Category Archives: American Eagle-Executive Airlines

American Eagle to expand its ground handling operations

American Eagle Airlines (2nd) (Dallas/Fort Worth) while it is phasing out its ATR 72 operations (operated by Executive Airlines), it is expanding its ground handling operations.

Eagle Ground Handling, American Eagle’s ground handling business, has been awarded a contract to handle United Express ground handling operations at nine U.S. locations.

Currently, Eagle Ground Handling provides ground handling services for other airlines in Waco, College Station, Killeen/Fort Hood and Tyler, Texas, as well as Monroe, La. As a result of these awards, it will add ground handling services for United Express at those stations, along with Dallas Love Field, Del Rio and Beaumont/Port Arthur, Texas, plus Binghamton, N.Y.

The United Express ground handling operations at the newly contracted stations will be transitioned to Eagle Ground Handling in the coming months.

Copyright Photo: Bruce Drum.

American Eagle-Executive Slide Show: CLICK HERE

American Eagle Slide Show: CLICK HERE

The end of the line for Executive Airlines and the American Eagle ATR 72

Executive Airlines (2nd) (San Juan) as a subsidiary of the bankrupt AMR Corporation (Dallas/Fort Worth) operates a dwindling fleet of ATR 72s in the American Eagle brand. Previously it was announced the ATRs would be pulled from the Dallas/Fort Worth and Miami hubs. Now the last bastion of ATR operations (started with the ATR 42) in San Juan appears to be endangered. The El Vocero newspaper has reported American Eagle will end operations, including the ATRs, at SJU in March 2013 citing a memo sent to the flight attendants. American Airlines and AMR have not confirmed the report.

Read the full report form the Washington Post: CLICK HERE

Copyright Photo: Bruce Drum.

American Eagle-Executive Slide Show: CLICK HERE

American Eagle to begin phasing out the ATR 72s from Miami starting in May

American Eagle Airlines (2nd) (Dallas/Fort Worth) will begin phasing out its nine ATR 72s from the Miami hub starting in May according to this report by Sky Talk citing a letter to the employees. The type should be retired from the MIA hub by November 2012. The ATR 72s, operated for American Eagle by Executive Airlines (2nd) (San Juan), will continue to operate from the San Juan hub. Some of the MIA ATR routes will be replaced with ERJ regional jets but some may be unsuitable for this type.

Read the full report: CLICK HERE

Copyright Photo: Bruce Drum. Please click on the photo for additional information.

American Eagle-Executive Airlines Photo gallery: CLICK HERE

American Eagle to retire the ATR 72 from the DFW hub on January 31

American Eagle Airlines (2nd) (Dallas/Fort Worth) is replacing all of its ATR 72 turboprop aircraft operating from Dallas/Fort Worth International Airport. Fourteen markets throughout Arkansas, Louisiana, Missouri, Oklahoma and Texas will have all-jet ERJ service beginning on January 31. The airline will operate the daily flights with a combination of 37-, 44- and 50-seat jets.

Copyright Photo: Bruce Drum. Please click on the photo for additional information.

AMR to return 21 ATR 72-500s, may furlough up to 119 pilots and 104 FAs

AMR Corporation (Dallas/Fort Worth) on December 20, 2011, announced it would return to the lessors 15 active ATR 72-500 aircraft at the DFW hub and another six that have been already grounded. The ATR 72 routes from the DFW hub will be replaced with ERJ regional jets. The ATR 72s are operated by Executive Airlines.

According to article by the WSJ, American Eagle will also cancel service between DFW and Augusta, GA.

American Eagle will also cancel routes between Chicago and Tri-Cities, TN; Miami and Savannah, GA and Miami and Fort Myers, FL.

AMR also announced it may furlough up to 119 DFW-based pilots and 104 flight attendants due to these reductions.

Further cuts are expected.

Read the full report: CLICK HERE

Copyright Photo: Bruce Drum. Please click on the photo for additional information.

AMR and American Airlines file for Chapter 11 bankruptcy protection and reorganization

AMR Corporation (Dallas/Fort Worth), the parent company of American Airlines, Inc. (Dallas/Fort Worth) and AMR Eagle Holding Corporation (American Eagle Airlines) (Dallas/Fort Worth) today filed for Chapter 11 bankruptcy protection and reorganization.

The corporation issued the following statement:

“In order to achieve a cost and debt structure that is industry competitive and thereby assure its long-term viability and ability to continue delivering a world-class travel experience for its customers, the Company and certain of its U.S.-based subsidiaries (including American and American Eagle), today filed voluntary petitions for Chapter 11 reorganization in the U.S. Bankruptcy Court for the Southern District of New York.

AMR’s Board of Directors determined that a Chapter 11 reorganization is in the best interest of the Company and its stakeholders. Just as with the Company’s major airline competitors in recent years, the Chapter 11 process enables American Airlines and American Eagle to continue conducting normal business operations while they restructure their debt, costs and other obligations.

American Airlines and American Eagle are operating normal flight schedules today, and their reservations, customer service, AAdvantage® program, Admirals Clubs and all other operations are conducting business as usual. Likewise, throughout the Chapter 11 process, American and American Eagle expect to continue to:

1. Provide safe and reliable service;

2. Fly normal schedules;

3. Honor tickets and reservations, and make exchanges and refunds as usual;

4. Fully maintain AAdvantage frequent flyer and other customer service programs, and ensure all AAdvantage miles and elites status earned by members remain secure and intact;

5. Provide Admirals Club access and similar amenities to members and eligible customers;

6. Remain an integral member of the oneworld® alliance, of which American is a founding member, and continue its codeshare partnerships;

7. Provide employee wages, healthcare coverage, vacation, and other benefits, without interruption; and

8. Pay suppliers for goods and services received during the reorganization process.

The Company has approximately $4.1 billion in unrestricted cash and short-term investments. This cash, as well as cash generated from operations, is anticipated to be more than sufficient to assure that its vendors, suppliers and other business partners will be paid timely and in full for goods and services provided during the Chapter 11 process in accordance with customary terms. Because of the Company’s current cash position, the need for debtor-in-possession financing is neither considered necessary nor anticipated.”

In addition, the Board of Directors of AMR Corporation, the parent of American Airlines, Inc., has named Thomas W. Horton chairman and chief executive officer (CEO) of the Company, succeeding Gerard Arpey , who yesterday informed the Board of his decision to retire. Horton will also succeed Arpey as chairman and chief executive officer of American. Horton will continue to serve as President of AMR and American.

The filing is not a surprise to many given the corporation’s continued losses. Most of AA’s competitors domestically have already gone through a Chapter 11 reorganization process and many will see this as a mechanism to lower AA’s high costs including its labor agreements.

Copyright Photo: Brian McDonough. Will the Oneworld Alliance be weakened with this filing?

American Slide Show: CLICK HERE

AMR Corporation continues to lose money, even in the usually profitable third quarter

AMR Corporation (American Airlines and American Eagle Airlines) (Dallas/Fort Worth) continues to bleed money. AMR Corporation today reported a net loss of $162 million, or $0.48 per diluted share, for the third quarter of 2011, compared to a net profit of $143 million, or $0.39 per diluted share, for the same period of 2010.

According to the airline, “these results reflect the adverse impact of quarter-end volatility in WTI crude oil prices and foreign exchange rates. WTI prices decreased, while jet fuel prices remained high, which resulted in a non-cash item relating to fuel hedging ineffectiveness being recorded in fuel expense. In addition, foreign exchange rates were volatile and the U.S. dollar strengthened during the period, and as a result of revaluing foreign assets, the Company incurred a foreign exchange loss. Altogether, these items, which the Company described on October 10, increased AMR’s net loss by approximately $50 million or 15 cents per share.

In the third quarter, the Company’s overall performance was negatively impacted by fuel prices, which increased 41 percent compared to the prior year period. Taking into account the impact of fuel hedging, AMR paid on average $3.15 per gallon for jet fuel in the quarter versus $2.24 per gallon in the third quarter of 2010. As a result, the Company paid $653 million more for fuel in the third quarter of 2011 than it would have paid at prevailing prices from the corresponding prior-year period.”

In October, American Airlines announced it will adjust its late fall and winter schedule, which is expected to result in fourth quarter mainline capacity that is approximately 3 percent lower on a year-over-year basis.

While advance bookings are generally in line with last year, the Company is taking these additional steps in light of the uncertain economic environment, ongoing high fuel costs and to ensure it runs a reliable schedule for its customers given additional pilot retirements it anticipates throughout the fourth quarter.

With these latest moves, American expects full year 2011 capacity to be up about 0.4 percent year-over-year for mainline and consolidated capacity will be up approximately 1.2 percent. The Company’s initial plan, announced in January, called for full year mainline capacity to increase and consolidated capacity to increase by more than 3 and 4 percent respectively.

In October, American also announced plans to retire up to 11 Boeing 757s in 2012. The retirements will result in maintenance and fuel cost savings.

According to the airline, “while the cost of jet fuel has been increasing recently and remains very volatile, based on the October 7 forward curve, AMR is planning for an average system price of $3.02 per gallon in the fourth quarter 2011 and $3.01 per gallon for all of 2011. Consolidated consumption for the fourth quarter is expected to be 667 million gallons of jet fuel.

AMR has 52 percent of its anticipated fourth quarter 2011 fuel consumption hedged at an average cap of $3.01 per gallon of jet fuel equivalent ($88 per barrel crude equivalent), with 41 percent subject to an average floor of $2.23 per gallon of jet fuel equivalent ($55 per barrel crude equivalent). AMR has 51 percent of its anticipated full-year consumption hedged at an average cap of $2.77 per gallon of jet fuel equivalent ($83 per barrel crude equivalent), with 39 percent subject to an average floor of $2.08 per gallon of jet fuel equivalent ($55 per barrel crude equivalent).”

Copyright Photo: Bruce Drum.

American Slide Show: CLICK HERE

AMR takes the next step in spin-off of Eagle as separate publicly-traded company, AA to keep Eagle’s aircraft

AMR Corporation (Dallas/Fort Worth), the parent company of American Airlines, Inc., announced today that its subsidiary, AMR Eagle Holding Corporation, has filed a Form 10 Registration Statement (“Form 10”) with the U.S. Securities and Exchange Commission.  The Form 10 filing marks the next step in a potential spin-off of Eagle and describes the potential spin-off, provides an overview of Eagle’s business, management and its ongoing relationship with American Airlines, and provides historical and pro forma consolidated financial statements of Eagle.  In the spin-off, AMR Corporation would distribute to its stockholders 100 percent of the outstanding shares of Eagle on a pro rata basis, and AMR Corporation would not retain any ownership interest in Eagle.

On a pro forma basis, in 2010, Eagle generated $1.2 billion in revenue with more than $250 million from ground handling services.  Eagle would operate the third largest regional airline in the United States as it provides the vast majority of American’s regional flight operations.  Under a nine-year air services agreement with American, Eagle would initially operate 281 aircraft on behalf of American.  American could withdraw from Eagle and re-bid up to 12 turbo prop aircraft per year beginning in 2012 and a specified number of jet aircraft up to 40 per year beginning in 2014.  The agreement would also include a provision to re-set rates to reflect any change in market levels for regional feed after four years.

Eagle would also operate one of the largest ground handling operations in the U.S., serving American Airlines and other passenger airlines at more than 100 airports in the U.S., the Bahamas, the Caribbean and Canada.  Under a ground handling agreement, Eagle would provide ground handling services to American at 106 airport locations.  The agreement would have an eight-year term, but provide American the right to re-bid ground handling services at a specified number of airports each year.

AMR and Eagle believe a spin-off of Eagle as a separate, publicly-traded company would offer a number of benefits that would enable:

 

  • American to diversify the source of its regional feed over time
  • Eagle to grow its business by better competing to offer regional flight services to other mainline carriers
  • Market forces to ensure American has continued access to the most competitive regional flight and ground handling rates and service
  • Each company to allocate resources and deploy capital in a manner consistent with its strategic priorities in order to optimize total returns to shareholders
  • Investors to value the two companies based on their particular operational and financial characteristics
While all aircraft will remain on Eagle’s operating certificates, prior to any divestiture, the Company expects to transfer to American all of its jet aircraft and the associated indebtedness, on which AMR is already a guarantor.  Ownership of the jet aircraft would provide American control over the regional aircraft that are pivotal to its network and would protect AMR’s position as guarantor of the debt.

The spin-off of Eagle would be subject to certain conditions, including U.S. Securities and Exchange Commission (SEC) clearance, receipt of regulatory approvals, an opinion from tax counsel and a favorable ruling from the Internal Revenue Service regarding the tax-free status of the spin-off to AMR shareholders, execution of inter-company agreements and approval by AMR’s board of directors. Stockholder approval of the spin-off is not required.

While AMR Corporation has taken this step toward a spin-off of Eagle, it could decide to retain Eagle, or the divestiture of Eagle could take another form, such as a sale.

Citi and Evercore Partners are acting as financial advisors to AMR Corporation.

Cuba Travel Services will commence charter flights to Cuba from San Juan, Houston and Fort Lauderdale/Hollywood

Cuba Travel Services, Inc. (CTS) announced that it has received landing permission by the government of Cuba to begin flights from three new airports in the United States: Luis Muñoz Marín International Airport in San Juan, Puerto Rico (SJU), Fort Lauderdale/Hollywood International Airport (FLL) and Houston Intercontinental Airport (IAH) to authorized airports in Cuba.

Nonstop charter service is expected to commence soon and will charter Airbus, Boeing 737, DC-9-80 (MD-80) as well as ATR 72 aircraft to operate these flights. CTS is currently under negotiations with several air carriers to operate this new service. Cuba Travel Services currently operates three routes to Cuba from the United States: Miami-Havana-Miami, Miami-Cienfuegos-Miami and Los Angeles-Havana-Los Angeles.

CTS has been servicing licensed passengers, from both the West and East coast of the US for more than 11 years. Under arrangements with US registered air carriers, CTS has been providing non-stop charter flights from Los Angeles and Miami since the year 2000 and is recognized as a leading provider of charter and travel services to Cuba.

According to the company, “CTS was formed by a group of Los Angeles business professionals to specifically facilitate a better understanding between the U.S. and Cuba by providing a convenient and cost-effective travel solution for those people who qualify under current US Treasury Department regulations. As an Indirect Air Carrier, CTS currently offers 10 flights per week between Miami and Cuba and continues to charter nonstop flights from Los Angeles to Havana. CTS has principal offices in Long Beach, California with additional offices in Miami, Florida and San Juan, Puerto Rico.”

Copyright Photo: Bruce Drum. Executive Airlines has operated charter flights for CTS. Please click on the photo for additional information.

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