Friday, April 11, 2008

Southwest Planes Had Cracks an Inspection Might Have Found


WASHINGTON — Five Southwest Airlines planes grounded last month because they had not been properly inspected had precisely the kind of cracks that the inspection order was intended to detect, an official of the agency testified Thursday to a Senate subcommittee. The testimony, by the associate administrator for safety of the Federal Aviation Administration, was the most explicit statement so far that the epidemic of aircraft groundings had genuine safety roots. But the agency’s troubles seemed to deepen as the subcommittee chairman, Senator John D. Rockefeller IV, Democrat of West Virginia, compared the F.A.A.’s handling of its lapses to the Pentagon’s handling of the abuse of prisoners at Abu Ghraib, and suggested that punishments should reach higher into the ranks. “Nobody at the top ever gets fired,” said Mr. Rockefeller, chairman of the Senate Commerce aviation subcommittee, while questioning Nicholas A. Sabatini, the F.A.A. associate administrator.

Mr. Sabatini blamed subordinates for the problem, though he acknowledged his responsibility. Senator Rockefeller, suggesting that heads should roll, remarked, “You’re responsible, but you don’t have to be accountable?” The F.A.A.’s recent decision to audit the airlines for compliance with its rules, resulting in an unprecedented wave of aircraft groundings, has been driven largely by revelations from a House committee, but the Senate was hardly friendlier. Mr. Rockefeller told a panel of witnesses, “It’s catastrophic economically, and it’s an embarrassment to the nation. ‘’

Mr. Sabatini stressed that statistically, the recent past has been the safest period in aviation history.

“We didn’t get here by accident,” he said, with no evident recognition of the double entendre. He attributed safety gains to extensive use of operating data by his agency and the airlines to isolate areas of risk and focus on them. In recent audits to determine if the airlines were complying with F.A.A. orders, “we found we had achieved 99 percent compliance, but it’s the other 1 percent that keeps me up at night,” Mr. Sabatini said. He used stronger language to describe what Southwest had done in flying planes that it knew had not been properly inspected. While the airline’s executives testified under oath last week that there was no safety-of-flight problem, Mr. Sabatini’s prepared testimony said the flights had been putting thousands of passengers at risk. Some senators said, however, that in a data-driven system, under which F.A.A. inspectors mostly review records rather than look at aircraft, the agency might have lost touch with actual conditions. Calvin L. Scovel III, the inspector general of the Transportation Department, of which the F.A.A. is part, said the problems at Southwest, where planes that had not been inspected were allowed to keep flying, amounted to “fundamental breakdowns in F.A.A. oversight.” These troubles, he said, were “symptomatic of much deeper problems in several key areas of F.A.A.’s oversight.”

In addition to the current maintenance crisis, the agency faces severe challenges in hiring employees in large numbers to replace air traffic controllers and safety inspectors; thousands have reached retirement age in the last few years or will soon. The biggest safety challenge of all may be the risk of runway collision, said Steven R. Chealander, a member of the National Transportation Safety Board. Mr. Chealander said that the number of serious runway incidents this year was double the level of early last year.

Frontier Airlines files for Chapter 11 protection

Wichita Business Journal - by Denver Business Journal

Frontier Airlines filed for Chapter 11 bankruptcy late Thursday in federal bankruptcy court in New York City in response to what the airline said was a threat to its liquidity resulting from actions by its principal credit card processor. On its website, the airline said it would continue its full schedule of flights and will honor tickets and reservations and provide refunds and exchanges under its standard policies. Frontier offers three flights a day to Denver from Wichita's Mid-Continent Airport using its Lynx carrier. Its frequent flyer program and customer service programs would remain unaffected, as will wages and benefits, the company said. Suppliers and other vendors payments would be unaffected, the airline said.

"Frontier is committed to delivering exceptional customer service and we intend to continue delivering on that promise with normal operations throughout our reorganization process," said Sean Menke, Frontier President and CEO. "To be clear, we filed for very different reasons than those of other recent carriers, and our customers and employees can be confident that we intend to keep on flying and providing outstanding service and products." The airline said it made the decision to file for Chapter 11 bankruptcy after its credit processor changed its fee schedule, specifically its hold back of customer receipts. That, the airline said, severely threatened its liquidity.

"Given the recent progress we have made towards strengthening our balance sheet and obtaining additional financing, it is truly unfortunate that we have had to take this action," Menke said. The company listed assets of $98.3 million and debts of $92.2 million as of Dec. 31, 2007. Its top five creditors are Wells Fargo $93,491,208.79; the City & County of Denver $2,408,887.38; Total Petrochemicals Inc. $2,366,875.29; Airport Revenue Fund $1,817,919.59; World Fuel Services Inc. - Wire $1,557,138.66, according to the bankruptcy filing. Frontier Airlines Holdings, Inc. common stock is traded on NASDAQ's National Market under the symbol FRNT.