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Airline Finance News - Europe.

Dec 31, 2006

European Commission yesterday decided to partially exclude Bulgaria, which is set to become a full EU member in January, from the internal aviation market. Bulgarian airlines will not be considered as "community carriers" and will continue to operate as "third-country operators" to and from member states in accordance with existing bilateral agreements. The decision follows EASA inspections in the past two years that revealed problems with the Bulgarian CAA's ability to exercise adequate oversight of aircraft personnel and maintenance organizations. "These deficiencies are considered by the Commission serious enough to adopt the safeguard clause," the EC said. Dec 21, 2006


Alitalia was hit by a 24-hr. strike Friday that forced the cancellation of hundreds of flights, including many scheduled for Saturday, the airline said. Press reports said workers were protesting the carrier's pending privatization. Dec 18, 2006

British Airways, BWIA West Indies Airways, Caribbean Airlines

British Airways purchased BWIA West Indies Airways' seven coveted slot pairs and landing rights at London Heathrow for no more than [pounds sterling]5 million, according to press reports in Trinidad & Tobago. BWIA will be shut down and replaced by Caribbean Airlines in January. Dec 19, 2006

CSA Czech Airlines

CSA Czech Airlines revealed that it expects to turn a 2007 profit of CZK42 million ($2 million), a reversal from the CZK493 million it expects to lose this year. Its 2007 business plan projects a 5.6% increase in passenger volume to 5.7 million and includes the sale and leaseback of five 737-500s. Dec 26, 2006

CSA Czech Airlines

CSA Czech Airlines said employee reductions and a more efficient organizational structure will produce CZK100 million ($4.7 million) in savings next year even though costs will rise as a result of existing labor agreements. It intends to shed approximately 200 of its 5,300 employees during the first quarter. Dec 21, 2006


Finnair flew 1.36 billion RPKs in November, a 2.3% increase from the year-ago month. Capacity grew 1.9% to 1.97 billion ASKs and load factor rose 0.3 point to 69.2%. Dec 26, 2006


Iberia flew 4.2 billion RPKs in November, a 10.5% increase over the year-ago month. Capacity rose 5.9% to 5.37 billion ASKs, lifting load factor 3.2 points to 78.1%. Dec 21, 2006


Lufthansa signed an MOU to sell its 50% stake in leisure travel group Thomas Cook to KarstadtQuelle for [euro]800 million ($1.05 billion) but will raise its stake in Condor Flugdienst from the present 10% to 24.9% and receive the shares held by Condor in Turkish holiday airline SunExpress. Dec 26, 2006

Lufthansa, Thomas Cook, KarstadtQuelle

The accord still requires the approval of both the Lufthansa and KarstadtQuelle boards and relevant regulatory authorities, Lufthansa said, adding that the transactions are scheduled to be finalized in the 2007 first quarter. LH and KarstadtQuelle each currently hold a 50% stake in Thomas Cook and Condor is presently 90% owned by Thomas Cook. Dec 26, 2006

Swiss International

Swiss International Air Lines CEO Christoph Franz said at the Star Alliance meeting in Istanbul earlier this month that the carrier no longer is in a crisis situation but that it will have to add liquidity to be safely positioned for the future. It will stay cautious in 2007 and not open any new long-haul destinations until 2008, he said. "We are not satisfied," he added. "It is not our goal to just maintain our position. We have to increase our liquidity in this more competitive environment." He said that on the cost side most improvements already have been implemented, but that "there are many things to make better" in terms of cost efficiency around the company. He cited a reduction in aircraft check turnaround times from 27 to 23 days as an example. Dec 18, 2006

Thomas Cook, KarstadtQuelle, Lufthansa

KarstadtQuelle Buys Thomas Cook. KarstadtQuelle said on Friday it had bought Lufthansa's 50 percent stake in Europe's second biggest tourism firm Thomas Cook for EUR800 million (USD$1.05 billion) to boost its presence in the tourism sector. Dec 22, 2006


TUI to merge airlines, buy 41 aircraft, cut 3,600 jobs. TUI said regarding its cost-cutting program, savings of [euro]150 million will come from materials and [euro]100 million from personnel, meaning the loss of 3,600 jobs in the tourism division including 2,600 in the UK and 400 in Germany. It said more than 3,300 new jobs will be created "by certain segments" in 2008. It also intends to reduce corporate costs to [euro]70-[euro]80 million from [euro]112 million by 2008 and merge its TUI Deutschland operating business into TUI AG. It is targeting a 2008 profit of [euro]450-[euro]550 million. Dec 18, 2006

TUI, Hapag-Lloyd Express

TUI confirmed speculation that Hapagfly and Hapag-Lloyd Express will combine under the new name "in order to secure access to the low-cost, Internet and modular tour growth markets," with the remaining five TUI airlines (Thomsonfly, TUIfly Nordic, Arkefly, Corsair and Jetair) joining the fold in 2008. The strategy will have an earnings impact of [euro]60 million by that time, the company said. "With, a European brand, it will be easier to address customers. At the same time, the new brand...will be an essential element of TUI's new Internet strategy," it said. Dec 18, 2006


Editor: Aram Gesar, eMail:

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Dec 11, 2006
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Publication:Airguide Online
Date:Jan 15, 2007
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