Atlas Air Worldwide Holdings has reversed plans for completing a full operational merger between its Atlas Air and Polar Air Cargo subsidiaries after opting to retain separate certificates for the two carriers.
In a joint letter to the US Department of Transportation (DoT) dated 30 May, Atlas and Polar say: “For commercial reasons, [Atlas Air Worldwide] has made the strategic decision to retain and conduct operations under both the Atlas and Polar certificates”.
Consequently, the three parties have withdrawn their previous request to register Atlas as an additional trade name of Polar’s, which would have supported a broader corporate strategy to consolidate Atlas into Polar with the surviving certificated carrier, Polar, operating under both brands.
Atlas acquired Polar in November 2001.
In its original application to the DoT, the company contended that “operational inefficiencies and unnecessary attendant costs are inherent in the present functional structure of two separately certificated air carriers, even under common ownership”.
It pointed out that US Federal Aviation Administration and foreign government requirements “add complexity to fleet cross-utilization and preclude aircraft interchangeability”, although inter-company wet-leasing has allowed for some flexibility in this regard.
Additionally, noted Atlas in its 2005 application, FAA requirements “necessitate duplicative Atlas and Polar management structures in the areas of flight operations and maintenance, precluding a more efficient coordination of operations through a single, completely integrated chain of command”.
Atlas and Polar now say the withdrawal of their application “does not affect out intent to proceed with the integration of the Atlas and Polar crewmember seniority lists, nor does it affect our intent to complete the operational merger of the two airlines to the extent allowed by the FAA.”
On 20 April, ATI exclusively reported that Polar is to park its remaining fleet of Boeing 747-100 and -200 freighters by 1 July, but will retain its fleet of five 747-400s for operation on scheduled services.
At that time, Bobb Henderson, chairman of the Polar division of the Air Line Pilots Association, insisted that “while Polar Air Cargo crewmembers are furloughed, much of Polar’s scheduled service flying will be flown by Atlas Air”.
Atlas, which posted a first quarter net loss of $3.7 million, recently blamed “shifting market dynamics” for its decision to reduce “nonessential capacity”.
Neither Atlas nor Henderson could be immediately reached for comment.
Source: Flight International
