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Aviation History
1990
1990 - 2918.PDF
0 PETITIONS: AIR TRANSPORT ace for GuH Airlines br July is likely to be the last month of high expansion fig ures for European airlines "...before growth patterns are disturbed by events in the Mid dle East", says the Association of European Airlines (AEA). The association does not ex pect an immediate dramatic change in member airlines' fig ures, however, except in travel to and from the Gulf itself. Preliminary results for August show a slight slackening of growth on most routes. Middle Eastern growth is down, but not dramatically. The AEA airlines' 5-8% fare increases, which be come effective next month, will have a depressing effect on travel, according to AEA statisti- Dan-Air Engii UK carrier Dan-Air has put its £50 million turnover Engineering division on the market — but it hopes to keep a minority interest. Dan-Air Services' (DAS) financial director David Quinn says he has been "...contacting interested parties worldwide who are capable of developing its full potential". Merchant banker Baring Brothers has been given the sales task. While cian David Henderson. The fare rises "...were not a kneejerk reaction to the Gulf. The Gulf was merely the last straw," he says. Infrastructure costs generally had been in creasing, including pre-crisis fuel prices. The extent of the market reaction to the price increases is impossible to predict, according to Henderson, but there will be a downturn. "The market does tend to act like the economic models," he says. Meanwhile AEA airlines' in ternational scheduled services passenger traffic increased 10.4% in July compared with the same period last year. Euro pean traffic showed exactly the Quinn avoids spelling it out, it appears that the sale is made because DAS needs the capital. "There is room in the market to expand but we need investment to achieve it," he explains. DAS' intention is to retain "a substan tial minority" of the equity of the Engineering Division. Quinn defines the planned holding as "...about 20%, but that is not cast iron if somebody makes us an offer we can't refuse". [ impact same growth, with the best fig ures being for Europe-Far East (13.6%), North Atlantic (13%) and mid-Atlantic (10.9%). The accumulated passenger traffic result for the year to the end of July was a 10% increase. The only July traffic drop (1.7%) was in the Middle East and north African sector — this preceded Iraq's 2 August inva sion of Kuwait. In all sectors except the Middle East and northern Africa and Europe-Far East, capacity increased at a lower rate than traffic, so over all load factors rose 1.2% to give a record July figure of 74.9%. Air cargo growth showed the second highest monthly in crease this year. • for sale Dan-Air intends to continue placing work with the division. This year about half of its work will have been from Dan-Air. Next year, because of fleet re duction and "an increase from outside, Quinn estimates it will provide about 40% of the work. The division employs 1,625 people, providing line mainte nance at 11 UK airports and overhaul at Gatwick, Lasham and Manchester. • Luton sale hit by holiday slump The planned sale of Luton Airport in the UK may be threatened by increasing finan cial losses, which could touch £3 million by the end of the current fiscal year. Luton Borough Council, the local government authority which owns the airport, is hop ing to raise between £30 million and45 million from the sale, which is due to be completed by the end of the year. Closed bids from at least seven interested parties are due in by the end of next month, but the authority's valuation could be affected by the airport's financial position. Luton has been badly hit by the decline in the inclusive-tour charter business in the UK, as well as by inflation and contin ued high interest rates. The recent bankruptcy of Capital Airlines was also a blow, as the independent carrier was to have carried most of the 300,000 passengers expected to use Luton's recently upgraded do mestic terminal this year. In total, Luton expects to handle 2.8 million passengers this year, well below original projections. Financial results to the end of March this year revealed a loss of around £990,000. A letter from chief executive David Bates to members of the board last month warned that if no action was taken the company would incur "...a substantial loss both in the current year and the following financial year". One source estimates that the losses could reach between £2 million and £3 million by March next year, although Bates says: "I wouldn't want to hazard a guess at this point. The figures are still being worked out by the accountants." Although Bates says that it is "...too early to say" what effect the losses may have on the sale, another source says the council's valuation may be forced down to the point where it no longer makes eco nomic sense to sell the airport. Luton is hoping to capitalise on traffic congestion in south east England to attract major carriers in the future. • I %„00& THAI FIRMS UP ON 146s Thai Airways International has ordered five British Aerospace 146-300s. The $100 million contract follows an earlier arrangement under which Thai leased three 146-300s and one -100 for 24 months at $200,000 a month per aircraft. Deliveries are scheduled to begin in May 1991 and to continue as each current lease expires up to January 1992. The manufacturer says that no decision has been made on whether the earlier aircraft will remain in service with Thai International under lease or purchase arrangements or be returned to BAe. The aircraft were among the unidentified orders reported by BAe last month leering put up 10 FLIGHT INTERNATIONAL 26 September - 2 October. 1990
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