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Monday, August 1, 2005

Quick Takes

  • The Federal Aviation Administration (FAA) has proposed a $1.5 million fine against Independence Air [FLYI] for neglecting maintenance when it previously operating as Atlantic Coast Airlines. In the complaint, the FAA said that the airline operated several of its planes last September and October for several thousand flights without the proper inspections. In one instance, the FAA said the carrier failed to perform the heavy maintenance "C" check on one of its Bombardier [BBD] CRJ 200s and then flew that plane for 455 additional flights without a complete inspection. In another case, the carrier flew a CRJ 200 on 134 flights past the deadline to calibrate its air data computer. While this was the second time in a year that the FAA has proposed civil fines for safety violations, the FAA and the carrier stated that the airline has taken action to correct the problems. Independence Air has filed an appeal in hopes of reducing its fine.
  • In the wake of Southwest Airlines' [LUV] plan to shift its Seattle service from Seattle-Tacoma International Airport to King County International Airport, also known as Boeing Field, Horizon Air and Alaska Air filed a request for equal access to the King County airport. The two units of Alaska Air Group [ALK] would operate 100 daily departures from the county-owned facility. Horizon now has 134 departures from Sea-Tac while Alaska has 147. Alaska Air Group is the largest operator at the airport, owned by the Port of Seattle. The two carriers would continue to fly some flights from Sea-Tac after shifting most of their operations to King County. Due to proposed hikes in landing fees at Sea-Tac, Southwest wants to shift locations. It has proposed spending $130 million to build an eight-gate commercial terminal at Boeing Field to handle up to 85 daily departures after 2009. Horizon projects that it may have to curtail some of its regional service if it needs to operate out of two Seattle airports.
  • DOT has given tentative approval for Warren Buffett's Executive Jet Management to operate as a scheduled commuter air carrier with 30 flights a week between New York's LaGuardia Airport and a Los Angeles airport. In addition, it will offer 10 weekly flights between New York and Chicago Midway Airport. With more than 80 aircraft under its control, the flights will be offered on business aircraft seating 8 to 18 passengers (RAN, March 7). Executive Jet will operate under Part 380 rules, the public charter rules, and serve as a direct carrier. The certificate will become final after Aug. 29 if no adverse comments are filed with DOT. Executive Jet is owned by NetJet, which in turn is owned by Berkshire-Hathaway [BRK], where Buffett is the CEO and largest shareholder. >>FAA Docket: OST-05-20492.<<
  • Eighty-one airports are planning $71.5 billion in new construction through 2009, according to a survey by the Airport Council International-North America. The FAA had estimated the tab at $39.5 billion.
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