Monthly Archives: January 2012

United Airlines announces new summer domestic routes

United Airlines (Chicago) today announced plans to launch year-round and seasonal service on several new routes to begin in the summer of 2012.

United will begin daily year-round service between Washington/Dulles International Airport (IAD) and Honolulu (HNL) on June 7, 2012, the only nonstop service between the two points. The flights will operate using the pictured Boeing 767-400 aircraft.

The airline will also add seasonal service to several popular summer travel destinations.

Alaska: New daily service between Denver (DEN) and Fairbanks, Alaska (FAI), will operate from June 7, 2012 through August 27, 2012, using Boeing 737-800 aircraft. Fairbanks offers access to Denali National Park, one of Alaska’s most visited destinations. The flights complement United’s existing Alaska service to Anchorage from hubs in Denver, Chicago, Houston and San Francisco, as well as Seattle/Tacoma.

South Dakota: United Express will offer daily seasonal service between Houston’s Bush Intercontinental Airport (IAH) and Rapid City, S.D. (RAP), gateway to the Black Hills, Mount Rushmore and the Badlands National Park, from June 7, 2012, to August 27, 2012. ExpressJet will operate the flights using Embraer ERJ 145 aircraft. United currently serves Rapid City from its Denver and Chicago hubs.

Wyoming: The airline will also add summer-season flights between its Houston and San Francisco (SFO) hubs and Jackson Hole, Wyoming (JAC), which attracts millions of summer visitors to nearby Yellowstone National Park and the Grand Tetons. The Houston flights will operate twice-weekly from June 8, 2012, through August 27, 2012, using Boeing 757-200 aircraft. The San Francisco flights will operate daily from July 1, 2012, through August 27, 2012, as United Express, with Bombardier CR700 aircraft flown by SkyWest Airlines. These flights are in addition to United’s existing service to Jackson Hole from hubs in Chicago, Denver and Los Angeles.

With these new route additions, United will remain within the previously announced capacity guidance.

Since the October 2010 merger of United and Continental, the larger combined fleet has given the company flexibility to better meet market demand. United has added new routes from its hubs to international destinations such as Lagos, Nigeria; 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.

The merger also enabled the company to add a number of new domestic routes by using a mix of mainline and regional aircraft from both carriers more efficiently.

Copyright Photo: Jeffrey S. DeVore.

United Slide Show: CLICK HERE

Will AMR attempt to shed its pension obligations?

AMR Corporation, parent of American Airlines and American Eagle Airlines (2nd) (Dallas/Fort Worth) is going through the Chapter 11 reorganization process. The corporation has not yet filed its intentions concerning its employee pension obligations. Previous Chapter 11 airline reorganizations have allowed U.S. carriers to leave their pension obligations behind.

According to this report by Reuters, the U.S. Pension Benefit Guaranty Corporation, which has the responsibility for insuring certain benefits in private retirement programs, has sued AMR for $92 million for its unpaid pension plan contributions.

Will AMR walk away from its obligations?

Read the full report: CLICK HERE

Copyright Photo: Brian McDonough. American tried and heavily touted its “Working Together” maintenance program. Will the teamwork continue with the “new” American?

American Slide Show: CLICK HERE

MALEV is out of money, draws up liquidation plans

MALEV Hungarian Airlines (Budapest) is out of money and has appealed to the government of Hungary for support. However due to recent European Commission rulings, state aid is very limited and this could be the end of the state carrier.

The Chairman of the Board, Dr. János Berényi, has requested the airline management to draw up a liquidation plan.

The airline has issued the following statement:

“During the January 30 meeting of the Board of Directors, Chief Executive Officer of Malév Lóránt Limburger informed the Board that despite the continually improving commercial results the financing of activities had become unviable and was unresolved from the end of January. At the same time, talks with ILFC on Friday had proved successful after agreement was reached that the American leasing corporation would continue to make the aircraft available for continuous operations.

In the interest of ensuring continuous operations, Chairman of the Board of Directors Dr. János Berényi requested Malév management to draw up – by the end of the week – a liquidity plan for the immediate future.

After discussing the Malév report the Board of Directors approached the owners with a request to do everything possible to resolve the situation, even though the Board recognized that due to the EU Commission ruling reached in January concluding that financing provided between 2007 and 2010 was unlawful state support, which further burdens the company’s heritage, the room for manoeuvre of the government is extremely limited.”

Meanwhile the government cabinet has declared the flag carrier to be a company of “strategic importance”, meaning that creditors cannot start the liquidation process.

Copyright Photo: Bernhard Ross.


Air New Zealand’s popular CEO Rob Fyfe to step down in December

Air New Zealand (Auckland) will be forced to find a new Chief Executive Officer (CEO) this year. Popular CEO Rob Fyfe, who is credited with turning the flag carrier around during his seven years at the top, has announced he will retire in December 2012.

Read the full story from the Sydney Morning Herald: CLICK HERE

Copyright Photo: Michael B. Ing. Please click on the photo for the full story of this special logojet.

Air New Zealand Slide Show: CLICK HERE

Korean Air loses $87 million in 2011, aims to turn it around in 2012

Korean Air (Seoul) reported a net loss of $87 million in 2011. The swing to the red is blamed on higher fuel costs. The company is vowing to turn it around in 2012.

Read the full report from AFP: CLICK HERE

Copyright Photo: Joe G. Walker. A new delivery for Korean Air. Please click on the photo for the details.

Korean Air Slide Show: CLICK HERE

ANA’s third quarter net profit drops by 10%, pilots threaten a strike tomorrow

ANA’s (All Nippon Airways) (ANA Group) (Tokyo) net profit for the first nine months was 33.8 billion yen ($443 million), down from 37.5 billion yen a year earlier. This represents a 10 percent drop, due mainly to higher corporate taxes.

The company issued the following guidance:

“ANA Group, Japan’s largest airline group,
today reported its consolidated financial results for the first nine months of fiscal year 2011.

Operating revenues for the first nine months of the fiscal year 2011 rose three percent to 1,069.8 billion yen, while operating income
increased by 17.3 percent to 91.1 billion yen and recurring profit by 22.5 percent to 71.4 billion yen. Net income for the period was 33.7
billion yen compared with 37.5 billion yen the previous year.

Although economic conditions domestically and internationally remain challenging, ANA is working strenuously to stimulate demand, reduce costs and improve its competitiveness as a network carrier and in October became the first airline in the world to operate the new Boeing 787 Dreamliner.

As a result of these different initiatives and the
strength of the yen, ANA has revised upwards its forecast for operating income and recurring profit for fiscal year 2011, although operating
revenues are expected to remain flat.

Japan’s economy continues to recover gradually from the Great East Japan Earthquake on March 11 last year, but the outlook globally remains uncertain owing to rising oil prices, the government bond crisis affecting the Eurozone and exchange rate fluctuations. ANA has responded to this challenging economic environment by working to stimulate demand for both its domestic and international routes, and
has rolled out approximately 30.0 billion yen in emergency cost improvement measures to minimize the impact on revenues. From November 1 last year, ANA began flying the Boeing 787, as a world’s first regularly scheduled service, and from January 21, began service on a new international route, Toyko Haneda-Frankfurt, further enhancing its
competitiveness as a network carrier.”

Read the full report from the Business Recorder: CLICK HERE

In other news, the pilots are threatening a strike tomorrow. ANA has issued the following statement:

“ANA Group regrets the threatened 24-strike on February 1st announced by its pilot unions and is continuing urgent negotiations with the unions concerned to avert industrial action and the disruption to passenger services it will cause.

Should the unnecessary strike go ahead, ANA will do everything possible to minimize the impact on passengers and services. No international flights will be affected. However domestic flights could regrettably be subject to cancellation and/or delay.”

Copyright Photo: Nick Dean.


UPS delivers record fourth quarter profits

UPS-United Parcel Service (Atlanta) today announced fourth quarter 2011 adjusted diluted earnings per share of $1.28, a 21% improvement over the prior-year period. Total revenue increased 6% to $14.2 billion and adjusted operating profit climbed 17% to more than $2 billion.

Last Friday, the company announced a change in pension accounting to a mark-to-market methodology. Adopted in the fourth quarter of 2011 and applied retrospectively, this new method resulted in after-tax charges in 2011 and 2010 of $527 million and $75 million, respectively. Also, in the prior-year period, UPS recorded a net after-tax gain of $32 million from the sale of certain non-core business units in the Supply Chain and Freight segment. On a reported basis, fourth quarter 2011 diluted earnings per share were $0.74, a decline of 28% from the same quarter last year.

For the full year 2011, UPS achieved a new high in adjusted diluted earnings per share at $4.35. On a reported basis, diluted earnings per share were $3.84.

Copyright Photo: Michael B. Ing.

UPS Airlines Slide Show: CLICK HERE

Vladivostok Air to add new routes from Moscow

Vladivostok Air (Valdivostok Avia) (Vladivostok) is adding new routes from Moscow to Chita, Ulan-Ude, Abakan and Blagoveshchensk this summer according to this article by

With the closure of Dalavia due to its large debt, Vladivostok Air announced the start of seven additional domestic routes and four new international routes from Khabarovsk.

Read the full story: CLICK HERE

Copyright Photo: Michael B. Ing. Please click on the photo for additional information.

Valdivostok Air Slide Show: CLICK HERE

South African Airways launches a new route to Beijing today

South African Airways (Johannesburg) today launched a new route from its Johannesburg base to Beijing, China, with an Airbus A340-600.

Copyright Photo: Wingnut.

Read the full report from Business Report: CLICK HERE

South African Slide Show: CLICK HERE

Ryanair swings to a fiscal third net profit of $19.8 million

Ryanair (Dublin) reported a net profit of $19.8 million in the fiscal third quarter.

The ultra low-cost carrier issued the following statement:

“Ryanair, the world’s favorite airline, on January 30 announced a Q3 profit of €15m compared to a Q3 loss of €10m last year. Revenues increased 13% to €844m as traffic fell 2% and average fares rose 17%. Unit costs rose 11% due to a 7% increase in sector lengths and an 18% increase in fuel costs. Excluding fuel, sector length adjusted unit costs declined by 1%.”

The flamboyant airline continued:

“Our new routes and bases have performed well this winter. We open 5 new bases in Baden Baden (Ger), Billund (Den), Palma (Spain), Paphos (Cyprus) and Wroclaw (Poland) in March/April 2012. We expect to launch at least 1 more base for summer 2012, shortly. The EU recession, higher oil prices, the unfolding failure of the package tour operator model, significant competitor fare increases and capacity cuts, has created enormous growth opportunities for Ryanair, as large and smaller airports across Europe compete aggressively to win Ryanair’s growth.

Unit costs rose 11% mainly due to an 18% increase in fuel costs. Excluding fuel, sector length adjusted unit costs fell 1%, as we aggressively controlled costs despite a 2% basic pay increase, higher Eurocontrol fees, and substantially higher Dublin Airport charges. In FY13 we are 90% hedged for H1 at $990 per ton (approx. $99 per barrel), and 70% hedged for H2 at approx. $100 pbl. We expect to hedge the balance of our H2 2013 needs over the coming months. However, at these prices our fuel bill for FY 2013 will rise by approx. €350m which poses a significant cost challenge for next year.

The BAA’s recent announcement that it will pay dividends of £240m this year to Ferrovial and its other shareholders is further evidence that it is generating monopoly profits under the CAA’s “inadequate” regulatory regime. Over the past five years while Stansted charges have doubled, traffic has declined 26% from over 24m in 2007 to just 18m in 2011. The BAA monopoly’s shareholders are being unfairly enriched at the expense of Stansted airport users who continue to suffer high charges and inadequate service. We again call on the UK government and the CAA to bring forward the sale of Stansted to enable competition between London airports to deliver lower airport charges and improved customer service where the BAA airport monopoly and CAA’s “inadequate” regulatory regime has repeatedly failed.

We also call on the UK government to scrap its APD tourist tax which is damaging UK tourism and jobs. A similar visitor tax in Holland was scrapped after just one year when it was proven that its detrimental impact on Dutch tourism was far greater than the revenue it generated. UK APD was doubled in 2007 to £10 and was increased again to £12 this year and has resulted in the UK having the highest aviation taxes in the world, to the detriment of the UK’s tourism industry, which was one of the UK’s most important revenue earners before its visitor numbers declined over the past four year.

In Ireland the Government owned DAA airport monopoly recently published its 2011 traffic figures which highlighted a 26% decline in traffic from 30m pax in 2007 to just 22m in 2011. While many UK and EU airports delivered growth in 2011 by reducing charges, the DAA monopoly (protected by the Dept of Transport) raised fees by 40% and delivered another year of underlying traffic declines. Sadly, the new Irish government has failed to deliver any change or reform in airport or tourism policy and failed to scrap the €3 tourist tax. Ireland needs competition between Dublin, Cork & Shannon airports in order to reduce the DAA’s high airport charges, and return our tourism industry to growth, which will create thousands of badly needed entry level jobs in the Irish economy. We will continue to campaign for this change and reform, since the Dept of Transport’s current policy of protecting the DAA monopoly and raising access costs clearly isn’t working.

Our Q3 Net Profit of €15m was slightly ahead of guidance due to a combination of benign weather which caused fewer flight cancellations and significant de-icing savings, and a better performance on yields reflecting our planned winter capacity cuts, longer sectors, and higher competitor fares/fuel surcharges. Should these positive Q3 trends continue into Q4, we now expect our full year profit will exceed previous guidance (of €440m) and rise to €480m.

EGM to approve ADR share buy back.

Our September 2011 AGM authorised the board to buy-back ordinary shares representing up to 5% of our issued shared capital. However, EU ownership rules require that at least 50% of the Company be owned by EU nationals.

In order to facilitate further share buy-backs, the board intends to hold an EGM in March 2012 to seek shareholder approval to include ADR’s as well as ordinary shares in future buy-back programs for up to 5% of our issued share capital. A detailed letter to shareholders explaining these matters will be issued in due course and the Board believes that shareholders will support this proposal which will be subject to Stock Exchange and regulatory approvals in due course.”

Copyright Photo: Antony J. Best.

Ryanair Slide Show: CLICK HERE