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Monday September 4, 2006

Northwest Airlines reported a net profit of $101 million in July in a filing to the US Securities and Exchange Commission. Operating revenues totaled $1.2 billion and expenses came to $1.02 billion, resulting in a $180 million operating profit. It recorded $39 million in reorganization costs.

Meanwhile, both the airline and its flight attendants, represented by the Assn. of Flight Attendants-CWA, were awaiting a ruling late Friday from US District Judge Victor Marrero on whether work actions can go ahead. Marrero granted NWA's request for a temporary injunction on Aug. 25 but did not say when he would issue a final decision. (ATWOnline, Aug. 28). The union said last week that it was not interested in returning to the negotiating table if it was denied the right to self-help.

Lufthansa remains in negotiations to sell its 50% stake in tourism firm Thomas Cook, including leisure carrier Condor Airlines, to co-owner KarstadtQuelle. Lufthansa board member Stefan Lauer confirmed discussions but told journalists last week in Frankfurt that "they are a long way from being finished." The German retailer has been after LH's holding in Europe's second-largest tourism company for some time. The unit returned to profitability last year, but LH has said Cook is not a core business. KarstadtQuelle could pay €800 million for the share, Der Spiegel reported.

The talks open yet another scenario on the recently volatile German airline landscape, which has been altered by Air Berlin's acquisition of dba (ATWOnline, Aug. 18) and TUI's decision to merge Hapagfly and Hapag-Lloyd Express (ATWOnline, Sept. 1). LTU German Airlines MD Juergen Marbach was quoted by several German sources as saying that Condor and LTU, which is owned by dba's former owner, the mercurial Hans Rudolf Woehrl, would make ideal partners. An LTU spokesperson would not comment on the speculation, but industry insiders say the airlines' networks and business models are complementary. TUI said following the AB/dba merger that it will evaluate partnerships with other carriers. Condor operates 14 A320s, one 757-200, 13 757-300s and nine 767-300ERs. LTU has a fleet of nine A320s, four A321s, eight A330-200s and four A330-300s.

by Kurt Hofmann

FlyMe of Sweden will triple its fleet to 15 aircraft with the acquisition of 51% of Astraeus, a UK charter carrier, in a deal wroth SEK82.7 million ($11.4 million) expected to be completed within the next month. Astraeus transports 800,000 passengers each year, employs 391 and boasts annual revenues of SEK1.2 billion. It operates four 757-200s, four 737-300s and two 737-700s based at London Gatwick and Manchester and flies several routes to Africa. FlyMe has five 737-300s. "There are great synergy effects between FlyMe and Astraeus. The acquisition gives us more optimum utilization of our joint fleet due to the matching seasonal variations," newly appointed FlyMe CEO Finn Thaulow said. This is FlyMe's second major purchase this year. It bought a one-third stake in Lithuanian Airlines in February (ATWOnline, Feb. 16).

Assn. of Asia Pacific Airlines DG Andrew Herdman assailed recent "unduly onerous" airport security changes as a "knee-jerk" reaction to the foiled transatlantic bombing plot. Herdman said "radically new" security measures, such as banning liquids and gels from carry-on luggage, defy "common sense and practicality." He added that "good security is about threat assessment and balanced risk management" and rejected the idea that airline passengers should be forced to comply with "restrictions that would be considered ludicrous in the context of other modes of transport or daily activities."

KLM will adjust its service to the Netherlands Antilles and Aruba over the next year in response to what it called "changing market conditions." From summer 2007, all flights will be aboard MD-11s instead of the present mixed fleet of 426-seat 747-400s and 282-seat MD-11s. The MD-11s will be "radically modernized" in the coming months to bring the product in line with the World Business Class and economy class standards of KLM's new 777s and A330s. Frequencies will be reduced. Aruba will be served four-times-weekly, twice in combination with Bonaire and twice with St. Maarten. Bonaire also will be served five-times-weekly to and from Ecuador. Daily flights to Curacao will be nonstop.

Air Berlin will begin six-times-weekly Oviedo-Palma de Mallorca service on Nov. 1. Oviedo will become the carrier's 12th Spanish destination.

Qantas will increase its Adelaide-Perth service to 31-times-weekly from 27 from Oct. 29.

American Airlines flew 12.48 billion system RPMs in August, a 1.4% decline from the year-ago month. Capacity dropped 1.9% to 15.21 billion ASMs and load factor rose 0.4 point to 81.9%. Domestic RPMs fell 4.1% against a 4.8% drop in capacity to 9.64 billion ASMs, lifting load factor 0.6 point to 82.4%. International traffic rose 3.7% to 4.52 billion RPMs, capacity grew at the same rate to 5.58 billion ASMs and load factor was steady at 81.1%.

American Eagle flew 792.6 million RPMs, an increase of 9.3%, against a 3.8% lift in ASMs to 1.07 billion, raising load factor 3.7 points to 74.3%.

Tiger Airways is giving passengers the option of paying $10 extra to increase their luggage allowance from 15 kg. to 20 kg. on roundtrip flights.

Rockwell Collins signed a three-year contract to provide repair and overhaul support for Mexicana Airlines at its Dallas and Atlanta service centers.

Aviareps reached agreement to represent Emirates in Poland.

British Airways teamed with Google to launch an interactive service on its website allowing passengers to "zoom in on their destination of choice" electronically using Google Earth.