Friday, August 29, 2008

American Airlines Seeks Delay In Chicago-to-Beijing Flight

August 29, 2008 5:14 p.m.

American Airlines has asked the U.S. Department of Transportation for a waiver that will allow it to delay for one year its launch of nonstop service between Chicago O'Hare International Airport and Beijing.

Citing the high cost of fuel and other problems facing the struggling airline industry, American, owned by AMR Corp., asked to start the flight on April 4, 2010. It had planned to launch service April 9, 2009.

The government has granted similar requests from US Airways Group Inc., Northwest Airlines Corp. and UAL Corp.'s United Airlines.

US Airways has delayed by one year its planned launch of a 13-hour daily flight linking Philadelphia and Beijing, without giving up its right to the route. The carrier has said fuel increases would raise the cost of running the once-daily Beijing flight to more than $90 million, from $50 million when it applied for the route a few months earlier.

Northwest received permission to suspend for a year seven weekly all-cargo flights it was operating between the U.S. and Guangzhou, China. United won a year's reprieve on its planned launch of San Francisco-Guangzhou flights.

Access to routes between the U.S. and China is highly competitive because air service between the two countries is restricted by bilateral agreements.

The reason long flights are so vulnerable to the mix of high fuel prices and weak airline traffic is a combination of physics and economics. A passenger on a 15-hour flight uses more fuel for each mile of the trip than someone on an eight-hour trip, but the airfare per mile generally doesn't rise proportionally.

When fuel is cheap and traffic strong, airlines can absorb the difference.
AMR's shares fell 1.2% to $10.21 in after-hours trading.

United to furlough 1,550 flight attendants
United Airlines says it will furlough more than 1,500 flight attendants this fall as it reduces its flights.

By The Associated Press

MINNEAPOLIS — United Airlines said on Wednesday it will furlough 1,550 flight attendants as it reduces its flying this fall.

The furloughs work out to roughly 10 percent of United's cabin workers. United is seeking 7,000 job reductions companywide by the end of 2009, said spokesman Jeff Kovick. United has previously announced plans to cut as many as 1,600 managers and 5,500 front-line workers, and to furlough 950 pilots.

United said it would seek voluntary flight attendant furloughs first, but will need to get to a total of 1,550 by Oct. 31.

"As we reduce the size of our fleet and take other actions to enable United to compete in this environment of record fuel prices, we must take the difficult but necessary steps to reduce the number of people we have to run our operation," Kovick said.

United is also laying off 213 foreign national flight attendants based in Bangkok and Singapore. Those workers, who are not part of the Association of Flight Attendants-CWA, are required to be dismissed before any union members can be furloughed, the union said. United, along with Northwest Airlines Corp., is one of the biggest U.S. carriers in Asia.

Furloughed flight attendants keep their health insurance and flight privileges. AFA spokeswoman Sara Nelson said the union is encouraging voluntary furloughs in an effort to avoid involuntary ones.

Also on Wednesday, testimony began in U.S. District Court in Chicago on United's request for a temporary injunction to stop alleged sick-outs by pilots. The Air Line Pilots Association has said it did its best to discourage any organized sick-out. Testimony was scheduled to continue on Thursday.

Alitalia files for bankruptcy protection
By ARIEL DAVID, Associated Press

25 minutes ago

ROME - Alitalia said Friday it has sought bankruptcy protection, taking the first step in a plan to reshape Italy's unprofitable and debt-laden national carrier.

The company said in a statement that its board had asked the government to appoint an administrator and had declared insolvency to a Rome court.

Alitalia has been losing some $3 million a day — hurt by labor unrest, competition from budget airlines and high fuel prices. Its shares have been suspended from trading since June.
The airline said its net debt at the end of July amounted to 1.172 billion euros ($1.73 billion). The figure does not include a 300 million euro ($442 million) loan that the government granted in April to keep the cash-strapped carrier flying.

Following Alitalia's announcement, the government named Augusto Fantozzi, a tax law expert and former finance minister, as the company's administrator.

Fantozzi served as economy minister in 1995 in a government headed by Lamberto Dini and then as minister of foreign trade in Romano Prodi's Cabinet a year later.

The government and others involved have been secretive about the negotiations to save the state-run carrier, but the plan reportedly calls for the breakup of Alitalia into two parts.
The profitable assets would be taken over by a group of Italian investors ready to inject 1 billion euros ($1.5 billion) into the airline under the reported plan. The other assets will be spun off into a separate company for liquidation.

The plan is the latest attempt by the government to sell its 49.9 percent stake in the loss-making airline following a failed bid by Air France-KLM earlier this year. On Thursday, Premier Silvio Berlusconi's government approved key changes to the country's bankruptcy-protection law, tailoring it to Alitalia's immediate needs.

The decree passed at a Cabinet meeting allows for the breakup of the company and gives the administrator the power to sell off assets through private or exclusive negotiations.
It also makes exceptions to Italy's antitrust regulations, a move that could pave the way for reported plans to combine Alitalia with Air One, Italy's second largest airline.

A group of 16 Italian businessmen has stepped up to invest in the new company, headed by Roberto Colaninno, the chairman of motorcycle maker Piaggio. He is expected to become chairman, while Rocco Sabelli, a veteran executive who has often worked with Colaninno, is the designated chief executive.

Air One's head, Carlo Toto, also figures among the group of investors. The possibility of a combination of the two biggest Italian airlines has raised antitrust concerns, especially because the resulting company would have a virtual monopoly on the highly traveled Rome-Milan route.

The plan could also raise concerns at the European Union, which is already investigating whether the government's loan in April broke EU rules that limit public assistance for companies.
In Brussels, EU officials said Thursday they had received a draft plan and that they were examining it.

Saving Alitalia has been a priority of Berlusconi's government since he won April elections and returned to power. The conservative leader has stressed that the new Alitalia would remain in Italian hands, and that any foreign airlines would only be allowed to acquire a minority stake in it.

The government has been trying to revive talks for an international partner for the revamped Alitalia, which is expected to be a leaner company with a reduced but younger fleet, and fewer personnel that will work longer hours.

Colaninno said in an interview published Friday that Air France-KLM and Germany's Lufthansa AG are both negotiating for a possible partnership with Alitalia and are on equal footing.
"We are negotiating with both, and they're going at the same speed," he told La Repubblica daily, adding that a foreign partner is "indispensable" for the Italian carrier.

Lufthansa declined to comment on Friday, while Air France-KLM carrier has confirmed that it wishes to "remain a strategic partner of Alitalia."

The Franco-Dutch carrier tried to take over the airline earlier this year in a bid that was opposed by unions and Berlusconi.

Corrado Passera, the CEO of the Italian bank Intesa Sanpaolo, which is acting as the government's adviser for Alitalia, said Friday it would take about a month to see if the plan could go ahead.
Passera told the AN

SA news agency that Intesa Sanpaolo itself would invest 100 million to 150 million euros ($150-220 million) and take a 10 percent stake in the new company.

Passera also was quoted as saying that the deal for the creation of the new Alitalia would be conditional on approval by unions.

Reports have said the plan to save Alitalia would include between 5,000 and 7,000 layoffs, from a work force of about 20,000. The laid-off workers are expected to be enrolled on welfare programs for up to seven years.

In a statement Friday, the nine unions representing Alitalia workers said they wanted a say on the entire plan, not just on the labor aspects. A meeting between unions and the government is scheduled for Monday.

Passengers stranded by budget airline collapse

Friday August 29, 2:20 pm ET By Jill Lawless, Associated Press Writer
Stranded passengers scramble for new tickets, worry over refunds after collapse Zoom airline

LONDON (AP) -- Thousands of passengers scrambled to rearrange travel plans Friday after the sudden collapse of trans-Atlantic budget airline Zoom, amid concerns that hundreds would not get their money back.

The Ottawa-based carrier suspended all flights Thursday, citing high fuel prices. Britain's Civil Aviation Authority advised passengers to fly on other airlines and apply to their credit card companies for reimbursement.

While passengers who reserved their flights by credit card or as part of a package holiday are all but guaranteed a refund, there is no such protection for those who paid by cash or check.
Morven MacLeod had been scheduled to travel with Scotland's Inverness Gaelic Choir to a music festival in Nova Scotia in October. She said the 25-member group had paid about 7,000 pounds ($12,750) for their tickets by check.

"Everyone has worked so hard, so for this to happen is hard to take. It's all still a bit surreal," MacLeod said. "There's no way we can raise funds in the next five weeks through the normal means, so short of finding a rich benefactor it's hard to know what we can do."

Travel industry group ABTA called on the British government to require all airlines to provide financial protection for their customers.

"This failure in a tough economic climate, along with numerous other airline failures this year, highlights the importance of having financial protection in place when you book flights," said the association's chief executive, Mark Tanzer.

Zoom was a leading trans-Atlantic budget airline, specializing in flights from regional centers such as Glasgow, Manchester and Cardiff in Britain and Ottawa and Calgary in Canada. Its routes targeted vacationers, with the winter schedule packed with flights to Canada's ski slopes, and the summer and Easter break schedules teeming with sun destinations like Florida.
Zoom's founders, Hugh and Jack Boyle, apologized to passengers but said the economic downturn and sharp rise in the price of aviation fuel had made it impossible to keep going. The Boyles said the airline had tried and failed to pay bills to airports, suppliers and aircraft creditors.
Zoom said British Airways and Virgin Atlantic had agreed to offer special rates to Zoom customers who had been left in the lurch. But some of the 4,500 people in Britain due to fly on the airline in the next week were struggling to make alternative plans.

"The other airlines are quoting 2,500 pounds ($4,500) and we just can't do it," said Isobel Shannon, who had planned to fly from Glasgow for a two-week holiday in Nova Scotia with her husband. "We'll have to cancel our trip but the Canadians need to get home, they are just going to have to pay out."

The effects of rising fuel costs have been evident for many airlines. AMR Corp.'s American Airlines, UAL Corp.'s United Airlines, Continental Airlines Inc., Delta Air Lines Inc. and Northwest Airlines Corp. have all announced capacity cuts, most of which take effect next month.

Zoom employed 450 people in Canada and 260 in Britain.
As summer ends, flyers brace for airline changes
Friday August 29, 2:56 pm
ET By Harry R. Weber, AP Business Writer

Higher fares likely as airlines offer fewer domestic seats for fall travel ATLANTA (AP)

The grip U.S. airlines have on travelers' wallets is about to get tighter as carriers go ahead with plans to trim their domestic schedules due to the high cost of fuel.

Executives acknowledge that despite the economic downturn, fares will rise, discounts currently available will be scarce, and routes and frequencies of flights will be reduced as domestic capacity is cut through the end of the year. The changes starting in September come on top of a litany of new charges -- for luggage, drinks, pillows and other amenities -- announced by some airlines earlier this year.

"Airline travel is airline travel -- it's been bad for a long time," Chris Bardasian, an American Airlines frequent flyer, said recently at Dallas-Fort Worth International Airport. "I suspect prices will go up, fewer people will travel, and if you're willing to pay the price it will be fine."

There were sharp capacity cuts during prior weak economic periods in the early 1990s and between 2001 and 2003, but fares went down as discount carriers moved in and filled the void, offering more competition, analysts said. But the high price of oil, airlines' limited ability to further cut certain costs and the fact that many of the discount carriers are facing the same difficulties as the big carriers make things different this time, analysts said.

"Despite this sluggish U.S. economy, the general demand picture is better than it was post-9/11," said Standard & Poor's analyst Philip Baggaley. "In addition, you have this consistent response across the board of airlines raising fares and adding fees."

On average, domestic fares between large metro cities are already up roughly 16 percent since Jan. 2, while fares between small cities are up roughly 37 percent year-to-date, according to Rick Seaney, head of airfare research site

The cheapest roundtrip ticket with a 10-day advance purchase, for example, on an American Airlines flight from Chicago to New York cost $258 on Aug. 26, excluding government and airport fees. That was an 87 percent increase from the $138 it cost on Jan. 2 for a similar advance purchase, according to The cheapest roundtrip ticket with a 21-day advance purchase on a United Airlines flight from Denver to Washington cost $382 on Aug. 26, excluding government and airport fees. That was a 37 percent increase from the $278 it cost on Jan. 2, Seaney said.

Recently announced airfare sales for travel during the traditionally slow fall season will be harder to come by as more capacity comes out of the system in the last four months of the year.
"If somebody sees a good fare, they should grab it," said Kevin Healy, senior vice president of marketing and planning for AirTran Airways.

Booking early for travel during peak times like the holiday season generally can get you a cheaper ticket than waiting until the last minute. But, airlines usually do not offer fare sales for travel over the holidays.

American Airlines, United Airlines, Delta Air Lines, Northwest Airlines, Continental Airlines, US Airways, JetBlue Airways, AirTran and Alaska Airlines plan to cut domestic capacity during the third and fourth quarters by single- to double-digit margins.

JetBlue, for instance, in September will end service between several cities, including Boston to San Francisco and Washington to Las Vegas. Southwest Airlines Co., which had resisted the kinds of capacity cuts being made by other carriers, will end service in November between Kansas City and Sacramento, Calif., and between Oakland, Calif., and Tucson, Ariz.

Some airlines, including JetBlue and Southwest, are adding or expanding service to states where other carriers are reducing service, like Florida. However, Southwest said recently that it will eliminate nearly 200 flights early next year as it struggles with high fuel costs and a weakening economy.

Fewer overall seats in the air means planes that remain will be fuller, which gives airlines pricing power to raise fares.

"The reality is -- and I don't want to diminish this -- the industry is going to have to cover its costs," American Airlines chief Gerard Arpey said in an interview.
Travelers are bracing for the impact of higher fares.

On a recent day at DFW Airport, passenger Vicki Schweiss, a classic rock DJ in Wichita Falls, Texas, said she might not be visiting her parents in Los Angeles quite so often this fall.
"If I can find a $200 ticket, I'll go," she said. "If there are fewer flights, that won't bother me, but if flights are really expensive, I just won't go or I'll go by myself instead of bringing my son and husband."

At Phoenix Sky Harbor International Airport, passenger Melinda Larson, a retired municipal worker, said she can afford the fare increases. What bugs her, though, are all the new fees.
"I'd just rather they incorporate that in the fare," Larson said of baggage fees some airlines are charging. "And then you're good to go. You don't have to worry about that."

Several airlines are now charging fees for a first checked bag. Some have imposed a fuel surcharge on frequent flier reward tickets. US Airways is even charging for soda.
Cuts in the number of flights in the U.S. also could mean people who booked flights far in advance for travel after September might have to fly at a different time or, if a route has been eliminated by their carrier, they might have to find another airline to get them to their destination. But airlines don't expect that to be a big issue.

"A very, very small number of people would have purchased tickets for travel in September or thereafter before the flights were taken out of the fall schedule in May and June of this year," American spokesman Tim Wagner said.

If someone had purchased a ticket for a flight that is canceled later, airlines provide remedies for passengers. In American's case, the airline would put the passenger on another American flight, accommodate them on another airline or refund their money.

As for frequent fliers, capacity cuts could mean fewer award seats available at the lowest level of award travel. Wagner said that in American's case, people could pony up more of their frequent flier miles to guarantee they get a reward ticket for any available seat on a flight. Atlanta-based Delta recently announced a similar guarantee.

While the price of a barrel of oil has fallen from a high of $147.27 in July to about $117 recently, that is not likely to slow the upward spike in fares, according to fare researcher Seaney. The current price of oil is still more than five times what it was in mid-August 1992, and it is more than four times what it was in mid-August 2002.

"I think if oil prices continue to go down, you will hear calls for relaxation of fuel surcharges, but that doesn't mean they won't hike base airfares," Seaney said.

He said that if load factors reach 90 percent, "There will be no reason to discount."
Another airfare observer, Tom Parsons of, said recently he believes that fares could fall early next year because discounter Southwest has already published its schedule and fares for that period. But Seaney said any fare decreases by major carriers would be limited to routes they compete on against Southwest. And Parsons said he believes other airlines will probably again charge higher fares for travel after March of next year.

Healy said that while fewer discounted seats may be available in the fall, he is confident AirTran will continue to provide value to its customers.

"I don't think most people in every aspect of their trip will notice a difference," Healy said. "If there is a silver lining, it may be that as a result of fewer overall operations, they may see better on-time performance."

The question on a lot of travelers' minds is how long will airlines be able to continue to raise fares. Airline analyst Ray Neidl of Calyon Securities said in the short-term that depends largely on the economy.

"That's the thing that will be tested this fall," Neidl said.

AP Business Writers Samantha Bomkamp in New York, David Koenig in Dallas and Chris Kahn in Phoenix contributed to this report.

Probe reveals oxygen tank burst on Qantas flight
By ROD McGUIRK, Associated Press Writer Fri Aug 29, 1:38 AM ET

CANBERRA, Australia - An oxygen tank exploded and blew a car-sized hole in a Qantas jet last month, air safety officials said Friday, but investigators appear to be no closer to figuring out why.

The release of the interim report by Julian Walsh, acting executive director of the Australian Transport Safety Bureau, confirmed earlier suspicions by investigators that the tank was the cause.

"We don't really know why the bottle failed — and that's the key question for the investigation," Walsh told reporters in releasing the report. He said the investigation will likely continue for months.

The Boeing 747-438 aircraft, carrying 365 people, was flying over the South China Sea July 25 when the explosion blew a hole in the fuselage 79 inches wide and 60 inches high, the report said.
Walsh said one of the seven emergency oxygen cylinders below the cabin floor had exploded.

The 26-pound steel cylinder, pressurized to 1,850 pounds per square inch, "sustained a failure that allowed a sudden and complete release of the pressurized contents," Walsh said.

Most of the cylinder rocketed up through the cabin floor, shearing off an emergency exit door handle and narrowly missing a crew seat before striking the cabin roof. It ricocheted back down through the hole it created in the cabin floor, the report said.

Walsh said the cylinder had undergone a safety inspection shortly before it was installed in the jet and six weeks before it exploded.

The plane — en route from London to Melbourne, Australia — rapidly descended thousands of feet with the loss of cabin pressure and flew about 300 miles to Manila, where it made a successful emergency landing.

No one was injured, but questions were raised about the much-lauded safety of Qantas Airways, which has never lost a jet aircraft because of an accident.

In the weeks after the incident, Qantas planes experienced a number of other problems, including a loss of hydraulic fuel that led to an emergency landing, failure of landing gear, and detached panels.

The problems prompted the Civil Aviation Safety Authority, Australia's aviation agency, to launch a review of Qantas Airways' safety standards. Qantas Airways backed the bureau's findings.

"The preliminary report was a factual account of the incident and investigation to date," Qantas chief executive Geoff Dixon said in the statement. "Our own investigations agree with the ATSB's preliminary conclusions."

Qantas earlier this month temporarily pulled six planes from service because of irregularities in maintenance records. Qantas said it was a record-keeping issue and there were no safety implications for the aircraft.

Saturday, August 23, 2008

When (a) buddy pass is not so friendly
Discounted flights can leave you stranded

By Clint Williams
The Atlanta Journal-Constitution
Saturday, August 23, 2008

Cheap isn’t always a bargain.

Ming Han Chung of Duluth figured he was saving a bundle using a Delta Air Line buddy pass to fly to Berlin last month, paying just $400 for a round-trip ticket that would normally cost about $1,300. The trip ended up costing much more —- about $1,500 as well as three unplanned vacation days.

In a city that boasts the world’s busiest airport, it’s easy to find a buddy pass. Delta Air Lines, which has about 25,000 Atlanta-based employees, annually gives every employee eight buddy passes. AirTran Airways, which has 6,000 local employees, issues six a year (employees will get two extra to use in September and October).

The buddy pass, a common airline perk, allows the holder to fly standby at a steeply discounted rate. The savings can be significant: coast-to-coast and back for $100; to Ireland and back for less than $200.

But Dad was right, you get what you pay for.

Passengers with a buddy pass board only if there are no paying customers to take those seats. A buddy pass traveler is the lowest priority. Even 200 pounds of cargo gets priority over 200 pounds of buddy pass holder.

Fly with a buddy pass and you risk being stranded. Like Ming Han Chung.

“The flight from JFK to Berlin was perfect. Business class. Very, very nice,” said Chung, who flew from Atlanta to New York before heading east across the Atlantic Ocean.

Chung’s July 29 flight home was canceled because of bad weather, and he was told that because of the backlog he wouldn’t be boarding the next day.

So he took a train to Frankfurt, then Dusseldorf, looking for a U.S.-bound plane with empty seats. “I spent an extra $200, $300 on train tickets around Germany,” he said.
Chung spent nights at his friend’s place in Berlin and days at airports.

“Luckily, I had enough vacation time saved up, although my boss was calling every day [after July 29],” Chung said, adding he built in a couple of extra days into his schedule to accommodate minor snags in getting a seat.

Finally, on Aug. 2, Chung gave Air Berlin $1,019 for a one-way ticket to Fort Myers, Fla. On Aug. 3, he used a second buddy pass to get home to Atlanta.

While Chung’s trip shows what can go wrong, there is a lot you can do to get where you want to go, roughly when you want to go there, when flying with a buddy pass.

Airline employees said that with the buddy pass they give out caveats and warnings: You’re the last one on the plane; there is a chance you might get stranded.

“It just takes some common sense,” said Fran Shockley, a Delta flight attendant who has been sharing buddy passes for more than two decades.

Don’t plan on flying out on Friday or returning on Sunday evening, said Shockley and other buddy pass vets. Don’t expect to drop into Vail during ski season or Rome in the summer. Be flexible. Very flexible.

“You’ve got to know what Plan B is,” said retired flight attendant Mary Towler of Powder Springs.

Christine Solomon of Marietta booked a flight from Atlanta to Seattle for her husband and two children using buddy passes. The three got bumped again and again. Then the relative who provided the buddy passes advised that the surest distance between two points isn’t always a straight line.

“We wouldn’t have thought of going to Houston to get to Seattle,” said Solomon.

Another trick: Solomon used frequent flier miles to secure a guaranteed seat on the return flight. The buddy pass worked for the return flight, so the $100 fee for returning the miles into the bank was sort of like an insurance premium, she said.

Knowing the risk associated with flying with a buddy pass, Solomon also said she makes sure she can cancel without penalty hotel reservations, car rentals and train tickets should she not get to where she is hoping to go.

All the uncertainty makes traveling with a buddy pass a bit nerve-wracking. Even for the employees who pass them along.

“I make it my business to watch the progress of those using buddy passes I gave them,” said Fowler, who logs on to the computer to see if friends and relatives have made it onto a flight.
A flight that appears to have plenty of empty seats the night before can fill up before standby passengers board, so employees said they serve as on-call travel agents to help buddy pass flyers find alternatives.

“I want it to be a good experience for everyone involved,” Shockley said.

Taking to the sky with a buddy pass? Here is what you need to know, according to experienced travelers:

  • Dress for success. If you want to travel in business class, you can’t do so in sweatpants and flip-flops. Airline policy for use of buddy passes includes a dress code.
  • Be unfailingly polite and courteous to the gate agents. You have no clout, as paying passengers might.
  • Pack light. You travel with only carry-on luggage.
  • Get online early and often. The airline Web sites can tell you how many empty seats are on a flight. Check your flight before even leaving for the airport. Things can change quickly.
  • Don’t use a buddy pass if you must make it to a destination for something like a wedding or you have to be back home by Tuesday or get fired.
  • Think long and hard about using a buddy pass for international travel.

Wednesday, August 20, 2008

Airlines Plan Big Job Cuts After Holiday
August 21, 2008

(Delta and Northwest say ther will be no layoffs if and when they merge. Just like the TWA employees were informed by then AMR CEO Don Carty, there would be no layoffs after TWA was absorbed by AMR...and thousands of TWA'ers lost their jobs...and some are STILL off the payroll...we shall see what happens at DL and NWA!)ed.

The airline industry is set to suffer its biggest wave of job losses since 2001, as carriers prepare to shed tens of thousands of jobs after the Labor Day holiday to cope with high fuel prices.
Airlines have collectively announced plans this year to cut more than 36,000 jobs, according to the Air Transport Association of America, an industry trade group.

Most of the cuts will happen in the weeks and months after the summer flying season ends.
By year's end, the work force, which numbered 414,600 full-time equivalent employees in June, is projected to have been slashed by between 12% to 15%, according to U.S. Bureau of Transportation Statistics officials.

That would be the biggest wave of job losses in the industry since 25% of jobs were lost immediately after the Sept. 11, 2001, terror attacks.

Many of the staffing cuts are required by the elimination of flights. The bulk of those cuts will come after the summer travel season.

The cuts come as airlines have also reduced services and added fees to increase revenue.
"As the months of this year go by, the employment ranks in the U.S. passenger-airline sector continue to decline, which should not be any surprise, given the financial condition," said John Heimlich, vice president and chief economist of the trade group. "High energy prices have taken a toll on us in two ways -- higher fuel expenses and less disposable income for our customers to spend on air travel and shipping."

AMR Corp.'s American Airlines, the U.S. industry's largest employer, is aiming to cut its full-time equivalent work force by as much as 8%.

No. 2 United, a unit of
UAL Corp., has said it will cut 5,500 jobs by year's end, and Continental Airlines Inc., which ranks fourth in size of work force, will shed 3,000 positions, mostly through voluntary buyouts.

They aren't alone, as most other big airlines have announced cuts."Our industry is shrinking to survive," said Mr. Heimlich.

Fuel prices appear to have already discouraged hiring. The Transportation Department's Bureau of Transportation Statistics reported Tuesday that airline employment increased a slight 0.1% in June from a year ago -- the smallest year-over-year increase since a decrease in January 2007. Employment has increased every year-over-year month since then. But then increases have been in the single digits, percentage-wise, and haven't been nearly enough to return staffing to pre-Sept. 11 levels.

The Air Transport Association estimates that airlines will spend $61 billion on fuel this year, $20 billion more than they spent in 2007. It blames fuel prices in part for the closing of 10 airlines since 2007.

Airlines have begun offering voluntary severance packages to employees in the hope of avoiding layoffs.

"Right now we're seeing flight attendants weighing their options, deciding if this is something they can do, they want to do," said a spokeswoman for the Association of Flight Attendants, which represents more than 55,000 workers at 20 airlines.
Write to Josh Mitchell at
United Airlines to Charge Up to $9 for Snacks
By LAUREN POLLOCK August 21, 2008

UAL Corp.'s United Airlines will adjust its flight attendant staffing to the minimum level required by the Federal Aviation Administration and begin charging up to $9 for snacks on certain domestic and international flights in October, the latest sign of distress in the airline industry.
Rising fuel costs have forced airlines to cut staffing in most employee groups and charge for a range of services that were previously considered part of the ticket price, as well as identifying new ways to extract revenue from airline passengers.

Carriers, including United, also have been forced to slash projected capacity for this year. Critics say the airlines risk making customers feel "nickel and dimed," but the companies say that the new charges are needed.

In a memo sent to flight attendants on Monday, United said it will no longer offer customers complimentary cookies and pretzels on certain flights and will expand its selection of snacks for purchase on flights lasting about two to three hours, effective Sept. 2, following testing in select markets.

In the memo, United said, "In the wake of high fuel prices and a challenging economic environment, we must continue to examine every aspect of our business and find new ways to improve our day-to-day operations through efficiencies that still meet our customers' expectations."

In October, the airline will raise prices of its snack boxes on longer flights. Shelf-stable items will see prices rise a dollar to $6, while fresh items will go up to $9 from $7.

The changes won't apply to customers traveling in the first-class cabin. Those in business class will receive complimentary beverages but will pay for snack items.

The buy-on-board offering will also replace complimentary meals on most flights to Europe.
In June, US Airways Inc. became the first airline to charge for nonalcoholic beverages.
Several U.S. carriers, including United and
US Airways Group Inc., have begun charging passengers a fee for the first checked bag on top of a higher fee for checking a second bag.
Write to Lauren Pollock at
American Airlines launches in-flight broadband service
02:14 PM CDT on Wednesday, August 20, 2008
By SUZANNE MARTA / The Dallas Morning News

The rehearsals are over and last-minute tweaks have been made.
American Airlines' new in-flight broadband service goes live starting today.

For $12.95, passengers on AA flights using its Boeing 767-200 will be able to surf the Net, check e-mail, instant message and access corporate VPN accounts using the system by Aircell LLC.
The ground-based system – called GoGo – won't enable any voice-based functions.
American says it will test GoGo on its fleet of 15 767-200s, which are used primarily on transcontinental flights, for three to six months.

Assuming everything goes well, the carrier may expand to the rest of its fleet.
American allowed passengers on a handful of flights test the system on June 25 and Aug. 13.
Rival Delta Air Lines Inc. announced earlier this month that it will install the system on its fleet of 133 MD-88/90 aircraft this fall and plans to offer it across its 330 mainline domestic fleet by mid-2009.

Several other carriers are testing in-flight connectivity. Dallas-based Southwest Airlines Co. plans to test a satellite system by Row 44 Inc. next month.

Henry Harteveldt, an analyst with Forrester Research, said the new service would provide the backbone for future airline in-flight entertainment and it won't be long before consumers come to expect the access.

"It's a game-changer," Mr. Harteveldt said. "You're no longer forced to be isolated from what's going on in your office, with your clients or with friends or family. For business travelers, this will greatly aid productivity, and for leisure travelers, it means they will be in control of their entertainment."

In-flight connectivity will also be a key driver as airlines compete for business.
"Live TV is great for now, but the Internet is what people want for the future," Mr. Harteveldt said. "Airlines that don't offer Internet access are going to lose business."
In-flight broadband is expected to generate $6.6 million in passenger revenue this year, according to a June report by MultiMedia Intelligence.

The research firm estimates the industry will skyrocket to $936 million revenue by 2012.
Quick Hits: In-Flight Meals, Now With In-Flight Porn
Scott Reeves Aug 20, 2008 12:30 pm

Bless the cash-strapped airlines, who may soon allow your seatmate to enjoy Internet pornography in-flight. Blame it on fuel costs. American Airlines (
AMR) has expanded the availability of Internet access on non-stop flights connecting New York with Los Angeles, San Francisco and Miami. For $12.95, American Airlines customers can browse the Internet and check e-mail from their seats.

In-flight Web surfing is part of the airline industry’s ongoing effort to
develop new sources of revenue in response to rising fuel costs. So far, efforts to boost revenue have included new fees for extra bags checked and charges for in-flight snacks. If American’s expanded Internet service is a money-maker, you can bet competitors will soon copy it.

Who knows, maybe United Airlines (
UAUA), Delta (DAL) and JetBlue (JBLU) will offer a similar service in the future. American tested in-flight Internet access on 2 flights in June. In-flight Web surfing is a good idea - until the pervert in the aisle seat clicks to a porno site and kids nearby ask their parents what’s going on. American Airlines won’t filter the Internet, and says current policies governing unruly passengers will be applied to bozos sniffing around naughty Web sites. Good luck with that.

You can bet that someone will complain about just about everything available on the Internet. Sports Illustrated and the bikini babes? Shocking! Hot cars? Evil carbon footprint! Cats? Just the thought of felines is bound to trigger an allergic reaction in someone. A religious Web site? Hah - the mug in seat 15A is almost certain to argue that there’s a Constitutional separation between church and airline, or ought to be.

There’s also the problem of confidential
e-mail, both personal and corporate. After you read an intimate note over Kansas, a bumptious seatmate is bound to say, “Hey buddy, I can help.” All this may turn flight attendants into kindergarten teachers, soothing and cajoling passengers - or telling those in a snit to put a sock in it. This is guaranteed to beat the crummy in-flight movie for entertainment value - at least for the first thousand miles.
149 dead in plane crash at Madrid airport
By HAROLD HECKLE, Associated Press Writer

58 minutes ago

(This MD-82 aircraft must have been jammed with people as the normal configuration on a US based similar aircraft is 140, including a first class cabin) ed.

MADRID, Spain - A Spanish airliner bound for the Canary Islands crashed, burned and broke into pieces Wednesday while trying to take off from Madrid's Barajas airport, killing 149 people on board, officials said.

There were only 26 survivors in the mid-afternoon crash, a Spanish emergency official said.
A police officer said the bodies were so hot that police could barely touch them and told El Pais newspaper the shattered wreckage bore no resemblance to a plane.

Dozens of ambulances rushed to the site as columns of smoke billowed from the wreckage. The prime minister broke off his vacation in southern Spain and rushed back to Madrid, heading straight for the airport.

"I have never seen anything like this in my life," ambulance driver Luis Ferreras was quoted as saying by El Pais.

A Spanish emergency rescue official said only 26 people survived the crash and the rest of those aboard were given up for dead. The official with the SAMUR municipal rescue service gave the toll after touring the site of the crash. He spoke to the AP on condition of anonymity because of department rules that barred him from giving his name.

Spanair Flight JK5022 — bound for the popular Canary Islands off the West African coast during the height of Europe's summer vacation season — sped off the end of the runway, crashed and broke into pieces, reports said.

Spanair spokesman Sergio Allard told a news conference the plane was carrying 175 people and the cause of the crash was not immmediately known.

El Pais said the plane's takeoff had been an hour late due to technical problems. It eventually managed to get slightly off the ground but crashed near the end of the runway, El Pais said, quoting an employee of the national airport authority AENA.

Helicopters and fire trucks dumped water on the plane, which ended up in a wooded area at the end of the runway at Terminal 4.

A makeshift morgue was set up at the city's main convention center, officials said.
The plane was an Boeing MD-82 on a codeshare flight to Las Palmas with Lufthansa's LH255, Spanair said. Departures from Madrid's airport were suspended for several hours but later resumed.

Boeing spokesman Jim Proulx said the company would send at least one person to assist in the investigation of the crash as soon as it receives an invitation from Spanish authorities.
"We stand ready to provide technical assistance," he said, reading from a prepared statement.

Sunday, August 17, 2008

Why Airlines Employees Are Fed Up!

There always seems to be financing for new aircraft, mergers, integrations, managment bonuses, but nothing left for employees. The ticket agents and flight attendants, who take abuse, the ramp people who load bags in the rain, heat, humidity, are the backbone of the industry.

These might be the only jobs not outsourced to India. Where will it end? If the employees worked for free for a week, I would love to see the balance sheet. Ouch! The CEO's still will bitch and complain these workers, who worked for free, are still overpaid! They are out of touch with frontline employees!

Costs to run these airlines are built into the price structure of the product. If an airline can charge for bags, food and the like, why not add a bit more to pay the frontline employees who are the final and last contact with passengers? Make sense?

Productive employees are happy employees and that is a proven statement. Would not an investment in the workforce not hit the bottom line and increase profit for the company?

Until airline executives realize keeping the workers who face the customers on a daily basis happy and do make a difference, instead of feeling beat up, then will customer service improve.

"Hey, I flew ABC airline and they treated me a like a valued customer". Does that not make sense? Your comments are welcome!

Saturday, August 16, 2008

FAA seeks payment of $10.2 millon Southwest fine
Friday August 15, 7:51 pm ET


WASHINGTON (Reuters) - Regulators upheld a record $10.2 million fine against Southwest Airlines Co (NYSE:LUV - News) for alleged safety violations and want payment this month, the U.S. Federal Aviation Administration said on Friday.

The FAA said in a letter to the airline and its legal counsel this week that the civil penalty "is appropriate" and would remain at the proposed amount.

The agency said it would turn the matter over to the Justice Department if payment was not received by August 29.

Southwest said the notification "was part of the process" and the company was reviewing its options. It declined to comment further.

Southwest met in April with FAA officials as part of an informal review of the fine proposed in March for alleged maintenance shortcomings.

It is common for airlines to appeal fines, and in many cases the penalty is reduced.
The FAA said Southwest had failed to inspect Boeing 737s for structural cracks and continued to fly those aircraft even after notifying the agency that it had missed a deadline to complete the work.

Southwest, the biggest U.S. airline by market value and the healthiest financially among major carriers, said it responded appropriately to the problem and never compromised flight safety.
The FAA said there were no safety incidents related to the missed inspections.
The case was triggered by whistle-blower complaints to Congress, which put pressure on the FAA to step up safety oversight of the industry.

The FAA on Thursday proposed a $7.1 million fine against American Airlines, a unit of AMR Corp (NYSE:AMR - News), for alleged safety violations and other problems.
American called the penalty excessive.

(Reporting by John Crawley; editing by Braden Reddall)

Monday, August 11, 2008

Allen for Congress

August 7, 2008

CONTACT: Sundee Southards
Communications Director
(417) 546-5632

Allen wins AFA endorsement

The Association of Flight Attendants (AFA), headquartered in Washington, DC, this week chose to endorse Joe Allen as its choice candidate for Missouri's 8th Congressional District, according to Roger Graham, a labor advisor for Allen's campaign. Representing 55,000 members for 20 airlines, including United, Northwest, USAir and American Eagle, AFA is the world's largest flight attendant union.

"I am especially honored by this labor endorsement," Allen stated. "As are so many others, the US aviation system and its members are caught in an economic quagmire. Faced with mergers, outsourcings, and job losses as well as a myriad of health and safety issues, these laborers deserve a congressman who will be a voice for them in Washington."

This is the second major endorsement, in as many weeks. The United Auto Workers (UAW) endorsed Allen in late July.

As an advocate for working families, Allen has taken the lead in exposing the current Administration’s war against American workers, “Jo Ann Emerson, in her twelve years representing Missouri’s 8th Congressional District, has only voted thirty five percent in the favor of American workers. Thirty five percent is an F in my grade book.”

This year alone, Emerson (R, MO-8) voted against the Housing Reform and Energy Tax Credit Bill (H.R. 3221), Alternative Energy Tax Incentive Bill (H.R. 6049), the Unequal Pay Bill (H.R. 1338), and workplace safety legislation such as the S-Miner Act (HR 2768) and establishing further OSHA safety regulations for combustibles (H.R. 5522).

Living in one of the poorest Congressional Districts in the country, Allen has pledged to create a climate that is fair to both businesses and employees. He will support the Employee Free Choice Act, stop any proposals to allow foreign control of U.S. Airlines, cosponsor and support legislation that will provide for a fair and universal healthcare system that will ensure quality and affordable health care coverage for all Americans, and vote against the expansion of free trade agreements that harm the American employee.

Allen for Congress
P.O. Box 1118
Forsyth, Missouri 65653
Office: (417) 546-5623 Fax: (417) 546-5634

Sunday, August 10, 2008

Branson warns U.S. presidential candidates on BA/AA
Sunday August 10, 10:54 am ET

LONDON (Reuters) - Virgin Atlantic owner Sir Richard Branson on Sunday wrote to U.S. presidential candidates Barack Obama and John McCain warning that a link-up between British Airways and American Airlines would be anti-competitive.

In the letter, Branson said the proposed alliance would "severely damage competition on major transatlantic routes and leave consumers worse off."

"Airlines everywhere are struggling with the current price of oil, but the solution to their problems should not lie in an anti-competitive agreement which will inevitably lead to less competition and higher fares," he said.

Virgin said, following BA's planned merger with Spanish rival Iberia (MCE:IBLA.MC - News), BA and American Airlines would have nearly half of all take-off and landing slots at London's Heathrow airport if the alliance takes place.

On Friday, a source familiar with the matter told Reuters that BA plans to lodge an application in the United States this week to seek antitrust immunity for an alliance.

A report in the Sunday Telegraph said Virgin Atlantic is poised to launch a 3 million pounds ($5.78 million) advertising and lobbying campaign as it attempts to frustrate plans for the alliance.

Meanwhile, the Mail on Sunday reported that BA is ready to surrender its right to hundreds of transatlantic flights in an attempt to win the backing of U.S. authorities for the alliance.
The report says BA will meet U.S. Department of Justice officials this week and offer to give up the flights.

(Reporting by Matthew Scuffham; Editing by Jason Neely)