For Immediate Release April 7, 2005

David Treitel, Chairman of SH&E, the Global Air Transport Consultancy Makes Presentation to Calyon Securities, Inc. Employees and Clients

Calyon Securities Inc. (formerly Credit Lyonnais Securities) is an international brokerage and investment banking firm with a focused interest in the aviation industry. Mr. Treitel discussed the outlook for the airline industry and the carriers with their varying cost and operating structures. In brief, among the key points of his Calyon presentation , Mr. Treitel noted that:

• Unit revenue (revenue per available seat mile, or RASM) may increase this year. As load factors continue to increase due to strong passenger demand, SH&E expects underlying traffic growth in the U.S. to outstrip capacity increases, pointing to some RASM recovery.
  
• Legacy carriers need a design overhaul. Instead of just flight attendant uniforms, the big networks carriers need to redesign their operations. Legacy carriers still have average unit costs excluding fuel that are nearly one-third higher than their low cost carrier (LCC) competition. Even as the legacy carriers achieve cost cuts from new deals with labor, they need actually to redesign their operations in order to increase aircraft utilization and labor productivity to be truly competitive.
  
• Watch out for the expansion of LLCs. LLCs will dominate aircraft deliveries over the next five years and the trend of North American LLC penetration suggests that market share will grow from nearly 28% this year to reach 50% in the future.

Contact:

Lindsey Litton
Media and Public Relations Manager
ICF International
1.571.265.1472
llitton@icfi.com
 

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