Private equity and regional airlines

There’s an excellent and informative article on regional airlines, particularly Pinnacle Air, at SmartMoney.com’s “Under the Radar” column.

Pinnacle, flying as Northwest Airlink, recently acquired Colgan, which will be its platform for growth.

Airline consultant Michael Boyd is quoted as saying regional airlines are headed for a round of mergers.

Private equity leveraged buyouts are touching every industry. Expect them to push consolidation among regional carriers as well.

The end of “Does anyone have change?” on Frontier Air

A milestone in airline passenger service: Frontier Airlines, starting April 1, will start taking credit and debit cards only for in-flight entertainment and drinks.

Attendants will use PDAs with card readers to record purchases.

“Using this new technology and eliminating the complications that come with cash transactions will allow Frontier's flight attendants to get passengers watching TV with beverages in hand quicker than ever before,” the airline said.

Oops, I mean UPS

Did anyone else notice that in all the hoopla over the Airbus A380 superjumbo landing in the U.S. that the plane still carried a UPS logo?

UPS canned its order for the freighter version of the aircraft, the A380F, some time ago, but I guess there wasn’t time to paint over the “brown” icon.

In fact, Airbus is shifting its engineering staff to the passenger version to battle the behind-schedule mammoth plane, and has officially zero customers at the moment for the freighter version.

United Airlines' Chief Operating Officer almost got away

In a proxy filing after the markets closed Monday, United Airlines’ parent company, UAL Corp., listed the value of the 2006 compensation package of its Chairman and CEO Glenn Tilton at $23.8 million.

Peter McDonald, UAL’s chief financial officer, garnered a pay package of $13.2 million.

Neither executive received a bonus, but reading the fine print reveals McDonald’s salary and package was actually higher. Why?

“Mr. McDonald’s base salary was increased in response to a competitive job offer he received from a non-passenger airline,” according to the filing.

UAL signed a new employment agreement with McDonald on Sept. 29, 2006, giving him an annual base salary of $700,000, more than the $501,000 listed for 2006.

To get him to stay, UAL is also giving McDonald a $2.6 million payment that funds a trust, and he in turn, gives up some restricted shares.

There are two major non-passenger airlines in the U.S.: UPS Inc. and FedEx.

By comparison, Scott Davis, the UPS CFO, earned $500,000 in 2006. Alan Graf Jr., the CFO of FedEx Corp., earned a base salary in 2006 of about $778,000.

Live soccer on JetBlue

JetBlue has signed a deal with Setanta Sports to air live English permiership and international soccer and rugby matches. This a great development for fans. Setanta has most major international qualifiers and friendlies and is set to air the Rugby World Cup later this year.


Setanta has been a pay-per-view service for most games, but now, it'll be one of the 36 DIRECTV channels available on JetBlue. Just so you won't miss the game on your JFK to San Fran flight.