Found this online. It's a picture of the aforementioned Independence Air letter: (if it's too small to read or not showing up properly, click here: http://forums.aca-lounge.com/attachment.php?s=&postid=54407)
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Wednesday, December 28, 2005
Tuesday, December 27, 2005
Independence Air Furlough Message
A flight attendant with Independence Air for three years posted this letter on a forum at Airliners.net. This letter seems to be the one that was mailed out to quite a few people:
Secondly, it also shows that you should not buy tickets on Independence Air, since they're planning already to go belly up in the next few weeks.
I wish the flight attendant who got this letter - and the rest, too - the best of luck in finding a better job.
December 23, 2005This does make me sad. First off, I don't know why managment over at FlyI can't wait a few days to send this out. There's no sense in wrecking someone's Christmas, if they celebrate it. You can call 866-465-9309 and hear some message that FlyI's recorded.
RE : Furlough
Dear Flight Attendant ######:
As you know, FLYi, Inc, the holding company for Independence Air, has been actively engaged in securing investors in, or purchasers of, the Company as it attempts to reorganize under Chapter 11 of the United States bankruptcy Code.
The Company expects that is it is unable to secure significant external investment or a sale of all or substantially all of its operations before January 7, 2006, it will permanently cease all operations and separate all employees at all locations sometime during the period January 7-21, 2006.
In accordance with Section 16.A.4 of the collective bargaining agreement between the Company and AFA covering flight attendants, this letter shall constitute notice that you will be furloughed effective January 7, 2006. The Company retains the right to amend or rescind this notice of furlough.
Sincerely,
Jeff Rodgers
Vice President, Employee Services
Secondly, it also shows that you should not buy tickets on Independence Air, since they're planning already to go belly up in the next few weeks.
I wish the flight attendant who got this letter - and the rest, too - the best of luck in finding a better job.
Monday, December 26, 2005
Asian Rivalry Is Good News for Boeing
A long-standing rivalry between two major airlines - Austrailia's QANTAS and Singapore Airlines - is heating up in a big way - in a way that can only benefit airplane manufacturer Boeing. Singapore might order the Boeing 777-200LR, quite a few 787 Dreamliners and up to six 747 Advanced freighters, according to the Wall Street Journal. Singapore would order a total of 80 planes, and had a bunch of 777-300ERs on order as well.
Also the word on the street is that Russian airline Aeroflot will buy 22 Boeing aircraft worth $2.5 billion. The order would be made up of those 787 Dreamliners. Looks like a good way for Boeing to close out a great year for them.
Sunday, December 25, 2005
DOT Says No To Delta, Northwest and Overseas Carriers
The US Department of Transportation said the other day that Delta Air Lines and Northwest Airlines can't coordinate prices and schedules with their European partners.
For quite some time, Delta has been allies with Air France, but this wasn't as strong as Northwest's seudo-marriage to KLM Royal Dutch Airlines. So when all four found themselves in the same airline alliance - SkyTeam - and when Air France merged with KLM, things got a bit trickier.
The ruling still allows Northwest to sell seats on Air France and Alitalia, another airline in SkyTeam.
For quite some time, Delta has been allies with Air France, but this wasn't as strong as Northwest's seudo-marriage to KLM Royal Dutch Airlines. So when all four found themselves in the same airline alliance - SkyTeam - and when Air France merged with KLM, things got a bit trickier.
The ruling still allows Northwest to sell seats on Air France and Alitalia, another airline in SkyTeam.
Saturday, December 24, 2005
United Bids For Part of Indy Air
First off, I'm not dead - I haven't posted here for a while because I've been very busy. They sure pack in the schoolwork the week before vacation.
I am currently in Spokane, Washington - a great city. I flew out from Boston two days ago, on United Airlines. Economy Plus both legs - it was via O'Hare - and pretty good service too, all things considered. Nice thing about Economy+ is that it gives me just the right amount of leg room.
Plus the second leg of the flight the captain enabled Channel 9 on the audio, which allows you to listen to what the pilots are listening to (the ATC chatter). It's enabled by the pilot - at his/her discretion, and I didn't get it on the BOS-ORD leg. But we had a bumpy flight over North Dakota and Montana, and we could hear the pilots always asking ATC for a different altitude. Here's an actual exchange:
PILOTS: Uh, Salt Lake Center, this is United 1711. Moderate chop up here at 28 [thousand feet]. Got anything smoother?
ATC: Sure. United 1197, descend and maintain flight level 2-6-0.
PILOTS: We sure complain a lot, don't we?
ATC: No, it's your job.
The landing at Geiger Field was great.
Speaking of United, reports are in that two days ago it wants to participate in a possible auction of Independence Air's assets. If it did happen, the auction would be on the third of January. This is the first time UAL has publicly expressed interest, even though it's no secret they wanted Atlantic Coast (iAir's former name) back again. From 1989 to last year, ACA provided flights to UAL as one of the United Express carriers. But after United went for Chapter 11 and wanted to renegotiate its contract, ACA declared its independece - har har - and went its own way.
And they've been regretting it ever since. Rumors are rampant that the airline will fold after the holiday travel season (read: the first few weeks of January) and sell its self off. Mesa Airlines, another regional carrier that does 'express' work for the big boys, is also interested in Indy Air.
It will be interesting to see how this plays out. . .
I am currently in Spokane, Washington - a great city. I flew out from Boston two days ago, on United Airlines. Economy Plus both legs - it was via O'Hare - and pretty good service too, all things considered. Nice thing about Economy+ is that it gives me just the right amount of leg room.
Plus the second leg of the flight the captain enabled Channel 9 on the audio, which allows you to listen to what the pilots are listening to (the ATC chatter). It's enabled by the pilot - at his/her discretion, and I didn't get it on the BOS-ORD leg. But we had a bumpy flight over North Dakota and Montana, and we could hear the pilots always asking ATC for a different altitude. Here's an actual exchange:
PILOTS: Uh, Salt Lake Center, this is United 1711. Moderate chop up here at 28 [thousand feet]. Got anything smoother?
ATC: Sure. United 1197, descend and maintain flight level 2-6-0.
PILOTS: We sure complain a lot, don't we?
ATC: No, it's your job.
The landing at Geiger Field was great.
Speaking of United, reports are in that two days ago it wants to participate in a possible auction of Independence Air's assets. If it did happen, the auction would be on the third of January. This is the first time UAL has publicly expressed interest, even though it's no secret they wanted Atlantic Coast (iAir's former name) back again. From 1989 to last year, ACA provided flights to UAL as one of the United Express carriers. But after United went for Chapter 11 and wanted to renegotiate its contract, ACA declared its independece - har har - and went its own way.
And they've been regretting it ever since. Rumors are rampant that the airline will fold after the holiday travel season (read: the first few weeks of January) and sell its self off. Mesa Airlines, another regional carrier that does 'express' work for the big boys, is also interested in Indy Air.
It will be interesting to see how this plays out. . .
Wednesday, December 14, 2005
The Beginning of the End for Independence Air
A certain airline based at Washington-Dulles announced that it will stop service on January 5 to Chicago, Manchester, NH, Jacksonville, FL, and Buffalo, NY.
At first this doesn't seem like a big deal. After all, many airlines have announced that they will trim back on unprofitable routes. But this is different - because the announcement comes from the mouth of that upstart carrier, that airline that decided to 'go its own way' and break away from a secure contract - Independence Air.
But I see this as the beginning of the end for Indy Air. Rumors are swirling that it will shut down the first week of January, after the holiday season travel rush is over.
At first this doesn't seem like a big deal. After all, many airlines have announced that they will trim back on unprofitable routes. But this is different - because the announcement comes from the mouth of that upstart carrier, that airline that decided to 'go its own way' and break away from a secure contract - Independence Air.
But I see this as the beginning of the end for Indy Air. Rumors are swirling that it will shut down the first week of January, after the holiday season travel rush is over.
Monday, December 12, 2005
Delta Cuts Deal With Pilots
Well, it looks like another 'Delta goes bye-bye' scenario has been averted. Late yesterday the pilots and management made a tentative deal worth more than $152 million a year in temporary pay cuts. The number is less than half of what Delta management wanted, and the pilots union is counting this one as a victory - after all, management did want them to give up $325 million a year in pay and benefits.
But the question remains: even though the pilots won this battle, who will win the war? Most people point to Delta. After all, most airlines in bankruptcy use the leverage of the court to get what they want - à la United in the past few years.
Yet at least for now, Delta's continuing to fly. And it's a good thing for everyone at Delta that the pilots agreed to cuts - because if they walked off the job like they were threatening to do, it would have been curtains for the entire outfit. Not that the pilot's union isn't threatening to strike, however. So while management - and everyone else - dodged a major bullet yesterday, don't think that Delta's problems are far from over.
But the question remains: even though the pilots won this battle, who will win the war? Most people point to Delta. After all, most airlines in bankruptcy use the leverage of the court to get what they want - à la United in the past few years.
Yet at least for now, Delta's continuing to fly. And it's a good thing for everyone at Delta that the pilots agreed to cuts - because if they walked off the job like they were threatening to do, it would have been curtains for the entire outfit. Not that the pilot's union isn't threatening to strike, however. So while management - and everyone else - dodged a major bullet yesterday, don't think that Delta's problems are far from over.
Friday, December 9, 2005
Continental CFO: Merger With UAL A Good Thing
Continental Chief Financial Officer Jeff Misner said that a merger with United Airlines would make a great combination - yet he also said that Continental prefers to stay independent, and a spokesperson from United said it hasn't made any deal for Continental - yet.
The CFO also said that if United would offer enough money, they would most likely go for it. And I bet that United just might do so, for the following reasons:
The CFO also said that if United would offer enough money, they would most likely go for it. And I bet that United just might do so, for the following reasons:
- Little route overlap. United has hubs at LAX, SFO, DEN, ORD, and IAD; Continental's main hubs are at IAH, CLE, and EWR. The only hubs there that overlap are ORD/CLE and IAD/EWR. United is strong on the West Coast doesn't have a shabby Midwest network; Continental has a strong East Coast setup. And don't forget the international network: United is dominant in Asia and has coveted landing slots at London Heathrow and a pretty extensive European network; Continental has a strong Latin American and European network.
- OK fleet commonality. United has primarily the A319/A320 for short haul, the 757 for medium haul, and the 747, 767 and 777 for long haul. Meanwhile, Continental has the 737 family for short haul (as does UAL, but it will get rid of its fleet of 737s over time), the 757 for medium haul, and the 767 and 777 for long haul.
- US Airways + America West (already happened)
- United + Continental
- Delta + Northwest (this has been speculated upon quite a bit)
Southwest Flight 1248
Many are probably aware of last night's incident at Chicago Midway. A Southwest 737 skidded off the end of the runway, plowed onto a road, and crashed into cars, killing a child in one of them. It is the company's first fatal accident in its 35 year history. No one onboard the aircraft was killed.
I generally don't like to discuss airline accidents here, but I'll make an exception this time - because Southwest has responded to the accident in such an open way. When you log on to the company's website, you are immediately given several links to information about the incident. I think that Southwest has done an excellent job responding to the situation - especially when they post information front and center on their website when other airline obscure it - if they even have it at all.
From the website:
I generally don't like to discuss airline accidents here, but I'll make an exception this time - because Southwest has responded to the accident in such an open way. When you log on to the company's website, you are immediately given several links to information about the incident. I think that Southwest has done an excellent job responding to the situation - especially when they post information front and center on their website when other airline obscure it - if they even have it at all.
From the website:
Southwest Airlines' CEO Gary Kelly discussed the Chicago Midway incident this morning. Kelly extended Southwest's heartfelt sympathies to those who were directly affected by the events of last night."This is a sad day for us here," said Kelly. "There are no words to adequately convey our grief and sorrow over this tragedy. It was with great sadness that we learned of the death of a child who was in one of the vehicles hit by the aircraft. The entire Southwest family is grieving this loss and our thoughts and prayers go out to the child's family."
Last night, Flight 1248 was involved in an incident at Chicago Midway Airport at approximately 7:15 p.m. CST while the aircraft, a Boeing 737-700, was landing. The aircraft veered off the runway and through the blast fence at the northwest corner of the runway--stopping at the intersection of Central and 55th Avenues. The weather conditions at the time could be described as one-quarter to one-half mile visibility with snow. The flight, which was on arrival from Baltimore/Washington International Airport, was scheduled to continue on to Las Vegas and Salt Lake City.
Flights into and out of Chicago Midway were cancelled for the remainder of the evening and our Employees are working hard to reaccommodate those passengers that were affected. Southwest resumed operations at Chicago Midway at 6:00 a.m. this morning.
The majority of the 13 injured have been treated and released from local hospitals. Southwest is still collecting and verifying injury reports, but at this time we have three individuals who are still receiving treatment at local hospitals.
"Southwest will do everything in our power to provide information and comfort to those who have been affected," said Kelly. "It is still too early to speculate as to a cause before the National Transportation Safety Board (NTSB) can complete a thorough investigation."
Southwest Airlines Employees are in the process of contacting the families of the passengers and crewmembers as well as those affected on the ground. A team of 94 trained Southwest Employees arrived in Chicago at 3:25 a.m. CST this morning and are working closely with the NTSB and the FAA as they perform their investigations. Another Team of Southwest's top leadership is departing for Chicago Midway momentarily. Gary Kelly will conduct the next media briefing from Chicago.
Southwest Airlines' immediate concern is with those affected both on the aircraft and on the ground. Southwest Airlines Employees are in the process of contacting the families of passengers and crewmembers, as well as those affected on the ground. Southwest Airlines has deployed an aircraft of Employees to assist passengers of Flight 1248. Passenger names will not be released until the appropriate family members have been notified.
A toll-free number has been established by Southwest Airlines to assist friends and family members wanting information about passengers onboard Flight 1248. That number is (800) 922-9525. Periodic updates will also be posted on the Company's web site at www.southwest.com.
Thursday, December 8, 2005
Boeing 737
Boeing recently passed the 6000 order mark with the 737. I personally feel that the 737 is one of the best aircraft in the skies today. Hopefully it will be the queen of the skies for many years to come. I would also like to add that it appears that over 50% of the 737 orders have been orders for the 737NG (737-600, 737-700, 737-800, 737-900, and 737-900ER). The Boeing 737 is the best selling commerical aircraft of all time, (although there were over 10,000 DC-3's manufactured, the majority of them were military versions, and therefore not included in the DC-3's total), followed by the A320 series and the 727.
~MD-11
~MD-11
Korean Air Pilots Walk Off The Job
KAL pilots, who want an 8 percent increase in pay, went on strike today as they pressured the airline to accept their increase. Management at Korean Air had been offering a 3 percent increase.
Korean Air suspended about 53 percent of scheduled flights. Cancellations were set to increase to 63 percent of the total, the airline said. The majority of the pilots are unionized. Some in the South Korean government are calling for the Ministry of Labor in intervene and force the striking pilots back to work. Last August, KAL's smaller rival Asiana Airlines had a similar situation, and then the government stepped in. So I bet that if they'd do it for Asiana, they'd certainly do it for Korean Air, which is seen as the 'flag carrier' of South Korea.
Korean Air suspended about 53 percent of scheduled flights. Cancellations were set to increase to 63 percent of the total, the airline said. The majority of the pilots are unionized. Some in the South Korean government are calling for the Ministry of Labor in intervene and force the striking pilots back to work. Last August, KAL's smaller rival Asiana Airlines had a similar situation, and then the government stepped in. So I bet that if they'd do it for Asiana, they'd certainly do it for Korean Air, which is seen as the 'flag carrier' of South Korea.
And now that figures are out saying that the strike costs the economy $200 million in exports every day (KAL has a large cargo division), I'm sure the government will certainly intervene. For its part, KAL will lose $25 million a day by its own estimate.
Indian Airlines Gets A Makeover
Well, it's about time, but Indian Airlines finally got a new livery yesterday. It also changed its name from Indian Airlines and the stylized initials logo to just 'Indian' in bold orange titles. At the same time it took delivery of its first new aircraft, an A319, in - get this - 11 years.The old and the new:
Wednesday, December 7, 2005
More Airbus Orders; RAM Selects 787
Philippine flag carrier Philippine Airlines (PAL) signed an agreement with Airbus to buy and lease 18 A320 aircraft - nine brand-new and options for five more at an estimated cost of 840 million US. PAL will also lease two brand-new A320s and two A319s from GECAS, and deliveries will begin the second half of 2006 to 2008. PAL has needed to update its aging fleet for a long time, so this order is good for them. Useless trivia fact: PAL became the first airline to order Airbus - back in 1978. This is important for Airbus, because PAL's short-haul fleet has been pretty much Boeing.
Also Airbus has announced an order from Germanwings, a German low-cost carrier:
Also Airbus has announced an order from Germanwings, a German low-cost carrier:
Germanwings, the rapidly-expanding Cologne-based low-cost carrier (LCC), has signed a contract for 18 Airbus A319s. The order follows an earlier announcement of the airline’s decision to further expand its fleet of Airbus single-aisle aircraft. The new aircraft are the first that Germanwings has acquired directly from Airbus, while the airline already operates a fleet of 19 A319s and three A320s.On the other side of the Atlantic, Boeing has announced that Royal Air Maroc (RAM) ordered four 787 Dreamliners with an option for one more. RAM will use them on North American, Middle Eastern, and African routes. RAM is, by the way, a loyal Boeing customer.
The new A319s for Germanwings will feature a comfortable single-class cabin layout for a maximum of 156 passengers. The aircraft will be powered by V2500 engines from International Aero Engines. Germanwings will fly the aircraft from its bases in Berlin, Stuttgart and Hamburg as well as from the main hub in Cologne to more than 40 destinations all over Europe.
Finnair orders 12 Airbus Aircraft
Today, Finnair, announced that they are going to be ordering 12 new aircraft from Airbus. The ordes consists of 9 A350-900's and 3 A340-300's. They also have an option for 4 additional A350's These aircraft are intended to evntually replace the MD-11 in Finnair's long-haul fleet, by 2012. Finnair is expecting that the A350's will be delivered between 2011 and 2013. Finnair hopes to continue to its fleet modernization through this aquisition. According to Finnair, the A350 will
use only 66% of the fuel that the MD-11 is currently using. By ordering the A350 and the A340, Finnair will increase the commonality with the rest of their modern fleet of A320'sPersonally, I think that the A350 will be a wonderful aircraft and will serve them for years to come. Unfortunatly, one of the true beauties of the skies, the MD-11 will have to be sacrificed because of this. Finnair is one of the last Western airlines to operate the MD-11 in commercial service. The thing that I find most interesting about this order is the A340's. I personally think that they must have been given a really good deal on the A340's, because if they are trying to conserve fuel, then, I think that the A330-300, with two engines would have been the more economical choice.
~MD-11
Monday, December 5, 2005
Alliance Update
It's time for the bi-monthly Airline Alliance Update, so here goes:
Star Alliance has added zero members to the group.
SkyTeam celebrated its 5th anniversary - but like Star, no new members.
Oneworld announced recently that JAL (Japan Air Lines) will become a member. When fully inducted, it will become the alliance's largest airline in terms of group revenues. It will form the 'Oneworld Big Three' with American Airlines and British Airways. Royal Jordanian will be inducted in late 2006/early 2007. More recently, Hungarian's MALEV was invited to join, and that will be completed in about fifteen months.
Star Alliance has added zero members to the group.
SkyTeam celebrated its 5th anniversary - but like Star, no new members.
Oneworld announced recently that JAL (Japan Air Lines) will become a member. When fully inducted, it will become the alliance's largest airline in terms of group revenues. It will form the 'Oneworld Big Three' with American Airlines and British Airways. Royal Jordanian will be inducted in late 2006/early 2007. More recently, Hungarian's MALEV was invited to join, and that will be completed in about fifteen months.
Sunday, December 4, 2005
A320: Made In China
Like MD-11 has already pointed out, there is the remote possibilty of Airbus opening a factory in China. This facility will produce Airbus' popular A320 aircraft.Chinese Primier Wen Jiabao was in Toulouse the other day, being shown the A380 by the bigwigs from Airbus. He also signed an agreement to consider the A320 factory. As of now, Airbuses are built in Europe: the A320, A330 and A340 in Toulouse, and the A319 and A321 in Hamburg, Germany. And Airbus has told China that it will allow it to build approximately 5% of the fuselage for the new A350.
Here's what MD-11 said:
I personally do not think that this is going to happen, because of how much the French and German governments own of Airbus.I, however, believe that the Europeans would be glad to ink this deal with the Chinese. France, for one, has been pushing for the repeal of EU embargoes placed on China for civil rights violations. Germany has agreed with this too. And everybody knows that in ten or twenty years from now, China will be where the money is - if not a lot sooner.
Boeing knows this too, and it's been racking up impressive orders from the Chinese for 737s. Cathay Pacific also ordered the 777 recently as well. If Airbus wants to keep up with Boeing, they're going to have to cozy up to the Chinese. And a good way to do this is to cut a deal like this with them. If Airbus - and the French and German governments - get their foot in the door in China before Boeing - and the United States - do, the implications could be severe for the Americans.
Bottom line: I believe Airbus will get the green light to do this. It's nothing really big, too - just 5% of the fuselage of the A350 - so workers in Europe shouldn't get too mad. But there's just one problem with the A320 factory: they might not be able to sell the Chinese-built A320s to the United States. I don't know what the policy is on this, and if anybody does know, I'd appreciate it if they'd tell me. But I'm sure that the Bush Administration wouldn't be too keen on seeing United or jetBlue take delivery of Chinese-made aircraft, especially when Bush is trying to turn around the US' whopping trade deficit with China.
Airbus in China
There have been rumors that Airbus is looking into opening a factory in China, as well as an article by Bloomberg about the issue. This factory would produce the A320 series of aircraft. I think that this is partially due to a large backlog on the A320's as well as Airbus wanting to win a lot of the orders in the growing Chinese airline industry, which have recently been going to Boeing for their 737NG product. I personally do not think that this is going to happen, because of how much the French and German governments own of Airbus.
~MD-11
Friday, December 2, 2005
Aeroflot To Create Affiliate In St. Petersburg
Anyone who follows this will know that I like to follow the Russian aviation industry. If you don't know this already, you know it now. That said, Aeroflot Russian Airlines announced today that it will set up an affiliate in St. Petersburg.
The move will "strengthen its positions on the international and domestic markets", according to its Board of Directors.
Air traffic at St. Petersburg-Pulkovo Airport (Аэропорт Пулково) is second only to Moscow. No idea as to what the new airline will be called. But Aeroflot has a measly percentage of domestic traffic - not measly, maybe, but not as big as you'd think, somewhere around 11% - so perhaps it wants to regain some of the prestige of the Soviet days. We'll see.
The move will "strengthen its positions on the international and domestic markets", according to its Board of Directors.
Air traffic at St. Petersburg-Pulkovo Airport (Аэропорт Пулково) is second only to Moscow. No idea as to what the new airline will be called. But Aeroflot has a measly percentage of domestic traffic - not measly, maybe, but not as big as you'd think, somewhere around 11% - so perhaps it wants to regain some of the prestige of the Soviet days. We'll see.
Thursday, December 1, 2005
Bleeding After Bankruptcy
It's my guess that Grinstein at Delta and Steenland at Northwest haven't been feeling too well as of late. Their airlines are bleeding red ink - especially at Delta, where the situation is critical. They put their airlines into Chapter 11 of the U.S. Bankruptcy Code on the exact same day. Perhaps they thought Chapter 11 would solve some of their problems. Perhaps they looked at United, which filed in December 2002 and is going to emerge soon. UAL projects $1 billion in profits by 2007 - which is optimistic at best in my opinion, but that's another post.
But interestingly enough, it may be the fact that it avoided bankruptcy a year ago that is hurting it so much today. In October 2004, management at Delta won over $1 billion in pilot pay cuts and an additional $1 billion in other costs. But with its losses now totaling $11 billion since 2001, things are going to have to change fast, and waiting a year might turn out to be too long. Things get worse, too. Its pilots are threatening to walk the picket lines, and they've learned lessons from United's trip through bankruptcy, where management in Chicago squeezed out a ton of concessions.
Delta has three ways out of this mess. The first is to do what United did - be nice to the unions. Or you can do the 'screw them' approach, like Northwest, which is to impose pay cuts. The final way is to continue what it's doing, and go under in a bit. But if the alarm bells aren't ringing in Atlanta, they should be now. Delta has lost $1.1 billion in bankruptcy, and that's been in the last two months. Someone over there's got to wake up and smell the jet fuel, so to speak, which is also dragging down income. If Delta doesn't change, they're likely to go under quick. |B762
But interestingly enough, it may be the fact that it avoided bankruptcy a year ago that is hurting it so much today. In October 2004, management at Delta won over $1 billion in pilot pay cuts and an additional $1 billion in other costs. But with its losses now totaling $11 billion since 2001, things are going to have to change fast, and waiting a year might turn out to be too long. Things get worse, too. Its pilots are threatening to walk the picket lines, and they've learned lessons from United's trip through bankruptcy, where management in Chicago squeezed out a ton of concessions.
Delta has three ways out of this mess. The first is to do what United did - be nice to the unions. Or you can do the 'screw them' approach, like Northwest, which is to impose pay cuts. The final way is to continue what it's doing, and go under in a bit. But if the alarm bells aren't ringing in Atlanta, they should be now. Delta has lost $1.1 billion in bankruptcy, and that's been in the last two months. Someone over there's got to wake up and smell the jet fuel, so to speak, which is also dragging down income. If Delta doesn't change, they're likely to go under quick. |B762
AA and Southwest 'Love'-ing Each Other
Big news today is that Southwest is free to go out of Dallas' Love Field, Southwest's headquarters - but only to Kansas City (MO) and St. Louis. President Bush signed legislation that allowed this to happen. The new service is going to begin December 13 with four non-stop flights to each city. The one-way fare from Dallas to either St. Louis or Kansas City will be $79 with a 14-day advance purchase, while the unrestricted fare is $129 each way, Southwest said.
The whole controversy involves the Wright Amendment, a 1979 federal law, along with the Shelby Amendment, which state that no large jet air service is allowed from Love Field to any point beyond Texas, Louisiana, Arkansas, Oklahoma, New Mexico, Kansas, Mississippi, and Alabama. Here's a short overview from Southwest's campaign website to open up Love Field:
As of now, the only airlines flying out of Love are Southwest and Continental Express. But that too will change, as American Airlines - based in next-door Forth Worth, and with a flagship hub at DFW and a hub at St. Louis - prepares to start service out of Love as well. American didn't want to start service at Love, where it leased three gates. "We didn't want to be forced to go to Love Field but we will go and we will compete aggressively," American Airlines spokesman Tim Wagner said. Regardless, American has to upgrade its facilities at Love first, so they won't be flying out any time soon.
So this means war. Southwest and American have been rivals for many years, but this is taking it into the Southwest's backyard. Will AA flyers use the Love Field facilities, or will they opt for its mega-hub at DFW? Or will other passengers stick to Southwest?
The whole controversy involves the Wright Amendment, a 1979 federal law, along with the Shelby Amendment, which state that no large jet air service is allowed from Love Field to any point beyond Texas, Louisiana, Arkansas, Oklahoma, New Mexico, Kansas, Mississippi, and Alabama. Here's a short overview from Southwest's campaign website to open up Love Field:
In 1979, Congress passed the federal law commonly referred to as the " Wright Amendment ", which restricts travel into and out of Dallas Love Field for commercial flights with more than 56 seats. This federal law makes it illegal to fly from Love Field to points beyond the four states surrounding Texas. The Wright Amendment also contains marketing restrictions, prohibiting Southwest Airlines from offering or advertising the availability of any connecting flights between Love Field and any city outside the Wright Amendment "service area." In 1997, Congress passed the Shelby Amendment, which added Alabama, Kansas, and Mississippi to the Wright Amendment service area. (from www.setlovefree.com)But a provision in the bill makes Missouri exempt from Wright. And Southwest fought long and hard for this moment. It cited a study that predicted that the estimated fare savings would be $77 million - and 500,000 additional Missouri passengers would fly. That's along with the additional $218 million per year into the Missouri economy. "The push from Missouri allows us to create a competition laboratory, if you will, to prove our case," said Herb Kelleher, Southwest's executive chairman and co-founder, in a statement. "Our experience in 60 other markets tells us that carriers serving these markets will decrease their fares and increase their Missouri traffic."
As of now, the only airlines flying out of Love are Southwest and Continental Express. But that too will change, as American Airlines - based in next-door Forth Worth, and with a flagship hub at DFW and a hub at St. Louis - prepares to start service out of Love as well. American didn't want to start service at Love, where it leased three gates. "We didn't want to be forced to go to Love Field but we will go and we will compete aggressively," American Airlines spokesman Tim Wagner said. Regardless, American has to upgrade its facilities at Love first, so they won't be flying out any time soon.
So this means war. Southwest and American have been rivals for many years, but this is taking it into the Southwest's backyard. Will AA flyers use the Love Field facilities, or will they opt for its mega-hub at DFW? Or will other passengers stick to Southwest?
Wednesday, November 30, 2005
The End Of An Era
Boeing has recently announced that production on the final 717 has commenced. There are two reasons that I feel this is the end of an era.
The first is that this jet, which is to be delivered to Airtran, will be the final aircraft to ever be produced at Boeing's Long Beach, CA facility. This facility has produced many aircraft which have changed the aviation world forever, such as one of the most important aircraft of all time, the DC-3. Other aircraft that were produced at the Long Beach facility include the DC-9, DC-10, MD-11, and the MD-80.
The second reason that I feel this is the end of an era is that this aircraft will be the last aircraft related to the DC-9 ever sold. The DC-9, MD-80, and the 717 are aircraft that are very
important aircraft in the fleets of many airlines, even though they are aging. Northwest Airlines operates a very large fleet of DC-9's. American Airlines has over 233 MD-80's in its fleet. Delta Airlines operates 136 MD-80's and MD-90's. Airtran operates 84 717's currently, with 4 more on order. Hopefully these great aircraft will continue to serve airlines for many years to come.So, to McDonnell Douglas, all the wonderful employees at Long Beach, the DC-9, and the Boeing 717, I say:
So long, and thanks for all the planes!
~MD-11
Tuesday, November 29, 2005
Surprise, Surprise: US Airways Orders A350
The newly merged US Airways will buy 20 A350-800s, becoming the first airline to do so, and deliveries will start in 2011 and go until 2014. The plane is capable of seating 253 in a standard three-class seat layout.
According to Airbus, the airline's A330 pilots won't need to undergo additional training to fly the new airplane. The deal is worth €3.42 billion, or $4.03 billion, at list prices. Keep in mind that Airbus will most likely cut a deal with the airline so that it pays significantly less for the aircraft.
According to Airbus, the airline's A330 pilots won't need to undergo additional training to fly the new airplane. The deal is worth €3.42 billion, or $4.03 billion, at list prices. Keep in mind that Airbus will most likely cut a deal with the airline so that it pays significantly less for the aircraft.
Monday, November 28, 2005
Air Canada Says Goodbye and Adieu to Jazz
ACE, the parent of Air Canada, said today it will spin off Jazz into an income trust. AC will get the proceeds of the deal, as well as majority control of Jazz. From the Globe and Mail of Toronto:
ACE plans to market Jazz as a source of stable income because it effectively serves as a charter airline booked by Air Canada for regional flights. Jazz incurs costs for pilots and planes, but it receives a steady stream of revenue from Air Canada, even if a flight is half empty.
Jazz began charging Air Canada an hourly flying rate on Sept. 30, 2004, when Air Canada emerged from bankruptcy protection.
“Jazz doesn't have to worry about fluctuations in passenger loads. If Jazz runs on a Monday and it's half empty, it's the same fee as if it's full. It has a guarantee of revenue because of a capacity purchase agreement,” an industry source told the Globe and Mail. As part of that pact, Jazz pumps jet fuel into its planes but Air Canada pays those fuel bills.
Jazz had capacity last month of 358 million available seat miles (ASMs), or 40 per cent of WestJet Airlines Ltd.'s capacity of 905 million ASMs. But as a trust, Jazz's $1-billion value on the stock market would be two-thirds the size of WestJet's $1.5-billion valuation of common shares.
Halifax-based Jazz has its roots spread across Canada. In 2002, Jazz emerged as the new name for the merger two years earlier of four regional carriers: Air BC, Canadian Regional Airlines, Air Ontario and Air Nova.
Jazz has 3,700 employees and 119 aircraft, which seat 37 to 75 people. The carrier has been growing rapidly, with its passenger traffic in October up 77.8 per cent from the same month last year.
Jazz CEO Joseph Randell, in a corporate presentation, wrote that Air Canada effectively “buys or rents the capacity flown by the regional carrier.”
Northwest Goes Down The Toilet - Literally
For those that don't believe me, check out http://cgi.ebay.com/NORTHWEST-AIRLINES-model-going-down-the-toilet_W0QQitemZ6581964642QQcategoryZ10771QQrdZ1QQcmdZViewItem
Since this link might not be around for much longer, I'll post the contents of the page here.
Please note that I did not write the remainder of this post, so don't get mad at me for these rather radical views.
With wage cuts, layoffs, and replacement workers…
parking airplanes and cutting service…
Since this link might not be around for much longer, I'll post the contents of the page here.
Please note that I did not write the remainder of this post, so don't get mad at me for these rather radical views.
With wage cuts, layoffs, and replacement workers…
parking airplanes and cutting service…
The Airline is shrinking!
If the Northwest airline model gets much smaller it will slide right down the toilet.
Just look at the picture.
This
Time is running out! This may be your last chance to salvage the Northwest airline model.
Bid Now, before it’s too late!
Getting the Northwest airline model out of the toilet would make a wonderful holiday gift for anyone who may be further impacted if it goes all the way down the tube.
Gift wrapping is available upon request.
One-way economy shipping from MSP would have cost only $158.51 if you had bid over a month ago. It might have cost you $255.51 a couple of weeks ago. By the end of this auction, the shipping will cost $1112.51 plus all applicable taxes and fees… however, to remain competitive in this dynamic market, we supposedly have no choice but to give away the farm. Shipping is now
"The Airline" refers to the airline industry as a whole, and all other airline references are descriptive only of the plastic airplane model pictured in the toilet.
EXECUTIVE BONUSES...
I can’t explain how we continue to operate without any profits. Our executive compensation plan is another important component of our strategy of giving away the farm. In order to retain the talented executives with the knowledge and skills necessary to get the airline model out of the toilet, we supposedly have no choice but to give huge executive bonuses in addition to some of the highest executive pay in the industry.
The first bidder is receiving the keys to a 1999 BMW 5-series with remote keyless entry. Yes, that’s right, I am giving this bidder the keys to a BMW just for bidding!
There will be more bonuses given as we continue to strive toward our goal of getting the Northwest airline model out of the toilet.
Do your part to get the Northwest airline model out of the toilet, Bid Now!
Sunday, November 20, 2005
Champagne Flows in Chicago Thanks to the Chinese
Just when the folks over in Chicago and Seattle couldn't have thought it possible t get muchhappier after the big Emirates order (see last post), they can now. Eight Chinese airlines placed an order yesterday - when President Bush was in town - for 70 737-700s and -800s worth about $4 billion. They will be delievered between next year and 2008.
No specifics were given, but the planes will go to Air China, China Eastern, and China Southern. And it seems now that for the first time in five years, Boeing might outsell Airbus - it has 659 orders now compared to Airbus' 494.
Boeing has traditionally been pretty strong in the Asia-Pacific market, even as Airbus has eroded its market share in other regions.
And President Bush has to be happy - he's been doing a lot of complaining lately about the United States' huge trade deficit with China. This order should help cut some of that.
No specifics were given, but the planes will go to Air China, China Eastern, and China Southern. And it seems now that for the first time in five years, Boeing might outsell Airbus - it has 659 orders now compared to Airbus' 494.
Boeing has traditionally been pretty strong in the Asia-Pacific market, even as Airbus has eroded its market share in other regions.
And President Bush has to be happy - he's been doing a lot of complaining lately about the United States' huge trade deficit with China. This order should help cut some of that.
Friday, November 18, 2005
Singapore: No Merger with Qantas
Excerpts from an article by the AP:
But the issue that's the focus point isn't alliances; it's a route: Los Angeles - Sydney, which is only flown by United and Qantas as of now. According to the AP article, Qantas has about 75% of the market share on that route, which also constitutes 15% of its total profit. Singapore wants in on the route, so it can pick up passengers on the Singapore-Australia-Los Angeles circuit.
I believe that Singapore, which will only allow a merger if the Australian government is more allowing of competition on the trans-Pacific routes, is playing hard-to-get. If the Australian prime minister is backing the merger, then they will probably do some things to appease Singapore.
Both airlines are world-class nonetheless. Singapore is known for its fantastic service (think Raffles class) and Qantas is known for its profitability and safety record.
SINGAPORE (AP) -- Singapore Airlines on Friday dismissed talk of a potential merger with Qantas, saying the issue could only be considered if the Australian government allows greater competition on the prized trans-Pacific route to the United States.Interesting. First of all, Singapore and Qantas both are bastions of their respective alliances - SQ is a big Star player, and Qantas was a founding member of oneworld. So if they did merge, which alliance would win out? The problem with this is that Qantas is partly owned by British Airways - another oneworld member. And Singapore owns 49% of Virgin Atlantic - BA's archrival.
On Thursday, Australian Prime Minister John Howard threw his weight behind the idea of a merger between two of Asia's biggest -- and most profitable -- airlines after a meeting with counterpart Lee Hsien Loong on the sidelines of the Asia-Pacific Economic Cooperation summit in South Korea."This issue has already been discussed and debated extensively in recent months," Singapore Airlines spokesman Stephen Forshaw said. "We've said all along that for mergers to happen, there needs to be considerable regulatory liberalization. It is an idea ahead of its time."
But the issue that's the focus point isn't alliances; it's a route: Los Angeles - Sydney, which is only flown by United and Qantas as of now. According to the AP article, Qantas has about 75% of the market share on that route, which also constitutes 15% of its total profit. Singapore wants in on the route, so it can pick up passengers on the Singapore-Australia-Los Angeles circuit.
I believe that Singapore, which will only allow a merger if the Australian government is more allowing of competition on the trans-Pacific routes, is playing hard-to-get. If the Australian prime minister is backing the merger, then they will probably do some things to appease Singapore.
Both airlines are world-class nonetheless. Singapore is known for its fantastic service (think Raffles class) and Qantas is known for its profitability and safety record.
Thursday, November 17, 2005
Olympic Airlines Is Gone.... Or Is It?
It seems that Greek flag-carrier Olympic Airlines will be replaced by a new airline company with a different name. Olympic Airlines was created by the Greek government back in 2003 to replace the old Olympic - Olympic Airways. The government has tried time and time again to privatize it, and with the latest attempt unsuccessful, it seems that they're going to shut it down and relaunch it.
Details are still sketchy, but the new entity will apparently have the word 'Olympic' in its new name. Some possibilities as of now are Olympic Air or Air Olympic.
Details are still sketchy, but the new entity will apparently have the word 'Olympic' in its new name. Some possibilities as of now are Olympic Air or Air Olympic.
Wednesday, November 16, 2005
Air Canada 767s Go Silver
In an effort to save cash, Air Canada is testing out the polished à-la-American look on its Boeing 767 fleet. The whole process shaves off 360 pounds of weight on each plane, which means AC will save about $24,000 per year on fuel costs. Not all 767s will be polished, and of course, Airbus crafts can't be polished because of the material they're made out of (no idea what it is, though).
Personally, I think the new 'toothpaste tube' paint job is OK, but it just doesn't go with polished aluminum. American's scheme is a classic, and Northwest did a decent job with their new paint job too. But the fuselage looks like it's been sanded with 120 grit sandpaper by a woodworking class.
Delta, Air France - KLM, and Northwest
In this day and age, there are a lot airlines allinces, but none stronger than one existing within SkyTeam. Delta and Air France have, for years, had very strong ties. Northwest and KLM are considered, by many, to be one airline, especially with their profit sharing. Now that Air France and KLM are one airline, the image has almost come full circle. The one missing peice is the joining of Delta and Northwest, to create the biggest airline, ever. Together, could emerge from Chapter 11, and be the face of the all new American aviation industry. One of the main barriers is that there are no aircraft that the two airlines have in common, except for the 757-200, but even those have different engines! One of the best things that the two airlines have that is different is their route structure. Northwest has a very extensive Pacific route network, and Delta has a pretty large European route structure, which has expansion in store. The presence over the Atlantic could be incresed using the Northwest 757-200's, like Continental (The Delta 757-200's have non-ETOPS engines). Sure, some aircraft would have to go, such as the DC-9, the DC-10, the 737-200, the 737-300, and the 747-200, but that is okay. The most important thing is to have most of the legacy carriers out of bankrupcy. It is possible that this new carrier may cause troubles for some of the other legacy carriers, but I do not think that we will see any of them going away any time soon.
Just my two cents...
~MD-11
Be sure to check back tomorrow for my opinions on today's aviation related stories.
Just my two cents...
~MD-11
Be sure to check back tomorrow for my opinions on today's aviation related stories.
Tuesday, November 15, 2005
Delta: Pilots Strike Would Be 'Murder-Suicide'
Yesterday, Delta Air Lines said that if their pilots were to go on strike, it would be'murder-suicide' for the third largest airline in the U.S. That's right, folks - we're looking at a very distinct possibility that come next week, Delta may not exist anymore.
Sure, we've heard it all before - United was going to fail back in '02. It was going to be curtains for American back in '03. And just how many times has everyone - myself included - stuck a fork in US Airways, pronouncing them dead? The most recent time was during last December. But now US Airways has a relatively promising future ahead of them, with the merger with America West and all that. In short, since 9/11 and the resulting industry tailspin, we have yet to see a major US legacy carrier bite the dust. Everyone knows that it will take just one carrier to collapse for the situation to improve drastically for everyone else. So it's been a game of chicken so far - and although all those airlines have filed for Chapter 11 or warned about Chapter 7 - nobody's actually gone under yet.
So could a strike by the pilots really kill Delta? Well, first we'd have to see whether the pilots are really going to strike or not. Delta wants $325 million more out of their payroll - on top of the $1 billion they conceded last year. If the pilot's contract is rejected in bankruptcy court, the ALPA has warned, the 6000 pilots at Delta will walk off the job. And according to the company, that would be illegal, saying that the Railway Labor Act would prevent such a thing. The RLA basically makes the would-be strikers resort to bargaining, mediation, arbitration, etc. instead of actually striking.
What's the company saying about this? They're basically dismissing it as a hollow threat. I believe that the top brass at Delta think that the pilots won't really strike. After all, a pilots strike by Eastern Airlines pilots in 1989 virtually killed the company. But it's definately a news item worth watching. Delta may believe that its pilots are just blowing smoke, but if you reported a $1.13 billion quarterly loss just a few days ago, wouldn't you be worried?
Sure, we've heard it all before - United was going to fail back in '02. It was going to be curtains for American back in '03. And just how many times has everyone - myself included - stuck a fork in US Airways, pronouncing them dead? The most recent time was during last December. But now US Airways has a relatively promising future ahead of them, with the merger with America West and all that. In short, since 9/11 and the resulting industry tailspin, we have yet to see a major US legacy carrier bite the dust. Everyone knows that it will take just one carrier to collapse for the situation to improve drastically for everyone else. So it's been a game of chicken so far - and although all those airlines have filed for Chapter 11 or warned about Chapter 7 - nobody's actually gone under yet.
So could a strike by the pilots really kill Delta? Well, first we'd have to see whether the pilots are really going to strike or not. Delta wants $325 million more out of their payroll - on top of the $1 billion they conceded last year. If the pilot's contract is rejected in bankruptcy court, the ALPA has warned, the 6000 pilots at Delta will walk off the job. And according to the company, that would be illegal, saying that the Railway Labor Act would prevent such a thing. The RLA basically makes the would-be strikers resort to bargaining, mediation, arbitration, etc. instead of actually striking.
What's the company saying about this? They're basically dismissing it as a hollow threat. I believe that the top brass at Delta think that the pilots won't really strike. After all, a pilots strike by Eastern Airlines pilots in 1989 virtually killed the company. But it's definately a news item worth watching. Delta may believe that its pilots are just blowing smoke, but if you reported a $1.13 billion quarterly loss just a few days ago, wouldn't you be worried?
Hello! from MD-11
Hi, I am MD-11 and I will be posting my opinions on current events in the aviation world! Today I am going to start off with the newly announced Boeing 747-8, so here it goes:
Today, Boeing FINALLY announced their plan to release a new 747!
But, they had to screw it up, by calling it the 747-8 Intercontinental, what's up with that? Why the heck don't they just call it the 747-800, or, even better, the 747-5, or, my personal favorite, the 747-500!
How long did it take for Boeing to finally realize that they might actually be able to undercut Airbus on this one, for once! I mean, they already had the main design from 40 years ago, all that they had to do was to strengthen the fuselage and extend the freaking upper deck, how hard would that be to do!
At least, Boeing says that it will have less wake vortex than the WhaleJet, one good thing!
An unfortunate thing that has come up with the 747-8 is that there are no orders for the passenger version, but these orders will hopefully come, especially with JAL's recent announcement to retire its 747-200's and its 747-300's.
~MD-11
Today, Boeing FINALLY announced their plan to release a new 747!
But, they had to screw it up, by calling it the 747-8 Intercontinental, what's up with that? Why the heck don't they just call it the 747-800, or, even better, the 747-5, or, my personal favorite, the 747-500!
How long did it take for Boeing to finally realize that they might actually be able to undercut Airbus on this one, for once! I mean, they already had the main design from 40 years ago, all that they had to do was to strengthen the fuselage and extend the freaking upper deck, how hard would that be to do!
At least, Boeing says that it will have less wake vortex than the WhaleJet, one good thing!
An unfortunate thing that has come up with the 747-8 is that there are no orders for the passenger version, but these orders will hopefully come, especially with JAL's recent announcement to retire its 747-200's and its 747-300's.
~MD-11
New Member Onboard
I've decided to let my friend MD-11 join the blog. He'll post his various rants, raves, etc. - not as often as I will, but it's still nice to have an opposing viewpoint now and then.
New Boeing 747 Model Launched
Big - literally - big news. Today Boeing launched its biggest aircraft ever, the 747-8, which will enter service sometime in late 2009. Already it (well, the cargo version, at least) has gotten 5 billion dollars in orders from Luxembourg's Carolux and Japan's Nippon Cargo Airlines. Boeing says that its new plane will bridge the gap between current aircraft on the market and the mammoth A380, produced by archrival Airbus.
According to Boeing, there's also going to be a passenger version that's capable of seating 450 - about 105 smaller than the A380. So far, however, no airline has ordered the pax version, which has been dubbed the Boeing 747-8 Intercontinental. Most airlines who are interested in the 747 already have various models of it, the most numerous of which is the -400. But Boeing is bragging that the Intercontinental won't need to have upgraded airport facilities to handle it like the A380 will.
Wednesday, August 24, 2005
American: The Best of the Legacy Carriers?
While United and US Airways are in Chapter 11 bankruptcy, Delta and Northwest are on the verge of filing, and the rest of the industry is being from high oil prices, pensions, etc., one major US airline seems to have pulled ahead from the rest: American. It is probably the best-managed of the legacy carriers.Let's start with it's CEO as an example. Gerard Arpey took over the reins in early 2003 after ex-CEO Don Carty resigned when it became known that he accepted large bonuses when he was trying to wring out concessions from everyone else, and the company was on the verge of bankruptcy. Since then, Arpey has refused pay raises, stock options and bonues, because he claimed that with employees making so many sacrifices, it "just didn't feel right". He's listened to the employees and welcomed their suggestions for cost-cutting measures, and this helped American post a $58 million profit in the second quarter this year.
Of course, his company isn't as successful as, say, jetBlue or Southwest. But it's not bad for a legacy carrier - especially compared to how United, Delta, Northwest, et al. are doing now.
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