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 FareCompare.com.
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 FareCompare.com. 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 Bestfares.com, 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.
Friday, August 29, 2008
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.
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.
TIPS
Taking to the sky with a buddy pass? Here is what you need to know, according to experienced travelers:
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.
TIPS
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
By JOSH MITCHELL
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 josh.mitchell@dowjones.com
By JOSH MITCHELL
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 josh.mitchell@dowjones.com
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 lauren.pollock@dowjones.com
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 lauren.pollock@dowjones.com
American Airlines launches in-flight broadband service
02:14 PM CDT on Wednesday, August 20, 2008
By SUZANNE MARTA / The Dallas Morning News
smarta@dallasnews.com
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.
02:14 PM CDT on Wednesday, August 20, 2008
By SUZANNE MARTA / The Dallas Morning News
smarta@dallasnews.com
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.
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.
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!
Editorial
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!
Editorial
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
Reuters
FAA seeks payment of $10.2 millon Southwest fine
Friday August 15, 7:51 pm ET
(SO MUCH FOR THE FAA DOING ITS JOB....TOO LITTLE TOO LATE...ED.)
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)
FAA seeks payment of $10.2 millon Southwest fine
Friday August 15, 7:51 pm ET
(SO MUCH FOR THE FAA DOING ITS JOB....TOO LITTLE TOO LATE...ED.)
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
FOR IMMEDIATE RELEASE
August 7, 2008
CONTACT: Sundee Southards
Communications Director
Joe@allen4congress.com
(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
Email: Joe@allen4congress.com
www.allen4congress.com
FOR IMMEDIATE RELEASE
August 7, 2008
CONTACT: Sundee Southards
Communications Director
Joe@allen4congress.com
(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
Email: Joe@allen4congress.com
www.allen4congress.com
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)
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)
Tuesday, July 29, 2008
American Airlines avoids flight attendant layoffs
Tuesday, July 29, 2008 - 7:20 PM CDT
Dallas Business Journal
American Airlines Inc. will not need to lay off any flight attendants after enough employees agreed to take voluntary leaves of absence or early retirement offers, a spokeswoman for the airline said Tuesday.
Fort Worth-based AMR Corp., (NYSE: AMR) the parent company of American Airlines, previously announced plans to eliminate 900 flight attendant positions in response to growing capacity reductions.
About 300 flight attendants accepted what the airline is calling a "bridge to retirement program," while the remaining staff reductions will be handled through voluntary leaves of absence.
Tuesday, July 29, 2008 - 7:20 PM CDT
Dallas Business Journal
American Airlines Inc. will not need to lay off any flight attendants after enough employees agreed to take voluntary leaves of absence or early retirement offers, a spokeswoman for the airline said Tuesday.
Fort Worth-based AMR Corp., (NYSE: AMR) the parent company of American Airlines, previously announced plans to eliminate 900 flight attendant positions in response to growing capacity reductions.
About 300 flight attendants accepted what the airline is calling a "bridge to retirement program," while the remaining staff reductions will be handled through voluntary leaves of absence.
AirTran Taps the Brakes on Growth
07/29/08 - 03:26 PM EDT
by Ted Reed
After growing at a 20% rate during the past five years, AirTran is stepping on the brakes.
The carrier now says capacity will decline by 7% to 8% during the last four months of 2008 and by 4% to 8% during 2009, as it moves to sell aircraft and to defer 22 deliveries. "Our priorities have clearly shifted," said CEO Bob Fornaro, on an earnings conference call Tuesday. "Growth is far down on the list of things we are interested in. Number one is maintaining liquidity and ultimately returning to profitability."
AirTran's planning reflects the broad impact of the airline industry's effort to reduce capacity. Until recently, industry leaders like Gerard Arpey, CEO of AMR, have called for capacity reductions but had trouble convincing fast-growth, low-cost carriers to seriously commit. Now, the industry is expected to reduce capacity by 10% in the fourth quarter.
Ironically, the AirTran cuts come as the cost of fuel is falling. Oil traded Tuesday below $122 a barrel, continuing its decline from a record high above $147 earlier this month.
AirTran reported a disappointing second quarter. Revenue per available seat mile, or RASM, grew at just 0.1%, the lowest rate among major airlines. The carrier reported a net loss of $13.5 million, or 12 cents a share. Excluding special items, including a hedging gain equivalent to 22 cents a share, the loss was 29 cents a share. Analysts surveyed by Thomson Reuters had estimated a loss of 25 cents.
"These results are unacceptable and we are taking numerous steps to adjust," said CFO Arne Haak, on the company's earnings conference call. He said slow RASM growth followed a 12.3% second-quarter capacity increase, by far the highest in the industry, and a shift in consumer behavior to buying less-expensive tickets. "The decision to continue growth through the summer was made early this year, with fuel at $100," Haak said.
Despite disappointing results, AirTran shares were trading up 51 cents, or 19%, at $3.21 Tuesday afternoon. The gain reflected falling oil prices, improved liquidity and possibly the impression that the carrier had beaten estimates.
At the end of June, AirTran had unrestricted cash and investment balance of $445.9 million, a record quarterly high. Additionally, it negotiated an extension with its primary credit card processor through 2009 and also received a commitment for a letter of credit facility up to $150 million, which could be applied to a credit card holdback. The deals addressed two problems: "Previously, we had no provisions for a holdback and the agreement was up for renewal at the end of the year," Haak said.
07/29/08 - 03:26 PM EDT
by Ted Reed
After growing at a 20% rate during the past five years, AirTran is stepping on the brakes.
The carrier now says capacity will decline by 7% to 8% during the last four months of 2008 and by 4% to 8% during 2009, as it moves to sell aircraft and to defer 22 deliveries. "Our priorities have clearly shifted," said CEO Bob Fornaro, on an earnings conference call Tuesday. "Growth is far down on the list of things we are interested in. Number one is maintaining liquidity and ultimately returning to profitability."
AirTran's planning reflects the broad impact of the airline industry's effort to reduce capacity. Until recently, industry leaders like Gerard Arpey, CEO of AMR, have called for capacity reductions but had trouble convincing fast-growth, low-cost carriers to seriously commit. Now, the industry is expected to reduce capacity by 10% in the fourth quarter.
Ironically, the AirTran cuts come as the cost of fuel is falling. Oil traded Tuesday below $122 a barrel, continuing its decline from a record high above $147 earlier this month.
AirTran reported a disappointing second quarter. Revenue per available seat mile, or RASM, grew at just 0.1%, the lowest rate among major airlines. The carrier reported a net loss of $13.5 million, or 12 cents a share. Excluding special items, including a hedging gain equivalent to 22 cents a share, the loss was 29 cents a share. Analysts surveyed by Thomson Reuters had estimated a loss of 25 cents.
"These results are unacceptable and we are taking numerous steps to adjust," said CFO Arne Haak, on the company's earnings conference call. He said slow RASM growth followed a 12.3% second-quarter capacity increase, by far the highest in the industry, and a shift in consumer behavior to buying less-expensive tickets. "The decision to continue growth through the summer was made early this year, with fuel at $100," Haak said.
Despite disappointing results, AirTran shares were trading up 51 cents, or 19%, at $3.21 Tuesday afternoon. The gain reflected falling oil prices, improved liquidity and possibly the impression that the carrier had beaten estimates.
At the end of June, AirTran had unrestricted cash and investment balance of $445.9 million, a record quarterly high. Additionally, it negotiated an extension with its primary credit card processor through 2009 and also received a commitment for a letter of credit facility up to $150 million, which could be applied to a credit card holdback. The deals addressed two problems: "Previously, we had no provisions for a holdback and the agreement was up for renewal at the end of the year," Haak said.
AP
American Airlines, El Al announce cooperation deal
Tuesday July 29, 3:45 pm ET
American Airlines, El Al to sell seats on each other's flights
NEW YORK (AP) -- El Al, Israel's national airline, and American Airlines said Tuesday they will begin selling tickets on each other's connecting flights beginning in September.
The agreement replaces a code-share deal that El Al had with Delta Air Lines Inc. until late last year, when Delta began its own direct flights from the United States to Tel Aviv.
The agreement with American will begin Sept. 2.
American will sell tickets on El Al flights from the U.S. to Tel Aviv as if they were American jets. El Al will sell seats -- or place its "code" on tickets -- on some American domestic flights from gateway cities reached by El Al flights.
Airlines use code-share agreements to expand their network without adding planes or employees. Customers of one airline typically earn miles for the part of their trip flown on the other's plane.
El Al Chairman Israel Borovich called the deal the most comprehensive code-share agreement between his airline and a foreign carrier.
American, a unit of Fort Worth, Texas-based AMR Corp., is the largest U.S. carrier.
American Airlines, El Al announce cooperation deal
Tuesday July 29, 3:45 pm ET
American Airlines, El Al to sell seats on each other's flights
NEW YORK (AP) -- El Al, Israel's national airline, and American Airlines said Tuesday they will begin selling tickets on each other's connecting flights beginning in September.
The agreement replaces a code-share deal that El Al had with Delta Air Lines Inc. until late last year, when Delta began its own direct flights from the United States to Tel Aviv.
The agreement with American will begin Sept. 2.
American will sell tickets on El Al flights from the U.S. to Tel Aviv as if they were American jets. El Al will sell seats -- or place its "code" on tickets -- on some American domestic flights from gateway cities reached by El Al flights.
Airlines use code-share agreements to expand their network without adding planes or employees. Customers of one airline typically earn miles for the part of their trip flown on the other's plane.
El Al Chairman Israel Borovich called the deal the most comprehensive code-share agreement between his airline and a foreign carrier.
American, a unit of Fort Worth, Texas-based AMR Corp., is the largest U.S. carrier.
Monday, July 28, 2008
American Airlines moving work out of Fort Worth base
11:17 PM CDT on Monday, July 28, 2008
By TERRY MAXON / The Dallas Morning News
tmaxon@dallasnews.com
American Airlines Inc. is moving maintenance support for its Boeing 777 aircraft from its Alliance Airport base in Fort Worth to its Tulsa, Okla., base, the airline confirmed Monday.
At the same time, American is sending additional work on the Boeing 767 to Alliance, reducing the impact on the Fort Worth facility.
An airline spokesman said it will be several weeks before the carrier can say how many job cuts or layoffs may be needed at Alliance, which has about 1,900 workers represented by the Transport Workers Union, as well as 175 management and specialist employees and 30 clerical workers.
The changes are part of American's restructuring as it prepares to cut its domestic capacity 11 percent to 12 percent, resulting in an 8 percent cut in overall flying capacity (including international service) by the fourth quarter.
American's executives have said overall employment will be cut in line with the 8 percent capacity reduction.
Maintenance and engineering employees learned of the looming changes Friday in a letter from Fred Cleveland, vice president of base maintenance.
American spokesman John Hotard said Monday that the airline won't know how many jobs may be cut at its three maintenance bases at Alliance, Tulsa and Kansas City, Mo., until sometime in August.
The Kansas City base could be in the biggest peril. It was acquired when American bought Trans World Airlines Inc. in 2001. None of the reallocated work thus far has gone to Kansas City.
Among the changes in the works:
•Boeing 777 maintenance checks will move from Alliance to Tulsa this fall. "The B777 will be a good fit, as the [Tulsa] base has the capacity for wide-body aircraft and a workforce that has wide-body experience," Mr. Cleveland wrote.
•Alliance, which now does the Boeing 777 work, will take on additional Boeing 767 duties. Its repair line will be upgraded to do maintenance checks as well, Mr. Cleveland's letter stated.
•American will combine the maintenance lines for its own McDonnell Douglas MD-80 jets and that for major customer Allegiant Air at the Tulsa base.
American plans to park 30 of its 300 MD-80 aircraft by year's end, with more expected to leave the fleet in 2009 as American takes delivery of 33 new fuel-efficient Boeing 737-800 airplanes.
Tulsa, which has been doing work on American's Airbus A300 fleet, will lose that job over the next 17 months as American grounds all 34 of its A300 jets, including 10 in 2008.
Kansas City is the smallest of the three bases and is home for the Boeing 767-200 fleet.
11:17 PM CDT on Monday, July 28, 2008
By TERRY MAXON / The Dallas Morning News
tmaxon@dallasnews.com
American Airlines Inc. is moving maintenance support for its Boeing 777 aircraft from its Alliance Airport base in Fort Worth to its Tulsa, Okla., base, the airline confirmed Monday.
At the same time, American is sending additional work on the Boeing 767 to Alliance, reducing the impact on the Fort Worth facility.
An airline spokesman said it will be several weeks before the carrier can say how many job cuts or layoffs may be needed at Alliance, which has about 1,900 workers represented by the Transport Workers Union, as well as 175 management and specialist employees and 30 clerical workers.
The changes are part of American's restructuring as it prepares to cut its domestic capacity 11 percent to 12 percent, resulting in an 8 percent cut in overall flying capacity (including international service) by the fourth quarter.
American's executives have said overall employment will be cut in line with the 8 percent capacity reduction.
Maintenance and engineering employees learned of the looming changes Friday in a letter from Fred Cleveland, vice president of base maintenance.
American spokesman John Hotard said Monday that the airline won't know how many jobs may be cut at its three maintenance bases at Alliance, Tulsa and Kansas City, Mo., until sometime in August.
The Kansas City base could be in the biggest peril. It was acquired when American bought Trans World Airlines Inc. in 2001. None of the reallocated work thus far has gone to Kansas City.
Among the changes in the works:
•Boeing 777 maintenance checks will move from Alliance to Tulsa this fall. "The B777 will be a good fit, as the [Tulsa] base has the capacity for wide-body aircraft and a workforce that has wide-body experience," Mr. Cleveland wrote.
•Alliance, which now does the Boeing 777 work, will take on additional Boeing 767 duties. Its repair line will be upgraded to do maintenance checks as well, Mr. Cleveland's letter stated.
•American will combine the maintenance lines for its own McDonnell Douglas MD-80 jets and that for major customer Allegiant Air at the Tulsa base.
American plans to park 30 of its 300 MD-80 aircraft by year's end, with more expected to leave the fleet in 2009 as American takes delivery of 33 new fuel-efficient Boeing 737-800 airplanes.
Tulsa, which has been doing work on American's Airbus A300 fleet, will lose that job over the next 17 months as American grounds all 34 of its A300 jets, including 10 in 2008.
Kansas City is the smallest of the three bases and is home for the Boeing 767-200 fleet.
American may lay off 900 flight attendants
American Chief Executive Gerard Arpey in May said the Fort Worth-based airline would cut thousands of jobs as it reduces its capacity by 11 to 12 percent by the fourth quarter. Last week, American said it would significantly reduce its management and support jobs by September.
The flight attendants union says American has agreed to some provisions for early retirements, voluntary leaves of absence and "partnership flying" in which two flight attendants can share the same job.
The "voluntary bridge to retirement" or VBR, is limited to flight attendants not currently on furlough, who are at least 50 years old and with at least 15 years' seniority as of Aug. 31, the union says. Attendants would get a $15,000 severance payment and some limited medical and travel pass benefits.
The one-time "bridge to retirement" will be awarded first, followed by leaves at bases with an overage. Where overages then still exist, partnerships will be awarded. After these three voluntary provisions are exhausted, and should any overage still exist, the company will then determine how many of the remaining 900 flight attendants are ultimately to be furloughed.
Web sites: http://www.aa.com/, ww.apfa.org
UPDATED JULY 30, 2008. 368 flight attendants took the VBR (bridge to retirement) and many others took short and long term leaves so NO FURLOUGHS FOR FLIGHT ATTENDANTS AT AMERICAN AIRLINES. ed.
American Airlines Inc. has told its flight attendants' union it MAY furlough 900 flight attendants beginning Aug 31, 2008.
The Association of Professional Flight Attendants said in a hotline message to its 19,000 members that the airline delivered a Worker Adjustment and Retraining Notification Act, or WARN, letter informing them of the possible layoffs. Texas' WARN ruling requires employers to give employees a 60-day advance notice of significant layoffs.
The letter said the 900 flight attendants with the least experience would be subject to furlough. (the former TWA flight attendants)American Chief Executive Gerard Arpey in May said the Fort Worth-based airline would cut thousands of jobs as it reduces its capacity by 11 to 12 percent by the fourth quarter. Last week, American said it would significantly reduce its management and support jobs by September.
The flight attendants union says American has agreed to some provisions for early retirements, voluntary leaves of absence and "partnership flying" in which two flight attendants can share the same job.
The "voluntary bridge to retirement" or VBR, is limited to flight attendants not currently on furlough, who are at least 50 years old and with at least 15 years' seniority as of Aug. 31, the union says. Attendants would get a $15,000 severance payment and some limited medical and travel pass benefits.
The one-time "bridge to retirement" will be awarded first, followed by leaves at bases with an overage. Where overages then still exist, partnerships will be awarded. After these three voluntary provisions are exhausted, and should any overage still exist, the company will then determine how many of the remaining 900 flight attendants are ultimately to be furloughed.
Web sites: http://www.aa.com/, ww.apfa.org
Monday, July 21, 2008
Here come more cuts as these fine people lose their jobs...half of the workforce! Look for Midwest to disappear as well as Frontier. My bet is jetBlue and Frontier hook up. Same aircraft, same in-flight television...we shall see...the landscape will change as never seen before in the next year. I told you so!
ed.
Midwest Airlines to cut half of workforces with flight reductions and grounding all MD-80's
Monday, July 21, 2008 - 9:40 AM CDT Modified: Monday, July 21, 2008 - 9:41 AM
The Business Journal of Milwaukee
Midwest Airlines announced Sunday its new flight schedule beginning Sept. 8, slicing 11 cities to cut service back to 32 destinations while expanding its ticketing partnership with Northwest Airlines Corp.
Oak Creek-based Midwest Airlines will eliminate service to three airports: Ft. Lauderdale, Fla.; Ft. Myers, Fla.; and San Diego. Service to two West Coast destinations -- Los Angeles and Seattle/Tacoma -- will now be offered via Kansas City year-round, in the same way the airline currently offers service to San Francisco, but travelers flying from Milwaukee to those two cities will have one stop in Kansas City, as opposed to the non-stop flights now offered.
Long-haul flights from Milwaukee to West Coast cities are affected by the airline’s decision to ground its MD-80 aircraft, which have longer range than its Boeing 717s but are also less fuel-efficient. The airline is restructuring its routes, cutting back service and eliminating about 1,200 jobs -- about 40 percent of its work force -- because of skyrocketing fuel costs.
Service to Orlando, Fla., will now be offered seasonally during peak travel months. This season, nonstop Milwaukee-Orlando service will commence Oct. 21 and end April 30, 2009. As Midwest transitions to seasonal Orlando service, it will suspend service to that city from Sept. 8 through Oct. 20. Nonstop service between Kansas City and Orlando will be discontinued, but Kansas City-Orlando service will continue to be available via Milwaukee.
Midwest is also expanding its codeshare agreement with Eagan, Minn.-based Northwest Airlines (NYSE: NWA), adding more than 100 new city pairs to the program. Codeshare flights are essentially flights offered by an airline on a partner airline’s planes.
“We will remain true to our mission of serving major business destinations with more nonstop flights from Milwaukee than any other airline,” said Timothy Hoeksema, chairman and chief executive officer. “From Kansas City, we will continue to serve as an important resource for the business community, with flights to key East and West Coast cities. While there will be adjustments to frequency in some of these markets, we will continue to offer convenient service and the unparalleled customer service our passengers expect from us.”
The airline will also discontinue service to eight airports currently served by its Midwest Connect regional jet service: Baltimore; Hartford, Conn.; Louisville, Ky.; Muskegon, Mich.; Raleigh/Durham, N.C.; St. Louis; San Antonio; and Wausau/Stevens Point. Additionally, it will discontinue its nonstop Kansas City-Madison route, but will continue to offer the service via Milwaukee.
The new schedule, which is posted at http://www.midwestairlines.com, also includes frequency and timing adjustments on various routes.
ed.
Midwest Airlines to cut half of workforces with flight reductions and grounding all MD-80's
Monday, July 21, 2008 - 9:40 AM CDT Modified: Monday, July 21, 2008 - 9:41 AM
The Business Journal of Milwaukee
Midwest Airlines announced Sunday its new flight schedule beginning Sept. 8, slicing 11 cities to cut service back to 32 destinations while expanding its ticketing partnership with Northwest Airlines Corp.
Oak Creek-based Midwest Airlines will eliminate service to three airports: Ft. Lauderdale, Fla.; Ft. Myers, Fla.; and San Diego. Service to two West Coast destinations -- Los Angeles and Seattle/Tacoma -- will now be offered via Kansas City year-round, in the same way the airline currently offers service to San Francisco, but travelers flying from Milwaukee to those two cities will have one stop in Kansas City, as opposed to the non-stop flights now offered.
Long-haul flights from Milwaukee to West Coast cities are affected by the airline’s decision to ground its MD-80 aircraft, which have longer range than its Boeing 717s but are also less fuel-efficient. The airline is restructuring its routes, cutting back service and eliminating about 1,200 jobs -- about 40 percent of its work force -- because of skyrocketing fuel costs.
Service to Orlando, Fla., will now be offered seasonally during peak travel months. This season, nonstop Milwaukee-Orlando service will commence Oct. 21 and end April 30, 2009. As Midwest transitions to seasonal Orlando service, it will suspend service to that city from Sept. 8 through Oct. 20. Nonstop service between Kansas City and Orlando will be discontinued, but Kansas City-Orlando service will continue to be available via Milwaukee.
Midwest is also expanding its codeshare agreement with Eagan, Minn.-based Northwest Airlines (NYSE: NWA), adding more than 100 new city pairs to the program. Codeshare flights are essentially flights offered by an airline on a partner airline’s planes.
“We will remain true to our mission of serving major business destinations with more nonstop flights from Milwaukee than any other airline,” said Timothy Hoeksema, chairman and chief executive officer. “From Kansas City, we will continue to serve as an important resource for the business community, with flights to key East and West Coast cities. While there will be adjustments to frequency in some of these markets, we will continue to offer convenient service and the unparalleled customer service our passengers expect from us.”
The airline will also discontinue service to eight airports currently served by its Midwest Connect regional jet service: Baltimore; Hartford, Conn.; Louisville, Ky.; Muskegon, Mich.; Raleigh/Durham, N.C.; St. Louis; San Antonio; and Wausau/Stevens Point. Additionally, it will discontinue its nonstop Kansas City-Madison route, but will continue to offer the service via Milwaukee.
The new schedule, which is posted at http://www.midwestairlines.com, also includes frequency and timing adjustments on various routes.
Sunday, July 20, 2008
Fasten Your seatbelts...here we go again! Replacement new aircraft need less repairs...so hang in there, my colleagues. Let's hope we all land safely.
ed.
AP
American Airlines to cut 1,500 jobs in maintenance
Friday July 18, 6:59 pm ET By David Koenig, AP Business Writer
American Airlines to cutting 1,500 maintenance jobs around US as it reduces aircraft fleet
DALLAS (AP) -- American Airlines will cut 1,500 jobs in its maintenance division as it reduces its fleet of aircraft.
The nation's largest airline told employees of the cuts in memos this week.
American did not break down the cuts by location. Tami McLallen, a spokeswoman for the airline, said Friday that those decisions had not yet been made.
The airline has maintenance hubs in Kansas City, Tulsa, Okla., and Fort Worth, Texas, plus many smaller bases around the country. Besides maintaining American's jets, workers at the hubs also work on jets brought in by other carriers.
American has about 14,000 employees in its maintenance division, including management and support staff, and 13,000 of them are represented by the Transport Workers Union, McLallen said.
The cuts include 1,300 mechanics and 200 management and support staff, she said.
The Fort Worth-based airline, part of AMR Corp., announced two weeks ago it would shed 8 percent of its work force -- about 6,800 jobs -- to cope with financial distress brought on by record fuel costs and a weakening economy.
The company has publicly identified only a portion of those cuts. It has said it will eliminate 900 flight attendant jobs and 200 pilot positions. The company is offering buyouts to senior employees to reduce the need for layoffs.
Chief Financial Officer Tom Horton hinted at the latest cuts when he said this week that American's maintenance organization was built for a much bigger airline than the one that will emerge after announced reductions in capacity.
American plans to cut its U.S. flying by up to 12 percent after the busy summer travel season ends.
On Wednesday, American announced it would speed up the retirement of its 34 Airbus A300 aircraft by the end of next year instead of waiting until 2012. American and its feeder carrier, American Eagle, will ground 103 planes this year.
AMR reported Wednesday that it lost $1.45 billion in the April-to-June quarter, most of it due to writing down the value of aircraft. Excluding those charges, the loss was $284 million.
AMR shares rose 22 cents, or 3.2 percent, to $7.13 in Friday trading.
ed.
AP
American Airlines to cut 1,500 jobs in maintenance
Friday July 18, 6:59 pm ET By David Koenig, AP Business Writer
American Airlines to cutting 1,500 maintenance jobs around US as it reduces aircraft fleet
DALLAS (AP) -- American Airlines will cut 1,500 jobs in its maintenance division as it reduces its fleet of aircraft.
The nation's largest airline told employees of the cuts in memos this week.
American did not break down the cuts by location. Tami McLallen, a spokeswoman for the airline, said Friday that those decisions had not yet been made.
The airline has maintenance hubs in Kansas City, Tulsa, Okla., and Fort Worth, Texas, plus many smaller bases around the country. Besides maintaining American's jets, workers at the hubs also work on jets brought in by other carriers.
American has about 14,000 employees in its maintenance division, including management and support staff, and 13,000 of them are represented by the Transport Workers Union, McLallen said.
The cuts include 1,300 mechanics and 200 management and support staff, she said.
The Fort Worth-based airline, part of AMR Corp., announced two weeks ago it would shed 8 percent of its work force -- about 6,800 jobs -- to cope with financial distress brought on by record fuel costs and a weakening economy.
The company has publicly identified only a portion of those cuts. It has said it will eliminate 900 flight attendant jobs and 200 pilot positions. The company is offering buyouts to senior employees to reduce the need for layoffs.
Chief Financial Officer Tom Horton hinted at the latest cuts when he said this week that American's maintenance organization was built for a much bigger airline than the one that will emerge after announced reductions in capacity.
American plans to cut its U.S. flying by up to 12 percent after the busy summer travel season ends.
On Wednesday, American announced it would speed up the retirement of its 34 Airbus A300 aircraft by the end of next year instead of waiting until 2012. American and its feeder carrier, American Eagle, will ground 103 planes this year.
AMR reported Wednesday that it lost $1.45 billion in the April-to-June quarter, most of it due to writing down the value of aircraft. Excluding those charges, the loss was $284 million.
AMR shares rose 22 cents, or 3.2 percent, to $7.13 in Friday trading.
Wednesday, July 16, 2008
American Airlines' owner swings to big loss in 2Q
AP
Wednesday July 16, 11:41 am
ET By David Koenig, AP Business Writer
AMR, parent of American Airlines, swings to big second-quarter loss on fuel costs, charges
DALLAS (AP) -- The parent of American Airlines swung to a big loss in the second quarter as high fuel prices swamped an increase in revenue and led the nation's largest carrier to write down the value of its jets.
Still, the results reported Wednesday were not as bad as Wall Street had feared.
Aided by a sharp drop in oil prices, airline stocks surged. Shares of AMR Corp. jumped $1, or 22.7 percent, to $5.41 in morning trading just a day after hitting a 52-week low of $4.
AMR said that for the three months ending June 30, it lost $1.45 billion, or $5.77 per share, compared to a profit of $317 million, or $1.08 per share, a year ago.
Excluding special charges to write down the value of its fleet, AMR said it would have lost $284 million, or $1.13 per share.
Analysts, who typically exclude charges from their forecasts, expected AMR to lose $1.40 per share, according to a survey by Thomson Financial.
Revenue rose 5.1 percent, to $6.18 billion. Analysts expected $6.14 billion.
Fuel costs spiked 47.4 percent, to $2.42 billion -- an increase of about $780 million from a year ago.
A gallon of jet fuel went from $2.09 a year ago to $3.19, and would have been even higher if the company hadn't bought some of its fuel in advance at lower prices. AMR expects to pay $3.81 per gallon in the third quarter.
Chairman and Chief Executive Gerard Arpey called the second-quarter results disappointing, but he said the Fort Worth-based company was taking steps to manage through a tough stretch.
AMR, which also owns the American Eagle airline, is cutting about 6,800 jobs and reducing its U.S. flying sharply to bring down costs while raising fares and special fees to boost revenue. Analysts, however, expect the company to keep losing money at least through 2010.
"Our company continues to be severely challenged by the fuel crisis that has afflicted our entire industry, and we expect these difficulties to continue for the foreseeable future," Arpey said in a statement.
Arpey said the company would do whatever it takes -- including cutting capacity, raising revenue and changing its fleet -- to turn things around.
The company announced Wednesday that it would speed up the retirement of its 34 Airbus A300 aircraft by the end of next year instead of the original plan, which stretched through 2012. In all, American and Eagle will ground 103 planes this year.
Over the next three years, American is replacing some of its gas-guzzling MD-80 jets with 70 Boeing 737s, which get better mileage.
AMR also said Wednesday that it has put on hold its plan to sell or spin off American Eagle until conditions improve in the airline industry.
A sale could boost AMR's cash balance, which ended the quarter at more than $5 billion in unrestricted cash and short-term investments. In the quarter, AMR raised $720 million by mortgaging some planes and selling others, then leasing them back. Total debt fell to $15.2 billion, down from $17.3 billion a year ago.
Ray Neidl, an analyst with Calyon Securities, said the quarterly results were "a little better then expected" but the situation "remains dire."
American will be happy to turn the page on the second quarter, which began with a costly grounding of its entire fleet of 300 MD-80s because some failed inspections of the electrical wiring. The March-through-June period ended with AMR taking a $1.1 billion non-cash charge to write down the value of planes and $55 million for severance expenses.
During the quarter, American became the first major U.S. carrier to impose a fee for checking even a single bag, and it raised a variety of other special charges on passengers.
After the peak summer travel season ends, American expects to cut its U.S. capacity 11 percent to 12 percent compared with late 2007. The company said further reductions are expected next year.
AP
Wednesday July 16, 11:41 am
ET By David Koenig, AP Business Writer
AMR, parent of American Airlines, swings to big second-quarter loss on fuel costs, charges
DALLAS (AP) -- The parent of American Airlines swung to a big loss in the second quarter as high fuel prices swamped an increase in revenue and led the nation's largest carrier to write down the value of its jets.
Still, the results reported Wednesday were not as bad as Wall Street had feared.
Aided by a sharp drop in oil prices, airline stocks surged. Shares of AMR Corp. jumped $1, or 22.7 percent, to $5.41 in morning trading just a day after hitting a 52-week low of $4.
AMR said that for the three months ending June 30, it lost $1.45 billion, or $5.77 per share, compared to a profit of $317 million, or $1.08 per share, a year ago.
Excluding special charges to write down the value of its fleet, AMR said it would have lost $284 million, or $1.13 per share.
Analysts, who typically exclude charges from their forecasts, expected AMR to lose $1.40 per share, according to a survey by Thomson Financial.
Revenue rose 5.1 percent, to $6.18 billion. Analysts expected $6.14 billion.
Fuel costs spiked 47.4 percent, to $2.42 billion -- an increase of about $780 million from a year ago.
A gallon of jet fuel went from $2.09 a year ago to $3.19, and would have been even higher if the company hadn't bought some of its fuel in advance at lower prices. AMR expects to pay $3.81 per gallon in the third quarter.
Chairman and Chief Executive Gerard Arpey called the second-quarter results disappointing, but he said the Fort Worth-based company was taking steps to manage through a tough stretch.
AMR, which also owns the American Eagle airline, is cutting about 6,800 jobs and reducing its U.S. flying sharply to bring down costs while raising fares and special fees to boost revenue. Analysts, however, expect the company to keep losing money at least through 2010.
"Our company continues to be severely challenged by the fuel crisis that has afflicted our entire industry, and we expect these difficulties to continue for the foreseeable future," Arpey said in a statement.
Arpey said the company would do whatever it takes -- including cutting capacity, raising revenue and changing its fleet -- to turn things around.
The company announced Wednesday that it would speed up the retirement of its 34 Airbus A300 aircraft by the end of next year instead of the original plan, which stretched through 2012. In all, American and Eagle will ground 103 planes this year.
Over the next three years, American is replacing some of its gas-guzzling MD-80 jets with 70 Boeing 737s, which get better mileage.
AMR also said Wednesday that it has put on hold its plan to sell or spin off American Eagle until conditions improve in the airline industry.
A sale could boost AMR's cash balance, which ended the quarter at more than $5 billion in unrestricted cash and short-term investments. In the quarter, AMR raised $720 million by mortgaging some planes and selling others, then leasing them back. Total debt fell to $15.2 billion, down from $17.3 billion a year ago.
Ray Neidl, an analyst with Calyon Securities, said the quarterly results were "a little better then expected" but the situation "remains dire."
American will be happy to turn the page on the second quarter, which began with a costly grounding of its entire fleet of 300 MD-80s because some failed inspections of the electrical wiring. The March-through-June period ended with AMR taking a $1.1 billion non-cash charge to write down the value of planes and $55 million for severance expenses.
During the quarter, American became the first major U.S. carrier to impose a fee for checking even a single bag, and it raised a variety of other special charges on passengers.
After the peak summer travel season ends, American expects to cut its U.S. capacity 11 percent to 12 percent compared with late 2007. The company said further reductions are expected next year.
July 16, 2008, 11:16 am
What Southwest Airlines Could Teach Delta and American
Posted by Heidi N. Moore
There is an interesting dichotomy at play in the airline industry: some airlines are actually profiting from rising oil prices.
Consider Delta Air Lines’ earnings today. The Atlanta airline, which has agreed to combine with Northwest Airlines, announced a $1.04 billion second-quarter net loss, partly because of rising fuel costs. But it could have been far worse. Delta actually earned a tidy bundle on the rising price of oil–more, in fact, than it counted in earnings this quarter.
Delta, with the help of its Wall Street investment bankers, created hedges to protect its business against rising oil prices. But as the WSJ reported today, “Delta hedged 49% of its fuel consumption and realized about $313 million in gains.” Delta’s earnings this quarter–excluding write-downs–were only $137 million.
American Airlines wasn’t as lucky, as its hedges missed the mark by a long shot. In June AMR revealed it had hedges on about 33% of fuel consumption. Taken in aggregate, it bet that oil prices wouldn’t rise above $78 a barrel this year. Oil today is at around $136 a barrel.
On the other side of the coin, consider Southwest Airlines. It has about $5 billion of fuel hedges, or about half of its market cap. Morgan Stanley analyst William Greene Tuesday went as far as to call Southwest an “oil play,” and complained that airlines’ fuel hedges cover a multitude of sins and may be an excuse for the airline to avoid cutting capacity. Greene wrote: “Considering that [Southwest’s] management recently suggested it may revisit its capacity plans and potentially raise growth suggests that management does not view its fuel hedge as a temporary comparative advantage but rather as a durable competitive advantage.
Not addressing the company’s economic challenges today may lead to a more difficult adjustment in the future.”The question, as always, is whether capacity cuts are what the industry needs. Greene believes they are. Still, late last week he presented several reasons why airlines would want to avoid any extensive cuts in capacity and “chase oil” instead.
In his words:
(1) The network effect of a hub-and-spoke model deteriorates as capacity is cut
(2) Labor contracts, fleet planning, and aircraft/facility financing make large capacity cuts difficult to reverse in the short-term
(3) An habitual (if currently muted) focus on maintaining and gaining market share
(4) An inability to predict competitive responses
(5) Lack of visibility in airline revenue trends
(6) Uncertainty surrounding oil prices, a pullback could quickly make many routes profitable
Employees who made significant concessions in union negotiations are going to be watching that bottom line very carefully. Especially the pilots at Delta and Northwest. As Delta noted today, “Pilots at both companies will receive pay raises and an equity stake in the combined company.” That money has to come from somewhere.
What Southwest Airlines Could Teach Delta and American
Posted by Heidi N. Moore
There is an interesting dichotomy at play in the airline industry: some airlines are actually profiting from rising oil prices.
Consider Delta Air Lines’ earnings today. The Atlanta airline, which has agreed to combine with Northwest Airlines, announced a $1.04 billion second-quarter net loss, partly because of rising fuel costs. But it could have been far worse. Delta actually earned a tidy bundle on the rising price of oil–more, in fact, than it counted in earnings this quarter.
Delta, with the help of its Wall Street investment bankers, created hedges to protect its business against rising oil prices. But as the WSJ reported today, “Delta hedged 49% of its fuel consumption and realized about $313 million in gains.” Delta’s earnings this quarter–excluding write-downs–were only $137 million.
American Airlines wasn’t as lucky, as its hedges missed the mark by a long shot. In June AMR revealed it had hedges on about 33% of fuel consumption. Taken in aggregate, it bet that oil prices wouldn’t rise above $78 a barrel this year. Oil today is at around $136 a barrel.
On the other side of the coin, consider Southwest Airlines. It has about $5 billion of fuel hedges, or about half of its market cap. Morgan Stanley analyst William Greene Tuesday went as far as to call Southwest an “oil play,” and complained that airlines’ fuel hedges cover a multitude of sins and may be an excuse for the airline to avoid cutting capacity. Greene wrote: “Considering that [Southwest’s] management recently suggested it may revisit its capacity plans and potentially raise growth suggests that management does not view its fuel hedge as a temporary comparative advantage but rather as a durable competitive advantage.
Not addressing the company’s economic challenges today may lead to a more difficult adjustment in the future.”The question, as always, is whether capacity cuts are what the industry needs. Greene believes they are. Still, late last week he presented several reasons why airlines would want to avoid any extensive cuts in capacity and “chase oil” instead.
In his words:
(1) The network effect of a hub-and-spoke model deteriorates as capacity is cut
(2) Labor contracts, fleet planning, and aircraft/facility financing make large capacity cuts difficult to reverse in the short-term
(3) An habitual (if currently muted) focus on maintaining and gaining market share
(4) An inability to predict competitive responses
(5) Lack of visibility in airline revenue trends
(6) Uncertainty surrounding oil prices, a pullback could quickly make many routes profitable
Employees who made significant concessions in union negotiations are going to be watching that bottom line very carefully. Especially the pilots at Delta and Northwest. As Delta noted today, “Pilots at both companies will receive pay raises and an equity stake in the combined company.” That money has to come from somewhere.
Monday, July 14, 2008
An American Airlines Hostess in 1967 (Getty photos)
The Way It USED to be!
When People Dressed For The Flying!
A Shame The Way People Dress At The Airport
And On The Aircraft!
The First Class Cabin When First Class was First Class!
Commentary
The public wanted cheap seats (hence the flip-flops and T-shirt dress in First Class...when First Class WAS First Class) and airline management and the unions got greedy. Now you have an airline system falling flat on its ass. You cannot have it both ways. Decide what kind of airline you wish to be and set a business model. Changing the way you do business on a daily basis confuses everyone!
People hated airplane food; the butt of jokes...now they wished they'd have it back. Go figure.
ed.
By SCOTT MCCARTNEY
Yearning for the Glamorous Golden Age of Flying
July 15, 2008
'Boeing Boeing,' JetBlue Indulge In Nostalgia'Boeing Boeing," a current hit on Broadway, is a revival of a 1960s farce about a bachelor in Paris who juggles three girlfriends, all dazzling, miniskirted stewardesses, by relying on the accuracy of airline timetables to schedule trysts. "My fiancées wheel about the earth so precisely as to be almost poetic," boasts the cad "Bernard."
Audiences in New York and London have found the proposition hysterical. Of course even in the early days of jet travel, airline flights run into delays and cancellations and schedules get discombobulated. Hilarity ensues.
The production, which won two Tony awards this year, channels a feeling many travelers share these days -- nostalgia for the good ol' days when flying was an uncrowded, enjoyable, adventurous dress-up luxury. You hear it often from longtime road warriors who hate the unpredictable flying-bus travel of today, especially in summer, when the U.S. air-travel system bogs down with long lines, late flights, missed connections and gruff service. Move along, shut up and pay your fees, right?
Nostalgia for the glam days of air-travel seems to be growing. JetBlue Airways Corp., for example, has launched an advertising campaign touting "Happy Jetting" that uses '60s style type in its print ads to give it a retro feel, trying to recall not only JetBlue's early days before it ran smack into long delays and stranded passengers, but also to the fond feelings people once had for air travel.
Can we ever go back to the fun traveling days of the 1960s and 1970s? What do you miss most about those bygone days? "I don't think people have let go of looking for every aspect of travel to be experiential," said Fiona Morrison, JetBlue's director of brand management and advertising.
There also have been various calls to rethink deregulation of the airline industry as it enters another tumultuous recession because of high fuel costs. Removing government controls on airline schedules and prices ignited tremendous growth in air travel, boosting the national economy and changing our lifestyles by making air travel cheap and available to the masses. But it also has meant instability for airlines, poorer service for many travelers and congestion in the skies, on runways and in terminals.
Robert Crandall, the now-retired chief of AMR Corp.'s American Airlines, recently called for re-regulating some aspects of the business, such as government playing a greater role in airline schedules to curb devastating delays.
"The idea of allowing airlines to schedule more flights than an airport can handle is unacceptable stupidity," Mr. Crandall said in an interview. "We can't have planes sitting for hours and spilling fuel out the tailpipe."
Joan Marcus
A flight from the mid-1960s.
The nation needs to accelerate deployment of a satellite-based navigation system as well, he said, because it will boost capacity, speed up air travel, reduce fuel use and pollution, and improve airline finances.
Of course, the good ol' days weren't as good as we probably remember them today -- flying was expensive and sometimes unreliable even then. Today's jets are more dependable mechanically and fly faster and higher in smoother air. Flying is much safer today than it was even 20 years ago, and airline schedules offer much more flexibility to consumers than they did in the 1960s and 1970s.
The trade-off for low ticket prices and ample air service is that airline seats are squished together, terminals are chock-a-block, passengers are sorted through connecting hub airports, more luggage gets lost, and delays have become rampant.
Few people in aviation, including Mr. Crandall, think we can ever go back to the days when half of the seats on jets were empty, offering comfort to fliers, and airports and airlines operated far below peak capacity. The reality of the airline world is that many travelers -- not all, but certainly most -- buy based on low prices and schedule convenience. They won't pay more for the promise of extra legroom and onboard meals.
"People regard the airline seat as a commodity," Mr. Crandall said.
JetBlue took off eight years ago trying to differentiate itself with some frills as well as cheap ticket prices, offering leather seats, onboard satellite television, friendly flight attendants and snacks instead of peanuts.
"When we launched, we were harking back to the glory days when it was exciting to travel," says Ms. Morrison. The "Happy Jetting" campaign is an attempt to recapture the airlines early days instead of the recent history of planes stranded in snowstorms and long delays.
The cast of the Broadway show 'Boeing Boeing.'
"Boeing Boeing" harks back much further to a day when airlines also sold sex appeal, with glamorous stewardesses chosen partly for their looks. The show was a flop on Broadway when it arrived in 1965, lasting only 23 performances. (The French farce, written by Marc Camoletti, had been a hit in Paris and London, and was made into a movie starring Tony Curtis and Jerry Lewis.)
But today it is much funnier because its premise seems so preposterous -- one man trying to organize three relationships based on airline schedules, a two-day layover for "Gloria," a Trans World Airlines stewardess, followed in short order by visits from "Gabriella" from Alitalia and "Gretchen" from Lufthansa. Say goodbye to one over lunch; welcome another a few hours later over dinner. "You just follow the timetable," says "Bernard," played by Bradley Whitford of "West Wing" fame.
Actress Kathryn Hahn, who plays "Gloria," said in an interview that many flight attendants come to see the show and lament at how much more difficult their jobs are now, with worries about air rage, terrorism, difficult travel and company layoffs.
"There's also something sad, something innocent about this play after Sept. 11 and after so many horrible travel tales," Ms. Hahn said.
The Way It USED to be!
When People Dressed For The Flying!
A Shame The Way People Dress At The Airport
And On The Aircraft!
The First Class Cabin When First Class was First Class!Commentary
The public wanted cheap seats (hence the flip-flops and T-shirt dress in First Class...when First Class WAS First Class) and airline management and the unions got greedy. Now you have an airline system falling flat on its ass. You cannot have it both ways. Decide what kind of airline you wish to be and set a business model. Changing the way you do business on a daily basis confuses everyone!
People hated airplane food; the butt of jokes...now they wished they'd have it back. Go figure.
ed.
THE MIDDLE SEAT
By SCOTT MCCARTNEY
Yearning for the Glamorous Golden Age of Flying
July 15, 2008
'Boeing Boeing,' JetBlue Indulge In Nostalgia'Boeing Boeing," a current hit on Broadway, is a revival of a 1960s farce about a bachelor in Paris who juggles three girlfriends, all dazzling, miniskirted stewardesses, by relying on the accuracy of airline timetables to schedule trysts. "My fiancées wheel about the earth so precisely as to be almost poetic," boasts the cad "Bernard."
Audiences in New York and London have found the proposition hysterical. Of course even in the early days of jet travel, airline flights run into delays and cancellations and schedules get discombobulated. Hilarity ensues.
The production, which won two Tony awards this year, channels a feeling many travelers share these days -- nostalgia for the good ol' days when flying was an uncrowded, enjoyable, adventurous dress-up luxury. You hear it often from longtime road warriors who hate the unpredictable flying-bus travel of today, especially in summer, when the U.S. air-travel system bogs down with long lines, late flights, missed connections and gruff service. Move along, shut up and pay your fees, right?
Nostalgia for the glam days of air-travel seems to be growing. JetBlue Airways Corp., for example, has launched an advertising campaign touting "Happy Jetting" that uses '60s style type in its print ads to give it a retro feel, trying to recall not only JetBlue's early days before it ran smack into long delays and stranded passengers, but also to the fond feelings people once had for air travel.
Can we ever go back to the fun traveling days of the 1960s and 1970s? What do you miss most about those bygone days? "I don't think people have let go of looking for every aspect of travel to be experiential," said Fiona Morrison, JetBlue's director of brand management and advertising.
There also have been various calls to rethink deregulation of the airline industry as it enters another tumultuous recession because of high fuel costs. Removing government controls on airline schedules and prices ignited tremendous growth in air travel, boosting the national economy and changing our lifestyles by making air travel cheap and available to the masses. But it also has meant instability for airlines, poorer service for many travelers and congestion in the skies, on runways and in terminals.
Robert Crandall, the now-retired chief of AMR Corp.'s American Airlines, recently called for re-regulating some aspects of the business, such as government playing a greater role in airline schedules to curb devastating delays.
"The idea of allowing airlines to schedule more flights than an airport can handle is unacceptable stupidity," Mr. Crandall said in an interview. "We can't have planes sitting for hours and spilling fuel out the tailpipe."
Joan Marcus
A flight from the mid-1960s.
The nation needs to accelerate deployment of a satellite-based navigation system as well, he said, because it will boost capacity, speed up air travel, reduce fuel use and pollution, and improve airline finances.
Of course, the good ol' days weren't as good as we probably remember them today -- flying was expensive and sometimes unreliable even then. Today's jets are more dependable mechanically and fly faster and higher in smoother air. Flying is much safer today than it was even 20 years ago, and airline schedules offer much more flexibility to consumers than they did in the 1960s and 1970s.
The trade-off for low ticket prices and ample air service is that airline seats are squished together, terminals are chock-a-block, passengers are sorted through connecting hub airports, more luggage gets lost, and delays have become rampant.
Few people in aviation, including Mr. Crandall, think we can ever go back to the days when half of the seats on jets were empty, offering comfort to fliers, and airports and airlines operated far below peak capacity. The reality of the airline world is that many travelers -- not all, but certainly most -- buy based on low prices and schedule convenience. They won't pay more for the promise of extra legroom and onboard meals.
"People regard the airline seat as a commodity," Mr. Crandall said.
JetBlue took off eight years ago trying to differentiate itself with some frills as well as cheap ticket prices, offering leather seats, onboard satellite television, friendly flight attendants and snacks instead of peanuts.
"When we launched, we were harking back to the glory days when it was exciting to travel," says Ms. Morrison. The "Happy Jetting" campaign is an attempt to recapture the airlines early days instead of the recent history of planes stranded in snowstorms and long delays.
The cast of the Broadway show 'Boeing Boeing.'
"Boeing Boeing" harks back much further to a day when airlines also sold sex appeal, with glamorous stewardesses chosen partly for their looks. The show was a flop on Broadway when it arrived in 1965, lasting only 23 performances. (The French farce, written by Marc Camoletti, had been a hit in Paris and London, and was made into a movie starring Tony Curtis and Jerry Lewis.)
But today it is much funnier because its premise seems so preposterous -- one man trying to organize three relationships based on airline schedules, a two-day layover for "Gloria," a Trans World Airlines stewardess, followed in short order by visits from "Gabriella" from Alitalia and "Gretchen" from Lufthansa. Say goodbye to one over lunch; welcome another a few hours later over dinner. "You just follow the timetable," says "Bernard," played by Bradley Whitford of "West Wing" fame.
Actress Kathryn Hahn, who plays "Gloria," said in an interview that many flight attendants come to see the show and lament at how much more difficult their jobs are now, with worries about air rage, terrorism, difficult travel and company layoffs.
"There's also something sad, something innocent about this play after Sept. 11 and after so many horrible travel tales," Ms. Hahn said.
Producer Sonia Friedman says "Boeing Boeing" would have been a disaster 10 years ago, with its political incorrectness and stereotypes panned by audiences and critics. Producers had a difficult time raising money for the revival, which opened last year in London, but the show proved a hit.
"It taps into a time people recall fondly," says Ms. Friedman, not only in terms of travel but also in relationships and sex. "And we know we can never do it again."
"It taps into a time people recall fondly," says Ms. Friedman, not only in terms of travel but also in relationships and sex. "And we know we can never do it again."
Thursday, July 10, 2008
Companies that vanished: TWA, a story of American CapitalismPosted Jun 9th 2008 by Michael Rainey
The story of Trans World Airlines is the story of American capitalism in the 20th century. Founded by aviation pioneers and scrappy entrepreneurs, TWA became one of the largest and most successful airlines in the world. It racked up numerous awards and distinctions and created a devoted base of customers and employees.
Along the way, it also displayed the twisted corporate history typical of capitalism American-style, with plenty of buyouts and mergers and awkward transitions. Finally, it ended up the victim of vulture capitalists, who picked it clean and sold its carcass to a competitor. All in all, a heckuva ride.
The company got its official beginning in 1930, when Transcontinental Air Transport and Western Air Express merged to form Transcontinental & Western Air (T&WA). The merger was driven by one of the great motivators in American free market capitalism: the pursuit of lucrative government contracts.
In this case, the contracts were for airmail transport and the new airline was soon rolling in federal dough, though not for long. The great Air Mail Scandal of 1934 brought an end to that arrangement and the airlines split up, although the name lived on. From 1930 forward, TWA experienced some dramatic ups and downs.
After a TWA crash killed Notre Dame coach Knute Rockne in 1931, the airline nearly went out of business. It survived though and went on to pioneer the use of many of the great aircraft of the 20th century, including the first (and only) DC-1, the Boeing Stratoliner, and the Lockheed Constellation.
TWA also built some beautiful buildings, including the famous terminal at JFK in New York designed by Eero Saarinen. And TWA gained some noteworthy owners and managers along the way, most famously the reclusive though aircraft obsessed Howard Hughes, who lost control of the airline when his effort to upgrade to jets in the 1950s hit some financial turbulence. TWA peaked in the early 1980s, when it was carrying over half of all passengers traveling from the U.S. to Europe.
But deregulation and a lack of investment in new aircraft hit the airline hard, and the airline was acquired by Carl Icahn in 1985 in a hostile takeover. In classic form, Icahn took the company private in 1988, pocketing nearly $500 million for himself while saddling the company with $540 million in debt. Four years later, stripped of its most valuable assets (like the routes to London sold to American Airlines) and struggling with massive debt payments, TWA declared bankruptcy. More difficulties followed.
Icahn made a deal that allowed him to buy certain TWA tickets for 55 cents on the dollar, then sell them for his own profit, which he did relentlessly at Lowestfare.com, costing TWA hundreds of millions of dollars. Another bankruptcy in 1995 took care of that problem.
Then TWA flight 800 exploded over the ocean near New York City in 1996, killing all 230 aboard. After that, TWA focused on domestic routes, but with decreasing success. Finally, American Airlines bought TWA in 2001, ending its run as an independent company.
Although it doesn't seem to be part of the official history of the company, Trans World Airlines was also a victim of the September 11 attacks against the United Sates. The airline had been struggling for years before that, but the attacks and the resulting turmoil in the airline industry were a final nail in the coffin.
Oddly enough, I took a TWA flight to Paris in early September, 2001. I didn't know it at the time, but it was one of the last TWA flights over the Atlantic.My girlfriend and I were scheduled to return to the U.S. on September 17 on TWA. Most flights were canceled in the days after 9/11, so we knew we wouldn't be leaving on that day. But we went to the airport in Paris anyway -- we couldn't call TWA, since the phone lines were jammed -- and were amazed by what we saw.
Thousands of people waited in lines, and many of them looked like they had been at the airport for days. I could hear loud American voices offering large sums of money to get on a plane back home or anywhere close. One group of travelers bought tickets to Mexico City and planned to rent or buy a car to get back home to Dallas.
It was a pretty chaotic scene.But at the TWA counter, the situation was different: there were no passengers at all. We walked right up to the counter and immediately spoke to the agents. We quickly found out why there was no one else there: TWA was no longer flying back to New York. In fact, TWA was no longer flying at all.
So despite the fact that we had purchased round trip tickets on TWA and had flown to Paris on a TWA plane, we would not be flying home on one. We ended up flying home days later on American Airlines. But TWA was gone for good.
Wednesday, July 09, 2008
(The Tucson Airport Authority, a private entity, runs the Tucson Airport. If they had suspended or waved landing fees until jet fuel comes down to earth jetBlue and Executive Jet MIGHT have stayed in Tucson) ed.
ExpressJet cuts mean loss of Tucson flights
By Jack Gillum
Arizona Daily Star
Tucson, Arizona Published: 07.09.2008
ExpressJet Airlines Inc. is ending its nationwide branded service, effectively cutting four remaining destinations from Tucson International Airport in September.
This latest move by the Houston-based regional air carrier marks a setback for Tucson and other mid-sized cities serviced by the low-cost airline, which has been grappling with skyrocketing fuel costs of late.
ExpressJet was widely seen as a boon for Tucson travelers. In fact, the airline singlehandedly increased destinations available from the Old Pueblo by almost 50 percent in 2007, and airport officials frequently touted the new service.
But earlier this year, signs began emerging that the airline was facing trouble. In March, ExpressJet stopped its El Paso service, and in May, it announced it was cutting flights between Tucson and Spokane, Wash.; Austin, Texas; Omaha, Neb.; and Reno, Nev.
The airline’s demise disappointed many local air travelers. “It was perfect because they had so many nonstops,” said Pam Francis, 54, who travels between Tucson and Austin to visit her son. Stopping over in other cities with some other airlines, she said, “was a disaster.”
ExpressJet, on the other hand, was a $189 round-trip fare and “was just delightful all the way around.”Earlier this month, ExpressJet said it would be cutting its Delta Connection service on Sept. 1, effectively ending non-stop service between Tucson to Los Angeles International Airport.
The new announcement means it will no longer fly to Kansas City; Ontario, Calif.; San Antonio and Sacramento, Calif. The airline will continue to operate Continental Airlines’s daily, non-stop service to Houston.
“It was nice to be able to fly direct to some smaller airports,” said Brad Richwine, who works for Raytheon Missile Systems and would fly to Sacramento for work. “I’m sad to see them go."
ExpressJet cuts mean loss of Tucson flights
By Jack Gillum
Arizona Daily Star
Tucson, Arizona Published: 07.09.2008
ExpressJet Airlines Inc. is ending its nationwide branded service, effectively cutting four remaining destinations from Tucson International Airport in September.
This latest move by the Houston-based regional air carrier marks a setback for Tucson and other mid-sized cities serviced by the low-cost airline, which has been grappling with skyrocketing fuel costs of late.
ExpressJet was widely seen as a boon for Tucson travelers. In fact, the airline singlehandedly increased destinations available from the Old Pueblo by almost 50 percent in 2007, and airport officials frequently touted the new service.
But earlier this year, signs began emerging that the airline was facing trouble. In March, ExpressJet stopped its El Paso service, and in May, it announced it was cutting flights between Tucson and Spokane, Wash.; Austin, Texas; Omaha, Neb.; and Reno, Nev.
The airline’s demise disappointed many local air travelers. “It was perfect because they had so many nonstops,” said Pam Francis, 54, who travels between Tucson and Austin to visit her son. Stopping over in other cities with some other airlines, she said, “was a disaster.”
ExpressJet, on the other hand, was a $189 round-trip fare and “was just delightful all the way around.”Earlier this month, ExpressJet said it would be cutting its Delta Connection service on Sept. 1, effectively ending non-stop service between Tucson to Los Angeles International Airport.
The new announcement means it will no longer fly to Kansas City; Ontario, Calif.; San Antonio and Sacramento, Calif. The airline will continue to operate Continental Airlines’s daily, non-stop service to Houston.
“It was nice to be able to fly direct to some smaller airports,” said Brad Richwine, who works for Raytheon Missile Systems and would fly to Sacramento for work. “I’m sad to see them go."
Wednesday, July 02, 2008
BREAKING NEWS FROM OVERSEAS!
HERE COMES THE BIG STORY!
BA to seek clearance for AA and Iberia merger
The London Financial Times
David Robertson, Business Correspondent
British Airways is said to be close to seeking clearance from competition authorities for a three-way operational merger with American Airlines (AA) and Iberia.
The deal would allow the companies to combine nearly all aspects of their operations, including sales, purchasing and marketing, leading to lower costs and greater economies of scale. Legal sources in the United States said that a submission to the US Department of Transport was expected as soon as next week.
The operational partnership may also provide a foundation for a full merger of the carriers should foreign ownership rules in the United States and Spain change. BA said two months ago that it was in talks with AA and Continental, another American carrier, about creating an alliance, but Continental has since walked away.
BA and AA have continued their discussions and are believed to have invited Iberia - in which BA has a 13 per cent stake - to be the third member. BA said last night that its talks with AA were continuing but a decision had yet to be made. If BA and AA do seek regulatory approval to merge their operations, it would be their third attempt, having been blocked by regulators in 1998 and 2001.
The authorities in Britain and America were concerned that the two carriers would have a dominant position on many North Atlantic routes and demanded that the airlines sell Heathrow slots to reduce their traffic. However, sources familiar with BA's discussions said that the airline was more optimistic of gaining approval this time because of the liberalisation of air travel rules between Europe and the US.
In addition, the dire state of the airline sector, which is striving to cope with high fuel prices, may force regulators to accept the deal. AA lost $328 million (£164.7 million)and Iberia €28.3 million (£22.5 million) in the first quarter of this year. BA has given warning that it may struggle to stay profitable this year. An analyst said: “There is a lot of pressure on BA and AA to do this deal and cut costs.
It's inevitable.” Another added: “Including Iberia makes sense, as it would give the alliance a strong position across both the North and South Atlantic.” Meanwhile, BA said yesterday that it had bought L'Avion, a French business-class only airline, for £54 million. L'Avion is the last of the survivors of the rush two years ago to launch all-business-class transatlantic services. Silverjet, MaxJet and Eos have all gone out of business. L'Avion will be merged with BA's new OpenSkies service, which flies from Paris to New York. The purchase price includes L'Avion's £26million in cash and two Boeing 757 aircraft.
The London Financial Times
David Robertson, Business Correspondent
British Airways is said to be close to seeking clearance from competition authorities for a three-way operational merger with American Airlines (AA) and Iberia.
The deal would allow the companies to combine nearly all aspects of their operations, including sales, purchasing and marketing, leading to lower costs and greater economies of scale. Legal sources in the United States said that a submission to the US Department of Transport was expected as soon as next week.
The operational partnership may also provide a foundation for a full merger of the carriers should foreign ownership rules in the United States and Spain change. BA said two months ago that it was in talks with AA and Continental, another American carrier, about creating an alliance, but Continental has since walked away.
BA and AA have continued their discussions and are believed to have invited Iberia - in which BA has a 13 per cent stake - to be the third member. BA said last night that its talks with AA were continuing but a decision had yet to be made. If BA and AA do seek regulatory approval to merge their operations, it would be their third attempt, having been blocked by regulators in 1998 and 2001.
The authorities in Britain and America were concerned that the two carriers would have a dominant position on many North Atlantic routes and demanded that the airlines sell Heathrow slots to reduce their traffic. However, sources familiar with BA's discussions said that the airline was more optimistic of gaining approval this time because of the liberalisation of air travel rules between Europe and the US.
In addition, the dire state of the airline sector, which is striving to cope with high fuel prices, may force regulators to accept the deal. AA lost $328 million (£164.7 million)and Iberia €28.3 million (£22.5 million) in the first quarter of this year. BA has given warning that it may struggle to stay profitable this year. An analyst said: “There is a lot of pressure on BA and AA to do this deal and cut costs.
It's inevitable.” Another added: “Including Iberia makes sense, as it would give the alliance a strong position across both the North and South Atlantic.” Meanwhile, BA said yesterday that it had bought L'Avion, a French business-class only airline, for £54 million. L'Avion is the last of the survivors of the rush two years ago to launch all-business-class transatlantic services. Silverjet, MaxJet and Eos have all gone out of business. L'Avion will be merged with BA's new OpenSkies service, which flies from Paris to New York. The purchase price includes L'Avion's £26million in cash and two Boeing 757 aircraft.
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