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Scandinavian airline group SAS AB on Tuesday posted a first-quarter net loss of 1.08 billion kronor (euro115 million; US$181 million ), citing higher fuel costs and growing competition, and said it would slash 1,000 jobs to reduce costs.

The result was down from a net loss of 18 million kronor in the first quarter of last year.

Sales in the first three months of 2008 rose to 12.83 billion kronor (euro1.37 billion; US$2.15 billion), from 11.89 billion kronor in the same period last year, SAS said.

“The negative earnings trend we experienced in November and December last year continued in the first quarter of 2008,” Chief Executive Mats Jansson said.

source: Forbes

In a joint letter written to Continental Airlines employees, company chairman Larry Kellner and president Jeff Smisek say that a merger with United Airlines or any other air carrier will not take place.

More than 45,000 Continental employees received the letter by e-mail Sunday following a meeting with the Continental Board of Directors. The board unanimously supported a management recommendation that the company not pursue a merger with another airline.

The two executives say that Continental still plans to consider potential alliances and membership in SkyTeam, but alternatives will also be considered in place of SkyTeam.

source: My Fox

Five of the six major airlines in the United States plan to start charging coach passengers as much as $25 next month to check a second bag, the latest move in their quest to offset high fuel prices.

The new fee of $25 for a second bag is being levied by Continental, Delta, Northwest, United and US Airways. The low-fare carrier AirTran has announced that it will charge $10 for a second checked bag. Airlines have long levied fees for checking a third bag. Some carriers have recently increased those as well, and the fees on the major carriers now run as high as $100.

source: New York Times

Air Europa pilots have called a strike from May 5 to 9 and could walk out again in June to protest against the airline’s plan to launch a low-cost airline, they said on Tuesday.The pilots worry that the launch of a second, low-cost airline will endanger jobs at Air Europa, one of Iberia’s main rivals on short-haul routes from Spain.

source: Reuters

Italy’s failing flag-carrier, Alitalia, faces a crucial week when its future looks likely to be decided at least as much by politics as economics.

Having made the salvation of the group’s “‘Italianness'” central to his successful election campaign, Silvio Berlusconi has to deliver on the promise of an alternative solution to the bid tabled and then withdrawn by Air France-KLM. The group has only enough cash to stay airborne until about the end of May.

Representatives of the incoming and outgoing governments agreed to find a way to keep Alitalia going while its fate was decided. Sources close to the talks said it could include a line of credit worth €100m (£80m) to €150m.

source: Guardian.co.uk

UAL Corp.’s United Airlines said on Sunday it was hiking the fee it charges passengers to change tickets from $100 to $150 in an effort to combat high fuel costs.

A spokeswoman for the airline said in an e-mailed statement that the company this weekend made the change to its ticketing policy.

It also added a Saturday night stay requirement on all tickets where it competes head-to-head with other legacy carriers, which she said will affect 65 percent of all the markets it serves. That will have the most impact on business travelers, who typically don’t want to spend a Saturday night in their destination.

source: Reuters

Two disgruntled British Airways passengers have heaped more embarrassment on the airline by a posting a musical video mocking Terminal 5 on the internet.

Tim Soong turned to satire after BA managed to wreck his wedding plans by losing his luggage, leaving he and his best man, Andy Baynes, without their suits. His fiancée, Sokha Nhim, was also left minus her dress.

The video they made about the airline has become a runaway success on the video-sharing website YouTube and the song, which is likely to be released as a single, is getting repeated plays on London radio stations.

source: Telegraph.co.uk

British Airways chief executive Willie Walsh admitted today that moving the airline’s long-haul flights to Heathrow’s Terminal 5 on April 30 would be an “‘unnecessary risk'”, as BA drew fierce criticism from airlines by postponing the transfer until June.

Walsh, who has rejected calls to resign over the T5 fiasco, said the carrier and Heathrow owner BAA had made a “‘pragmatic'” decision in waiting until problems with the building and baggage handling operations are solved. Other airlines are expected to seek compensation over the delay with BMI, Heathrow’s second largest carrier, slamming the decision as “‘outrageous'” and claiming it had been taken without consulting other airlines.

source: guardian.co.uk

Delta Air Lines Inc will buy Northwest Airlines Corp for more than $3 billion under a proposal unveiled Monday to create the world’s biggest airline, as carriers seek to counter skyrocketing fuel prices and a weak economy.

After racking up $35 billion in losses and finally emerging from a five-year slump in 2006, U.S. airlines are hoping mergers could lead to higher fares as combined carriers reduce flights and use their increased market power to raise prices.

source: guardian.co.uk

Late flights and lost bags, to say nothing of higher fares, are making air travelers grumpy, an annual survey of airline quality says.

The industry posted declines last year in every area of the Airline Quality Rating, amid rising fuel prices, safety problems and bankruptcy filings that shut down three carriers last week alone.

The biggest change was in the rate of consumer complaints, up 60 percent overall. The rate more than doubled at US Airways and Comair, and rose for 15 of the 16 airlines included in the study. The exception was Mesa Airlines.

On-time arrivals dropped for the fifth straight year, with more than one-quarter of all flights late, according to the survey. The rates of passengers bumped from overbooked flights and bags lost, stolen or damaged also jumped in 2007.

source: thetimesonline.com