American's new deal with BA, Iberia

American Airlines, Iberia, and British Airways announced earlier today that they were forming a three-way alliance that would allow them to cooperate on flights between Europe and North America. Although the three airlines are already part of the oneworld alliance, the deal allows them to work more closely together and to cut costs. Not surprising, Virgin Atlantic's Richard Branson took a dim view of the deal, which he said would create a "monster monopoly".

The announcement comes at a time when other airlines are also seeking to link up: United, Continental, Air Canada and Lufthansa are working on a transatlantic alliance, similar to the AA/Iberia/BA one announced today.

Farnborough Airshow Review, Day 3

A quick summary of orders at the Farnborough Airshow on July 16:

Boeing

• Malaysia Airlines ordered 35 737-800s.
• Aviation Capital Group ordered 15 more 737-700s.

Airbus

• Netherlands-based lessor AerCap launched the A320/A321 freighter, with an order for 30.
• Asiana Airlines ordered 30 A350 XWBs, with 10 options.
  

American to retire A300

photo by Vidiot

American Airlines CEO Gerard Arpey said earlier today that the airline's fleet of Airbus A300s, which were due to be retired by the end of 2012, will instead be phased out by the end of 2009. Right now, the type is based at either JFK or Miami (there still is a significant AA A300 presence in San Juan, but this has declined as AA has started to downsize operations there slightly) and flies mainly on routes to and from the Caribbean. The A300 is also a pretty versatile aircraft - it's used on AA's Miami - Orlando route three times a day.

It's unclear as to what American will replace the A300 with, but they might not choose to replace it at all. Instead of going for higher capacity, AA might just choose to have higher fares for fewer seats.

Farnborough Airshow Review, Days 1 and 2

The Farnborough 2008 Airshow, which runs from July 14 to 20, is the first major airshow to be held since the Paris Air Show last June. Boeing VP Randy Tinseth pointed out on his journal a few ways that the aviation world has changed since the Paris show:

• There have been 2,678 commercial airplane orders (Boeing and Airbus)
• Oil has gone from $67/bbl to $134/bbl
• Jet fuel has gone from $2.12/gal to $3.92/gal
• The U.S. dollar has gone from 0.75 euros/dollar to 0.64 euros/dollar, and from 123 yen/dollar to 107 yen/dollar
• The market has continued to liberalize with “open skies” between the EU and the U.S.
• And worldwide aviation traffic continues to grow

The economic situation that the airline industry's in has only gone downhill since last year, so some expect that, as a result, there will be fewer orders announced at this year's airshow. So here's a quick summary of the orders placed from days 1 and 2 (July 14 and 15). It should also be noted that Airbus tends to "save up" announcing orders until airshows, while Boeing tends to announce them on a more regular basis.

Boeing

• Dubai-based low-cost startup FlyDubai ordered 50 737-800s, worth $3.74 billion at list prices.
  
• Ethiad Airways ordered 35 787-9s and 10 777-300ERS, worth $9.4 billion.
• Nigerian airline Arik Air announced an order for seven more 737s.

Airbus

• Aeroflot ordered five A321s.
• Dubai-based Aircraft lessor DAE Capital ordered 30 A350-900s and 70 A320s.
  
• Aviation Capital Group ordered 23 A320 family aircraft.
• Tunisair ordered three A350-800s, three A330-200s and ten A320s.
• Qatar Airways ordered four A321s.
• Ethiad Airways ordered 20 A320s, 25 A350 XWBs and 10 A380s.
  
• Saudi Arabian Airlines ordered eight A330s.
  

Northwest to cut 2500 jobs, add fees

photo by caribb

Northwest Airlines announced yesterday that it would be laying off 2,500 employees in all groups of positions (pilots, mechanics, flight attendants, and other employees), but that it would first be looking for volunteers to leave the company. A variety of "voluntary programs including early-out programs, voluntary leaves, work rule modifications and attrition" will be offered, with the airline moving to furloughs as a last resort.

“Our fuel costs have more than doubled in the past year,” said Doug Steenland, President and CEO. “In order to manage through this unprecedented fuel challenge, we have to take action to both control costs and increase our revenue... These reductions are the direct result of our extraordinary fuel costs and the necessary actions we must take to right-size our airline and eliminate unprofitable flying." Last month, Northwest said that it would reduce its system capacity by 8.5%.

In additions, the airline is introducing a set of new fees: for travel in the US and Canada, it will charge $15 for the first checked bag, $25 for the second and $100 for three or more checked bags. Northwest also rolled out new fees for using frequent flier miles as well as ticket changes. Steenland said, “We expect these three incremental revenue enhancing measures to generate $250 million to $300 million a year, which will help ease the burden of these record high oil prices.”

Vladivostok Avia starts US service

For those of you in the US who have been wanting to fly on a Russian-built aircraft, here's a new opportunity: Vladivostok Avia has started seasonal twice-weekly service from Anchorage to Vladivostok, via Petropavlosk-Kamchatsky. The first flight, which arrived in Anchorage on Monday morning, was flown by a Tupolev TU-154, although the airline has said that the route will be flown with newer Tupolev TU-204 airplanes. The flights will be carried out until September 15, and if this summer's flights are a success, the airline might continue them next summer.

BA's OpenSkies to merge with L'Avion

British Airways has announced that it will purchase Paris-based premium carrier L'Avion to add to its OpenSkies premium transatlantic subsidiary. The deal, which only set back BA $52 million in cash, will be completed this month, and OpenSkies will formally combine with L'Avion shortly thereafter.

In a statement, British Airways head Willie Walsh noted that "L'Avion is a successful airline that has built up a premium business in a relatively short period. It has many synergies with OpenSkies and buying it provides a larger schedule and an established customer base."

L'Avion flies Boeing 757-200 aircraft from Paris Orly to Newark, and is the last of the independent premium transatlantic airlines surviving - MAXjet, Silverjet, and EOS have all become victims of higher oil prices.