Boeing 777 service via Dubai increases customers' travel options

With the departure today of flight 977, United Airlines will launch a daily service between its Washington hub, Dulles International Airport, and Doha, Qatar, via Dubai.

The extension of the existing Dubai service to Doha is the first of three new, previously announced United services from Washington Dulles. The airline will introduce nonstop service between Dulles and Manchester, U.K. tomorrow, and between Dulles and Dublin, Ireland, on June 7.

"We are delighted to add Doha to United's global route network," said James Mueller, United's vice president Atlantic & Pacific Sales. "Our customers in both the U.S. and Qatar will benefit from increased travel opportunities and options with this new service."

United operates the Washington/Dulles-Dubai-Doha service with a Boeing 777 aircraft.

Industry analyst Saj Ahmad commented: “US airlines are slowly waking up to the competitive threat posed by GCC airlines and United Airlines will have it all to do if it aims to make profitable its daily services to Doha via Dubai.

“It is interesting that United Airlines is not servicing Doha directly, just as Qatar Airways does on this cash-lucrative route. Whether this changes in the future depends on its success in trying to compete with the likes of the big three Arab carriers in their backyard.

“But with Emirates and Etihad Airways also launching services to Washington DC over the next few months, it feels as if United Airlines was compelled to making a move - after all, could it absorb the pressure of more astute carriers from the Persian Gulf forever? Probably not and its precisely why they are introducing daily flights to give customers more choice, aside from the big three Gulf airlines. However, that Etihad, Emirates and Qatar Airways have far superior cabin products and all sport new airplanes such as the 777-300ER, it will be mighty difficult for United Airlines to compete effectively, especially when it still wont be servicing Doha with a direct connection."

Article Source : Arabian Aerospace

Etihad signs MoU with Lulu

Etihad Airways has signed a memorandum of understanding (MoU) with the Abu Dhabi-based Lulu International Group. Etihad Airways will be the preferred supplier of air cargo services for Lulu's retail operations into and out of the UAE.

Under the agreement, Etihad Airways will offer the Lulu International Group and its forwarding agents a range of preferential and priority air cargo services.  This includes transporting mostly fresh produce from countries such as Egypt, India, the Philippines, Thailand and the United Kingdom to and through the UAE.

Best known for the Lulu chain of supermarkets, department stores, hypermarkets and shopping malls, the Lulu International Group operates businesses all over UAE, Oman, Qatar, Bahrain, Kuwait, Saudi Arabia, Yemen, Egypt, India, Indonesia, Malaysia, Thailand, Hong Kong, Vietnam, China, Kenya, Tanzania, Ivory Cost, Ghana and Benin.

Etihad Airways Chief Commercial Officer, Peter Baumgartner, said:  “We are delighted to have signed this MoU with the Lulu International Group and look forward to working together as this relationship develops. 

“This deal is central to Etihad Airways’ role of facilitating trade into and out of the UAE, and will further support the commercial development of the Emirate of Abu Dhabi.”

Chief Executive Officer of Lulu International Group, Saifee T Rupawala, said:  “We are very excited about this new agreement with Etihad Airways which will help us immensely in effectively managing our worldwide supply chain and logistics

“This in turn will help us cater to the diverse needs of our large multi-ethnic consumer base with prompt service and competitive prices.”

Article Source : Arabian Aerospace

TAV Consortium wins MRO contract at Jeddah Airport

TAV Construction-Al Rajhi Holding-Al Habtoor Leighton Joint Venture has won an US$800 million contract for the SAEI Aircraft Maintenance, Repair and Operation (MRO) facility at King Abdul Aziz International Airport in Jeddah, Saudi Arabia.

TAV Construction will build the MRO facility, which consists of 11 hangars, aircraft maintenance facilities, an administrative building, closed car park and aircraft parking aprons, in 900 days.

The venture will carry out the design and construction works of the facility and, if required, will undertake the second phase of the project, which is already planned.

TAV Group CEO Sani Şener, said: "We are more than happy to win the tender of construction works of hangars in Jeddah Airport; this has been another big success after the construction and operation of Medina Airport in Saudi Arabia.

“This project, which we will carry out together with our partners, is of great significance in terms of expansion works of King Abdul Aziz International Airport, the busiest airport of the country, and it is expected to provide for the operational needs of the next 20 years.

“Airport construction is a special sector requiring wide experience and specialized knowledge. You are obliged to know every kind of information about that aviation industry while constructing facilities such as terminal building, tower, hangar, runways within the core of airport. You have to know about aircrafts, their performances and their sizes, as well as meteorology, capacity of air traffic and its devices, their activity fields and their functions in detail. Additionally, you have to know passenger behaviors and administration of commercial areas. You have to master information technologies, luggage and ground services. The organization created by TAV Group is an organisation which gathers all this knowledge in its core. That is why we keep on increasing our success rate in aviation related businesses throughout the world.

“TAV Construction has also a bright history in this sector as a brand opening up to the world from Istanbul. We will keep on working in our targeted region to achieve new successful projects primarily through the airport projects”.

Article Source : Arabian Aerospace

Boeing presents –the Boeing Edge - at Jeddah exhibition

The Boeing Company is presenting its new initiative –the Boeing Edge - at the inaugural Kingdom Airports, Aviation and Logistics Exhibition in Jeddah, Saudi Arabia, from May 1-2.

The Boeing Edge is the industry’s largest portfolio of services, support and solutions, backed by Boeing’s extensive aviation knowledge and experience.
The Boeing exhibit, at booth 117, will showcase the company’s Flight Services and Information Services business units, spotlighting air traffic management (ATM) solutions and professional services. The exhibit will also showcase the Boeing widebody airplanes proudly flying in Saudi Arabian Airlines’ fleet.

“The Boeing Edge is all about making our customers and the aviation industry successful,” said Lou Mancini, senior vice president, Boeing Commercial Aviation Services. “Through our global portfolio of support, services and solutions, we deliver our customers every competitive advantage they need to succeed.”

Boeing offers a comprehensive portfolio of ATM solutions to optimize the efficiency of the worldwide system. Boeing Professional Services offers consultative solutions across a broad array of disciplines and services to provide valuable insight to Boeing customers as well as organizations that operate, lease, maintain or service airplanes of any type.

Boeing enjoys a historic partnership with the Kingdom of Saudi Arabia and Saudi Arabian Airlines. “Boeing has a strong and long-standing partnership with the Kingdom, going back more than 65 years. We always support strategic and high-profile initiatives such as the Airports, Aviation & Logistics exhibition here in Jeddah,” said Ahmed Jazzar, President of Boeing Saudi Arabia. “This region is expected to enjoy significant economic growth over the next 20 years. Boeing is here to offer our customers a powerful combination of expertise, innovation and support as they expand their fleets and operations to meet the demand in air travel and achieve the maximum value and efficiency in their businesses.” 

Article Source : Arabian Aerospace

Double-top for flydubai as Middle East's best low-cost airline

Flydubai was named Best Low-Cost Airline Serving the Middle East for the second consecutive year at the 2012 Business Traveller Middle East Awards, held in Dubai.

Above: Chairman of flydubai, His Highness Sheikh Ahmed Bin Saeed Al Maktoum, and flydubai CEO Ghaith Al Ghaith celebrate winning the title of Best Low-Cost Airline Serving the Middle East for the second consecutive year at the 2012 Business Traveller Middle East Awards.

The annual Business Traveller Middle East Awards celebrate the achievements of the region’s business travel industry and recognise some of the sector’s key players. Flydubai was praised for its ongoing commitment to offering convenient and reliable, low fare travel to business travellers across the region, while embodying the high standards of quality in service that the region is renowned for.                           

Flydubai’s CEO Ghaith Al Ghaith said: “Winning this award is a significant achievement for flydubai and highlights our position as a pioneering force within the region’s travel and tourism industry. We started out just under three years ago with a vision to make travel a little less complex, a little less stressful and a little less expensive.

"We have since transformed into one of the world’s fastest growing start-up airlines ever. With over 800 flights a week to more than 45 destinations spanning the GCC, Middle East, Subcontinent, Africa and Central and Eastern Europe, we are also the second largest carrier operating out of Dubai International Airport. I would like to thank all the readers who voted for us and their ongoing confidence in flydubai.”

Since starting operations on 1 June 2009, flydubai has redefined the low-cost model, offering an unbundled product that has not been seen in the UAE before.

Article Source : Arabian Aerospace

Delta expects immediate payoffs through oil refinery acquisition

Delta Air Lines (DL) anticipates its US northeast operations will easily take up all the fuel available from the oil refinery that the carrier is purchasing and that payoffs of the daring strategy will be almost immediate.

DL announced Monday that its Monroe Energy LLC subsidiary is acquiring an idled Pennsylvania refinery in a $180 million deal that includes $30 million state assistance from Pennsylvania.

The deal is expected to be completed by end of June and has been described as a smart strategy by one expert who tracks oil market issues for airlines.

“Essentially the supply of incremental gasoline and jet fuel to the Atlantic coast is being monopolized,” Philip Verleger, president and owner of energy and commodity consulting firm PKVerleger LLC told. “By buying this refinery, Delta escapes that and leaves the other airlines at the mercy of very few incremental suppliers.”

The Phillips 66 refinery complex in Trainer, Pa., including pipelines and transportation assets, has crude oil processing capacity for 185,000 barrels per day and Monroe will invest an additional $100 million to convert existing infrastructure to maximize jet fuel production. A DL spokesperson told that its Northeast operations will “easily take all fuel we’ll produce at this point in time.”

Production at the refinery, along with multi-year agreements to exchange gasoline, diesel, and other refined products from the refinery for jet fuel, will provide 80% of DL’s jet fuel needs in the US, the carrier said.

Monroe, a wholly owned unit that DL created in 2011, began talks late last year with Conoco (now Phillips 66).

Jet fuel production is expected to begin during the third quarter, resulting in 2012 fuel savings of more than $100 million. DL’s consolidated fuel bill last year was $9.73 billion, a 28% jump up over 2010 fuel costs. Average fuel price per gallon for the full year, including fuel expense incurred under contract carrier arrangements, jumped 31.3% to $3.06.

“Savings will be immediate when we get the plant making jet fuel for us because we capture the ‘crack spread’—the markup that refineries charge airlines for jet fuel. We won’t pay that for fuel we get from Trainer,” a DL spokesperson told.

He described Trainer as “a piece in a total fuel management strategy for us that includes careful procurement, smart hedging and now a production asset. We think Trainer will not only save us money on crack spreads, but also give our hedging efforts more effectiveness since we’ll be bringing physical product to the table.”

"Acquiring the Trainer refinery is an innovative approach to managing our largest expense," DL CEO Richard Anderson said. "This modest investment, the equivalent of the list price of a new widebody aircraft, will allow Delta to reduce its fuel expense by $300 million annually and ensure jet fuel availability in the Northeast.”

Verleger said the move could be enormously profitable for DL. “It’s a logical extension to what the airline industry has been doing,” he said. “The airline industry has gradually taken over the management of its own fuel supply, saving itself billions over the years … this is the next logical step.”

It will also allow DL to “build a fortress hub in New York,” he said. “The way the airlines survive is to build really impregnable hubs. What it is going to do is give [DL] a huge cost advantage over all the other carriers operating in New York.”

Under a three-year agreement, BP will supply crude oil to be refined at the Trainer facility, where DL will employ approximately 400 people. Monroe will report to a board of directors that includes officers from DL. The fuel management team currently reports through finance to DL CFO, Paul Jacobson.

"We expect the Trainer acquisition to be accretive to Delta's earnings, expand our margins, and to fully recover our investment in the first year of operations," Jacobson said. "We look forward to closing this transaction and moving quickly to begin capturing its benefits."

Monroe said it will now enter strategic sourcing and marketing agreements with BP and Phillips 66.

Article Source : ATW Daily News

Etihad acquires stake in Aer Lingus

Etihad Airways (EY) said Tuesday it has acquired a 2.987% stake in Aer Lingus. The airline said the purchase would forge a commercial partnership with the Irish national carrier.

The Irish government announced in September it would sell its stake in EI as part of efforts to reduce public debt.

EY operates 10 flights a week from Abu Dhabi to Dublin and has carried more than 750,000 passengers between the two capitals since it began flying the route in July 2007.

EY has codeshare partnerships with 34 airlines around the world.

Article Source : ATW Daily News

Austrian finalizes Tyrolean integration decision

Vienna-based Austrian Airlines (OS) decided late Monday to transfer the company’s mainline operations—which include about 80 aircraft and 2,100 employees—to subsidiary Tyrolean Airways from July 1 after failing to reach agreement with labor representatives.

The move surprised industry analysts after OS announced earlier it had struck a tentative agreement with pilots and flight attendants, heading off the carrier’s plans to shift their contracts to Innsbruck-based Tyrolean with less generous terms. However, negotiations over the past two weeks “proved impossible to reach agreement over principles” with the company’s works council.

In a statement, the company said the executive board views this as a measure to secure OS’s future, abolish automatic salary increases and introduce a modern collective agreement. The move is part of a €220 million ($289.7 million) cost-cutting plan.

“What our staff need now is clarity,” CEO Jaan Albrecht said in a statement. “I remain convinced that this path offers us a perspective for the future. The integration could cost OS around €160 million. Forty-three OS pilots have already left.

OS and Tyrolean have formed a team to carry out the integration work by the end of 2012.

SAS divests six Swedish airports properties

SAS Scandinavian Airlines (SK) has announced the latest step in its strategy of focusing on its core airline business through the divestiture of six properties at Swedish airports.

The Scandinavian carrier has signed a sale and leaseback deal with Swedavia, the state-owned group that owns, operates and develops 11 airports across Sweden for the buildings, a mixture of hangars, warehouses, workshops and offices at Stockholm Arlanda (ARN), Gothenburg Landvetter (GOT) and Malmö Sturup (MMX) airports

SK puts a market value of SEK1.77 billion ($263 million) on the deal, adding that the transaction will generate SEK450 million ($66.7 million) and capital gains of approximately SEK350 million ($51.8 million), which will be reported in the second quarter. The annual cost for the lease agreement is neutral, compared with ownership of the properties, said the carrier.

“The transaction is part of our 4Excellence strategy, in which we focus on the core business, while releasing capital and strengthening our financial preparedness,” said Benny Zakrisson, SK EVP-infrastructure and mergers and acquisitions.

SAS Group recorded a net loss last year of $255 million, with fuel costs and its stake in defunct Spanish carrier Spanair (JK) playing their part.

The sales process, which was initiated by SAS in 2011, was implemented in international competition. Newsec Corporate Finance was SK’s advisor in the transaction.

Article Source : ATW Daily News

WestJet commits to Q400s for new regional carrier; 1Q income up 41.6%

WestJet (WS) has signed a letter of intent to buy 20 Bombardier Q400 turboprops, the Canadian low-cost carrier announced Tuesday.

The deal also includes options on a further 25 aircraft.

Calgary-based WS said the aircraft will be operated by its new regional airline, which is expected to launch in the second half of 2013.

It will fly the Q400 on new city routes as well as on existing destinations not currently connected by WS, the carrier said. The airline expects to announce its initial regional schedule in 2012.

WS had considered the Q400 and the ATR 72-600 for its new regional carrier, which has not yet been named.

The carrier reported first-quarter net income of C$68.3 million ($69.4 million), up 41.6% from C$48.2 million in the year-ago period. First-quarter revenue rose 15.3% to C$891 million while expenses lifted 13.4% to C$785.3 million, producing operating income of C$105.7 million, up 32.3% from C$79.8 million last year.

Traffic increased 10% to 4.72 billion RPMs on an 8.8% capacity rise to 5.69 billion ASMs, generating a load factor of 83%, up one point. Yield rose 4.8% to C18.87 cents as RASM rose 6% to C15.66 cents and CASM lifted 4.2% to C13.8 cents. CASM ex-fuel lifted 0.4% to C8.95 cents.

Article Source : ATW Daily News

American streamlines management, cuts jobs

American Airlines (AA) parent AMR Corp., which is restructuring via the Chapter 11 bankruptcy process, on Tuesday announced it will eliminate five manager positions as part of the third phase of restructuring. AMR said the cuts, combined with the previous organizational changes, represents a 20% reduction in the company’s most senior leadership positions.

AMR chairman and CEO Tom Horton said the organization redesign “purposefully began at the top, and today's changes will further advance the company's restructuring objectives and bring us one step closer to ensuring American has the leanest, most capable and effective leadership team in the industry."

AMR said it will consolidate or modify positions, which “illustrate elements of the company’s transformation,” such as combining the positions of VP-New York and international from previously separate positions “to bring a distinct focus on American's New York franchise, its trans-Atlantic and trans-Pacific businesses, and oneworld alliance partners.”

SVP-human resources Jeff Brundage has been replaced by Denise Lynn, who will become SVP-people. AMR did not give details of the other positions affected by the restructuring.

Article Source : ATW Daily News

Spirit 1Q earnings nearly triple to $23.4 million

Florida-based Spirit Airlines (NK) reported first-quarter net income of $23.4 million, almost tripled from a net profit of $7.9 million in the year-ago period.

Spirit president and CEO Ben Baldanza credited the airline’s network expansion as the reason for the result. “Robust demand for our ultra-low base fares with a range of optional services for a fee resulted in our revenue growth outpacing our capacity growth,” Baldanza said in a statement.

Revenue was up 29.6% to $301.5 million while expenses increased 28.4% to $264.3 million, producing an operating profit of $37.2 million, up 38.7% from $26.8 million in the year-ago quarter. NK said the operating performance was “primarily due to increased flight volumes and higher fuel expense,” which increased $27.8 million during the quarter.

Traffic rose 18.8% to 2.2 billion RPMs on a 17.7% increase in capacity to 2.6 billion ASMs, producing a load factor of 84.8%, up 0.8 point. Yield increased 9.1% to 13.74 cents as RASM rose 10.1% to 11.65 cents and CASM increased 9.2% to 10.21 cents. CASM ex-fuel was 5.99 cents, up 5.6%.

Article Source : ATW Daily News

Thai Smile on track to launch in July

Thai Airways International (TG) subsidiary Thai Smile is on track to launch July 7 with twice-daily service from Bangkok to Macau.

TG chairman Ampon Kittiamporn told the National News Bureau of Thailand (NNT) that Thai Smile plans to offer more routes to regional cities as well as to China and India. The carrier will have an all new Airbus A320-200 fleet in an all-economy class configuration although its Smile Plus service will offer 30 premium seats with additional space and inflight services.

Thai Smile’s MD Woraneti Lahprabang told NNT it does not position itself as a low-cost carrier but is operating on a low- to -medium cost base. He said the carrier is tied to mother brand Thai Airways International.

Woraneti told NNT the new lower-cost service was established partly in anticipation of increased intra-ASEAN travel in 2015. According to NNT, he said that with the open skies policy, a number of airlines will compete for the best services in the regional market and their competitive edge lies in their flexible business model and lower operating cost.

Article Source : ATW Daily News

US Airways sets offerings at $623 million for aircraft financing

US Airways (US) has priced two offerings of enhanced equipment trust certificates at approximately $623 million to refinance two Airbus aircraft and to finance 12 Airbus aircraft scheduled for delivery between September and March 2013.

According to US, the $623 million financing includes approximately $380 million of Class A certificates with a final expected distribution date of Oct. 1, 2024, approximately $125 million of Class B certificates with a final expected distribution date of Oct. 1, 2019, and approximately $118 million of Class C certificates with a final expected distribution date of Oct. 1, 2015. The offerings are expected to close May 14.

Article Source : ATW Daily News