Commercial NewsUS Air-American Deal May Mean Higher FaresConsumer advocates are concerned that the decision to approve another big airline merger will mean higher prices, even though smaller airlines will get more access to busy airports in Washington and New York as part of the deal. In the short term, the industry is waiting for the sale of takeoff and landing slots by the merging US Airways and AMR's American Airlines, a process that will take several months and be overseen by the Department of Justice. The largest airlines are expected to be barred from bidding, leaving the field open to carriers such as JetBlue, Allegiant and Spirit, if they chose to participate. Despite this, fliers will ultimately face higher airfares after the industry shrinks to just three major carriers, said Rick Seaney, chief executive of FareCompare, which tracks airfares.
LinkGaruda Indonesia To Double Fleet By 2025Garuda Indonesia plans to add up to 250 aircraft by 2025 to effectively double its fleet and meet demand in one of the world's fastest-growing aviation markets. Garuda is rising to the challenge of Lion Air, AirAsia and Mandala Airlines, who are expanding in a market which is expected to become one of the largest within a matter of years. The airline will finalize plans by year-end and seek board approval next year to order another 200-250 planes, taking its fleet to 350-400 aircraft by 2025, chief executive Emirsyah Satar told Reuters news agency.
LinkAir France-KLM Refuses Alitalia Cash CallAir France-KLM on Thursday refused a plea for cash to rescue Alitalia, saying a new business plan was not enough to save the stricken Italian carrier unless its creditors also write off some of its huge debts. Alitalia, which was privatized in 2008, has been unprofitable for more than a decade and has been stuck in a months-long tussle with Air France-KLM over whether to keep their strategic and financial partnership alive. Italian officials say they hope they can still find another international airline to invest and save the carrier, but time is running out after Air France-KLM walked away from the EUR€300 million (USD$403 million) call for more cash.
LinkEADS Profit Up, Raises Airbus Order GoalAirbus parent EADS posted higher profits and raised its forecast for new aircraft orders and deliveries on Thursday but doubts grew over production rates for its flagship A380 as recession softens demand for the world's biggest airliner. EADS posted a 22 percent increase in its underlying nine-month operating profit to EUR€2.3 billion (USD$3.1 billion). Strong demand for most types of passenger aircraft pushed operating profit at the main Airbus division up 85 percent, more than offsetting a slower performance at Eurocopter, the world's largest commercial helicopter manufacturer.
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Airbus bullish after VivaAerobus successAirbus is ready for more "ferocious fights" with Boeing in Latin America after its success in the campaign at VivaAerobus, as it predicts long-term demand for more than 2,300 new aircraft in the region. The manufacturer secured an order last month for 52 A320-family aircraft – including 40 of the re-engined A320neo variant, along with 40 options – when Mexican low-cost carrier VivaAerobus decided to switch from incumbent supplier Boeing. The deal was valued at $5.1 billion. "It was a very difficult campaign – we had to work very, very hard to make it a win," says Rafael Alonso, Airbus’s executive vice-president for Latin America and the Caribbean. "Sometimes to change suppliers is difficult for an airline. The fact that we won this one shows that we have a good product."
LinkMitsubishi plays down SkyWest's remarks on MRJMitsubishi Aircraft has sought to play down recent comments by customer SkyWest that suggested the US regional carrier could cancel its MRJ order if delays to the program continue. "SkyWest is very committed to this program," says Mitsubishi's head of sales Yugo Fukuhara. "We have an excellent relationship with them." During the carrier's earnings call on 6 November, SkyWest president Brad Rich said that Mitsubishi needs to deliver the MRJ "in a timeframe that makes sense for us". He warned: "If that doesn’t happen, we have no financial obligations or commitments to take the type."
LinkGuarulhos expansion on schedule for May 2014 openingTAM Holdings president Marco Antonio Bologna expects the new Terminal 3 at Sao Paulo Guarulhos International airport to open on schedule in May 2014. "If they don’t open it by May next year, they’re going to have penalties," he says of Concessionaria Aeroporto Internacional de Guarulhos, which owns the 20-year concession. "We don’t know the service levels but it’ll be there."
LinkBoeing looks outside Wash. for 777X work after union rejects contract Boeing says the Nov. 13 decision by the International Association of Machinists & Aerospace Workers (IAM) to reject a long term contract extension deal gives it “no choice” but to look at alternate sites away from the Seattle, Wash., area to assemble the 777X and its composite wing. The ‘no’ vote is a setback for the company which expects to officially launch the 777X at the Dubai air show early next week. Boeing had hoped to cement a deal in advance of the program go-ahead, and the contract rejection adds a new level of complication and uncertainty to the planning process for the re-engined, re-winged 777 derivative. Although the vote was substantially against the deal by a margin of 67% to 33%, the IAM is expected to seek further talks with Boeing over a compromise deal as part of further efforts to retain the work in the Puget Sound area. However, the rejection of the deal, which would have extended the IAM contract from 2016 to 2024, means that any revised contract must now compete with financial packages designed to lure production of Boeing’s largest ever twinjet to alternate sites.
LinkDelta expresses interest in slots at DCA and DALDelta Air Lines has expressed interest in two gates at Love Field in Dallas (DAL) that American Airlines plans to divest as part of its settlement with the Department of Justice. "Delta would like the opportunity to bid for slots and facilities at Washington-Reagan National Airport (DCA) as well as Dallas Love Field, where it currently provides competition with daily nonstop flights to its international hub in Atlanta," Delta said in a statement.
LinkAA-US Airways settlement will boost hub cities, experts sayThe American Airlines-US Airways settlement with the Department of Justice will help hub cities such as New York and Washington, D.C., experts say. The deal is "good for lots of cities and ancillary business around the country," said Bob Crandall, former chairman of American Airlines.
LinkAirlines substantially improve key servicesAirlines have substantially improved key services for customers, according to statistics released by the Department of Transportation, including a 14.1% drop in consumer complaints during the first nine months of 2013.
LinkAirbus A340 tests AVOID system for ash-cloud detectionResearchers have flown an Airbus A340 through a man-made ash cloud to test its AVOID system. The AVOID system, created by Nicarnica Aviation, can detect ash from 100 kilometers away. "We are at the beginning of an invention which could become a useful solution for commercial aviation to prevent large-scale disruption from volcanic ash," said Charles Champion, executive vice president and head of engineering at Airbus.
LinkTSA to roll out PreCheck for military to 100 airportsThe Transportation Security Administration is expanding its PreCheck program for military personnel from 10 airports to 100 airports by the end of 2013. "Providing expedited screening while on travel is the least we can do for these courageous men and women," said John W. Halinski, deputy administrator for the TSA.
LinkMIA rolls out passport kiosks to alleviate wait times for customersThere are now 36 self-service passport kiosks in the North Terminal at Miami International Airport (MIA). The kiosks process passports for U.S. and Canadian citizens. Next year, 12 additional kiosks will be installed in the South Terminal.
LinkDigital luggage tags being testedA British Airways pilot test of digital bag tags was a success, and could make hard-to-recycle paper tags a thing of the past. The airline is considering rolling out a digital tag for customer use in early 2014.
LinkSurvey: Americans take advantage of airport amenitiesAn Airports Council International – North America survey of 94 hubs finds that travelers are airport spending is on the rise as they take advantage of available shopping and eatery options. The survey found that U.S travelers spent $5.15 per person per departure on airport food last year. The survey also revealed that shoppers in 2012 spent an average of $3.31 per departure on gifts, news and other retail items.
LinkAirbus overbooks on current A320 productionAirbus is beginning to see overbooking on the baseline A320, leaving the airframer confident that it will be able to maintain its monthly production rate of 42 aircraft as it transitions to the A320neo. EADS chief financial officer Harald Wilhelm says the commercial momentum for both variants has been “outstanding”. He says Airbus has recorded “overbooking” on the current A320, adding: “It’s allowed us to close the transition between the [A320] and the [A320neo].” Airbus’s order data at the end of October officially listed 4,223 single-aisle aircraft in the backlog, including 1,771 current A320s.
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