This article from NYTimes.com has been sent to you by psa188@xxxxxxxxx Another NY Times screwup. Note that they allege that AA's F100s are ex-TWA. psa188@xxxxxxxx /-------------------- advertisement -----------------------\ Explore more of Starbucks at Starbucks.com. http://www.starbucks.com/default.asp?ci=1015 \----------------------------------------------------------/ Airlines' Unwanted Fleet Grows in the Desert June 7, 2003 By EDWARD WONG MOJAVE, Calif. - No better barometer of the fortunes of the airline industry exists than 1,200 acres of parched brown earth here, baking at 102 degrees. Row upon row of jetliners sit idle in three lots, their engines sealed with silver or black Mylar, their rudders rising from the flat desert like shark fins protruding from an ocean's glassy surface. Rattlesnakes slither in the shadows of nose cones and tortoises inch their way past landing gear. A yellow school bus carrying a dozen mechanics barrels between planes, kicking up dust. About 230 jets have been consigned to this purgatory, a storage and maintenance yard operated by Avtel Services. That number is four times what it was before the terror attacks of Sept. 11, 2001. When the airline business is poor, the money here can be good, and the general manager, Justin Loucks, says his business will only get better. "I don't think we've seen the end of the bankruptcies in the U.S.," Mr. Loucks said as he stared out the window of his second-floor office at the field of planes. "Several companies are on the brink." Avtel has 50 customers from around the world, and many have parked their multimillion dollar assets on Mr. Loucks's scorching front yard. There are silver Fokker 100's from the ailing American Airlines, cherry red Boeing 737-200's from US Airways' failed Metrojet venture and hulking blue 747's from KLM, the Dutch airline. About 70 percent of the planes are from lessors and the leasing arms of companies like Bank of America and General Electric, the rest from the airlines themselves. The ebb and flow of planes here serves as a gauge of both industrywide health and the strength of individual airlines. There are other indicators of the state of airline economics as well. For instance, Avtel is getting a flood of résumés from mechanics as airlines wrest concessions from unions and lay off workers, officials here said. Privately owned by the Telford Group, which is based in Bangor, Me., Avtel does not have to report financial numbers, though it did make a profit in the last five quarters, said Vern Alexander, the director of marketing. Before the Sept. 11 attacks, about 80 percent of Avtel's revenue came from performing heavy maintenance checks on planes, and only 20 percent from storage and upkeep, Mr. Alexander said. Since then, those percentages have reversed. The air park here, at 3,000 feet above sea level, is the largest of five lots - all owned by different companies - that are scattered across Southern California, Arizona and New Mexico, according to Back Aviation Solutions, an airline consulting firm. The second largest, 60 miles to the southeast in Victorville, Calif., had 168 planes as of May 22, up from 77 before the Sept. 11 attacks. The third largest, in Roswell, N.M., had 145 aircraft, up from 16 before the Sept. 11 attacks. A total of 734 airplanes were in long-term storage as of May 22, according to Back Aviation. Airlines have been parking jets to trim a surplus of seats in the air. Available seat miles among major airlines, a measure of capacity, were down 6.5 percent in April from April of last year, and down nearly twice that much in May, according to the Air Transport Association, the industry's main trade group. "We started seeing parking of airplanes, so we aggressively went after those customers," said Trevor Van Horn, the chief executive of Evergreen Air Center, a privately owned company that is storing more than 100 planes in Marana, Ariz. Last year, he said, Evergreen had its second-largest profit in a decade. Michael Allen, the chief operating officer of Back Aviation, says the parking of planes might slow in the summer - the busiest travel season - then pick up again. Here in Mojave, the number of stored planes reached a peak of 310 last August, Mr. Loucks said. It has dropped by 26 percent since then, but not because the big airlines in the United States are returning their jets to service. Generally, the aircraft - many of them 25 years old - are being sold to airlines in developing countries. It is a buyer's market for planes. A 737-200 that would have sold for $3.5 million to $5 million three years ago goes for less than $1.5 million now, Mr. Loucks said. A drive around the lot gives a firm sense of the misfortunes of some of the industry's biggest players. To trim costs at the largest airline in the world, American, part of the AMR Corporation, has been trying desperately to winnow the variety of planes in its fleet, which accounts for the 16 silver F-100's sitting in the lot called Area 3. American has contracted with Avtel to store 74 of the aging planes, which were acquired when American bought Trans World Airlines two years ago, Mr. Alexander said. Gerard J. Arpey, American's new chief executive, has said that American still may have to file for bankruptcy protection, despite the $1.8 billion in annual labor savings it has obtained from workers. A filing by American could add as many as 60 planes to the lot here, Mr. Loucks said. When National Airlines shut down last November after two years in bankruptcy court, Avtel received eight 757's within two days. Aircraft leasing companies hired flight crews to fly the planes from National's base in Las Vegas to various air parks. "It looked like Saigon on the last day of the war," Mr. Loucks said, adding that half the planes have been leased out again. Aircraft are here from many other companies that are struggling through bankruptcy or met ignominious ends: Air Canada, the single largest customer here, with 29 planes; Hawaiian Airlines, whose DC-9's have been bought by an engine broker in Florida; and Swissair, now defunct, its distinctive white cross on a red field still painted on the tailfins of MD-11 jets. Though Avtel has a contract with Southwest Airlines, that company - which has remained profitable through the industry's deep slump - has stored jets here only once. That exception involved 19 brand-new 737-700's that Southwest took delivery of from Boeing right after the Sept. 11 attacks, Mr. Alexander said. Those planes have since been put into service. But as Southwest updates its aging fleet of 737-200's, it will start parking the old jets here, he added. A plane put into storage generally goes through three stages: preparation, which includes covering the engines and taping all cracks (at a cost of about $12,000 for a narrow-body jet); monthly maintenance and engine checks ($1,000 or so a month); and restoration to service, essentially reversing everything done in the first stage (another $12,000). Avtel employs about 350 people, mostly mechanics. The Federal Aviation Administration has two officials on the ground to ensure quality, and every major customer has a representative here. Mr. Alexander says he has talked with several carriers, including United Airlines, about assigning mechanical work to Avtel. United recently won concessions from its machinists' union that allow the airline to farm out more of these duties. Other airlines are expected to try to negotiate similar terms with their unions, which could be a boon for companies like Avtel. There have been recent though rare instances of airlines' returning to service the planes that they stored here. After US Airways filed for bankruptcy protection last August, it parked dozens of planes, Mr. Loucks said. The airline left bankruptcy court in March, and all but seven planes are flying again, he added. In the first lot, a towering 767 from British Airways stands with its doors open. Mr. Alexander said that the long-haul plane - its tail painted with colorful geometric designs conceived by the South African artist Emmly Masanabo - would go back into service in mid-June, after having languished here for about 16 months. Workers will take two weeks to prepare it. "There definitely is a good feeling in seeing an aircraft taxi or take off that you had in storage," he said. "An airplane is only alive when it's in flying condition." But for now, most of the other planes will remain in limbo. The tortoises crawling across the dirt are putting in more miles these days. http://www.nytimes.com/2003/06/07/business/07AIR.html?ex=1055999013&ei=1&en=16253482117f46f8 --------------------------------- Get Home Delivery of The New York Times Newspaper. Imagine reading The New York Times any time & anywhere you like! Leisurely catch up on events & expand your horizons. Enjoy now for 50% off Home Delivery! Click here: http://www.nytimes.com/ads/nytcirc/index.html HOW TO ADVERTISE --------------------------------- For information on advertising in e-mail newsletters or other creative advertising opportunities with The New York Times on the Web, please contact onlinesales@xxxxxxxxxxx or visit our online media kit at http://www.nytimes.com/adinfo For general information about NYTimes.com, write to help@xxxxxxxxxxxx Copyright 2003 The New York Times Company