China has been playing an important role in forging closer ties between China and the rest of the world. The 40 faces are those of 20 recognized staff members of Air China and 20 netizens. Each of them has interesting stories to tell about China’s airline industry – they are pilots who have flown all over the world, ground handling staff who make sure that everything goes without a hitch, technicians who take good care of the aircraft and passengers who have seen the world.”

Currently, Air China is using its Boeing 777-300 ERs on international routes from Beijing to Frankfurt, Los Angeles and Paris as well as on the domestic trunk routes from Beijing to Shanghai, Guangzhou, Shenzhen and Chengdu.

Copyright Photo: Air China. Boeing 777-39L ER B-2035 (msn 38674) is seen today on the ramp at Paine Field near Everett.

Air China: 

British Airways launches London Gatwick-Las Vegas flights

British Airways (London) today (October 29) began its second London-Las Vegas service, helping high rollers travel from London Gatwick to the Nevada city.

The three-times-a-week service will be operated by a three-class Boeing 777 offering three cabins: Club World (business class), World Traveller Plus (premium economy) and World Traveller.

Together with the Heathrow service, British Airways will operate 10 flights a week from Las Vegas.

Copyright Photo: Michael B. Ing. Boeing 777-336 ER G-STBF (msn 40543) completes its final approach into London (Heathrow).

British Airways: 

American Airlines announces new routes to Asia, Europe and Latin America

American Airlines (Dallas/Fort Worth) announced today that it will launch service to markets in Asia, Europe and Latin America, delivering on the airline’s business plan and network strategy designed to offer customers more choices to new destinations. Next year, American will begin the following international services: Dallas/Fort Worth - Seoul, South Korea; Dallas/Fort Worth - Lima, Peru; Chicago O’Hare - Dusseldorf, Germany; and New York JFK - Dublin, Ireland.  This new service enhances American’s network footprint and will provide more access and choices for customers in key international markets.  It will also add domestic service to match customer demand through its Dallas/Fort Worth and Chicago hubs.

Last week, American announced that international unit revenue increased 8.0 percent for the first nine months of 2012, driven by increased load factors across all entities and improved yield performance. Unit revenue performance in the Pacific entity for the same period was strong, up 13.3 percent, driven by increased demand for the premium cabins, greater revenues from Asia point-of-sale and joint selling efforts with joint business partner, Japan Airlines. The Latin American entity posted a 7.2 percent unit revenue increase for the first nine months of 2012, including yield improvements in Mexico and Central and South America. The growing strength of American’s enhanced network, together with coordinated selling efforts with joint business partners British Airways and Iberia over the Atlantic, helped drive a 6.5 increase in trans-Atlantic unit revenue improvement for the first nine months of 2012 versus the prior year.

The strengthening of American’s global network is just another example of the company’s progress toward its business plan, which includes focusing its hubs in the most important domestic and international cities, enhancing relationships with the best international alliance partners and creating a pipeline of industry-leading products and services, including a significant renewal and transformation of an aircraft fleet that American expects to be the youngest and most fuel-efficient among its U.S. airline peers by 2017.

New Service to Asia

From its largest hub at Dallas/Fort Worth, American will launch its first-ever service to Seoul on May 9, 2013.  As one of the top 10 premium markets in the world, the new service to Seoul reinforces American’s commitment to customers and the Asia-Pacific region.  The new service will be operated as a part of American’s joint business agreement with Japan Airlines and will provide convenient access for customers traveling from South Korea to connect to more than 200 flights from Dallas/Fort Worth to cities in the United States and Latin America.

More Service to Europe

Beginning April 11, 2013, American will add service between Chicago O’Hare and Dusseldorf, Germany. American will code share with oneworld® alliance partner, airberlin - further reinforcing an already strong relationship and allowing customers to fly not only to Dusseldorf, but also to cities such as Moscow, Tel Aviv, and Nice through airberlin’s extensive network. This route will also operate as part of the joint business agreement with British Airways and Iberia.

In addition, American also will add new service between New York - JFK and Dublin, Ireland, beginning June 12, 2013.  These new flights also will be operated in conjunction with American’s Atlantic joint business partners, British Airways and Iberia. From JFK, American flies non-stop to nearly 50 cities throughout Asia, Europe, North America and South America with nearly 90 daily departures.

Increased Service to Latin America

Beginning April 2, 2013, American will add service between Dallas/Fort Worth and Lima, Peru.  American provides more service than any other airline between North America and Latin America with more than 900 weekly flights to 49 destinations.  With the addition of Dallas/Fort Worth - Lima, customers can access 30 destinations to Central America, Mexico, and South America from the Dallas/Fort Worth hub.

In addition, this added service continues to enhance American’s relationship with oneworld partner, LAN, including reciprocal frequent flyer benefits for American Airlines AAdvantage® and LANPASS members, and reinforces American’s commitment to the Peruvian market by providing seamless connections to multiple destinations including the Dallas/Fort Worth - Tokyo non-stop.

New Domestic Cities from Dallas/Fort Worth and Chicago:

On February 14, 2013, American will also add new domestic service, through its regional affiliates American Eagle and ExpressJet, from Dallas/Fort Worth to the following cities: Beaumont/Port Arthur, Texas, Columbia, Mo., and Fargo, N.D, as well as new Chicago O’Hare – Columbia, Missouri service.

DFW is the largest of American’s five domestic hubs offering more than 740 departures to nearly 170 cities in Asia, Europe, North America and South America.

Below is a summary of the new service:

International

Dallas/Fort Worth (DFW) – Lima (LIM)
AA2193 Leave DFW: 5:30 p.m. Arrive LIM: 12:25 a.m. (next day)
AA2194 Leave LIM: 2 a.m. Arrive DFW: 9:15 a.m.
Aircraft Type: Boeing 757
Frequency: Daily service
Start Date: April 2, 2013

Chicago O’Hare (ORD) – Dusseldorf (DUS)
AA242 Leave ORD: 5 p.m. Arrive DUS: 8:15 a.m. (next day)
AA241 Leave DUS: 12:10 p.m. Arrive ORD: 2:20 p.m.
Aircraft Type: Boeing 767-300
Frequency: Daily service
Start Date: April 11, 2013, subject to government approval

Dallas/Fort Worth (DFW) – Seoul (ICN)
AA27 Leave DFW: 10:30 a.m. Arrive ICN: 3 p.m. (next day)
AA26 Leave ICN: 5 p.m. Arrive DFW: 4:20 p.m.
Aircraft Type: Boeing 777-200
Frequency: Daily service
Start Date: May 9, 2013, subject to government approval

New York – JFK-Dublin (DUB)
AA290 Leave JFK: 6:55 p.m. Arrive DUB: 6:55 a.m. (next day)
AA291 Leave DUB: 9 a.m. Arrive JFK: 11:30 a.m.
Aircraft Type: Boeing 757-200
Frequency: Daily
Start Date: June 12, 2013, subject to government approval

Domestic

Dallas/Fort Worth (DFW) – Beaumont/Port Arthur (BPT)
AA2543 Leave DFW 8:40 a.m. Arrive BPT 9:50 a.m.
AA2521 Leave DFW 11:20 a.m. Arrive BPT 12:35 p.m.
AA2523 Leave DFW 3:10 p.m. Arrive BPT 4:20 p.m.
AA2525 Leave DFW 6:25 p.m. Arrive BPT 7:35 p.m. (except Saturday)
AA2510 Leave BPT 6:30 a.m. Arrive DFW 7:45 a.m.
AA2543 Leave BPT 10:20 a.m. Arrive DFW 11:30 a.m.
AA2521 Leave BPT 1:05 p.m. Arrive DFW 2:15 p.m.
AA2523 Leave BPT 4:50 p.m. Arrive DFW 6 p.m. (except Saturday)
Aircraft Type: CRJ 200
Frequency: All flights are daily except as noted above
Start Date: Feb. 14, 2013

Dallas/Fort Worth (DFW) – Columbia, Mo. (COU)
AA3396 Leave DFW Noon Arrive COU 1:25 p.m.
AA3348 Leave DFW 6:55 p.m. Arrive COU 8:25 p.m. (except Saturday)
AA3215 Leave COU 6:45 a.m. Arrive DFW 8:35 a.m.
AA3291 Leave COU 5:40 p.m. Arrive DFW 7:25 p.m. (except Saturday)
Aircraft Type: Embraer 145
Frequency: All flights are daily except as noted above
Start Date: Feb. 14, 2013

Chicago – O’Hare (ORD) -COU
AA3919 Leave ORD 3:55 p.m. Arrive COU 5:10 p.m.
AA3900 Leave COU 1:55 p.m. Arrive ORD 3:20 p.m.
Aircraft Type: Embraer 145
Frequency: Daily
Start Date: Feb. 14, 2013

Dallas/Fort Worth – Fargo (FAR)
AA2537 Leave DFW: 12:05 p.m. Arrive FAR: 2:30 p.m.
AA2537 Leave FAR: 3:05 p.m. Arrive DFW: 5:50 p.m.
Aircraft Type: CRJ 200
Frequency: Daily
Start Date: Feb. 14, 2013

Copyright Photo: Bruce Drum. Boeing 777-223 ER N760AN (msn 31477) arrives at New York (JFK).

American Airlines: 

Turkish Airlines plans to order 15 additional Boeing 777-300 ERs

Turkish Airlines (Istanbul) plans to order 15 additional Boeing 777-300 ERs by 2017 with five options according to a report by Reuters.

Read the full report: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-3F2 ER TC-JJP (msn 40797) completes its final approach into Los Angeles International Airport.

Turkish Airlines: 

AeroMexico to launch nonstop Mexico City-London (Heathrow) flights on December 14

AeroMexico (Mexico City) is planning to launch nonstop Mexico City-London (Heathrow) service starting on December 14. The route will be operated three days a week.

Read the full story from lainformacion.com (in Spanish): CLICK HERE

Copyright Photo: Ariel Shocron. Boeing 777-2Q8 ER N776AM (msn 28692) climbs away from Madrid (Barajas).

AeroMexico: 

Ceiba Intercontinental launches its first European route to Madrid

Ceiba Intercontinental Airlines (Malabo) made its historic first intercontinental flight on October 4 from Malabo, Equatorial Guinea, to Madrid. Ceiba will service the route with its Boeing 777-200 LR aircraft.

The Ministry of Civil Aviation of Equatorial Guinea purchased the aircraft as the first step in the government’s efforts to meet the growing demand for air service to the country and support its growing economy.

Ceiba has scheduled three flights a week on the new Madrid-Malabo route and is part of the African Airlines Association (AFRAA).

Ceiba currently offers scheduled service from Bata and Malabo in Equatorial Guinea to several cities in West and Central Africa, including Accra, Ghana; Abidjan, Cote d’Ivoire, Brazzaville, Congo; Douala, Cameroun; Libreville, Gabon; Cotonou, Benin; andLome, Togo.

Copyright Photo: Nick Dean. Boeing 777-2FB LR 3C-LLS (msn 40668) takes off from Paine Field near Everett.

Ceiba Intercontinental: 

 

Air Canada to add two additional Boeing 777-300 ERs, 15 Embraer ERJ 175s to be transferred to Sky Regional Airlines

Air Canada (Montreal) yesterday (October 1) unveiled a fleet plan providing for international growth at both the mainline carrier and its new low-cost leisure airline to be launched in 2013.

Air Canada will add two new Boeing 777-300 ER aircraft to the mainline carrier’s widebody fleet in order to pursue strategic growth opportunities for its international network.  With the addition of these two aircraft, to be delivered in June and September 2013, Air Canada’s Boeing 777 fleet will consist of 20 aircraft comprising the latest generation of 300 ER and 200 LR models. Air Canada currently operates 56 widebody aircraft and 149 narrowbody aircraft.

The arrival of these new Boeing 777s, along with the 787 Dreamliners in 2014, will allow AC to introduce new routes for the mainline carrier and release aircraft from the existing fleet to the new low-cost leisure carrier. Air Canada’s mainline carrier will continue to grow internationally as it launches new routes, while the leisure carrier will pursue opportunities in markets where we are not adequately cost competitive under the mainline brand, according to the carrier.

On September 20, 2012, Air Canada announced that it will hire more than 900 employees over the next 12 months to meet its planned workforce requirements at the main airline. In addition, 200 new jobs will be created for flight attendants and pilots at the airline’s new leisure carrier.

New international services to be introduced with the addition of two Boeing 777 aircraft at the main network carrier will be announced at a future date, as will further details of its leisure carrier low cost unit.

Consistent with Air Canada’s focus on pursuing international growth opportunities and its on-going cost transformation initiatives, the airline and Sky Regional Airlines, Inc. (Air Canada Express) (Toronto) have agreed to the transfer of 15 Embraer 175 aircraft, the smallest aircraft in Air Canada’s fleet, from Air Canada to Sky Regional to operate the aircraft on behalf of Air Canada under the capacity purchase agreement between the parties. The aircraft will continue to be operated on short-haul regional routes, primarily from Toronto and Montreal to destinations in the northeast United States, under the Air Canada Express banner. The transfer of the 15 regional aircraft is expected to be made between February and June 2013. The agreement is subject to a number of conditions. Sky Regional has operated Air Canada Express service between Billy Bishop Toronto City Airport and Montreal Trudeau Airport since May 2011.  In addition to Sky Regional, Air Canada has capacity purchase agreements with its other regional airline partners, Jazz, Air Georgian and EVAS, that operate regional Air Canada Express flights on behalf of Air Canada.

Top Copyright Photo: Keith Burton. Boeing 777-333 ER C-FIUV (msn 35248) climbs away from the runway at London (Heathrow).

Air Canada: 

Bottom Copyright Photo: Brian McDonough. The 15 Embraer ERJ 170-200SUs (ERJ 175s) will leave the mainline AC fleet and will be operated now as Air Canada Express aircraft by lower-cost Sky Regional. C-FEJD (msn 17000090) prepares to land at Washington (Reagan National).

FedEx Corporation reports 1Q net income of $459 million, down 1%

FedEx Corporation (FedEx Express) (Memphis) reported earnings of $1.45 per diluted share for the fiscal first quarter ended August 31, compared to $1.46 per share last year.

FedEx Corporation reported the following consolidated results for the first quarter:

• Revenue of $10.79 billion, up 3% from $10.52 billion the previous year

• Operating income of $742 million, up 1% from $737 million last year

• Operating margin of 6.9%, down from 7.0% the previous year

• Net income of $459 million, down 1% from last year’s $464 million

During the quarter, improved FedEx Freight results and the continued strong performance at FedEx Ground were more than offset by lower demand for priority services at FedEx Express.

Copyright Photo: Nick Dean.

FedEx Express: 

Emirates SkyCargo starts new freighter service to Osaka and Seoul

Emirates SkyCargo, the freight division of Emirates Airline (Dubai), commenced a new freighter service from Dubai to Japan and Korea on September 7.

The new service will operate one flight per week and serve the growing demand for air freight to and from Kansai International Airport and Seoul Incheon International Airport. Flight EK 9891 – using a Boeing 777F freighter with a cargo capacity of more than 100 tons – will depart Dubai every Thursday at 22:30 and arrive at Kansai at 12:40 the following Friday, and depart Kansai at 14:40 and arrive at Inchon at 16:10 same day.

Flight EK 9892 from Incheon to Dubai will depart from Incheon at 18:15 every Friday and arrive at Dubai at 22:45 on the same day.

Copyright Photo: Andi Hiltl. Boeing 777-F1H A6-AFG (msn 35613) climbs away from the runway at Zurich.

Emirates: 

 

Emirates arrives in Washington

Emirates Airline (Dubai), one of the fastest growing airlines in the world, has launched its daily nonstop service from Dubai to Washington Dulles International Airport (IAD). It is the seventh gateway for Emirates in the United States, and the twelfth new route to join the airline’s international network in 2012.

Copyright Photo: Nick Dean. Brand new Boeing 777-31H ER A6-EGR (msn 41077) climbs away from the Boeing factory at Paine Field near Everett.

Emirates: 

American Airlines becomes the first commercial carrier with FAA approval to use Electronic Flight Bags in all phases of flight

American Airlines (Dallas/Fort Worth) has announced it is expanding its iPad Electronic Flight Bag program after becoming the first commercial carrier to receive FAA approval to use the Apple iPad in the cockpit during all phases of flight.

American’s pilots will be using iPad, the only FAA-approved tablet as an Electronic Flight Bag in approved aircraft. An Electronic Flight Bag reduces or replaces paper-based reference material and manuals often found in a pilot’s carry-on kitbag. Removing the 35-pound kitbag from each American Airlines plane will save an estimated $1.2 million of fuel annually based on current fuel prices.

Alaska Airlines is also using the iPad in the cockpit.

As part of the Electronic Flight Bag program, American’s pilots will use mobile software and data from Jeppesen, a unit of Boeing Flight Services. The FAA-approved Jeppesen application, which is allowed for gate-to-gate use throughout all phases of flight, will replace bulky paper operating manuals with real-time, up-to-date electronic information that is easier to access.

American’s pilots will start using iPads this month on the airline’s Boeing 777 fleet. American aims to have FAA approval for use in all fleet types by the end of 2012. Beginning in January 2013, American will stop distributing paper revisions to its flight manuals and most navigation charts.

To ease the transition company-wide, all active pilots and instructors will receive an iPad for use in training and inflight.

American first received FAA approval to use iPads in the cockpit in 2011, which came several months after American completed testing with pilots using iPads in the cockpit. The first FAA-approved device to be tested is the iPad, and if other tablets are approved by the FAA they will be evaluated for use.

Top Copyright Photo: Michael B. Ing. Boeing 777-223 ER N757AN (msn 32636) climbs awy from the runway at Los Angeles International Airport.

American Airlines: 

Bankruptcy judge rules AMR can void the American Airlines pilot’s contract

AMR Corporation (American Airlines) (Dallas/Fort Worth) now has what it has wanted. Bankruptcy Court Judge Lane has issued his decision which now permits AMR and American Airlines to unilaterally void its contract with its pilots, represented by the Allied Pilots Association. AMR has stated it needs labor stability and around 20 percent lower costs to emerge from its Chapter 11 reorganization. Who now will make the next move?

Read the full report from Reuters: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-223 ER N756AM (msn 30264) climbs away from Los Angeles International Airport.

American Airlines: 

American’s pilots are talking with the US Airways’ pilots about a transitional labor agreement

American Airlines‘ (Dallas/Fort Worth) pilots, represented by the Allied Pilots Association (APA), have been meeting with the pilots of US Airways (Phoenix) and CEO Doug Parker about a transitional labor agreement and also about possible airline consolidation between the two carriers according to this article by the Tulsa World. The APA pilots are united in their opposition against American CEO Tom Horton. The pilots of American are the last labor group holding out against a new labor agreement and are threatening to strike if their current contract is voided by the bankruptcy court. The judge is due to rule on September 4.

Read the full article: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-223 ER N791AN (msn 30254) of American Airlines in the Oneworld motif climbs away from the runway at Los Angeles International Airport.

American Slide Show: 

US Airways Slide Show: 

British Airways to start nonstop London Gatwick-Colombo service on March 31

British Airways (London) will start nonstop London (Gatwick)-Colombo (Sri Lanka) flights starting on March 31, 2013. The route will be operated three days a week and flown with Boeing 777-200 ERs.

Copyright Photo: Rolf Wallner. Boeing 77-236 ER G-YMMT (msn 36518) completes its final approach into London (Heathrow).

British Airways: 

Qatar Airways is coming to Chicago

Qatar Airways (Doha) has announced an expansion of its USA route network with the introduction of daily passenger flights to Chicago (O’Hare) from April 10, 2013.

The nonstop service from Doha, capital of the State of Qatar, will be Qatar Airways’ fourth USA gateway, following its daily operations to New York (JFK), Washington (IAD) and Houston (IAH).

The carrier, which already operates twice-weekly cargo flights to Chicago O’Hare, will use its flagship long-haul Boeing 777-300 ER (Extended Range) passenger aircraft on the Doha – Chicago route with an approximate flying time of 15 hours.

Copyright Photo: Nick Dean. Boeing 777-3DZ ER A7-BAH (msn 37662) climbs away from Paine Field near Everett.

Qatar Airways: 

 

 

Cathay Pacific Group slips into a first half loss of $120.5 million

Cathay Pacific Group (Cathay Pacific Airways) (Hong Kong) slipped into the red for the first half of 2012, reporting a new loss of $120.5 million (US). The company issued the following report:

          1H2012

 1H2011

Change

Turnover HK$ million       48,861

46,791

+4.4%

(Loss)/profit attributable to owners of Cathay Pacific HK$ million          (935)

2,808

-133.3%

(Loss)/earnings per share HK cents         (23.8)

71.4

-133.3%

Dividend per share HK$                -

0.18

-100.0%

The Cathay Pacific Group reported an attributable loss of HK$935 million for the first six months of 2012. This compares to the profit of HK$2,808 million in the first half of 2011. Loss per share was HK23.8 cents as compared to the earnings per share of HK71.4 cents in 2011. Turnover for the period rose by 4.4% to HK$48,861 million.

In the first half of 2012, Cathay Pacific’s core business was significantly affected by the persistently high price of jet fuel, passenger yields coming under pressure and weak air cargo demand – factors common to the aviation industry as a whole. Profits from associated companies, including Air China, also showed a marked decline. In response to these challenges, the Cathay Pacific Group introduced measures designed to protect its business, including schedule changes and capacity reductions, the withdrawal from service of older, less fuel-efficient aircraft, a recruitment freeze and the introduction of voluntary unpaid leave for cabin crew. At the same time the Group kept its network intact and did not allow cost reductions to compromise the brand or service quality. It also continued with major investments – new aircraft, new products and its own HK$5.9 billion cargo terminal at Hong Kong International Airport – that will benefit the business in the long term.

Fuel remains the airline’s most significant cost. Fuel prices were at historical high during the first half of 2012 (although they decreased significantly at the end of the period) and this had a major impact on Cathay Pacific’s operating results. In the first six months of 2012, the Group’s fuel costs (disregarding the effect of fuel hedging) increased by 6.5% compared to the same period in 2011. Fuel accounted for 41.6% of total operating costs. Managing the risk associated with high and volatile fuel prices remains a key challenge. The airline’s fuel hedging programme helps to mitigate the impact of fuel price fluctuations. However, with the fuel price remaining high for the past two years, realised profit from hedging activities in the first half of 2012 fell by 59.4% compared to the same period in 2011.

In the first six months of 2012, the passenger business of the Cathay Pacific Group was affected by pressure on yields against the background of increased fuel prices and higher operating costs. Revenue for the period was HK$34,713 million, representing an increase of 9.2% compared to the same period in 2011. Capacity increased by 6.9%. A total of 14.3 million passengers were carried by Cathay Pacific and Dragonair in the first six months, which is a rise of 8.6% compared to the same period in 2011. The load factor rose by 0.8 percentage points. Yield increased by 1.2% to HK66.1 cents. The high cost of fuel made it more difficult to operate profitably, particularly on long-haul routes operated by older, less fuel-efficient, Boeing 747-400 and Airbus A340-300 aircraft.

The Group’s cargo business was affected by continued weak demand in major markets. Cargo revenue for the first half of 2012 was down by 7.6% to HK$11,897 million compared to the same period in 2011. Yield was down by 0.4% to HK$2.41. Capacity was down by 4.3%, while the load factor was down by 4.1 percentage points to 64.3%. Demand for shipments from the Group’s two key markets, Hong Kong and Mainland China, was well below expectations, though the introduction of new hi-tech consumer electronics products in March resulted in a temporary improvement. Capacity was adjusted in line with demand. Cathay Pacific continued to develop new markets where demand warranted doing so, introducing freighter services to Zhengzhou in March and to Hyderabad in May.

Six Airbus A350-900 aircraft were ordered in January. In August, the airline agreed to acquire 10 Airbus A350-1000 aircraft and to convert 16 previously ordered Airbus A350-900 aircraft into Airbus A350-1000 aircraft which has a bigger capacity and longer range. The Cathay Pacific Group will take delivery of 19 aircraft in 2012 which will help to improve the operational efficiency of the fleet. In view of their high operating costs when fuel prices are high, the retirement of the airline’s Boeing 747-400 passenger aircraft has been accelerated. Three Boeing 747-400BCF freighters have also been withdrawn from service in order to reduce costs.

In May, Cathay Pacific announced its intention to reduce some passenger services on transpacific routes. This will enable fuel-efficient Boeing 777-300 ER aircraft to operate on routes currently served by older less fuel efficient Boeing 747-400 aircraft. The Group remains committed nevertheless to maintaining its network and has increased some services in Asia, where demand is relatively robust. Dragonair introduced or resumed flights to six destinations – Xi’an, Guilin, Clark, Jeju, Taichung and Chiang Mai – and will introduce flights to Kolkata and Haikou later in the year. Cathay Pacific continues to improve products and services in the air and on the ground. A new Premium Economy Class was launched alongside new long-haul Economy Class seats. The airline also continued to install its popular new Business Class on long-haul services. Cathay Pacific was proud to be named World’s Best Business Class in the 2012 World Airline Awards organized by Skytrax.

Copyright Photo: TMK Photography. Boeing 777-367 ER B-KPF (msn 36832) in the special Hong Kong-Asia’s world city motif arrives at Toronto (Pearson).

Cathy Pacific Airways: 

TAM to start daily nonstop Rio de Janeiro-Orlando service on October 29

TAM Linhas Aereas (TAM Airlines) (LANTAM Airlines Group) (Sao Paulo) will now launch the daily nonstop Rio de Janeiro (Galeao)-Orlando route with Airbus A330-200s on October 29 according to Airline Route.

In addition, the airline will upgrade the daily Sao Paulo (Guarulhos)-Miami route to the pictured Boeing 777-300 ER starting on September 19.

Copyright Photo: Nick Dean. Climbing beautifully, brand new Boeing 777-32W ER PT-MUD departs from the runway at Paine Field near Everett.

TAM: 

American Airlines’ pilots reject the tentative contract by 61%

American Airlines‘ (Dallas/Fort Worth) 7,500 pilots, represented by the Allied Pilots Association (APA), have rejected by a 61 percent vote, to disapprove the latest tentative contract. American stated it was disappointed by the vote and will now ask the bankruptcy court to impose harsher terms for its pilots.

Meanwhile AA’s flight attendants are voting on a tentative agreement through August 19.

Read the full account in the Washington Post: CLICK HERE

Copyright Photo: Michael B. Ing. Boeing 777-223 ER N786AN approaches Tokyo (Narita) for landing.

American Airlines: 

Air Canada reports EBITDAR second quarter income of C$314 million

Air Canada (Montreal) recorded earnings before interest, taxes, depreciation, amortization and impairment, and aircraft rent (EBITDAR) of C$314 million in the second quarter of 2012 compared to EBITDAR of C$338 million in the second quarter of 2011. Operating income of $63 million decreased $10 million from the same quarter in 2011.

In the company financial call, airline executives confirmed AC is still proceeding with a low-cost subsidiary in 2013. The new subsidiary will operate Airbus A319s and Boeing 767-300s on leisure routes. AC’s pilots are fighting the creation of this new subsidiary.

Here is the full financial report (all currencies in Canadian dollars):

Income Statement Highlights

On a system capacity growth of 0.6 per cent, system passenger revenues increased $85 million or 3.3 per cent in the second quarter of 2012, on a 1.4 per cent growth in traffic and a 1.2 per cent improvement in yield. Passenger revenue per available seat mile (RASM) increased 2.0 per cent from the second quarter of 2011. In the premium cabin, second quarter 2012 passenger revenues increased $21 million or 3.7 per cent from the same quarter in 2011, driven by a 2.1 per cent improvement in yield and a 1.6 per cent growth in traffic.

In the second quarter of 2012, operating expenses increased $81 million or 3 per cent from the second quarter of 2011, primarily due to increases in wages, salaries and benefits, aircraft maintenance, capacity purchase costs and other expenses. Partially offsetting these increases was a reduction in depreciation, amortization and impairment expense. Unit cost, as measured by operating expense per available seat mile (CASM), increased 2.3 per cent from the second quarter of 2011. Excluding fuel expense and the cost of ground packages at Air Canada Vacations, CASM increased 3.6 per cent from the second quarter of 2011. The 3.6 per cent increase in CASM, excluding fuel expense and excluding the cost of ground packages at Air Canada Vacations, was less than the 4.0 per cent to 5.0 per cent increase projected in Air Canada’s news release dated May 4, 2012, as a number of cost categories were slightly below what Air Canada had previously anticipated.

Air Canada reported an operating income of $63 million in the second quarter of 2012, a decline of $10 million from the second quarter of 2011.

Air Canada reported a net loss of $96 million or $0.35 per diluted share in the second quarter of 2012 compared to a net loss of $46 million or $0.17 per diluted share in the second quarter of 2011. On an adjusted basis, net loss per diluted share was $0.05 in the second quarter of 2012 compared to a net loss per diluted share of $0.01 in the second quarter of 2011. Removing the impact of the labour disruptions and the capacity impact related to the Aveos closure, the adjusted income per diluted share would have been $0.07 to $0.12, an improvement over the same quarter in 2011.

Liquidity Highlights

At June 30, 2012, Air Canada’s cash and short-term investments amounted to $2,383 million, $124 million higher than Air Canada’s cash and short-term investments balance at June 30, 2011, and represented 20 per cent of 12-month trailing operating revenues.

At June 30, 2012, adjusted net debt of $4,223 million decreased $353 million from December 31, 2011. This reduction in adjusted net debt included the impact of lower debt balances and the impact of an increase in cash and short-term investments of $284 million from December 31, 2011, which was mainly due to positive free cash flow of $368 million in the first six months of 2012.

Current Outlook

In the third quarter of 2012, Air Canada expects its system ASM capacity, as measured by available seat miles (ASMs), to increase in the range of 0 to 1.0 per cent when compared to the third quarter of 2011.

Taking into account reported ASM capacity for the first six months of 2012, Air Canada expects its full year 2012 system capacity to increase in the range of 0.5 to 1.5 per cent when compared to the full year 2011 (as opposed to the 0 to 1.5 per cent ASM increase projected in Air Canada’s news release dated May 4, 2012) and expects its full year 2012 domestic capacity to increase in the range of 0.5 to 1.5 per cent from the full year 2011 (as opposed to the 0 to 1.5 per cent ASM increase projected in Air Canada’s news release dated May 4, 2012).

For the third quarter of 2012, Air Canada expects CASM, excluding fuel expense and excluding the cost of ground packages at Air Canada Vacations, to increase by 1.0 per cent to 2.0 per cent from the third quarter of 2011.

Air Canada continues to expect its full year 2012 CASM, excluding fuel expense and excluding the cost of ground packages at Air Canada Vacations, to increase by 0.5 per cent to 1.5 per cent from the full year 2011 level.

Air Canada’s above-mentioned outlook assumes Canadian GDP growth of 1.5 per cent to 2.0 per cent in 2012. In addition, Air Canada expects that the Canadian dollar will trade, on average, at C$1.01 per U.S. dollar in the third quarter of 2012 and for the full year 2012 and that the price of jet fuel will average 85 cents per litre for the third quarter of 2012 and 88 cents per litre for the full year 2012.

The following table summarizes Air Canada’s above-mentioned outlook for the third quarter of 2012 and for the full year 2012 and related major assumptions:

Third Quarter 2012 versus
Third Quarter 2011
Full Year 2012 versus
Full Year 2011
Current Outlook
Available seat miles (System) Increase 0% to 1.0% Increase 0.5% to 1.5%
Available seat miles (Canada) n/a Increase 0.5% to 1.5%
CASM, excluding fuel expense and excluding the cost of ground packages at Air Canada Vacations Increase 1.0% to 2.0% Increase 0.5% to 1.5%
Major Assumptions -
Third Quarter 2012
Major Assumptions -
Full Year 2012
Major Assumptions
Canadian dollar per U.S. dollar 1.01 1.01
Jet fuel price – CAD cents per litre (net of fuel hedging) 85 cents 88 cents
Canadian economy 2012 annualized Canadian GDP
growth of 1.5% to 2.0%
Canadian GDP
growth of 1.5% to 2.0%

For the full year 2012, Air Canada also projects the following:

  • Depreciation, amortization and impairment expense to decrease by $55 million from the full year 2011, as opposed to the decrease of $70 million projected in Air Canada’s new release dated May 4, 2012. This revised guidance reflects changes in residual values of aircraft and the acceleration of depreciation of various assets, including as a result of the planned removal of nine CRJ-100 aircraft from the covered fleet under Air Canada’s capacity purchase agreement with Jazz Air LP.
  • Employee benefits expense to increase by $30 million from the full year 2011.

The following table summarizes the above-mentioned projections for the full year 2012:

Full Year 2012 versus
Full Year 2011
Depreciation, amortization and impairment expense Decrease $55 million
Employee benefits expense Increase $30 million

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

Non-GAAP Measures

Below is a description of certain non-GAAP measures used by Air Canada to provide additional information on its financial and operating performance. Such measures are not recognized measures for financial statement presentation under Canadian GAAP and do not have standardized meanings and therefore may not be comparable to similar measures presented by other public companies. Readers should refer to Air Canada’s Second Quarter 2012 MD&A for a reconciliation of non-GAAP financial measures.

  • Adjusted net income (loss) per diluted share is used by Air Canada to assess share performance without the effects of foreign exchange, mark-to-market adjustments on derivatives and other financial instruments recorded at fair value and unusual items.
  • EBITDAR is commonly used in the airline industry and is used by Air Canada to assess earnings before interest, taxes, depreciation, amortization and impairment, and aircraft rent, as these costs can vary significantly among airlines due to differences in the way airlines finance their aircraft and other assets.
  • Operating expense, excluding fuel expense and excluding the cost of ground packages at Air Canada Vacations, is used by Air Canada to assess the operating performance of its ongoing airline business as such expenses may distort the analysis of certain business trends and render comparative analyses to other airlines less meaningful.
  • Free cash flow is used by Air Canada as an indicator of the financial strength and performance of its business because it shows how much cash is available for such purposes as repaying debt, meeting ongoing financial obligations and reinvesting in Air Canada.
  • Adjusted net debt is a key component of the capital managed by Air Canada and provides a measure of the airline’s net indebtedness.

Copyright Photo: Wingnut. Boeing 777-233 LR C-FNNF climbs away from the runway at London (Heathrow).

Air Canada:

Air France-KLM 2Q net loss expands to $1.1 billion

Air France (Paris) and KLM Royal Dutch Airlines (Amsterdam) reported their second quarter net expanded to almost $1.1 billion.

Read the analysis from the Washington Post: CLICK HERE

Top Copyright Photo: Nick Dean. Boeing 777-328 ER F-GZNN (msn 40376) in the SkyTeam motif climbs away from Paine Field near Everett, Washington.

Air France: 

KLM: 

Bottom Copyright Photo: Paul Denton. KLM’s Boeing 737-7K2 PH-BGN 9msn 38125) taxies at Geneva.

 

Philippines Airlines is coming to Toronto, Paris and Rome

Philippines (Philippine Airlines) (Manila) is planning to add Toronto (Pearson) before of the end of this year as the company adds more Boeing 777-300 ERs according to this report by the Manila Bulletin. The flag carrier is also planning to add Paris and Rome in February 2013.

Read the full report: CLICK HERE

Copyright Photo: Micheil Keegan. Boeing 777-36N ER RP-C7777 (msn 37709) prepares to touch down in Sydney.

Philippines: 

Korean Air finalizes an order for two more Boeing 777-300 ERs, returns to an operating profit in the 2Q

Korean Air (Seoul) has finalized an order for two additional Boeing 777-300 ERs (Extended Range) airplanes. The order is valued at $596 million at Boeing list prices.

Korean Air currently operates 34 777 airplanes that include 10 777-300 ERs. With this order, the airline has six more 777-300 ERs on order with Boeing. The airline became the first airline in the world to operate both the 747-8 and 777 Freighters when they were added to its fleet after a historic double airplane delivery in February 2012.

On the financial side, the company returned to an operating profit in the second quarter. The airline issued the following financial report for the second quarter:

“Korean Air, South Korea’s flagship airline, announced its financial results for the second quarter of 2012 ended June 30, 2012.

The airline posted operating income of 3,119 billion KRW for the second quarter of 2012, a year-on-year increase of 9.9%. Operating profit turned to black from a loss of 38 billion KRW in the same period of last year to a profit of 100 billion KRW. International passenger and cargo businesses remained the major revenue contributors for the airline, accounting for 56.8% and 25.1% of the operating revenue respectively.

International Passenger Business

During the second quarter of 2012, it saw increased traffic across all routes, including the Commonwealth of Independent States (CIS, up 41%), Japan (up 28%), China (up 18%) and Europe (up 15%). International passenger segment recorded a year-on-year growth of 10.1% and 9.0% in passenger traffic and carrying capacity, reaching 16,232 million RPK and 20,540 million ASK respectively. Overseas outbound traffic lifted 18%, with 21% and 15% increase in Korea inbound traffic and transit respectively.

To cater the growing demand in summer, the airline will increase passenger carrying capacity in high demand routes. With the introduction of new Incheon – Yangon route in the third quarter, as well as stepping up frequency on selected routes, such as Incheon – Jinan, Incheon-Kunming, Incheon-Okayama, Incheon – Guam, Incheon – Paris etc., the airline sees potential growth in passenger traffic.

With stabilized jet fuel price and exchange rate, the airline is expected to see improvement in profitability.

Cargo Business

Cargo traffic recorded a year-on-year fall of 12.2% to 2,013 million FTK as it saw a Y-o-Y decrease of 9% in Korea outbound traffic and transit traffic respectively. While transit traffic from Japan reported a slump, transit traffic from Oceania recorded increase of 47%. Direct flight between Shanghai and Americas was also put into operation in the second quarter.

Benefiting from the London Olympic Games and seasonal high demand in the third quarter, cargo traffic is expected to recover gradually. In an attempt to address environmental issues and high jet fuel price, Korean Air will introduce fuel efficient and environmental friendly aircraft to the fleet. The airline will strive to enhance profitability and sustain growth by developing new markets such as South America and Africa.

Korean Air will continue to expand its business prudently while enhancing the quality of its service for the remaining of the year. With its long-standing commitment to achieving “Excellence in Flight”, Korean Air aims to provide the best quality to its customers while bringing the best returns to its shareholders.

* Exchange rate on June 30, 2012: 1 US Dollar = 1,153.8 KRW”

Copyright Photo: Michael B. Ing. Boeing 777-3B5 ER HL8208 (msn 37645) climbs away from Los Angeles International Airport.

Korean Air: 

Ethiopian Airlines orders an additional Boeing 777-200 LR (Longer Range)

Ethiopian Airlines (Addis Ababa) has announced it has placed an order for one additional 777-200 LR (Longer Range) Worldliner, adding to the airline’s fleet of five 777-200 LRs. The order is valued at approximately $276 million at list price.

Ethiopian Airlines was the first African airline to operate the 777-200 LR, the first to order the Boeing 787 Dreamliner with an order for 10 and the first to order the 777 Freighter. Ethiopian Airlines currently operates an all-Boeing fleet of 737, 757, 767 and 777 airplanes in passenger service and a 757, MD-11 and 747 in cargo operations.

Copyright Photo: Christian Volpati. Boeing 777-260 LR ET-ANO (msn 40771) named “The Rift Valley” arrives from Addis Ababa at Dubai, United Arab Emirates (UAE).

Ethiopian Airlines: 

United announces new international and domestic routes from hub cities

United Airlines (Chicago) today announced plans to launch year-round and seasonal service on several new international and domestic routes, including:

  • New daily trans-Pacific and trans-Atlantic flights from San Francisco, United’s largest Pacific gateway;
  • New flights from Chicago to points in the U.S., Canada, Mexico and the Caribbean;
  • New “Capital to Capital” service between Washington and San Salvador; and
  • Additional flights from Denver and Los Angeles.

United and its regional partners will operate these new routes with a mix of mainline and regional aircraft.

The newly announced and previously launched services are consistent with United’s previously announced 2012 capacity guidance.

United will begin daily year-round service between its hub at San Francisco International Airport and Taiwan Taoyuan International Airport in Taipei on April 9, 2013, subject to government approval. The flights will operate using Boeing 777-200 ER aircraft with 269 seats – eight in United Global First, 40 in United BusinessFirst, 104 in United Economy Plus, and 117 in United Economy.

The new San Francisco-Taipei flights will be available for booking once United receives government approval.

The airline will also begin daily year-round service between San Francisco and Charles de Gaulle International Airport in Paris on April 11, 2013, subject to government approval. The Paris flights will operate with Boeing 767-300 aircraft with 214 seats – 30 in BusinessFirst, 49 in Economy Plus and 135 in economy.

The new Paris and Taipei services will augment United’s ongoing investment in air service at San Francisco International Airport. This year, the airline will operate more than 300 flights daily from San Francisco, more than any other airline and more than 8 percent more departures from San Francisco compared to 2011. United offers nonstop service to more than 60 airports across the United States, including those in top business travel markets in New York, Los Angeles, Chicago and Houston, and to nearly 20 international destinations, including markets in Asia, Australia, Europe and Latin America

Daily service between United’s hub at Chicago’s O’Hare International Airport and Monterrey, Mexico will begin on December 19, 2012, subject to government approval. The United Express flights will operate using Canadair CRJ700 regional jet aircraft with 66 seats – six in first class, 28 in Economy Plus and 32 in economy.

The new Chicago-Monterrey flights will be available for booking once United receives government approval.

United will also offer daily United Express service between Chicago O’Hare and Thunder Bay, Ontario, Canada, using Canadair CRJ200 regional jets with 50 economy seats. The Thunder Bay flights will begin on February 14, 2013.

Weekly, peak-season service between Chicago and Nassau, Bahamas will begin on February 9, 2013, subject to government approval. The flights will operate on Saturdays through July 27, 2013, using Canadair CRJ700 regional jet aircraft.

United Express service between the Chicago hub and Jackson, Mississippi will begin on November 4, 2012. The flights will operate using Embraer ERJ 145 regional jets with 50 economy seats.

In addition, the airline will begin service between Chicago and Anchorage for the winter peak-travel period of December 19, 2012 to January 2, 2013. The flights will operate using Boeing 737-800 aircraft with 154 seats – 16 in first class, 48 in Economy Plus and 90 in economy. This service is in addition to United’s summer-season flights between Chicago and Anchorage.

United offers nearly 600 nonstop flights each day from Chicago to more than 150 destinations worldwide – dozens more flight and destination options than any other airline.

The airline will also add new domestic and international routes from other domestic hubs:

  • Denver – Three-times-daily service between Denver International Airport and Sloulin Field International Airport in Williston, North Dakota, will begin on November 4, 2012. The United Express service will operate with Embraer ERJ 145 regional jet aircraft.
  • Los Angeles – United Express service between Los Angeles International Airport and Kelowna, British Columbia, Canada, will begin on December 19, 2012, using Canadair CRJ700 regional jet aircraft.
  • Washington/Dulles – United will add daily service between Washington/Dulles International Airport and San Salvador International Airport in El Salvador, beginning December 19, 2012, subject to government approval. The flights will operate with Boeing 737-800 aircraft with 154 seats – 16 in first class, 48 in Economy Plus and 90 in economy.

In the past 18 months, United has added new routes from its U.S. hubs to international destinations such as Guadalajara, Mexico; Montreal, Canada; Port-au-Prince, Haiti; Shanghai, China, and Stuttgart, Germany, along with new intra-Asia routes between the Tokyo hub and Hong Kong and between the Guam hub and Okinawa, Japan.

In addition, the airline recently launched new service between Houston and Lagos, Nigeria; between Newark and Buenos Aires and Istanbul; between Washington/Dulles and Manchester, U.K. and Dublin, Ireland; and announced new service between Denver and Tokyo.

United also added a number of new domestic routes by using a mix of mainline and regional aircraft.

Copyright Photo: Michael B. Ing.

United Airlines: 

American to deploy the Boeing 777-300 ER to London Heathrow in February

American’s First Class product on the new Boeing 777-323 ER.

American Airlines (Dallas/Fort Worth) has announced Los Angeles – London Heathrow as the next route to feature its new Boeing 777-300 ER.

American’s 777-300 ERs will be configured as three-class aircraft and will include fully lie-flat First and Business Class seats with direct aisle access, Main Cabin Extra, inflight entertainment at every seat, and Wi-Fi capability to keep customers connected while traveling internationally. American previously announced that customers traveling between Dallas/Fort Worth (DFW) and Sao Paulo (GRU) will be the first to experience the newest addition to American’s fleet in December 2012. In February 2013 the aircraft will fly to London Heathrow from both Dallas/Fort Worth and New York JFK.

Below is the schedule for the new 777-300ER LAX-LHR routes that will appear in global distribution systems this week.

Market Flight Frequency Date
Los Angeles (LAX) – London Heathrow (LHR) AA136/AA137 Daily June 1, 2013

The three-class cabin configuration in the new 777-300 ERs will provide American with more customer and cargo capacity than any other aircraft in its fleet today. American will be the first airline to use a dramatic archway and ceiling treatment on the 777-300 ER to create a feeling of spaciousness, and customers will be welcomed into the aircraft by unique mood lighting. A walk-up bar in the premium cabin stocked with snacks and refreshments will be a first for any U.S. airline and adds another unique element of luxury to the 777-300 ER. Entertainment options include up to 120 movies, more than 150 TV programs and more than 350 audio selections that will be offered throughout the aircraft. Every seat will feature individual 110-volt AC power outlets and USB jacks for charging personal electronic devices.

American is the first U.S. airline to order and take delivery of the Boeing 777-300 ER. American anticipates taking delivery of 10 Boeing 777-300 ERs beginning in December 2012.  The 777-300 ERs will complement American’s fleet by offering additional network flexibility in the future, as well as providing increased efficiency due to better seat mile economics and performance characteristics.

The question still remains, will AA introduce a long-overdue brand refresh with the first stretched Triple Seven?

Copyright Photo: American Airlines.

American Airlines: 

Austrian Airlines moves all aircraft (except one) to Tyrolean Airways, Austrian Arrows name being retired

Austrian Airlines (Vienna) as of midnight July 1, 2012 moved all flight operations to lower-cost subsidiary Tyrolean Airways (Innsbruck), including all of the long-range flights. One former Lauda Air Boeing 777-2Z9 (OE-LPB) was kept on the Austrian certificate to maintain its official “airline” status.

The company issued this statement:

“As of July 1, 2012, there will be joint flight operations under the unified Austrian brand name.

The objective: achieving competitive framework conditions enabling profitable operations

All of the flight operations of the Austrian Airlines Group, which has a fleet of some 80 aircraft, are now bundled at its 100% subsidiary Tyrolean Airways. As of July 1, 2012 Tyrolean is also operating the long-distance fleet.

For customers, the so-called “operational transition” will not result in any essential changes. The “Austrian” brand will remain on all aircraft. The flight numbers will also bear the “OS” airline code, as was the case in the past. However, travel agencies and tickets will provide notification on the identity of the operator of the aircraft undertaking all medium and long-distance flights based on the supplementary annotations “VO” or “operated by Tyrolean”. The supplementary brand “arrows” found on Tyrolean Airway aircraft will successively be removed by the end of 2012.

What has happened in detail:

• Aircraft fleet: 22 airplanes of the A320 family, 7 Boeing 737s, 6 Boeing 767s and 3 Boeing 777s changed their operators within the Austrian Airlines Group on midnight of July 1, 2012. One Boeing 777, OE-LPB, will stay with Austrian Airlines. This is due to international traffic laws. The outplacement of the fleet of the seven Boeing 737 medium-range airplanes still on hand and the “in-placement” of the seven Airbus A320s forms part of the harmonization of the fleet of medium-range aircraft which is being continued.

• Organization: The organization of the entire flight operations is to be bundled in Tyrolean Airways. Austrian Airlines retains such key responsibilities as station management, the technical department, sales in Austria and abroad, as well as such management departments as network planning, personnel, finances and marketing. There will be no changes in ownership. “Tyrolean Airways Tiroler Luftfahrt GmbH” remains a 100% subsidiary of Austrian Airlines AG.

• Austrian Airlines retains its operation authorization, and remains the user of traffic rights. The flights will be performed under the OS flight numbers. However, they will be “operated by Tyrolean”. Austrian Airlines serves some 50 countries from Vienna. No further permits or licenses need to be secured in a large number of countries. This is due to the fact, amongst other reasons, because prevailing legal regulations, especially in the European Union, generally permit this. For countries outside Europe, the requisite approvals have been secured.

• Personnel: some 460 pilots and 1,500 flight attendants are changing their employer within the Group. They will be transferred from Austrian Airlines to Tyrolean Airways. 110 pilots and 214 flight attendants have, in the final analysis, left the company. As a whole, Austrian has 900 pilots and 2,000 flight attendants, including the Tyrolean employees.  The employees will not experience any changes in working environments and remuneration. Tyrolean currently has a work force of about 1,500 employees, which will increase to 3,500 employees as a consequence of the operational transition. The Austrian Airlines Group employs approximately 6,700 people.

• Flight plan: to compensate for the departure of the pilots, a series of temporary measures were implemented for the summer flight plan:

• Retraining: The removal of 4 Boeing 737 airplanes from the fleet leaves 31 Boeing 737 pilots available. They have already been trained to fly Airbus A320 airplanes. The cessation of part-time work at Tyrolean has freed 36 Tyrolean co-pilots for other duties. These pilots, who were trained to fly Fokkers, have already been retrained to handle Airbus aircraft.

• Leasing of airplanes: Austrian Airlines will temporarily lease five airplanes from Lufthansa, Augsburg Airways, Contact Air und Welcome Air (wet leases). Lufthansa will provide a 139-seat Boeing 737-300 to fly the OS routes between Vienna and Düsseldorf and between Vienna and Rome in July and August. Lufthansa will assume responsibility for Vienna-Dubai-Vienna in July by flying a 241-seat Airbus 340-300. In a further move, the Salzburg-Frankfurt route, which has been served by Austrian acting under a commission from Lufthansa, will be operated by Lufthansa itself using a Boeing 737-300 for the first two weeks in July. Contact Air will fly a Fokker 100 seating 100 passengers to two of the four daily OS routes between Vienna-Zurich-Vienna and Vienna-Varna-Vienna. This aircraft would have originally been flown as a “wet lease” under a commission of Austrian’s associate SWISS. Augsburg Airways, which is part of the Lufthansa Group, will temporarily assume responsibility for one of the four flights serving the route between Vienna-Munich-Vienna and for two of the total of three flights on the Vienna-Stockholm-Vienna route during the period July 15 – August 31. 2012. Welcome Air will use a further a 31-seat Dornier 328 to carry out flights between Vienna and Klagenfurt, Salzburg and Prague, in addition to the existing four of the five flights between Linz und Vienna. Passengers will receive Austrian’s on-board services. Austrian will make use of the longer on-ground times by having Austrian Technik conduct maintenance work.

• Freelancers: Some of those pilots that have made use of the privileged termination of employment will be provided with work on a temporary and case-by-case basis.

The reorganization is based on the operational transition is a key component of the EUR 220 million restructuring program presented in January 2012. The objective of the program is the modernization of the structures of Austrian Airlines, so as to bring and sustainably keep Austria’s largest domestic airline in the profit zone.”

Bottom line: Austrian Airlines (under orders from parent Lufthansa) needed to reduce its cost structure and this dramatic move will probably accomplish this goal.

Top Copyright Photo: Michael B. Ing. Sister-ship Boeing 777-2Z9 ER OE-LPC (msn 29313) is now being operated for Austrian Airlines by Tyrolean Airways.

Austrian Airlines: 

Austrian Arrows-Tyrolean Airways: 

Lauda Air: 

Bottom Copyright Photo: Gerd Beilfuss. Boeing 777-2Z9 OE-LPB (msn 28699) when it was with Lauda Air.

FedEx Corporation completes the acquisition of French express transportation company, TATEX

FedEx Corporation (FedEx Express) (Memphis) announced today that it has completed the acquisition of TATEX, a leading French business-to-business express transportation company. This transaction represents the latest step in the company’s strategy to sustainably grow in Europe.

The addition of the TATEX business to the FedEx network will deliver an excellent extension to the service portfolio of both companies and will provide customers with more comprehensive international and domestic service options. The acquisition will give FedEx access to a nationwide domestic ground network which carries 19 million shipments and produces approximately EUR 150 million in revenues annually. In return, TATEX customers will gain direct access to the global FedEx network.

FedEx has been steadily broadening its European network and today’s announcement follows the recent acquisition of Opek, a Polish courier company with 1,200 employees and a network of 44 stations. In fiscal year 2012, FedEx opened 38 new stations across Europe, launched five Boeing 757-200 freighter flights on intra-European routes, and another Boeing 777F freighter (pictured) for long-haul routes—bringing the total number of Boeing 777Fs operating FedEx routes in and out of Europe to four.

FedEx entered the French market in 1985. Since then the company has been continuously expanding its range of international shipping services in the market and today employs over 3,000 team members in the country. In 2009, the company expanded its EMEA hub at Paris’ Roissy Charles de Gaulle airport, making it the biggest FedEx Express hub outside the U.S.

Copyright Photo: Nick Dean. The pictured brand new Boeing 777-FS2 N864FD (msn 37735) at Everett (Payne Field) joined the FedEx fleet on May 15, 2012.

FedEx Express: 

Unsecured creditors give American until December 27 to work out their own reorganization plan

American Airlines (Dallas/Fort Worth)’ unsecured creditors are giving AMR some space and time to work out their own reorganization plan. This time period will keep US Airways (Phoenix) away (for now) if the bankruptcy court grants this motion to AMR management.

The company has issued this short statement:

“AMR Corporation, the parent company of American Airlines, yesterday (June 29) announced that the Company and the Official Committee of Unsecured Creditors (UCC) have agreed to jointly request that the United States Bankruptcy Court for the Southern District of New York extend exclusivity for AMR to file its Plan of Reorganization to December 27, 2012.”

US Airways and the unions have not yet commented on this statement. Stay tuned.

Copyright Photo: Luimer Cordero.

American: 

Delta expands Wi-Fi-equipped fleet to include international aircraft

Delta Air Lines (Atlanta) will begin offering in-flight Internet service on its long-haul international fleet of more than 150 aircraft, which includes Boeing 777, 767, 747, Airbus A330 and transoceanic Boeing 757 aircraft in early 2013.

The expanded Wi-Fi service will use satellites to provide coverage internationally and will complement the existing air-to-ground service already provided by Gogo for aircraft flying within the domestic U.S.

Delta already operates the world’s largest Wi-Fi-equipped fleet of aircraft with more than 3,000 flights daily, including its entire fleet of 550 domestic mainline aircraft. More than 800 Delta aircraft, including all Delta Connection two-class regional jets, are equipped with in-flight Wi-Fi service offering more than 400,000 customers per day access above 10,000 feet.

The international service will use high-bandwidth Ku-band capacity satellites to provide global coverage. When complete in 2015, Delta will operate approximately 1,000 Wi-Fi-equipped aircraft in its worldwide fleet.

Copyright Photo: Michael B. Ing.

Delta: 

Transaero Airlines starts Moscow-Rome flights

Transaero Airlines (Moscow) today (June 27) launched nonstop Moscow (Vnukovo)-Rome (Fiumicino) service with Boeing 777-200s.

Initially  Transaero’s flights  UN 399/400 between Moscow and Rome will be operated five times a week  (except Mondays and Tuesdays) under the following schedule.

Departures from Moscow  at 9:15 am (0915), arrivals in Rome  at 10:50 am (1050).  Departures from Rome at 11:40 am (1140), arrivals in Moscow at 5:10 pm (1710).  All times local.

From September 24, 2012, the service will  be offered daily.

Eventually Boeing 737 aircraft with two-class  configuration including Business and Economy classes of services will be  operated on the Moscow – Rome route.

Copyright Photo: Ton Jochems.

Transaero Airlines: 

Air Canada and the IAMAW receive a new arbitrated contract

Air Canada (Montreal) stated yesterday (June 17) that it along with the International Association of Machinists and Aerospace Workers (IAMAW) have received the decision of the arbitrator, Mr. Michel Picher, in the final offer selection arbitration conducted in accordance with the process legislated by the federal government in the Protecting Air Service Act.  

The arbitrator’s selection of Air Canada’s final offer concludes a new collective agreement with the IAMAW following negotiations and mediated talks that took place over a period of 14 months.  The five-year collective agreement is in effect until March 31, 2016.

The new collective agreement maintains the current defined benefit pension plan for current employees, introduces a new IAM multi-employer pension plan for new employees hired after today’s date, contributes to the reduction of the pension deficit and, as required by the legislation, establishes a protocol for the sustainability of the pension plan taking into account any short term funding pressures on the company.

The airline will not have further comment as details of the new collective agreement are being communicated to its employees.

The IAMAW represents 8,600 mechanics, baggage handlers and cargo agents employed by Air Canada.

Copyright Photo: Nick Dean. Now only a memory.

Air Canada: 

Kenya Airways drops Muscat and Rome, increases London frequencies

Kenya Airways (Nairobi) is immediately dropping all services to Muscat (Oman) and Rome.

The carrier is increasing flights to London (Heathrow), going from daily service to 10 flights a week in July with 322-seat Boeing 777-200 ERs. Paris (CDG) will also increase to six weekly flights during the July-August peak period.

Kenya Airways is also planning to add Kilimanjaro (Tanzania), Eldoret (Kenya), Abuja (Nigeria) and Beirut between July and October.

On the financial side, the flag carrier reported a 53 percent decline in its fiscal year net profit to $19.5 million for the year ending on March 31, 2012.

Read the full report from Bloomberg: CLICK HERE

Copyright Photo: Antony J. Best. 

Kenya Airways: 

Air France calls on its unions to overhaul its European network, takes delivery of its 60th 777 passenger aircraft

Air France Boeing 777-328 ER F-GZND (msn 35543) PAE (Nick Dean). Image: 902719.

Air France (Paris) today called on its unions to help it overhaul its loss-making short-haul European network. The survival of its short and medium haul routes depends on “drastic” cuts (20 percent) that the company has developed at its regional bases according to this report by Reuters.

Air France has also stated it will develop and expand the lower-cost Transavia Airlines (Amsterdam).

Air France is facing stiff competition in Europe by easyJet (UK) (London-Luton) and Ryanair (Dublin) which have lower labor costs.

Read the full report from Reuters: CLICK HERE

In other news, on April 3 AF celebrated the delivery of its 60th Boeing 777 passenger jetliner. 777-328 ER F-GZNL (msn 40063) arrived in Paris on April 4.

Air France’s newest 777-300 ER seats 468 passengers in a three-class configuration. The brand-new cabin includes 14 business class lie-flat seat beds measuring over 78.74 inches (2 m) in length, plus an in-seat entertainment system with 15-inch (38 cm) wide screens in 16:9 format. It also features 32 “Alize” new premium economy fixed-shell seats offering 40 percent additional space compared with seats in economy class.

Air France, a member of Sky Team, will operate this 777-300 ER between Paris and the French Overseas Departments in the Indian Ocean and the Caribbean regions, including Fort de France, Pointe a Pitre and St-Denis de la Reunion.

By summer 2012, Air France will operate a total of 62 777 passenger jetliners and two 777 Freighters.

Copyright Photo: Nick Dean.

Air France Slide Show: CLICK HERE

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