AIRLINE NEWS.

Australian airlines outperformed operators in the US and Europe in on- time performance in Jan., according to the first official figures on domestic flight punctuality released by the government. The Bureau of Transport and Regional Services statistics showed that 87.1% of departures and 86.7% of arrivals operated by the major carriers were achieved within 15 min. of scheduled times. Western Australia Regional airline Skywest was the leading performer with 95% of its flights for the month landing and taking off on-time. It finished ahead of Qantas with 87.3% of departures and 89.5% of arrivals conducted on-time, compared to Virgin Blue with 84.4% and 83.8% of departures and arrivals on-time.

Air France signed a new code share agreement with Air Europa for flights between France and Spain that strengthens their existing code sharing

Air India will launch direct service from Los Angeles to Mumbai/Bombay on June 11 2004. The only direct flights available from the West Coast to India, the new thrice-weekly Boeing 747-400 service will reduce flying time to India by several hours. To celebrate the new service, Air-India is offering special roundtrip Introductory Fares (Price depends on departure date):

* $6,499 in First Class

* $3,870-$4,410, Executive Class

* $1,099-$1,590, Economy Class

These special fares are available June 11 to Sept. 30 and are valid for stays of up to six months. Tickets must be purchased by April 30 2004; other restrictions apply. Air-India flight 136 will depart from LAX's Tom Bradley International Terminal B at 7:20 p.m. PST every Wednesday, Friday and Sunday, and arrive in Mumbai at 3:45 a.m. (two days later, local time). Return flight 137 departs Mumbai at 7 a.m. and arrives at LAX at 4:20 the same day. Both eastbound and westbound flights include a brief stopover in Frankfurt to disembark and board passengers. The carrier will continue to offer code-share flights daily from Los Angeles and San Francisco via Singapore Airlines, and from Los Angeles via Malaysian Airlines.

Air Polonia launched twice-weekly flights between Brussels South Charleroi and Katowice. On April 26 2004 the Polish LCC will introduce a thrice-weekly service to Warsaw.

Air Service will start a thrice-weekly service between Brussels South Charleroi and Pescara tomorrow.

AirTran Airways launched a two-day fare sale April 6 for flights to or from Atlanta and Philadelphia. The reduced fares are available for purchase through April 7 and are good for travel through June 16 2004. They require a 14-day advance purchase. Examples of some of the one-way fares are Philadelphia to Boston for $34, to Denver for $119 and to Los Angeles for $99. From Atlanta, the fares range from $69 to Miami and $109 to Las Vegas. Fares are not valid on Fridays and Sundays. Travel is not permitted on May 31 (Memorial Day).

Aloha Airlines has named its First Class Navigator Class and will now refer to coach as Voyager Class. Glenn Zander, president and CEO, said that as other airlines continue to cut back on food and other amenities, "branding our in-flight service as Navigator Class and Voyager Class differentiates what we do and how well we do it." The names reflect Polynesian voyaging canoes. When it takes delivery of new 737-700s, it will name them after stars that guided the navigators to and from Hawaii. Aloha uses all-leather seats in both classes, offers a complimentary Mai Tai and macadamia nuts, and a freshly baked chocolate chip cookie.

American Eagle will start new seasonal service to Nassau, Bahamas, from Dallas-Fort Worth. The carriers will operate one flight daily with a 70 seater CRJ-700 regional jet from June 10 to Sept. 7 and then starting up again on Dec. 15 2004.

In a similar decision to one made by United to terminate its United Connection contract with Atlantic Coast Airlines (ACA), Delta has informed the regional carrier it also will be terminating its Delta Connection contract. The decisions come as ACA prepares to morph into a large, low-fare carrier at Washington Dulles Airport, called Independence Air. It will no longer fly as the regional arm of these major airlines. To prepare for the transition, Delta will be moving 10 regional jets flown by ACA out of Boston to Cincinnati in July, and will discontinue ACA flights from New York. Independence Air intends to operate more than 300 daily departures this summer. The inaugural flight is scheduled for June 16 2004.

British Airways will launch wireless Internet connections in 80 of its main lounges around the world. BA said it anticipates having the technology in the lounges by the end of May 2004.

Cathay Pacific Airways will start daily nonstop service from New York- JFK to Hong Kong starting July 1, 2004. It will be the only daily nonstop between the two cities and, with the continuation of the airline's existing one-stop service via Vancouver, Cathay will be the only airline operating double daily service between New York and Hong Kong. The airline serves 24 cities in the United States, either direct or through code share passenger services. Cathay Pacific will operate the new service with Airbus A340-600 and follow a route over the North Pole. Passengers will save approximately three hours journey time and avoid the inconvenience of an intermediary stop. Currently from the U.S., Cathay Pacific offers double daily nonstop service from Los Angeles to Hong Kong, daily nonstop service from San Francisco to Hong Kong, daily direct service from New York to Hong Kong (increasing to double daily frequency with nonstop service July 1) and daily nonstop service from New York to Vancouver.

Delta is now planning hourly flights to Philadelphia from Atlanta starting June 1 2004. Delta said the increase is a response to increasing demand for business and leisure travel to the city. Its flights from Atlanta will begin at 6:40 a.m. and end at 9:40 p.m. From Philadelphia they begin at 5:40 a.m. and end at 7:40 p.m. Separately, Delta announced that CFO Michele Burns is leaving at the end of April to work for Mirant Corp. in Atlanta. The airline has not yet named a replacement.

Delta Air Lines says it and its fellow SkyTeam members are gearing up for an increase in international travel this summer. So far this year, international traffic is up 6 percent, and that should continue throughout the rest of the year, said Paul Matsen, Delta senior VP of international and alliances. The International Air Transport Association is predicting a 7 percent annual growth in global passenger traffic. There will be several new flights this summer by Delta, which will also be adding new or expanding code sharing flights with Aeromexico, Air France, Alitalia, China Airlines, China Southern, Emirates and Korean Air.

Delta Air Lines will increase its international service by expanding its own flights and placing its code on flights operated by its SkyTeam partners. In April it will launch a second daily flight from Atlanta to Cancun and two weekly flights from Atlanta to St. Lucia. It also is adding two new daily flights from New York JFK to San Juan. In May, the carrier will begin new daily service from Cincinnati to both Amsterdam and Rome and a second daily Atlanta-Munich flight. June additions include daily flights from JFK to Santo Domingo, a thrice-weekly JFK to Athens flight and new service from Cincinnati to Cancun. This summer Delta will place its code on flights to destinations in Europe, Asia and the Middle East operated by AeroMexico, Air France, Alitalia, China Airlines, China Southern, Emirates and Korean Air. In addition, it will expand its code share agreement with Continental and Northwest to include flights to 11 cities in the Caribbean, 12 in Latin America and 14 in Canada.

Emirates will launch thrice-weekly service from Dubai to Christchurch via Melbourne June 10 using an A340-500. The service will double to six times weekly Aug. 1 2004.

Emirates will offer in-flight e-mail service across its fleet using Tenzing software. The system will be installed initially on new A340- 500s beginning in the first quarter of 2004 and progressively across the entire fleet.

Hawaiian Airlines has received the last governmental approval it needed before its May 18 2004 expansion to Sydney. The airline has received its international airline license from Australia's Department of Transport and Regional Services, clearing the carrier for the launch of four nonstop roundtrips a week between Honolulu and Sydney. The route marks Hawaiian's return to this market after an absence of more than a decade. In related news, Hawaiian and Boeing Capital Corp. again have agreed to extend lease negotiations, this time through May 31. At issue are agreements for 11 Boeing 717-200 aircraft for its inter-island network and three Boeing 767-300ER planes for transpacific service that Hawaiian leases directly from BCC or through BCC-controlled trust arrangements. The latest extension is subject to approval by U.S. bankruptcy court.

Hawaiian Airlines is alerting consumers to a ticketing scam for a package of mainland tickets. An Asian man, about 50 years old who walks with a limp and calls himself either Wayne or Dwayne of Wayne Travel Discount is selling five roundtrip mainland tickets with a sixth for free for $250 apiece. Customers must pay up front, and the first ticket is actually sold through a bona fide travel agency at a higher fare than the one he is advertising. But they find that the other five tickets are invalid when they go to use them. Keoni Wagner, VP of public affairs, said "Unless you're booking directly with Hawaiian online or through our reservations department, we recommend that travelers purchase tickets through a licensed, professional travel agent." Anyone who thinks they may have been scammed should file a report with the police and call Hawaiian's customer advocate line at 808-838-3500.

Iberia will adopt a two-class service product on A340 long-haul services, eliminating first class in favor of an enhanced business- class cabin with lie-flat seat beds, audio-video on demand, satellite phones and text messaging. It will invest eur100 million ($125 million) to equip 31 A340s with the new product, which will be rolled out on the airline's first three A340-600s in Oct. and installed across the fleet by the end of 2005.

Icelandair says it has a goal of distributing half of all of its tickets electronically by the end of this year.

Jet2.com launched routes to Venice, Nice and Murcia from Leeds Bradford. A new Belfast International Airport to Prague service commences April 29 2004. The LCC, a subsidiary of aviation services and distribution conglomerate Dart Group, launched operations in Feb. 2003 and now serves 12 European destinations.

JetBlue Airways, which already offers passengers 24 channels of live DirecTV programming in-flight, reached agreement with XM Satellite Radio and News Corp., a media and entertainment conglomerate, under which the airline will add up to 100 channels of digital satellite radio and movies to its in-flight entertainment system. JetBlue said it expects to introduce the system on its fleet of A320s in 2004 and on its new fleet of Embraer 190s as they are introduced into service beginning in 2005.

Jetsgo will launch a discount shuttle between Toronto and Montreal April 19 2004. The service will operate hourly from 7 a.m. to 7 p.m. local time on weekdays. There will be a total of 14 flights each way with the last flight leaving from Montreal at 8:30 p.m. and from Toronto at 10:30 p.m. During the summer months of July and Aug., frequency will be eight flights a day each way. The regular schedule will return Sept. 7 2004.

KLM will operate daily service to Tokyo, Beijing and Shanghai this summer, deploying the new 777 on flights to Tokyo and Shanghai. Beijing will be served using 747-400s. KLM and Northwest will boost flights between their respective Amsterdam and Minneapolis/St. Paul hubs from two to three daily and the number of weekly services to Houston, which serves as partner airline Continental's hub, will rise from seven to nine. Additionally, weekly flights to San Francisco will increase from six to seven and to Vancouver from five to seven. Capacity will grow on KLM's daily flights to Toronto as a 747-400 replaces an MD-11 on the route. Service to Aruba and the Netherlands Antilles also will increase this summer. Bonaire will be served with 11 weekly flights, Curacao with seven, St. Maarten with two and Aruba with five.

Lufthansa's new $350 million business class product, which includes a new flatbed seat concept and upgraded in-flight entertainment system, will first appear on Lufthansa's new Airbus A340-600, which will begin service next week. The carrier will also add the new product on its new A330-300 aircraft and retrofit existing aircraft with the business class product early next year.

Northwest Airlines said it selectively matched an $8-$9 roundtrip domestic price increase imposed by Delta Air Lines on all of its fares in markets served with connecting flights.

OneWorld partner airlines continue to expand their code sharing links. The latest is between American and British Airways, now that the AA code has been placed a number of BA flights at London Gatwick. BA also has placed its code on American flights to 26 destinations in the U.S. and Latin America. BA also has increased its code sharing with Iberia. The Spanish airline now code shares on BA flights from London Heathrow to Dubai, Montreal, Toronto and Vancouver. Iberia also places its code on U.K. carrier Comair to Cape Town, Durban and Port Elizabeth from Johannesburg. BA is placing its code on Iberia flights between Barcelona and Munich. Swiss, which will join the alliance later this year, is also code sharing with BA.

Orbitz has added activities and services to its online offerings. Users can now book airport shuttles, theme park tickets, sightseeing tours and activities such as deep-sea fishing and winery tours. The activities can be booked at the same time as the air, hotel or vacation package.

Qantas will be the major investor in a new Singapore-based low-fare airline that intends to fly on intra Asian routes. Qantas CEO Geoff Dixon says the airline will fly to cities within five hours of Singapore. It will operate either the 737-800 or the A320. Qantas currently does not fly in any of the main routes being planned by the new airline. Qantas will own 49.9 percent of the yet-to-be-named venture. Well-known Singapore financiers Tony Chew and F.F. Wong will own 21.1 percent and 10 percent, respectively. Holdings Limited will own the remainder. Separately, beginning in December Qantas, will offer the only direct link between Adelaide and Auckland, New Zealand. It will fly three times a week with two classes of service.

Singapore Airlines signed a code share agreement with bmi. The carrier added its code on five bmi routes, Belfast, Brussels, Dublin, Edinburgh and Glasgow, that connect from any of SIA's thrice-daily Singapore- London Heathrow flights.

Singapore Airlines has become the launch customer for Boeing's new Airplane Health Management system that monitors the health of aircraft in flight and relays the information in real time to the ground. Primary source of the data is the central maintenance computer or condition monitoring system. Boeing said AHM also can collect electronic logbook data from the new Electronic Flight Bag being introduced on the 777-300ER.

Song, Delta Air Lines' low-fare carrier, said that 75% of its fleet has been outfitted with its in-flight entertainment system and it is on schedule to complete the entire fleet by March 31 2004. Song's IFE system will feature live satellite television, video on demand pay-per- view movie programming, MP3 audio programming and interactive video games.

Southwest Airlines Chairman Herb Kelleher told the World Affairs Council there that the airline will add 14 more daily nonstops to its previously announced schedule, effective July 6 2004. By mid-summer, it will be operating 28 daily nonstops from Philadelphia. Just the day before, US Airways CEO David Siegel told employees in an Internet broadcast that the airline must drastically reduce costs because "Southwest is trying to kill us." He also revealed Southwest's plans to add flights in July to West Palm Beach, Fort Lauderdale, New Orleans, Houston Hobby, Los Angeles, and Raleigh-Durham.

US Airways will paint 10 aircraft in a new Dot-Com livery to remind customers that they can book their flights from Usairways.com. The aircraft will also have the logo "No booking fees. No brainer" as part of an advertising campaign that will proceed this month. Ben Baldanza, senior VP of marketing and planning, said, "We want to significantly raise awareness of the consumer benefits of buying at usairways.com, including the fact that we do not charge service fees like many other sources."

US Airways said Expedia customers now can purchase its tickets through all Expedia points of sale. Last December the airline said it no longer would sell its tickets through Expedia following the online travel website's decision to raise the booking fee it charges customers to purchase US Airways tickets from $5 to $8.99.

Virgin Atlantic Airways intends to launch new routes from London to Australia, Cuba and the Bahamas while increasing existing service to the U.S., Caribbean, Asia and the Far East in the next two years. And it will be adding an additional 1,400 employees over the next year. Chairman Richard Branson said the New York-London route for business travel has been "incredibly strong in recent weeks," while its London- Gatwick flights to the Caribbean and Florida are popular with leisure travelers. He said in the next year the carrier will begin to serve Sydney, Havana and Nassau. In the next two years, it will take delivery of six A340-600s.

Virgin Atlantic Airways will operate additional seasonal service to London from Boston, Washington and Newark June 1-Oct. 30 2004. It will add three flights per week between London and both Boston and Washington as well as one weekly Newark service.