Qatar Airways boss accuses Delta of flying 'crap' planes

The chief of Qatar Airways on Monday denied his company receives subsidies and accused rivals Delta Air Lines of flying "crap" older planes, escalating hostilities between Gulf and American carriers.

Speaking at an arts conference in Doha, Akbar al-Baker said any money his airline receives from the state is in the form of "legitimate" equity and added his company's fleet of aircraft were much cleaner for the environment in comparison to Delta.

"I think Mr Anderson (CEO of Delta, Richard Anderson) doesn't know the difference between equity and subsidy. We never receive any subsidy," Baker said.

He was responding to claims made earlier this month by three US airlines - Delta, American and United - that Qatar, along with carriers in the United Arab Emirates have received US$42 billion in unfair subsidies to wrest business away from competitors.

Baker also accused Delta of flying "crap airplanes that are 35 years old", when talking about pollution by the aviation industry.

In contrast, Baker said Qatar Airways had an "ultra-modern fleet" and was the lowest CO2 contributor in the aviation industry.

SOURCE

Joint ventures between airlines result in consumer benefits: CCS

A recent market study on the aviation industry in Singapore has found consumer benefits resulting from joint ventures between airlines.

The Competition Commission of Singapore (CCS) had commissioned the study, which focused on two joint ventures in particular -- the agreement between Japan Airlines and American Airlines and the one among United Airlines, Continental Airlines and All Nippon Airways.

In a statement on Tuesday, CCS noted that airline joint venture agreements are inherently anti-competitive, as they typically involve price fixing, market sharing or output limitation.

But it said there is a need to carefully assess such agreements, as they can sometimes generate substantial benefits to consumers, such as lower airfares, more choices in connectivity and better service.

When an agreement generates such benefits, CCS may grant it anti-trust immunity.

The study, which was carried out by external consultants ICF SH&E, found that the two joint ventures have resulted in higher passenger numbers and lower fares.

But the improvements were smaller than those reported in Western literature on airline joint ventures in the US and Europe.

In particular, the significant drop in passenger fares found in literature based on US flight data were not replicated in the joint ventures formed in, or operate in, Singapore and the Asia Pacific region.

Still, the agreements resulted in other benefits such as improved flight schedules and increased capacity.

CCS said to date, it has reviewed eight airline joint ventures agreements, with the consideration that any substantial lessening of competition should be carefully weighed against the extent of consumer benefits that the agreement may generate.

It said it will continue to monitor developments in the aviation market in Singapore.

More information on the study may be found at the CCS website.

SOURCE

Brazil's Embraer meets jet delivery targets for 2013

Brazil's top aircraft manufacturer Embraer said on Wednesday said it met its aircraft delivery targets for 2013 following strong sales in the fourth quarter.

A company statement said a total of 209 aircraft were delivered, including 90 commercial jets and 119 light and large executive jets.

The company had set delivery targets of between 90 and 95 commercial aircraft, 80 and to 90 light executive jets and 25 to 30 larger executive jets.

Embraer, based in Sao Jose dos Campos near Sao Paulo, said its order backlog stood at US$18.2 billion the end of 2013.

The strong performance in the fourth quarter included a huge order for 60 E175 jets from American Airlines in a contract valued at US$2.5 billion.

Embraer last month said the deal includes an option for American Airlines to buy another 90 E175s, which could bring the total order to 150 aircraft.

Embraer is the world's third largest commercial aircraft manufacturer behind Boeing and Airbus.

SOURCE

American Airlines orders 90 jets from Embraer, Bombardier

American Airlines kicked off its freshly minted status as the world's largest carrier on Thursday with an aggressive order for $3.9 billion worth of regional jets from Brazil's Embraer and Canada's Bombardier.

Three days after completing its merger with US Airways, the new American said it had inked deals to buy 30 CJR900 NextGen aircraft from Bombardier, and 60 Embraer E175s.

Bombardier said its deal was worth $1.42 billion, while Embraer put a $2.5 billion value on its order.

American also has options to buy an additional 40 CJR900s and 90 E175s.

American said the 76-seat regional jets ordered will replace less efficient 50-seat jets it currently operates on short- and medium-haul flights.

They will all be flown under the American Eagle regional brand.

The CJR900s, which will be delivered beginning in the second quarter of next year, will be configured with 12 first-class seats, 32 "main cabin extra" seats and 32 regular seats, American said.

The E175s, the first of which will arrive in the first quarter of 2015, will have 12 first-class, 20 main cabin extra and 44 regular seats.

All of the aircraft will be powered by General Electric CF34-8 engines, American said.

"Now that we've closed our merger with US Airways, we can deliver a top-tier regional product that offers a first-class cabin, main cabin extra and in-flight wi-fi -- important elements of an improved flying experience for our customers," said Kenji Hashimoto, American's senior vice president for regional carriers.

The new aircraft "will greatly improve economic efficiencies by lowering operating costs," he said in a statement.

Including this latest order from American Airlines, Embraer, the world's third-largest commercial aircraft manufacturer behind Boeing and Airbus, said it has received orders and options for more than 700 E-jets from US airlines this year.

Paulo Cesar Silva, president and chief executive of Embraer Commercial Aviation, hailed the "remarkable order" from American.

"American achieved impressive results with the ERJ145 aircraft family, and we are sure that will continue with the E175," he said.

Mike Arcamone, president of Bombardier Commercial Aircraft, said the CJR900 offers major cost savings on fuel and a lower environmental impact, which with its "outstanding" cabin amenities, are "all core priorities for today's competitive airlines".

The order is the first announced after American completed on Monday its merger with US Airways, a combination that made it the world's largest carrier.

The merger came after the two agreed to give up a number of slots and other rights at several US airports to satisfy the concerns of US antitrust authorities who feared the new American would over-consolidate the power of the country's top four carriers and hurt consumer choice.

It also came as American itself emerges from bankruptcy reorganisation.

The $11 billion merger was first announced in February, but was held up by an antitrust lawsuit from the US government and backed by several states, worried about the combined airline's potential monopoly power.

The shares of the new American, which began trading Monday on the Nasdaq exchange under the AAL symbol, were up 1.7 percent at $26.44 in early trade Thursday.

SOURCE

New American Airlines emerges as world's top carrier

American Airlines and US Airways merged on Monday to create the new American Airlines, the world's largest airline, after overcoming concerns that it will hurt competition and raise travellers' costs.

AMR Corporation, the former parent of American Airlines, and US Airways Group announced in a statement they had completed the deal after AMR emerged from bankruptcy protection.

The new American Airlines Group is a goliath, providing nearly 6,700 daily flights to more than 330 destinations in more than 50 countries.

"Our people, our customers and the communities we serve around the world have been anticipating the arrival of the new American," said Doug Parker, chief executive of American Airlines and the former chairman and CEO of US Airways.

"We are taking the best of both US Airways and American Airlines to create a formidable competitor, better positioned to deliver for all of our stakeholders. We look forward to integrating our companies quickly and efficiently so the significant benefits of the merger can be realised."

The plan to create a third giant carrier to compete with US rivals United and Delta cleared a major hurdle in November after the Justice Department announced a settlement to resolve antitrust complaints seeking to block the merger.

Under the agreement, AMR and US Airways are giving up slots and other rights at seven key airports to low-cost airlines.

The agreement was joined by six states and Washington, DC, which also sought to block the merger, saying the new airline would have near-monopoly power in some routes and airports.

The two airlines are abandoning a significant number of slots at two of the busiest airports on the East Coast -- 34 at New York's La Guardia and 104 at Washington's Reagan National.

The new American is committed to maintaining hubs in New York's Kennedy International, Los Angeles, Miami, Chicago's O'Hare, Philadelphia, Phoenix and Charlotte for three years.

The companies said on Monday there would be no immediate change to their operations. The integration of the two companies to achieve a Single Operating Certificate is expected to take approximately 18 to 24 months, they said.

As part of the combination, US Airways will exit Star Alliance on March 30 and will enter the next day the oneworld alliance, joining American with a group of airlines including British Airways, Cathay Pacific, Japan Airlines and Qatar Airways.

"Customers will begin to see enhancements to their experience in early January, including the ability to earn and redeem miles when travelling on either American Airlines or US Airways, reciprocal American Admirals Club and US Airways Club benefits, and reciprocal elite recognition," the companies said.

The new American Airlines is expected to generate more than US$1 billion a year in synergies by 2015, they said.

American, which filed for bankruptcy protection in late 2011, won approval from the bankruptcy court in September to go ahead with the US$11 billion merger plan announced in February.

The August antitrust lawsuit stalled the merger, which the companies had expected to complete during the third quarter after garnering the approval of shareholders, creditors and European regulators.

The lawsuit argued that the tie-up would mean four airlines -- which it said have a history of "tacit coordination" instead of competition -- would control more than 80 per cent of the US commercial air travel market.

US Airways and American alone compete directly on more than 1,000 routes, it argued.

Shares in American Airlines began trading Monday at US$23.95 on the Nasdaq exchange under the ticker symbol AAL. After 90 minutes of trade, the stock was at US$24.49, after trading as low as US$23.45.

SOURCE

Merged American Airlines to land on Nasdaq

American Airlines and US Airways, essentially cleared for merger next month, on Friday said that the combined company, the world's biggest airline, will trade on the Nasdaq Stock Market.

American's parent, AMR Corporation, and US Airways Group knocked down a major hurdle for their merger Tuesday by agreeing to drop airport slots and other rights at key airports in a proposed deal settling a Justice Department antitrust lawsuit.

Court approval of the deal appeared likely, and the two companies announced plans for the new American Airlines to debut on the tech-rich Nasdaq, abandoning the rival New York Stock Exchange where US Airways currently trades.

American used to be listed on the NYSE but is now being traded over the counter as it undergoes Chapter 11 bankruptcy reorganization.

"Upon closing of the merger and AMR's emergence from Chapter 11, the combined company will be renamed American Airlines Group Inc. and will use the ticker symbol AAL," the companies said in a joint statement.

US Airways and AMR common stock will be cancelled and current investors will receive shares in the combined group under the merger terms.

The companies expect to complete the merger in December.

"Today we moved another step closer in our preparations to launch the new American Airlines. NASDAQ offers a most advanced trading platform driven by innovation and efficiency -- qualities that complement the new American," Tom Horton, AMR chairman, president and chief executive, and incoming chairman of the new American, said in the statement.

"We are very excited about the listing of our shares on the NASDAQ Global Select Market," said Doug Parker, chairman and CEO of US Airways, and incoming CEO of the new giant airline.

The head of Nasdaq OMX, operator of the Nasdaq Stock Market, Bob Greifeld, welcomed the planned market debut.

"We are pleased to have the new American Airlines call NASDAQ home and we look forward to celebrating many milestones with the company and its shareholders in the years to come," Greifeld said in the statement.

Nasdaq OMX crowed on Twitter about landing the big global airline. "SHARE this historic switch:@AmericanAir will be traded on #NASDAQ$AAL," it tweeted.

US Airways shares closed almost 1.0 per cent higher, AMR lost 1.5 per cent in over-the-counter trade and Nasdaq OMX dipped 0.3 per cent.

Shares in Intercontinental Exchange, which took over the NYSE Euronext on Wednesday, were up 1.6 per cent.

SOURCE

Mexican airport suspends operations due to volcano

A handful of US flights were cancelled at two Mexican airports on Friday after ash from a nearby volcano fell in central Mexico, authorities said.

Alaska Airlines voluntarily cancelled a flight from Los Angeles to Mexico City's international airport and the later trip back to California, airport spokesman Jorge Gomez told AFP. The rest of the airport, however, was operating normally.

The small airport of the central city of Puebla, located just 25 kilometres (15 miles) from the Popocatepetl volcano, suspended its operations as a safety precaution "due to the abundant presence of ash," the transportation ministry said in a statement.

This forced the cancelation of six flights, including a United Airlines flights to Houston, Texas, an American Airlines trip to Dallas, Texas, and four domestic routes operated by Mexican carriers Volaris and Aeromexico, it said.

Two cargo flights were also affected, the ministry said, adding that clean up crews were deployed to pick up ash from the runway and roads.

The Popocatepetl volcano has been rumbling periodically since May, spewing huge columns of ash that prompted several US airlines to cancel dozens of flights into and out of Mexico City last week.

Last Saturday, authorities raised the alert level around the volcano to Yellow Phase III, one notch below evacuations of residents who live near the 5,452-meter-high (17,887-foot-high) "Popo," as it is locally known.

The Mexican capital is only 55 kilometres (35 miles) from the snow-capped volcano.

In its latest bulletin, the National Disaster Prevention Centre reported that the volcano had spewed steam and ash accompanied by medium intensity explosions early Friday that blew glowing rocks up to two kilometres (1.2 miles) from its crater.

SOURCE

Volcanic ash is a pain in the butt for commercial aviation. It is highly damaging to jet engines and airlines will not want to risk flying in unsafe airspace. Flight cancellations will cause losses for them, but when safety is concerned, some profit will have to be compromised.