Spanish airline Iberia is negotiating to expand its use of "wet lease" agreements, leasing planes and crew from other companies, Iberia sources said. Spanish financial newspaper Cinco Dias reported that Iberia had reached agreements to lease 10 aircraft from Iceland-based Air Atlanta and Spanish group Gestair. Iberia sources said negotiations were under way but details had not been made final. "It is true that we are in this process," one source said. Another Iberia source said the use of wet leases brings flexibility at low cost and would allow the Spanish airline to offer more flights after completion of an expansion at Madrid's Barajas Airport. Cinco Dias said Air Atlanta would operate four Boeing 747s for Iberia on routes between the Spanish mainland, the Canary Islands and the Caribbean. Gestair would operate six Boeing 757s on Iberia's Madrid to Barcelona route, it said.

renamed ‘Birthday Girl’ and will fly between London Heathrow and many of Virgin Atlantic’s North Atlantic routes. The new Flying Lady has moved from the nose of the aircraft to the rear of the aircraft and has quadrupled in size. To toast Virgin Atlantic’s 21st birthday, she is holding a glass of champagne, which on its own measures 50” high (127cm) and which if it were filled, would hold 29 magnums of champagne. Inspired by the famous Varga girls whose images graced an entire generation of British and American military aircraft during and after the Second World War, the original Flying Lady is featured on the nose of every aircraft within the Virgin Atlantic fleet.

Finnair's pilots stopped working overtime in April and will not start unless a new agreement is clinched by then, the pilots' union said. Head of the union Panu Maki said the main disagreements with employers were over working and rest hours, which the company wants to keep unchanged. The previous agreement ran out in January. "Especially in long-distance flights, where Finnair has added many destinations, there are too short rest times and too small crews. We fly too long days also in global comparison with only two pilots," Maki said, adding pilots also wanted to have a say in outsourcing issues. He said the 620 union members were not considering a strike at this point, hoping a deal could be reached with a help of the state mediator.

Bankrupt US Airways confirmed it was in talks with America West on a "strategic transaction," but said there is no assurance a deal will be reached. While US Airways would not characterize the talks, reports this week said the two carriers were in advanced discussions on a merger. Such a deal would lift US Airways out of Chapter 11 and give America West a strong foothold in the East. Other reports have said the two could enter into an agreement short of a merger under which America West would invest in US Airways and the two would "codeshare" - cross-market and sell seats on each others' flights. Although US Airways officials were until Friday close- mouthed on the subject and America West Chief Executive Douglas Parker refused to discuss the matter at an industry conference this week, the talks became the industry's biggest open secret.

The European Union is still examining a rescue plan for Italian flag carrier Alitalia, the EU's executive Commission said on Monday. Shares in the ailing airline rose on Monday after a newspaper report on Saturday said the European Commission had been advised to give the go-ahead for stateowned holding company Fintecna to take a stake in spun-off ground service unit AZ Service, a key part of Alitalia's rescue plan. The Italian daily la Republica also quoted EU Transport Commissioner Jacques Barrot as saying that the Alitalia rescue plan was "exemplary", comments his spokesman could not confirm. "We are continuing to examine the issue. We are awaiting some additional information from the Italian authorities," Barrot's spokesman Stefaan De Rynck told a daily news briefing.

United Airlines, struggling to regain financial stability, is setting its sights on new Asian routes where economic growth is fueling passenger demand, United's chief executive said on Friday. United must continue to bolster its position as a global airline, shifting US domestic capacity to international routes, said Glenn Tilton, in a recorded message to employees. United has been focusing on international expansion as a means to exit Chapter 11 bankruptcy protection. The carrier has four daily nonstop flights from the United States to China and is eager to establish more. "In particular, we see great opportunities for United in the Asia Pacific market," Tilton said, noting growth in foreign investment and the number of affluent consumers in the region. "As the middle class and their disposable income continue to grow in Asia, more and more people in this market are traveling to the United States," Tilton said.