Flybaboo took delivery of its first E-190 on 30-Apr-08. The Geneva-based carrier, which previously operated a dedicated turboprop fleet, operates the aircraft under a leasing agreement with M1 Travel Ltd, a wholly-owned subsidiary of Lebanon's M1 Group.
Alitalia confirmed it received a EUR300 million bridge loan from the outgoing Italian Government to keep the airline operational until a new buyer is found (Reuters, 05-May-08). The European Union, which permits state aid to airlines only under strict conditions, has expressed doubts over the emergency loan, stating it may violate regulations. The Italian Government is required to respond to European Commission questions regarding the loan by 19-May-08. A decision by the EC on the legality of the loan is expected later this month.
Meanwhile, Italian LCC, Air One, stated it has been in contact with Bruno Ermolli, who has been charged by Italian premier-elect, Silvio Berlusconi, with finding a buyer for Alitalia, on joining a consortium to acquire Alitalia (Thomson Financial, 05-May-08). Air One last year submitted a bid for state-controlled Alitalia, but the Italian Government chose to enter exclusive takeover talks with Air France-KLM instead. Talks with Air France-KLM collapsed last month. Mr Ermolli is currently attempting to organise a consortium of Italian businessmen, and possible airline partners, at the request of Mr Berlusconi.
Meanwhile, Italian bank, UniCredit, denied a report that it held talks with Lufthansa over a possible role for the airline in a bid for Alitalia (Reuters, 05-May-08).
Austrian Airlines' majority shareholders are reportedly considering a strategic partnership with another airline amid Sheikh Mohamed Bin Issa al Jaber’s plans to withdraw from an agreement to invest EUR150 million in the carrier (Thomson Financial, 05-May-08). It has been reported that Austrian Airlines has held initial talks with Emirates.
On 30-Apr-08, lawyers representing Sheikh Mohammed Bin Issa Al Jaber informed Austrian Airlines and the state industrial holding company, OIAG, which holds a 42.75% stake in the airline, that Al Jaber no longer feels bound to purchase a 20% stake in the carrier, as part of its planned capital increase. Al Jaber's lawyers reportedly stated Al Jaber believes he had been misinformed about the true state of the carrier's business development when he signed a preliminary agreement on 03-Apr-08.
Austrian Airlines confirmed it had received Al Jaber's letter of withdrawal, but stated the letter does not have any legal effect and rejected allegations the Saudi investor had been intentionally misled. The carrier stated it is currently in talks with OIAG and representatives for Al Jaber concerning the preparation of resolutions to be passed at its general assembly on 07-May-08 regarding the capital increase.
Vueling's controlling shareholder, Grupo Planeta, could hold up to 40% ownership in a carrier to be created from the merger of Vueling and Clickair, according to Planeta Chairman, Jose Manuel Lara (Reuters, 04-May-08). Planeta’s shareholding increase would be raised to match that of Iberia, which owns 20% of Clickair, but controls 80% of the carrier’s voting rights.
Grupo Planeta: "We want to make sure that decisions taken at Vueling are in Vueling's interest. If this was just a straight merger, Iberia would have the largest number of shares. We are prepared to match Iberia, if necessary, and luckily there are other Catalan investors who are prepared to join us in that investment so that we match Iberia,” Chairman, Jose Manuel Lara. Source: Reuters, 04-May-08.
Aeroflot and PPF, a Czech financial group, reportedly entered discussions for cooperation in the privatisation of CSA Czech Airlines (Thomson Financial, 05-May-08). PPF holds a 4.3% shareholding in CSA through its insurance unit, Ceska Pojistovna.
United Airlines is reportedly intensifying merger negotiations with US Airways, with a deal expected to be announced in the next ten days (Wall Street Journal, 05-May-08). The two carriers reportedly expect cost savings and revenue enhancements of USD1.5 billion p/a from a merger.
European Commission rejected (05-May-08) plans to legally limit the size of carry-on luggage, scheduled to come into effect from May-08, as it would create “undue operational complications" for airlines. The proposed maximum size of carry-on baggage was 56 cm x 45 cm x 25 cm. EU member states will retain the right to impose stricter limits if deemed necessary.
European Commission: "We must seek to balance security with passenger convenience... In this case it is clear that the inconvenience of additional limits would outweigh the advance in security," Jacques Barrot, Head of Transport and Security. Source: DPA, 05-May-08.
Oil prices set a new intra-day record high of USD120.36 per barrel in New York on 05-May-08, due to the weaker US dollar and supply concerns in Nigeria and Iran (Reuters, 06-May-08). Crude settled up USD3.65 at USD119.97.
US Federal Reserve Bank’s former Chairman, Alan Greenspan, stated the US has slipped into an “awfully pale recession” and the economy may continue to be weak for the remainder of 2008 (Bloomberg, 05-May-08). Mr Greenspan added it was too soon to declare an end to the global credit crisis.
Alan Greenspan: “We're in a recession. But this is an awfully pale recession at the moment. The declines in employment have not been as big as you'd expect to see. Until there are stabilised prices of homes - and I think they have a good way to go down - you still have prospective losses…The trade-off between inflation and growth is clearly turning adverse”, Former US Federal Reserve Chairman. Source: Bloomberg, 05-May-08.
Warren Buffett stated the US economy is in recession, even though official data shows very slow growth (Reuters, 05-May-08).
Warren Buffett: “The US is in recession as I define it. I would define that as a situation where people are doing less well than they were three months, six months or eight months earlier and most businesses find themselves in that position too. [Housing problems would weigh on bank earnings] for a couple of years. There's going to be more pain, sure [in the banking sector]". Source: Reuters, 05-May-08.
International Air Transport Association reports (05-May-08) a decline in airline CEO confidence for the first time since the quarterly survey commenced in Mar-05.
IATA: “Half of the respondents thought profitability decreased in Q1, while over 61% expect it to deteriorate further over the next 12 months. The survey responses strongly reflect the more challenging economic environment encountered by airlines in recent months. Further expansion in developing markets - for example, Asia - through new capacity and new routes continues to boost demand, though this is increasingly offset by a slowdown in the US economy and increased competition on many routes”, Media Release. Source: IATA, 05-May-08.
bmi launched London Heathrow-Freetown (Sierra Leone) service on 02-May-08 – see Route Changes Table for more information.
KLM awarded Aviapartner Handling a ground handling contract, covering all KLM’s ramp handling and traffic operations services in Marseille, Nice and Toulouse (Avipartner, 05-May-08). In Toulouse, Aviapartner will be handling KLM's three daily services from 03-Jun-08. In Nice, KLM will switch to Aviapartner Handling as of 17-Jun-08 for four daily service. In Marseille, Avipartner will handle KLM’s three daily services, as of 30-Sep-08. All these KLM services are operated with Fokker 70 and Fokker 100 aircraft.
airberlin announced (05-May-08) plans to transfer operations from Milan's Bergamo Orio al Serio Airport to Malpensa Airport, effective 16-Jun-08. [more at Peanuts.aero]
Lufthansa launched Düsseldorf-Toronto service on 01-May-08 – see Route Changes Table for more information.
Lufthansa announced plans to expand operations to India, through the launch of daily Munich-Mumbai service in Oct-08, six times weekly all business-class Frankfurt-Pune service on 01-Jul-08 and an increase in Kolkata-Frankfurt frequency from three to five times weekly – see Route Changes Table for more information (Economic Times, 05-May-08).
Iberia increased Madrid-Guatemala City-Panama frequency from three to four times weekly on 05-May-08 – see Route Changes Table for more information.
Norwegian Air Shuttle launched (05-May-08) twice weekly Oslo-Milan service – see Route Changes Table for more information.
Volareweb launched (05-May-08) three times weekly Milan-Malta services – see Route Changes Table for more information.
Blue Air announced (04-May-08 ) plans to launch services from Sibu to Stuttgart, Bucharest and Cologne-Bonn in Jun-08 – see Route Changes Table for more information.
American Airlines, United Airlines, Delta Air Lines and US Airways report (05-May-08) the following traffic highlights in Apr-08 on Atlantic services:
• Passenger numbers (RPMs):
o American Airlines: -5.3% year-on-year;
o United Airlines: -5.2%;
o Delta Air Lines: +17.6%;
o US Airways: +23.9%,
• Passenger load factor:
o American Airlines: 80.1%, -0.5 ppts;
o United Airlines: 79%, -5.2 ppts;
o Delta Air Lines: 80.2%, -0.7 ppts.
o US Airways: 77.4%, -1.7 ppts
Cargolux announced (05-May-08) plans to increase its fuel surcharges to EUR1.05 per kg, effective 19-May-08.
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Europe Airline Daily: Main News: 6 May 2008 
