Money Makes The World…

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Congress To Decide On Next Four Years Of FAA Funding…

Tuesday, the Bush administration’s four-year funding plan for the FAA, known as the Centennial of Flight Aviation Authorization Act (Flight-100), went off to Congress. “Flight-100 will help increase capacity and efficiency throughout our aviation system,” DOT Secretary Norman Mineta said in a news release. The proposal would support modernization of the air traffic control system, provide a substantial investment in safety research (perhaps without one major NASA research center) and airport infrastructure improvements, and would restructure the Airport Improvement Plan to spend more at small airports. The proposal includes $2.9 billion in FY 2004 for FAA facilities and equipment, rising to $3.1 billion by 2007. The FAA would receive $7.5 billion in FY 2004 for operations and maintenance — a 7-percent increase over the FY 2003 budget request. The funding would support implementation of the FAA’s Operational Evolution Plan, the acceleration of airspace redesign and future air traffic controller staffing needs. Flight-100 calls for an Airport Improvement Program investment of $3.4 billion each year. “The Bush Administration looks forward to working closely with the Congress on timely passage of this bill as we continue to improve the safest aviation system in the world,” Mineta said.

…As Industry Struggles With Lagging Production…

Following a recent cutback in its expected bizjet orders, Cessna will axe about 1,200 jobs, most of them in Wichita, Kan., and 6,000 workers will be furloughed for seven weeks, The Wichita Eagle reported last week. Cessna’s parent company, Textron Inc., based in Providence, R.I., cited global concerns in its decision. “The current economic and geopolitical situation has worsened and is affecting business jet demand much more severely than expected,” Textron CEO Lewis Campbell said in a news release. Textron had planned to deliver about 220 jets this year, but now has cut that number to 180-195. Cessna delivered 305 bizjets in 2002. Contributing to the latest job reduction was a decision by Cessna’s biggest customer, NetJets, to cancel orders for some of the business jets it planned to buy from Cessna this year, The Wichita Eagle reported. Campbell said the downturn in the bizjet market will not affect new product development, and Cessna will roll out its new Sovereign, CJ3 and Mustang jets according to plan. “In spite of the temporary softening in the business jet market, we believe that long-term demand for business jets is still excellent,” he said. The CJ3 is scheduled for a first flight sometime in May.

…And Worries Of War Feed Uncertainty

As the war in Iraq continues, it could cost the airlines $10 billion worldwide, the International Air Transport Association (IATA) said on Saturday, about $4 billion of that in the U.S. But when the White House on Monday asked Congress for $75 billion in emergency funding to pay for the war, no airline relief could be found there. International passenger traffic could drop up to 20 percent, the IATA said, and already about 150 flights over Middle Eastern airspace have been suspended or rerouted. Delta said Monday it will cut its schedule by 12 percent, joining the other four top airlines, which cut back from 6 to 12 percent last week. Boeing laid off another 960 workers last Friday, bringing its job-loss total to 5,000 in the last year and a half. More airline bankruptcies loom, as well as tens of thousands of job cuts. IATA Director General Giovanni Bisignani called on governments worldwide to allow more airline mergers. “We need the economies of scales that mergers or acquisitions can provide,” he said. “The air transport industry is going through its worst crisis since the Wright Brothers flew one hundred years ago.” IATA has activated a 24-hour task force to help 270 member airlines rejigger routes in wartime.

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