Monthly Archives: February 2013

US Airways’ flight attendants ratify the new contract

US Airways‘ (Phoenix) flight attendants, represented by the Association of Flight Attendants – CWA (AFA), ratified a new contract today that provides immediate pay increases and includes support for the merger of US  Airways and American Airlines. The new contract opens four-party negotiations with American’s flight attendant union and airline representatives, an initial step in reaching a combined collective bargaining agreement. Eighty percent of flight attendants voting approved the agreement, which covers the airline’s 6,800 flight attendants who are based in US Airways’ four hub cities of Phoenix, Philadelphia, Charlotte, N.C., and Washington, D.C.

Following ratification today, the new contract specifies negotiations to begin within thirty days between airline officials at US Airways and American Airlines, AFA and the union representing American Airlines flight attendants, the Association of Professional Flight Attendants (APFA). The talks would establish protocols for reaching a combined collective bargaining agreement once the merger of US Airways and American Airlines, announced on February 14, is closed. The merger is expected to close by the third quarter of this year following regulatory agency and bankruptcy court approvals.

Copyright Photo: Jay Selman. Will the US Airways logojets survive the merger with American? Probably yes since US Airways’ CEO Doug Parker will be running the new American. Doug has always honored and celebrated the legacies of the previous airlines and wisely promoted local sports teams at his hubs. There may be more logojets coming at the new AA especially those celebrating the local AA hub cities and their sports teams. Airbus A319-112 N717UW (msn 1069) in the Carolina Panthers special sports livery taxies to the runway at the Charlotte hub.

US Airways: AG Slide Show

ALC orders 10 new Boeing 777-300 ERs, places two with Air New Zealand

Boeing (Chicago) and Air Lease Corporation (ALC) announced an order today for 10 777-300 ERs (extended range) airplanes. The order, valued at $3.2 billion at current list prices, adds to the growing portfolio of long-haul airplanes for the Los Angeles-based leasing company.

ALC has ordered 185 airplanes from Boeing including 78 Next-Generation 737s, 80 737 MAXs, 12 787 Dreamliners and 15 777-300ERs. The leasing company also has reconfirmation rights on 20 additional 737 MAX airplanes.

In other news, Air Lease Corporation announced long term lease agreements today with Air New Zealand (Auckland) for two new Boeing 777-300 ER aircraft delivering in 2014.

Copyright Photo: Keith Burton. Air New Zealand’s Boeing 777-319 ER ZK-OKO (msn 38407) arrives at London (Heathrow).

Air New Zealand: AG Slide Show

American to start nonstop Miami-San Diego flights, applies for more Brazil frequencies

American Airlines (Dallas/Fort Worth) announced today that it will launch new service this summer to San Diego and Mexico from its hubs in Miami (MIA) and Dallas/Fort Worth (DFW), respectively.

Beginning June 12, American will offer more choices for travel from its Miami hub with the addition of daily service between Miami and San Diego International Airport (SAN). This flight will be operated with a Boeing 737-800 aircraft (above) with 150 seats.  With the addition of this route, American and American Eagle will now serve San Diego from each of its five hubs, with a combined total of 25 daily flights.

The schedule for the new service between Miami and San Diego will be as follows:

From To Flight # Departs Arrives Frequency
Miami San Diego AA1065 6:50 PM 8:55 PM Daily
(MIA) (SAN) (nonstop)
San Diego Miami AA1042 9:45 PM 5:40 AM Daily
(SAN) (MIA) (nonstop)  next day

With the addition of this route, American will serve 115 destinations from Miami with more than 300 daily flights.

Also beginning June 12, American Eagle will begin service between DFW and two new destinations in Mexico – Ignacio Pesqueira Garcia International Airport in Hermosillo (HMO) and General Leobardo C. Ruiz International Airport in Zacatecas (ZCL), pending government approval. Flights between DFW and HMO will operate once daily, and flights between DFW and ZCL will operate on Monday, Wednesday and Saturday.  The flights will be operated with a 44-seat Embraer ERJ-140 aircraft.

The schedule for the new service to Mexico will be as follows:

From To Flight # Departs Arrives Frequency
Dallas/Fort. Worth Hermosillo AA2833 7:10 PM 7:35 PM Daily
(DFW) (HMO) (nonstop)
Hermosillo Dallas/Ft. Worth AA2938 7:00 AM 11:30 AM Daily
(HMO) (DFW) (nonstop)
Dallas/Fort. Worth Zacatecas AA3379 10:45 AM 12:50 PM Mon., Weds., Sat.
(DFW) (ZCL) (nonstop)
Zacatecas Dallas/Ft. Worth AA3390 1:30 PM 3:50 PM Mon., Weds., Sat.
(ZCL) (DFW) (nonstop)

*all flights begin June 12, 2013, pending government approval

With the addition of flights to Hermosillo and Zacatecas, American and American Eagle will serve a total of 20 destinations in Mexico.

In other news, American Airlines today filed an application with the U.S. Department of Transportation (DOT) for the right to fly additional United States – Brazil frequencies beginning in 2013 and 2014. American will use these frequencies to add one new daily round trip service from its Los Angeles and Chicago hubs to Sao Paulo

Copyright Photo: Mark Durbin. Boeing 737-823 WL N908NN (msn 39238) in the new corporate look taxies at San Francisco.

American Airlines: AG Slide Show

Air Mekong suspends operations today as it restructures its fleet

Air Mekong (2nd) (Phu Quoc, Vietnam) at the end of business today (February 28) suspended all operations as it restructures its fleet. The airline is planning to remove its Bombardier CRJ900s (above) and add two Airbus A321s.

Read the full story from CLICK HERE

Copyright Photo: Trevor Mulkerrins. Air Mekong leases four Bombardier CRJ900s from partner SkyWest Airlines. Air Mekong’s aircraft are painted with the image of the Sarus Crane, a precious bird in Vietnam which symbolizes peace. Former MyAir CRJ900 (CL-600-2D24) EI-DUY (msn 15112) at Shannon became VN-A804 with Air Mekong.

Air Mekong logo

Route Map:

Please click on the map for the full size view.

Please click on the map for the full size view.

Austral’s McDonnell Douglas DC-9-81 LV-WFN is being preserved in Argentina

Austral DC-9-81 LV-WFN (07)(Grd) ODB (AR)(LRW)

Austral Líneas Aéreas‘ (Buenos Aires) DC-9-81 (MD-81) LV-WFN (msn 48025) was retired from service on February 2, 2012 and flown to Córdoba International Airport-Pajas Blancas on March 16, 2012 for preservation. It was one of the oldest (if not the oldest) DC-9-81 in service.

LV-WFN performed its final flight between Córdoba to Morón Air Force Base in Buenos Aires (MOR) on February 26. The aircraft was donated by Austral Líneas Aéreas to Museo Nacional de Aeronáutica, as it was the first of the DC-9 Super 80 airliner to enter service with Austral in 1981. This plane was retired from service on March 2012 and was preserved waiting for a decision about its fate. Lately the aircraft was being readied before being ferried to Morón as AU 2080, unpressurized and with landing gear deployed.

Copyright Photo: Alvaro Romero. LV-WFN looks forlorn at Córdoba while waiting for its final fate. Now it will be preserved.

Austral: AG Slide Show

Silver Airways is coming to Macon, Georgia

Silver Airways (Fort Lauderdale/Hollywood) has been selected for Essential Air Service (EAS) authority to serve Macon, Georgia (MCN). The company expects to launch operations on April 1 to both Atlanta and Orlando (weekend only service) according to this report by The Telegraph.

Read the full report: CLICK HERE

Copyright Photo: Brian McDonough. SAAB 340B N346AG (msn 446) completes its final approach into Washington Dulles International Airport.

Silver Airways: AG Slide Show

Republic Airways Holdings improves to a $51.3 million net profit in 2012

Republic Airways Holdings Inc. (Republic Airways) (Indianapolis) reported its full year 2012 net income of $51.3 million, or $1.02 per diluted share, a $203.1 million improvement from our full year 2011 results of a net loss of $151.8 million, or $3.14 per diluted share. The Company also reported fourth quarter 2012 net income of $12.6 million, or $0.25 per diluted share, a $136.1 million improvement over the fourth quarter 2011 net loss of $123.5 million, or $2.55 per diluted share.

“We’re pleased with the solid financial improvement we experienced in 2012,” said Republic Airways Holdings Chairman, President and CEO Bryan Bedford. “Our restructuring efforts in 2011 laid the foundation for Frontier to return to profitability in 2012, despite higher fuel costs. Our 50-seat RJ restructuring effort completed last October enabled us to return all of our idled aircraft to fixed-fee service with our partners and significantly reduced the financial burden associated with our Chautauqua operation.”

The Company incurred the following items in 2012:
Pre-tax amount
Loss on sale of E190s
Republic $11.2 million 3Q-12
Gain on sale of slots
Republic ($8.3) million 3Q-12
Professional and legal fees related to restructuring
Republic $4.3 million 4Q-12
Restructuring and fleet transition expenses
Frontier $15.5 million 4Q-12
Frequent flyer adjustment to passenger revenue
Frontier ($9.8) million 4Q-12
The Company incurred the following items in 2011:
Pre-tax amount
Fleet transition expenses
Republic $9.1 million 4Q-11
Impairment of fleet asset values
Republic $191.1 million 4Q-11
Fleet transition expenses
Frontier $32.3 million 4Q-11

Note: The amounts reported below for pre-tax income (loss) and net income (loss) exclude the impact of the items listed above. Please refer to the schedules at the end of this release for a tabular reconciliation of the Company’s GAAP pre-tax and after tax income (loss) to the ex-tem pre-tax and after-tax income (loss) and diluted earnings per share.

Consolidated Results (ex-items)

Excluding the items listed above, the Company reported 2012 full year net income of $59.0 million, or $1.15 per diluted share, as compared to a 2011 full year net loss of $6.2 million, or $0.13 per diluted share. For the fourth quarter of 2012 the Company reported net income of $18.5 million, or $0.35 per diluted share, as compared to the fourth quarter 2011 net income of $20.7 million, or $0.41 per diluted share.

Business Segment Presentation

The Company has adjusted its presentation of business segments in 2012 and has revised the prior year’s information to conform to the current period segment presentation. Reportable segments now consist of Republic and Frontier. The Republic segment includes all regional flying performed by sub-100-seat aircraft operating under either fixed-fee or pro-rate agreements, subleasing activities, regional charter operations as well as the cost of any unassigned regional aircraft. The Frontier segment includes passenger service revenues and expenses for operating Frontier’s Airbus fleet, as well as its charter and cargo operations.

Republic Segment Summary (ex-items)

Revenues for the year decreased 10.2% to $1,377.4 million. This was a result of a change in the mix of flying between pro-rate and fixed-fee operations and a $48.2 million reduction in fuel-related revenue under Republic’s fixed-fee agreements. Pre-tax income improved nearly 31% to $69.5 million for the year ended December 31, 2012, compared to $53.1 million for the prior year.

For the quarter, revenues decreased 8.9%, or $31.9 million to $327.4 million, compared to the prior year’s fourth quarter, due primarily to a decrease of $23.3 million in fuel reimbursement under Republic’s fixed-fee agreements. Effective July 1, 2012, Republic no longer records fuel expense and does not recognize fuel-related pass-through revenue under any of its fixed-fee agreements. The remainder of the decrease in revenue is due to the increase of Republic’s fixed-fee operations and reduction in pro-rate flying with Frontier.

Income before taxes was $24.1 million for the quarter, compared to pre-tax income of $23.3 million for the prior year’s fourth quarter. Fuel costs for Republic were $21.8 million for the quarter, a decrease of $38.5 million from the prior year’s fourth quarter, due to both the removal of fuel expense under Republic’s fixed-fee agreement with United and a reduction in pro-rate operations with Frontier. The price per gallon increased 9.1% from $3.19 in the fourth quarter of 2011 to $3.48 in the fourth quarter of 2012.

As of December 31, 2012, Republic operated 70 aircraft with 44-50 seats and 143 aircraft with 69-80 seats to support its fixed-fee commercial agreements. Additionally, Republic operated one aircraft with 50 seats and 12 aircraft with 99 seats under pro-rate agreements with Frontier.

Frontier Airlines Segment Summary (ex-items)

Frontier Airlines’ (2nd) (Denver) revenues for the year increased 7.0% to $1,423.7 million. On a 1.1% increase in capacity, unit revenues increased 5.8% to 11.96¢ from 11.30¢. Frontier’s pre-tax income improved $92.6 million to $29.6 million of income for 2012 compared to a pre-tax loss of $63.0 million for 2011.

For the quarter, decreased 1.1% to $334.9 million, compared to $338.5 million for the same period in 2011. Total revenue per ASM (“TRASM”) was 11.88¢, an increase of 2.9% from the same quarter in 2011, while capacity on Frontier decreased 4.0% from the prior year’s fourth quarter. Load factor for the fourth quarter was 88.9%, an increase of 0.7% from the fourth quarter of 2011.

For the quarter, Frontier posted pre-tax income of $7.3 million compared to pre-tax income of $10.1 million for the prior year’s fourth quarter. Fuel costs for Frontier were $128.2 million for the quarter, a decrease of $0.8 million from the prior year’s fourth quarter. The fuel cost per gallon, including into-plane taxes and fees, increased 6.5% to $3.42 for the fourth quarter of 2012, compared to $3.21 for last year’s fourth quarter. The fourth quarter results include an expense on fuel hedges of $0.5 million, or $0.01 per gallon, while the 2011 results include a benefit of $3.5 million, or $0.09 per gallon. Frontier has approximately 15% of its anticipated fuel consumption hedged through the second quarter of 2013.

Frontier’s operating unit cost was 7.03¢ for the quarter, a 3.4% increase compared to 6.80¢ for the same quarter in 2011.

As of December 31, 2012, Frontier operated a total of 55 Airbus aircraft versus 60 Airbus aircraft as of December 31, 2011.

Recent Business Developments

During the fourth quarter of 2012, the Company completed the restructuring of its 50-seat platform, Chautauqua Airlines, Inc. (Indianapolis). As a result of the restructuring, the Company expects to realize, on average, $45.0 million of cash flow improvement per year for the next five years and has reduced its aircraft rent and depreciation expense on its 50-seat aircraft. In addition, in order to finalize the restructuring, the Company issued a $25.0 million convertible note to one of the third parties involved in the restructuring. The note bears interest at a rate of 6.0% per annum and is convertible into 2.5 million shares of Republic Airways Holdings Inc. common stock.

On January 24, 2013, the Company entered into a capacity purchase agreement (“CPA”) with American Airlines which is subject to bankruptcy court approval. American filed a motion for approval of the CPA to be heard before the court on February 14, 2013. The hearing on that motion was subsequently adjourned until February 26, 2013. On February 14, 2013, US Airways and American Airlines announced a merger agreement. On February 21, 2013, the hearing on American’s motion to approve the CPA between the Company and American was adjourned to March 12, 2013.

On February 8, 2013, the Company announced the transition of nine ERJ 145 aircraft flying on Chautauqua Airlines, Inc. from US Airways to Delta Air Lines under separate amendments. The US Airways amendment provides for termination of the current aircraft operating under the Jet Service Agreement by July 2013. The Delta amendment extends the current term for certain aircraft, as well as adds ten aircraft into service during 2013.

Balance Sheet and Liquidity

The Company’s total cash balance increased $23.6 million to $394.3 million as of December 31, 2012, compared to December 31, 2011. Restricted cash decreased $4.3 million, to $147.1 million, from December 31, 2011. The Company’s unrestricted cash balance increased $27.9 million, to $247.2 million, from December 31, 2011. A condensed cash flow statement has been provided in the tables section of this release.

The Company’s debt decreased to $2.12 billion as of December 31, 2012, compared to $2.36 billion at December 31, 2011. As of December 31, 2012, almost 90% of the total debt is at a fixed interest rate. The Company has significant long-term lease obligations for aircraft that are classified as operating leases and are not reflected as liabilities on the Company’s consolidated balance sheet. At a 6.0% discount factor, the present value of these lease obligations was approximately $1.0 billion and $1.2 billion as of December 31, 2012 and 2011, respectively.

Copyright Photo: Bruce Drum. Despite an expanding route map, Frontier’s Airbus fleet actually shrank from 60 aircraft on December 31, 2011 to 55 aircraft on December 31, 2012 as the airline began the phase out of the shorter Airbus A318s (now down to two aircraft). The higher-tail A318 cannot taxi under the Concourse A-Terminal connector at Denver International Airport. Now departed, A318-111 N801FR (msn 1939) arrives at Seattle-Tacoma International Airport from the Denver hub.

Republic Airways: AG Slide Show

Frontier Airlines-Chautauqua Airlines: AG Slide Show

Frontier Airlines (2nd): AG Slide Show

Hawaiian Airlines’ flight attendants ratify a new narrow-body aircraft agreement

Hawaiian Airlines‘ (Honolulu) flight attendants have ratified a tentative agreement reached earlier this month between the company and the Association of Flight Attendants (AFA) on new contract terms covering the operation of long-range, single-aisle aircraft the company plans to acquire to complement its current fleet of wide-body aircraft serving Hawai’i from the U.S. West Coast.

On January 7, Hawaiian announced the signing of a Memorandum of Understanding with airframe manufacturer Airbus to acquire 16 new A321neo aircraft between 2017 and 2020, with rights to purchase an additional nine aircraft.

The company also announced that the acquisitions are contingent upon the signing of new agreements with its pilots’ and flight attendants’ unions covering operation of the new aircraft type.

Hawaiian’s pilots ratified a similar agreement between the company and the Air Line Pilots Association on January 28.

The fleet expansion is expected to generate roughly 1,000 new jobs at Hawaiian.

The long-range, single-aisle A321neo aircraft will complement Hawaiian’s existing fleet of
wide-body, twin-aisle aircraft used for long-haul flying between Hawai’i and the U.S. West Coast.

At 146-feet-long, the A321neo will seat approximately 190 passengers in a two-class configuration (First and Coach) and has a range of 3,650 nautical miles. The aircraft will offer the more comfortable seat widths found in the twin-aisle A330.

Copyright Photo: Andy Jung. Hawaiian currently operates the narrow-body Boeing 717 in the inter-island network. The new A321s will open some new thin long-range Mainland routes previously pioneered by Aloha Airlines and largely filled recently by Alaska Airlines with its Boeing 737-800s. The pictured Boeing 717-2BD N488HA (msn 55101) arrives at the Honolulu hub.

Hawaiian Airlines: AG Slide Show

ExpressJet Airlines joins with Cape Air in the JetBlue University Gateway Program

ExpressJet Airlines (Atlanta) has joined the JetBlue University Gateway Program to give pilots a career path. The following statement was released:

The highly-successful University Gateway Program, a four-way collaboration with JetBlue Airways (New York), Cape Air (Hyannis), the University of North Dakota (UND) and Embry-Riddle Aeronautical University (ERAU), has added another airline.  ExpressJet Airlines, the largest regional airline in the world, will partner with Cape Air to provide a parallel path for aspiring pilots to join JetBlue. The Gateway Program has been designed to facilitate the early-entry of highly-qualified pilots from Aviation Accreditation Board International (AABI) programs, who have appropriate flight instructor experience, into Cape Air, where they further hone their skills. After gaining their Captain’s credentials at Cape Air, pilots can choose to interview with ExpressJet.  If accepted, they will be slotted for a training class providing valuable time as pilots in command.  They then will be eligible for a final interview with JetBlue after gaining their necessary hours.

There are now 140 pilots in the Gateway Program.  To date, four pilots have successfully completed the necessary steps and have been hired by JetBlue, with more qualifying for a final interview every month.  Cape Air expects as many as 50 pilots per year will eventually join JetBlue via the program.

Copyright Photo: Mark Durbin. ExpressJet’s Embraer ERJ 145XR (EMB-145XR) N16147 (msn 145749) is pictured at the Houston (Bush Intercontinental) hub operating as an United Express carrier.

United Express-ExpressJet: AG Slide Show

Routes flown for United Airlines:

Please click on the map for the full size view.

Please click on the map for the full size view.

JetBlue Airways and Airbus reach agreement to retrofit the Airbus A320 fleet with Sharklets

JetBlue logo

JetBlue Airways (New York) announced today that it has signed a letter of intent (LOI) with Airbus to acquire 110 ship-sets of retrofit Sharklets for the airline’s in-service A320 aircraft. Deliveries are scheduled to start in 2014. Just last week, JetBlue Airways unveiled the first of its A320 aircraft to be outfitted with Sharklets. Sharklets are newly designed wing tip devices that are expected to improve the aerodynamics of Airbus aircraft and significantly cut fuel burn and emissions by up to four percent.

Sharklets are an option for the A320 Family aircraft and offer JetBlue the option of an additional 100 nautical miles range or increased payload capability of up to 1,000 pounds. Sharklets are standard on all members of the A320neo Family. JetBlue is not only the first carrier to fly with Sharklets in North America but, with the conclusion of this agreement and the retrofitting, will have the largest A320 fleet in the world with Sharklets. JetBlue’s future Airbus deliveries also will come outfitted with Sharklets.

JetBlue Airways: AG Slide Show

Bottom Copyright Photo: JetBlue was an early volunteer with Airbus for testing two early winglet concepts.