ac7e7
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Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 1:36 am



PEACHTREE CITY, Ga., March 8 /PRNewswire-FirstCall/ -- World Airways, a wholly owned subsidiary of World Air Holdings, Inc. has signed a two-year ACMI wet-lease contract with Air Canada for international cargo service between Toronto, Canada and several cities in Asia, and between Toronto and Europe. Under the agreement, World will operate an MD-11F freighter aircraft for Air Canada beginning in May 2005. The contract has an estimated value of $44 million.




PEACHTREE CITY, Ga., March 8 /PRNewswire-FirstCall/ -- World Airways, a wholly owned subsidiary of World Air Holdings, Inc. has signed a two-year ACMI wet-lease contract with Air Canada for international cargo service between Toronto, Canada and several cities in Asia, and between Toronto and Europe. Under the agreement, World will operate an MD-11F freighter aircraft for Air Canada beginning in May 2005. The contract has an estimated value of $44 million.

"Air Canada is a leader in the airline industry, and we welcome the opportunity to partner with them as they expand their cargo operation," said Rob Binns, World’s senior vice president, marketing and planning. " This agreement extends World’s presence in the flourishing Asian cargo markets."

World Airways, a wholly owned subsidiary of World Air Holdings, Inc., is a U.S.-certificated air carrier providing customized transportation services for major international cargo and passenger carriers, the United States military, and international leisure tour operators. Founded in 1948, World operates a fleet of 16 wide-body aircraft to meet the specialized needs of its customers. For information, visit http://www.worldairways.com/ .

"Safe Harbor" statement under the Private Securities Litigation Reform Act of 1995: This release contains forward looking statements that are subject to risks and uncertainties including, but not limited to, the impact of competition in the market for air transportation services, the cyclical nature of the air carrier business, reliance on key marketing relationships, fluctuations in operating results and other risks detailed from time to time in the company’s periodic reports filed with the SEC (reports are available from the company upon request). These various risks and uncertainties may cause the company’s actual results to differ materially from those expressed in any of the forward looking statements made by, or on behalf of the company in this release.

CONTACT: Steve Forsyth of World Airways, +1-770-632-8322

Web site: http://www.worldairways.com/

 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 1:58 am

Isn't Hollis Harris (the first Georgian to run AC) still the CEO of World Airways? He's the one who hired the horrendous 2nd Georgian Robert Milton into AC. So now they do a deal. Surprise, surprise.

Well, hopefully the deal was at least tendered first, and not just a Milton favour for "Uncle Holly". It smells suspiciously of pay-back or nepotism when the (current) failed AC CEO concludes an agreement with his predecessor (who happened to hire him into AC) and who now leads another airline. Talk about implied or perceived conflict of interest.

I can hear the AC BoD rubber-stamping as we speak. It will be nice when AC learns some corporate ethics.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
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clickhappy
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 2:00 am

World is run by Randy Martinez, and has been kicking ass butt and taking names. Good to see World growing so strongly, I wish I would have bought more stock.
 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 2:18 am

Hollis Harris stepped down from the CEO position in Q2 last year, and left the BOD a little later.

This still smacks of corporate nepotism. Of all the cargo companies worldwide that could have bid on the AC business, the one that AC chooses has the recently former CEO that hired the current AC CEO? I can smell the pay-back from here, and it stinks.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
boac707
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 2:31 am

So who should they have contracted with....WestJet....???? They already have contracts with Gemini and ACE. Why not spread the business around...round out your portfolio and protect against the pitfalls of using one operator.

I think your critism is premature and not founded in fact.
smokey classics to the end of time
 
ACYWG
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 4:08 am

Quoting Boac707 (Reply 4):
So who should they have contracted with....WestJet....???? They already have contracts with Gemini and ACE. Why not spread the business around...round out your portfolio and protect against the pitfalls of using one operator.

I think your critism is premature and not founded in fact.


EXACTLY
 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 4:47 am

There are dozens of carriers worldwide with the lift capability to bid on the AC business. Don't you think it's mighty coincidental that Milton chose World Airways (given that the outgoing CEO hired Milton into AC)?

I wonder if this was just a "good ole boy" deal between 2 Southern boys?
"Thanks for hiring me into AC Uncle Holly......here's some cargo business for you in return".

Unless there is confirmation of a fair tendering of this AC cargo business (and frankly, I do not know that AC is even required to confirm this publicly), I will assume this is just another Milton deal with no financial review (since most of his previous strategic decisions at AC have had no financial benefit).
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
wjcandee
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 5:39 am

YYZ: If this was "corporate nepotism", whatever that is, don't you think that the contract would have been issued when World was desperate for business just a couple of years ago, rather than now, when they are merely building their business. Then, they took contracts with marginal operators (like STAF, RiteTime, etc.) just to have something to do with the planes they already had. Now, they will have to add aircraft to service the newest contracts that they are selling. There's a difference between using one's contacts to attempt to make a sale, and "corporate nepotism"...oooooh...evil!

Of course, I'm sure that there's no persuading you, so...whatever.

PS Which of the Heard and McDonald Islands are you from? They're awfully far from Canada. Or is this just some clever play on Shag Island? Gee, wouldn't it be swell to be from Shag Island? Mmmmmm....Shag Island...Doh!
 
sebring
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 6:08 am

There's a simple explanation for this and Neil owes this board an apology.

Gemini Air Cargo was supposed to operate a second MD-11 for AC Cargo but backed out because all of its spare lift has been chartered by FedEx. AC must have an MD-11, and there are only two MD-11 freighter wetlease providers in North America, World and Gemini. So AC went to World. World will operate one MD-11F for AC, Gemini the other. It would have been more advantageous for AC to have one operator provide both aircraft, but that isn't possible. So there is no sweetheart deal, and the only thing that stinks, Neil, is your attitude.
 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 6:31 am

AC must have an MD-11, and there are only two MD-11 freighter wetlease providers in North America, World and Gemini. So AC went to World. World will operate one MD-11F for AC, Gemini the other. It would have been more advantageous for AC to have one operator provide both aircraft, but that isn't possible.

Seems partially reasonable. But why MUST AC have an M11? Why MUST it be a North American M11 carrier? What about 747F's? What about Martinair? Seems like the "conditions" ensured that World would win the contract.

The fact that the former CEO of World hired the current CEO of AC SHOULD PRECLUDE any deal between AC and World due to the perception of nepotism, unless of course this was a fair tendering process. This would be true even if Milton was a successful CEO, but he's not. The supposed "need" for a North American M11 operator suggests the business was deliberately funnelled to World as a favour from Milton to Harris. I have no proof but the suspicion is there.

There's a simple explanation for this and Neil owes this board an apology....the only thing that stinks, Neil, is your attitude.

Sebring, cut the personal attacks and stick to the issue. Act like the 46-55yo man you claim to be. Thanks in advance.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
ac7e7
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 6:46 am

Quoting Yyz717 (Reply 3):
This still smacks of corporate nepotism. Of all the cargo companies worldwide that could have bid on the AC business, the one that AC chooses has the recently former CEO that hired the current AC CEO? I can smell the pay-back from here, and it stinks



LMAO!!!!! Listen, this isn't the Liberal Party of Canada. I'm sure it had nothing to do with the relationship between Harris and Milton.


Quoting Yyz717 (Reply 9):
Seems partially reasonable. But why MUST AC have an M11? Why MUST it be a North American M11 carrier? What about 747F's? What about Martinair? Seems like the "conditions" ensured that World would win the contract.


Maybe they don't need a 747F, an MD-11 would do. Maybe they are watching their $$$ and see that a 747F would be too expensive and/or the 747 has too much cargo capacity for what they need.
 
sebring
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 7:08 am

The 747 is too big, at least at this stage of the development in Cargo's freighter business. It's a big business risk. The MD-11 has been performing exceedingly well for AC. As for why it would require a North American operator, it's because AC won't necessarily operate the plane seven days a week. With a non-North American operator, that would mean either incurring downtime on the aircraft or ferrying it to and from another continent, both equally unattractive for the operator. With a US operator, the plane can come back to toronto and deadhead to a US point and do a run for the US Military or for FedEx or UPS, then deadhead back to North America. Gemini and World as the service providers are also close by if it becomes necessary to substitute an aircraft because of maintenance or scheduling reasons, and AC has been known to ask for an extra section on short notice, which again is something that is easier for a North American operator to provide.
 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 7:16 am

It all makes sense Sebring. Martinair however operates M11 services to many North American cities. I wonder whether Martinair had the oppty to bid on this business? If not, why not?

I'm still not convinced that Milton did not say "I want this business to go to World, make it happen". So many bad decisions completely bereft of financial sense have come from Milton, I have no confidence that this tendering (if it was a tendered) was analyzed in an unbiased fashion. That World got the business given Milton's existing close ties just seems so suspiciously coincidental.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
gothamspotter
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 7:22 am

99% of deals/major hires in business and government involve some sort of nepotism or back scratching. World is a perfectly capable carrier. There's no reason to question why AC would contract with them, nor should you question the ethics of why McDonald's sells Coke rather than Pepsi, or why Dell uses UPS rather than FedEx.
 
FRA2DTW
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 7:27 am

Hollis Harris has no longer any ties to World Airways. He is not on the Board, is not a "consultant" and sold all or most of his shares at half the price they would bring today. I don't think the parting was amicable and he would not in any way benefit from any "favors" by Mr. Milton. HH saved World Airways from extinction and will always be admired for that.

The reason Air Canada went to World Airways is that MD-11 freighters are at a pemium and both Gemini's and Martinair's capacity was sold out. Know the current cargo market before making accusations!
 
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yyz717
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 7:30 am

99% of deals/major hires in business and government involve some sort of nepotism or back scratching.

Not for tendered projects, they don't. Corporate governance guidelines increasingly demand accountability and transparency. AC shareholders demand the most cost effective cargo deal....serious questions remain unanswered about this one (that granted, do not need to be publicly answered). I do hope that the BOD takes Milton to task on this cargo deal to ensure that it was indeed tendered and analyzed fairly. The optics do not look good though.

World is a perfectly capable carrier. There's no reason to question why AC would contract with them

Given Milton's poor record as CEO, and his personal ties to a recent former CEO of World, there is every reason to question this contract.
I dumped at the gybe mark in strong winds when I looked up at a Porter Q400 on finals. Can't stop spotting.
 
boac707
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RE: Air Canada Signs Cargo Deal With World Airways

Thu Mar 10, 2005 9:10 am

I rarely reply twice on the same thread...but I am watching this thing go back and forth with reasonable suggestions and explanations only to have YYZ717 respond in the same "conspiracy" theory format. Quite frankly, yyz, you sound like a spurned lover that will not listen to reason. I thank you for your deidication to attacking the topic, but really move on.

To the rest of those that responded, thank you all for reasonable well thought out comments
smokey classics to the end of time

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