Air Transport World

U.S. nationals. (World Airline Report 1986)

U.S. nationals

AirCal: Two of the players in the consolidation game in the U.S. airline industry in 1986 were national carrier AirCal and mega-major American, which in November announced its intention to beef up its U.S. West Coast presence by purchasing AirCal for approximately $225 million.

Final DOT approval of the merger was obtained in the spring and American plans to have the two carriers fully integrated in July, although AirCal's fleet of eight Boeing 737-300s, 23 737-200s, two 737-100s and six BAe 146s may not be fully repainted in American's colors within that time period. AirCal has another four 737-300s on order.

AirCal, meanwhile, posted small operating and net losses for 1986 despite significant increases in traffic, and blamed its poor financial performance primarily on "heavy fare discounting' in the first half of last year. Although revenues were up 9% to $375.4 million, expenses rose at a faster 14.3% clip to $379.1 million, producing an operating loss of $3.67 million and a net loss of $1.6 million in contrast to an operating profit of $12.8 million and a net of $9.28 million in 1985.

Passenger boardings rose 12.9% last year to 5,024,090, RPKs jumped 21.1% to 3.59 billion as service was launched to Anchorage, San Diego and Chicago, and freight traffic soared 54.1% to 4.37 million FTKs.

Air Wisconsin: A carrier that grew from the regional into the national ranks after deregulation, Air Wisconsin had an eventful year in 1986 as it changed its identity to United Express to feed its partner's hubs at Chicago-O'Hare and Washington-Dulles airports.

From United's midfield terminal at Dulles, Air Wisconsin is serving six cities in Virginia, Pennsylvania and Delaware, primarily with its six Shorts 360s. From O'Hare, where in August it will move into United's new "Terminal of Tomorrow,' it files to 23 cities in six midwestern states with eight BAe 146s and 12 Fokker F27-500s.

The carrier's aircraft all have been repainted in United Express colors, and new interiors incorporating United upholstery are now being installed.

Healthy traffic growth marked 1986, with passenger boardings rising 17.3% to 2,025,972, RPKs climbing 8.7% to 524.4 million and load factor increasing 3.2 points to 46.4%. Revenues dipped 0.8% to $119.2 million as a result of lower yields in the first three quarters of the year, but a 2% cut in operating expenses produced an operating profit of $5.97 million, up from $4.66 million in 1985. Net profit, aided by gains from the sale of aircraft and of slots at LaGuardia and Washington National airports, rose sharply to $5.37 million from $1.34 million.

Alaska: "Quite a year' is the way Alaska Airlines Group described 1986 in its annual report. The parent of Alaska Airlines acquired two other carriers, Jet America and Horizon, during the year, and the Alaska Airlines subsidiary posted its 14th consecutive year of profits. …

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