<B> InsideTrack</B>
<B>E-Tix Interlining Begins Next Millennium</B>
Amadeus will introduce an electronic ticketing server that will allow carriers to interline by the first quarter of 2000. Finnair is testing the system. Meanwhile, IBM is preparing to host e-ticketing interlining transactions for the International Air Transport Association. Plans are for three or four carriers to begin using the system by next summer.
<A NAME="2"><B>More Carriers Limiting Y2K Flights</B>
American Airlines said it will cut its usually lighter New Year's Eve capacity an additional 6 to 8 percent as the digital clocks turn. Northwest and KLM, citing "lower than normal demand" also will cut back flight schedules on Dec. 31 and Jan. 1. KLM will operate only five intercontinental flights, compared with 35 at the end of 1998. Meanwhile, British Airways said its turnover schedule will reflect reduced consumer demand. It plans to have 20 jets in the air at the stroke of midnight, compared with 55 last year. Other carriers have reduced or eliminated flight schedules, but all insist the moves are demand-driven and not a result of computer problems or fears.
<A NAME="3"><B>Delta, US Airways Reach Labor Agreements, AA Doesn't</B>
Delta and the Air Line Pilots Association reached a tentative agreement on pay scales and work regulations for B777 and B767-400 aircraft. Delta this summer was forced to defer remaining 777 deliveries due to unsuccessful pilot contract negotiations, but said the agreement, if ratified, will allow the carrier to move forward on fleet renewal. Delta's flight attendants also are working toward organizing a new labor union, which would be represented by the Association of Flight Attendants. Delta is the only major U.S. carrier to employ nonunionized attendants. US Airways also reached a tentative agreement with the International Association of Machinists and Aerospace Workers. The deal, which staved off a possible machinists strike, still awaits union ratification. Meanwhile, the union representing American's 21,000 flight attendants voted down a tentative contract agreement and will return to the bargaining table. In a statement, the carrier said the rejection was "unfortunately consistent with recent industry trends."
<A NAME="4"><B>Starwood to Sell Stock to Improve Performance</B>
Starwood Hotels & Resorts Worldwide Inc. announced late last month that it plans to sell approximately $500 million worth of hotel properties between now and the second quarter of 2000. Sale proceeds are expected to be used primarily to repurchase stock under Starwood's existing share repurchase program. Starwood chairman and CEO Barry S. Sternlicht said in a statement that the company is trying to improve its stock performance and is evaluating capital expenditures as well as all owned real estate to maximize returns on invested capital. "We are very focused on selling non-strategic assets around the world in a tax-efficient manner," he noted. "Our goal is to retain the management contracts where possible.
<A NAME="5"><B>EC Directorate General Closes Amadeus Probe</B>
Putting to rest a cloud that has hung over Amadeus for more than two years, the European Commission's Directorate General for Competition last week said it will close its investigation into a complaint filed with the U.S. Department of Justice against the global distribution system by American Airlines and Sabre. The complaint alleged that Amadeus, which is based in Madrid and majority-owned by European airlines, of exclusionary conduct designed to keep Sabre out of the European market. The Commission said it did not find "any infringement as alleged."
<A NAME="6"><B>AA Integrates Another</B>
Following its integration of Reno Air earlier this summer, American Airlines has merged Business Express into the American Eagle network. Despite protests from AA labor groups, all 300 daily Business Express flights now are available through Sabre. As a result of the integration, American Eagle now serves six new Northeastern cities.
<A NAME="7"><B>VTS Rebrands</B>
Following the acquisition of the New York-based Direct Travel Inc. in July (<I>BTN</I>, July 5), VTS Travel Enterprises Inc. has announced a name change and logo for its subsidiary, VTS Travel. The name VTS Travel Direct was chosen because, "we wanted to really embrace former Direct Travel clients and operations in a way that makes sense," said Vince Vitti, CEO of VTS Travel Enterprises Inc. "VTS has a good presence and is well known in the metro-New York area, but we are not known much at all in the midmarket in Boston, Washington, Chicago and San Francisco where Direct was doing promotions and had established client relationships for a long time. We thought it made sense to come up with an identity that brought both of those things together.