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October 2003

Frequent Flyer Program News
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TRAVEL NEWS

The discovery of box cutters and other paraphernalia "intended to simulate a threat" on two Southwest Airlines jets Thursday prompted a hasty call for searches of all US commercial transports, which were carried out October 17 and 18 2003 during normal ground stops. Southwest said the items were discovered in a compartment in a lavatory of a 737 in New Orleans while the airline was performing maintenance late October 16. A similar discovery was made on an aircraft in Houston during a scheduled C check the same night, the airline said.

Malaysian police launched a full-scale investigation into what is being termed the sabotage of a Malaysia Airlines A330 at Kuala Lumpur International Airport. The aircraft was to have operated a KL Perth flight on Oct. 2 but preflight checks discovered a series of faults that led engineers to seven damaged wire bundles under the cockpit. Police believe the sabotage was an inside job.

AIRLINE NEWS

Aer Lingus will add nine new routes from Dublin to Europe in its summer schedule next year. Services to Berlin, Venice, Bilbao, Valencia, Lyon and Zurich will start at the end of March while services to Dubrovnik, Warsaw and Copenhagen will begin at the end of May 2004.

Aero Lloyd, the biggest independent German charter carrier with 12% of the market, unexpectedly filed for insolvency on October 17, 2003. The collapse came after its main creditor and 66% shareholder, Bavarian state bank BayernLB, withdrew support and declined to provide financing for a management-proposed restructuring of the struggling airline. Flight operations ceased at 6 a.m. local time, stranding 8,500 passengers, including 4,500 outside Germany, who scrambled to find new flights from travel agencies or carriers operating for TUI and Thomas Cook. BayernLB acquired its 66% stake in Aero Lloyd in 1987; the rest is owned by private investors. The airline had 1,400 employees, 1,000 of them in Germany. With its fleet of 21 A320-200s and A321-200s it flew to 60 medium-range tourist destinations in 13 countries. It carried 3.5 million passengers last year. Unlike competitors such as LTU, Hapag-Lloyd and Thomas Cook, Aero Lloyd was unaffiliated with any tour-operator conglomerates and cooperated with all major tourism companies in Germany and Austria. Most flights from its 11 German and five Austrian departure points were nonstops. It generated more than 80% of its turnover from organized charter packages and the rest through seat-only sales.

Air Arabia, which touts itself as the Middle East's first no-frills airline, inaugurated operations this week from Sharjah with a 55-min. A320 hop to Manama, hoping to cash in on the expatriate and guest-worker market. CEO Adel Ali called his company the first carrier in the region to offer online booking and nonrefundable ticketing "to reduce distribution costs and, ultimately, fares." Passengers who want to snack will have to pay for meals. The initial schedule of 14 weekly flights will include services to Beirut, Damascus, Kuwait and Muscat. Ticket prices are reportedly a third those of regional competitors. Air Arabia operates two leased A320s and plans to expand the fleet to six aircraft, reported Gulf News. Rival Gulf Traveller, the low-cost arm of Gulf Air, began services out of Abu Dhabi in July, marketing itself as a full-service economy-class airline.

Air Canada launched daily nonstop service between Toronto and Delhi using a 282-seat A340.

Air France and KLM are on track to sign their definitive merger agreement and expect to file for approval with European and US regulatory authorities by the end of October 2003, according to their chief executives. However, AF's Jean-Cyril Spinetta and KLM's Leo van Wijk ruled out the possibility of an early entry by Alitalia into the planned merger. In an interview with the Financial Times, Spinetta stressed that Alitalia, which is still majority state-owned, must be privatized before a merger deal can be pursued, while van Wijk made it clear the Italian carrier also must show significant progress in its planned restructuring. "We need to see that the restructuring program does have an effect and that it gives a sound basis for participation in this newly created holding structure," van Wijk told the newspaper. "We must see evidence of the restructuring as the basis for convincing our shareholders about the inclusion of Alitalia."

Air New Zealand will offer complimentary cafe-style meals and beverage service on all transtasman flights on its new Tasman Express flights.

Air New Zealand will launch a code share relationship with Austrian Airlines Group Oct. 26 2003. ANZ will place its code on Lauda Air's five weekly flights from Sydney to Vienna via Kuala Lumpur and on services operated by Austrian Airlines between Vienna and London. Austrian Airlines Group will code share on selected transtasman flights operated by ANZ from Auckland, Wellington and Christchurch to Sydney and Melbourne.

Air Sahara and Jet Airways are "ready, willing and able" to launch international operations and connect Indian metro areas with destinations such as Sri Lanka.

Air Seychelles effective Nov. 1 2003 is repositioning from Munich to Frankfurt its weekly 767-300 nonstop services between Germany and Mahe.

AirTran Airways launched three daily nonstop flights between Reagan Washington National Airport and Atlanta and one daily nonstop service between Reagan National and both Ft. Lauderdale and Ft. Myers.

AirTran Airways will begin one daily nonstop flight between Reagan Washington National Airport and West Palm Beach Dec. 4 2003. The carrier, which was awarded the slots at Washington National in August, previously announced new service from the airport to both Atlanta and Ft. Myers and plans to launch service to Ft. Lauderdale.

All Nippon Airways will take part in trials at Tokyo Narita of a new e-check-in system using facial recognition technology. Tests will be conducted in conjunction with the Narita Airport Authority, NTT Data Corp. and Oki Electric Industries. Participation by passengers will be on a voluntary basis. The trial will run from early Dec. to the end of March 2004.

America West launched two daily flights between Los Angeles International Airport and both Boston Logan and New York JFK.

American Airlines and regional affiliate American Eagle will add a significant number of new flights at Chicago O'Hare in a move that is part of its previously announced decision to expand operations in Chicago and Dallas/Ft. Worth while downsizing its St. Louis hub. American will add 25 flights a day at O'Hare, including new service to Cleveland, Ft. Myers, San Jose del Cabo and West Palm Beach, bringing its daily total to 309 departures. American Eagle will add 23 daily flights to seven new or previously served cities, bringing its daily departures at ORD to 223.

American Airlines will launch new and additional services this winter from all three New York area airports to destinations in the Caribbean, Florida and Mexico. From Nov. 1 AA will begin additional weekly flights from New York JFK to Barbados, Jamaica, Mexico, Haiti, Turks & Caicos, US Virgin Islands and Netherland Antilles. Beginning Dec. 15 2003 it will commence new service from New York JFK to the Cayman Islands, Jamaica, Dominican Republic, Costa Rica and Puerto Rico. At New York LaGuardia, the airline will begin new service to West Palm Beach Nov. 1. Also from Nov. 1 it will launch new flights between Newark and San Juan.

American Airlines will increase or begin several flights Nov. 1 2003 from Miami, Ft. Lauderdale, West Palm Beach, Ft. Myers, Tampa and Orlando to destinations in the US, Mexico, Latin America and the Caribbean. AA also introduced several enhancements to its schedule at Boston Logan, including a range of new seasonal services to destinations in the US, the Caribbean and Mexico.

ATA Airlines will launch new daily nonstop service between Honolulu and Seattle Feb. 20 2004 using a 757-200.

Blue1, formerly Air Botnia, took delivery of an RJ-100 in a deal arranged and managed by Skyways Aviation. A further RJ-100 and two RJ-85s are due to be delivered in the coming weeks. Blue1 will operate the additional aircraft from its hub in Helsinki across a number of Scandinavian and European routes.

Boeing's new 777-300ER completed the longest engine-out demonstration on a 13-hr. flight from Seattle to Taipei in support of ETOPS certification when it flew more than 5 hr. with one of its two GE90-115B engines shut down.

British Airways confirmed it is phasing out first class seating on six routes from London Heathrow to Montreal, Beijing, San Diego, Denver, Calcutta, and Dhaka. BA said it will start a major flight switch program, consisting of a dozen long-haul and 35 short-haul flights, that will be phased in over the next six months. The first phase will see double-daily Tokyo Narita and Johannesburg services transferred from Heathrow's Terminal 4 to Terminal 1 from Oct. 26 2003, the start of the winter season. The remaining switches will be made at the start of the summer 2004 season. To support the program, the airline is upgrading its facilities at T1 with new lounges and improved check-in facilities, including a designated check-in zone for premium passengers.

British Airways Concorde was expected to make its final landing at Washington Dulles on October 14. The supersonic aircraft, which will be retired officially from commercial service Oct. 24 2003, previously was used on three daily flights between Dulles and London Heathrow. Last week the Concorde made its final flight to Boston.

British Airways plans to trial a special sleeper service for business travelers between New York and London. The as-yet-unnamed service is designed to take advantage of the airline's flatbed seats in its Club World business-class cabin. The plan is to offer a sleep-only flight on one late-night departure out of New York JFK. Travelers will be able to eat dinner at the airline's lounge at the airport, sleep during the 7-hr. flight, then shower and have breakfast at Heathrow. The trials will coincide with the retirement of Concorde services, but it is unlikely the sleeper service will be introduced formally before next spring.

Cathay Pacific will commence services to Beijing from Dec. 2 2003, operating three return services per week and marking a major milestone for the airline, which has been prevented from offering services to the mainland for many years. "Cathay Pacific being able to operate three services a week to Beijing is a very important step but it is still just a start," said Director and COO Philip Chen.

Cathay Pacific Airways will start a thrice-daily Hong Kong-Beijing service next month but is still waiting for a go-ahead on service to Shanghai and Xiamen. The airline was granted rights to the three Chinese cities after a protracted and bitter court battle with Dragonair, in which it holds a minority stake. In addition, from Oct. 26 2003 Cathay's services to Rome will increase from four to five per week while Melbourne flights will jump from 11 to 13 weekly and Auckland services will go from 10 to 12 a week. From Dec. 1 2003 it will add a sixth weekly flight to Johannesburg. It has restored its schedule to pre-SARS levels but said yields remain under intense pressure.

China Southern Airlines began a weekly flight from Beijing to Dubai via Urumqi using a 757.

Continental Airlines will introduce three weekly flights between Houston George Bush Intercontinental Airport and Liberia, Costa Rica, Jan. 31 using a 124-seat 737-700, pending government approval.

Continental Airlines, effective the week of October 6 2003, no longer will reduce its base fares to compensate for government-imposed segment fees or to cover passenger facility charges at Cleveland. The carrier previously reduced base fares whenever the segment fee exceeded $6 and for the $4.50 per-departure PFC at Cleveland Hopkins International Airport. This in turn meant that connecting and one-stop flights on Continental through one of its hubs remained cost competitive with nonstops offered by other airlines.

Delta Air Lines said it will offer pre-order meals on all 142 daily flights operated by its low-fare subsidiary Song. Passengers can order meals through Song's website up to 12 hr. before departure. The pre-order offering created by technology partner e-gatematrix "constitutes only a reservation of a selection, so there is no obligation or pre-purchase agreement should the customer decide to change flight plans." The menu was created by Song Consulting Executive Chef Michel Nischan and executed by Gate Gourmet.

Delta Air Lines launched code share e-ticketing with Continental Airlines for travel beginning October 7 2003. The carrier said it has begun to develop a similar system for an e-ticket code share with Northwest Airlines for travel beginning Oct. 26 2003.

Delta Connection carrier Atlantic Southeast Airlines launched two daily nonstop flights between Atlanta and Grand Bahama Island using a CRJ on October 15 2003.

Emirates will take delivery of the first of eight A340-500s the week of October 30 2003. The carrier said it will use the aircraft, in a three-class configuration, on services to Australia initially and on flights to North America beginning next year.

Emirates will have eight ex-Singapore Airlines A340-300 refurbished with three-class interiors and they will enter service in March on routes from Dubai to Shanghai, Casablanca, Johannesburg, Perth and Osaka. They will be used to meet capacity shortfalls ahead of the delivery of 26 777-300ERs ordered at the Paris Air Show this year. The first 777-300ERs arrive in 2005. Also, Emirates will launch a daily service between Dubai and Brisbane via Singapore Oct. 26 2003. The flights will be extended to Auckland.

Estonian Air and Air France will code share from Oct. 26 2003 on Estonian Air-operated flights over the Tallinn-Paris route to Charles de Gaulle Terminal 2. Estonian opened regular 737 service from Tallinn to Paris March 30 and the route has served more than 14,000 passengers in less than seven months. The carrier code shares on other routes with SAS, Aeroflot, air Baltic and Aerosvit.

Finnair will serve Miami again for the first time in three years with twice-weekly services during the winter season and onward connections to Central and South America with oneworld alliance partner American Airlines. All-economy service is being introduced on flights to Budapest, St. Petersburg, Prague, Riga, Tallinn, Warsaw and Vilnius. In addition, connections to four destinations in Lapland will be available from Paris, Zurich, Milan and Amsterdam.

FlyBE launched daily flights from Bristol to Toulouse, from Birmingham to Salzburg and from Southampton to both Salzburg and Prague. The UK's largest independent Regional started services from Southampton to Edinburgh Sunday and will begin flights from Southampton to Chambery Dec. 16 2003.

Gulf Air will launch twice-weekly services Oct 26 to Bangalore under terms of a new commercial accord that will see the Indian Airlines code placed on Gulf Air flights. Gulf Air also said it plans to operate additional services from the UK to cater for strong demand in the year-end holiday period. It will operate 14 nonstop A340-300 flights from London Gatwick to Abu Dhabi and Bahrain Dec. 11 to 22 and again Jan. 2-10 in addition to its 24 weekly nonstops from Heathrow to the Gulf and beyond.

Jetsgo launched on October 4 2003 nonstop service between Toronto and Orlando Sanford International Airport using a 160-seat MD-83. The carrier will operate two additional weekly flights on the route during peak winter months.

KLM took delivery of the first of 10 new 777-200ERs that will replace its 747-300s. The remaining 777s will arrive over the next two years. The carrier plans to use them on intercontinental routes to New York, Toronto, Tokyo, Cape Town, Nairobi and other destinations. They will be the first aircraft with the new Boeing Electronic Flight Bag on the flight deck. Additionally, KLM is introducing the Matsushita System 3000i in-flight entertainment system on the 777. Seats, which recline into a nearly flat position, feature video monitors, in-seat reading lights, lumbar support, back massage and privacy hoods.

Star Alliance were in Warsaw to welcome state-controlled LOT Polish Airlines as the group's 15th member, enhancing Star's network in an area also served extensively by Lufthansa and Austrian Airlines. LOT, the largest carrier in Central and Eastern Europe, serves 46 cities in Europe and beyond in addition to 12 destinations in Poland. It has a fleet comprising five 767s, 19 737s and 14 ERJ-145s as well as eight ATR 72s and five ATR 42s that ply regional and domestic routes.

LOT Polish Airlines will move its New York JFK operations to Terminal 4 from Terminal 8 on Oct. 26 2003. The airline will also launch flights to Warsaw with connecting service to Krakow using a 757 when it moves its New York JFK operation.

Lufthansa unveiled on October 7 2003 at Frankfurt Airport its new business class that will be installed initially on all A340-600s and A330-300s and eventually on the airline's entire long-haul fleet of 80 aircraft. The revamped cabin, in which LH invested eur300 million ($351 million), features new lie-flat seats, in-flight entertainment systems and food and beverage service. "With the new business class we are opening up a new dimension for our customers," said Deutsche Lufthansa AG Executive Board Chairman Wolfgang Mayrhuber. "We offer maximum comfort, more space, more peace and quiet, a diverse information and entertainment program and excellent service onboard." The new business class will feature the PrivateBed, a 2 m. long seat bed with full recline; inclination to the floor is just 9 deg.., the airline said. The seats also incorporate a foldaway screen for privacy along with motorized adjustments. Seat space will increase 25% (depending upon the setting) compared to the previous business class. The new in-flight entertainment system, entitled Media World, features 10.4 in. screens, video/audio on demand and a range of games. Media World also includes FlyNet, an Internet program that passengers can use to access news that is updated regularly via satellite. New food and beverage service are also part of the upgraded business class.

Mesa Air Group signed an agreement to create a code share relationship between its subsidiary Air Midwest and United Airlines. Under the new accord, the UA code will be added to Air Midwest flights operated under a preexisting US Airways Express agreement. Currently, Air Midwest operates 240 daily flights with Beech 1900s as US Airways Express.

A two-year struggle by financially troubled Midway Airlines appeared to be at an end on Oct. 30 2003 as the company moved from its Chapter 11 bankruptcy status to Chapter 7, which will require it to sell off its assets. Midway was operating a fleet of eight CRJ200s as a US Airways Express carrier when it shut down. Starting Nov. 3, its routes will be picked up by other US Airways affiliates.

Qatar Airways will add Singapore, Vienna and Cebu to its network, in addition to the previously announced destinations of Shanghai, Seoul and Tripoli. Thrice-weekly services to Vienna via Munich begin Nov. 19 2003. Service to Singapore launches Dec. 10 with continuing service to Cebu, also on a thrice-weekly basis.

Qatar Airways begins thrice-weekly service to Shanghai with onward service to Seoul, using A330-200s.

Qatar Airways will add Singapore, Vienna and Cebu to its route network later this year as it prepares to begin new services to Shanghai, Seoul and Tripoli. Thrice weekly A300-600 services to Vienna via Munich will start Nov. 19. The Cebu flight, via Singapore, will begin Dec. 10. Thrice weekly A330-200 services to Shanghai and Seoul will start Oct. 28 with Tripoli flights effective from Nov. 9 2003.

Ryanair will launch a new daily route between London Stansted and Valladolid Nov. 6 2003. The Irish no-frills carrier expects to carry 100,000 passengers on the route in its first year. Valladolid is the fifth airport in Spain served by Ryanair.

Singapore Airlines will increase capacity and add flights on several routes in the upcoming months to meet "traditionally higher demand" in Nov., Dec. and Jan. From Oct. 28 to Jan. 31 2004 it will operate an additional 114 flights to Sydney, Melbourne, Perth, Brisbane and Christchurch. Larger aircraft will be used on 30 scheduled services to Australia and New Zealand during this period. SIA also will operate 17 additional flights to Indonesia, six to the Netherlands, six to Japan and four to Athens. The carrier said it plans to operate supplementary services to India at the end of this year and to Kuala Lumpur and Penang in early 2004.

Singapore Airlines will not offer a separate first-class section on its new A340-500s that will begin operating daily nonstop services between Singapore and Los Angeles in February 2004. Instead SIA is fitting the aircraft, dubbed the A345 Leadership, with 181 seats in a two-class configuration. There will be 64 Raffles Class lie-flat Spacebeds in a 2-2-2 business-class layout and 117 20-in. wide Executive Economy Class seats that will feature in-seat power and 37-in. pitch in a 2-3-2 layout. Executive Economy is a new product offering for the airline. SIA Senior Executive VP Michael Tan said that the decision not to fit a first-class product to the aircraft was a reflection of weight and space issues. "We can get 2.5 Raffles Class Spacebeds for one first class bed," according to Tan. He said the A340-500 is a "business aircraft and not designed for Singapore Airlines' first class demanding requirements." Tan said SIA will start services to New York from Aug. 2004. "The five aircraft we have coming meet our LA and New York requirements," he said. The first A340-500 is due to arrive in Singapore in mid-Dec. and will operate on regional routes for crew and systems training. SIA recently has been the target of pressure from Boeing with its 777-200LR.

Southwest Airlines added to the challenges facing US Airways Group, announcing that it will establish a new base at Philadelphia next May, using four gates and five new 737-700s to operate up to 14 daily flights initially to a mix of short- and long-haul destinations.

Southwest Airlines launched two daily nonstop flights this month between Baltimore/Washington and San Diego. The carrier now operates five daily nonstop coast-to-coast flights.

SriLankan Airlines said that with the addition of two A340s, it is boosting its weekly services to London from nine to 11 while Paris goes from three to four weekly and Frankfurt receives an additional weekly frequency for a total of three.

Swiss said it will serve 72 destinations in 44 countries in a revised route network effective Oct. 26 2003. The financially struggling carrier plans to continue offering direct winter flights to key points in Europe, Asia, Africa and the Americas, while business travelers within Europe who are based near Basel, Geneva and Zurich will have early morning departures and late-evening returns. Zurich will continue to be the airline's hub not only for its intercontinental services but also for its European network of 40 destinations. Thirty intercontinental points will be served from Zurich and Geneva. The intercontinental network covers destinations in 22 countries while European routes extend to 42 points also in 22 countries. Swiss's network will be supplemented by code share partners offering direct services between Switzerland and 10 other destinations. Its 50 seater fleets of ERJ-145s and Saab 2000s will be operated in a single cabin configuration from the start of the new schedules.

Trans Atlantic Airlines will join ARC as a participating carrier effective with sales of Oct. 13 2003. The airline, based in Sierra Leone, will launch its maiden flight Oct. 30. It will operate service between New York JFK and Freetown and Banjul with continuing flights to Lagos.

United Airlines will begin daily nonstop service between Washington Dulles and San Jose, Costa Rica, Feb. 12 2004 using a 757 in a two-class configuration.

United Airlines will launch daily nonstop service to San Juan from its Washington Dulles hub from Dec. 15 2003. It will operate seasonal Saturday-only service to Grand Cayman from Chicago Dec. 20 to April 24 2004.

United Airlines said customers with travel booked through Denver may add an extended stopover to their itinerary for a $60 fee.

US Airways launched daily nonstop service between Charlotte and Mexico City using a 120-seat A319.

US Airways and Lufthansa will begin their code share relationship that includes reciprocal frequent-flier mileage accrual Oct. 26 2003. US Airways will add its code to Lufthansa flights between Frankfurt and Berlin, Boston, Duesseldorf, Hamburg, Philadelphia, Nuremberg and Stuttgart as well as flights between Munich and Berlin, Duesseldorf and Hamburg. Lufthansa will add its code to US Airways flights between Philadelphia and Albany, Baltimore/Washington International, Elmira, Greensboro, Hartford, Manchester (N.H.), Pittsburgh, Providence, Raleigh-Durham, San Juan, Reagan Washington National Airport, West Palm Beach, White Plains and Wilkes-Barre/Scranton. Lufthansa also will code share on US Airways flights between Pittsburgh and both Frankfurt and Boston, Philadelphia and both Frankfurt and Munich, and between Charlotte and Frankfurt.

Valuair, Singapore's first low-cost airline, said it will lease two new A320s from Singapore-based leasing firm SALE to launch its first services in March. The aircraft, which will be delivered directly from Airbus, will be in a single-class, 162 leather-seat configuration. The carrier plans to operate flights to destinations up to 5 hr. from Singapore, which puts it at odds with the typical low-cost model where flights of 1-2 hr. are the norm. Valuair was established in March and will be the first new airline to operate out of Singapore after Singapore Airlines and its subsidiary SilkAir. The carrier plans to expand its fleet by at least two aircraft per year.

VLM Airlines will add a ninth daily return every weekday on its express link between Manchester and London City Oct. 26 2003.


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