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Ryanair chief Michael O’Leary has astounded observers in the airline industry once again, this time by hailing the looming recession as good news. Speaking after the low-cost carrier confirmed that its half-year profits had fallen by 47 percent, O’Leary said that he looked forward to the economic downturn as it will “get rid of crappy loss-making airlines.” That, he said, would afford Ryanair an opportunity to expand its fleet by purchasing grounded aircraft, particularly large planes capable of transatlantic travel. More than two dozen airlines have already declared bankruptcy this year and British Airways chief executive Willie Walsh recently said that he expects a further 30 to go under before the end of the year.

Delta and Northwest Airlines won antitrust approval on Wednesday, with the Justice Department saying the creation of what will be the world’s largest airline will help consumers without hurting competition. The approval means the only thing standing between the two airlines and the deal closing is a trial in San Francisco next week in a lawsuit brought by 28 travelers. Northwest CEO Doug Steenland has said he does not believe the lawsuit will stop the deal, which the carriers have said they hope to close by the end of this year.

Denmark low-cost carrier Sterling Airlines has filed for bankruptcy, and canceled its flight schedule going forward. The collapse left thousands stranded around Europe, and the airline warned that customers who purchased tickets directly through its website would not be refunded. Sterling, which operated a fleet of 27 aircraft to 40 European destinations, blamed the financial meltdown in Iceland for the failure.

The US Transporation Security Administration (TSA) says that, starting in 2009, airline passengers should be able to carry big bottles of liquids onto their flights, though the containers will still have to be removed from bags for separate screening. Technological advances are the reason for the change, with X-ray machines now capable of distinguishing between harmless liquids and dangerous explosives.

OneWorld Alliance partners British Airways (London) and Qantas Airways (Sydney) will pay a combined $15.5 million in fines in Australia for cargo price-fixing charges dating back to 2002. The airlines already have paid fines in the U.S., and an investigation by the EU is ongoing.

Hawaiian Airlines has bought two new wide-body Airbus A330-200 aircraft that will accelerate the start of the company’s transition to a new Airbus fleet to 2011. The two jets are in addition to the agreement that Hawaiian announced earlier this year to purchase up to 24 new Airbus aircraft. Hawaiian also announced a separate agreement with AWAS to extend to 2011 the leases of two Boeing 767-300ER jets currently in the fleet. The newly leased A330s will ultimately replace the B767s with the extended leases.

American Airlines (Dallas/Ft. Worth) placed an order Wednesday for 42 Boeing 787-9 Dreamliners, worth more than $8 billion at list prices. American joins Continental and Northwest as the main US carriers to order the carbon-composite and titanium jet, which is designed to carry about 200 to 300 passengers on long-range flights using 20 percent less fuel than its predecessors. American, the world’s biggest airline by traffic, said it would take delivery of its 42 787-9s between 2012 and 2018. It also took out purchase rights on a further 58 787s that would be delivered between 2015 and 2020.

A drunk passenger tried to hijack a Turkish Airlines flight to Russia Wednesday before being brought under control, the head of Turkey’s civil aviation authority has said. The flight – which originated in the southeastern Turkish city of Antalya – was scheduled to land on time in St. Petersburg at 3:20 p.m. (7:20 a.m. ET), according to a spokeswoman for St. Petersburg’s Pulkovo Airport. Russia’s Interfax News Agency said the flight was carrying 164 Russian nationals.

Authorities say at least six passengers who complained of bumps and bruises from turbulence on an American Airlines flight from Argentina to Miami are being treated for minor injuries. American spokesman Tim Smith says Flight 908 was making a descent into the airport before 7 a.m. when it hit severe turbulence at 30,000 feet. Six people - two flight attendants and four passengers - were taken to the hospital with back and neck injuries. The Boeing 777 carrying 246 passengers and 14 crew members from Buenos Aires landed safely.

Regional carrier Mesa Air Group Inc. says it has a tentative contract with its pilots union after 10 months of negotiations. The new contract includes more days off for pilots and gives them more control over their work schedules. Mesa Air operates 159 aircraft to 126 cities under contracts with Delta Air Lines, US Airways and United Airlines. It also independently operates go! with air service throughout the Hawaiian islands.

The Bush administration escalated a bitter fight with airlines on Thursday by pushing ahead with a plan to auction takeoff and landing rights at New York-area airports despite key congressional opposition and an industry threat to block the initiative in court. The Transportation Department said it would start selling excess slots in January to ease congestion and delays and spur competition in the most lucrative U.S. business travel market. A slot is equal to rights for one takeoff and one landing. All three New York-area airports are notorious for congestion, which affects flights in other cities. A third of all U.S. air traffic arrives, departs or flies over New York.

Southwest Airlines (Dallas) will begin flying to Minneapolis in March, 2009. The low-cost carrier will only offer flights between Minneapolis/St. Paul International Airport and Chicago’s Midway airport. The company didn’t reveal how many flights it will offer, however, the carrier expects to take up to three gates at MSP.

At least 32 people were injured Thursday after a China Airlines flight from Hong Kong to Bangkok encountered turbulence, a Thai airport official said. Most of those hurt aboard flight CI-641 from Hong Kong suffered minor cuts and bruises, but two had spine injuries, a hospital spokesman said. Early accounts said there had been fewer injuries, none serious. The Boeing 747-400 was hit by turbulence about 20 minutes before landing at Bangkok’s Suvarnabhumi Airport at about 1:30 p.m., said a spokeswoman for Airports of Thailand.

Low on cash as it enters one of the slowest travel seasons of the year, Sun Country Airlines told workers on Monday it would cut their pay in half beginning next week and reimburse them in 2009. But the carrier’s two large unions – representing pilots and flight attendants – haven’t endorsed that plan. Stan Gadek, Sun Country’s CEO, said he hopes to gain union support of the plan. But in the interview he added: “I intend to go forward with it regardless” of the union response. “I’ve got to run a business here.” In his letter, Gadek told Sun Country workers, he will “work without pay until this crisis is resolved.”

Hundreds of workers at Greece’s debt-ridden Olympic Airlines have held a peaceful protest in Athens against government plans to privatize the carrier. An estimated 500 people took part in the protest at the transport ministry. This month, the EU approved Greece’s plan to break up and fully privatize Olympic by the end of 2009, transferring most of its 8,100 staff to public sector jobs. The company will keep its name and logo. Employee unions oppose the plan, and have staged a series of protests. The company has accumulated total losses of around €2.7 billion ($3.87 billion).

Unions representing civil aviation workers at Italy’s national airline, Alitala, have sealed a deal with a group of investors to keep the company from liquidation. Two unions, AVIA and SDL, mainly representing cabin crew, signed up to an agreement with investor group CAI on 29 September; the agreement is set to save Italy’s national airline Alitalia from bankruptcy. The ITF-affiliated union Federazione Italiana Lavoratori Trasporti-CGIL, also representing Alitalia workers, agreed to the deal last week after it won two new protocols, which resolved the union’s earlier concerns. The new airline is likely to be flying from 1 November; meanwhile technical operations are to be ironed out during October.

German police raided a plane in Cologne just before it was taking off Friday and arrested two ethnic Somalis, saying they found a suicide note that claimed the men wanted to fight a holy war and die in a terror attack. Police spokeswoman Katharina Breuer said authorities did not think the men planned to hijack the plane — KLM Flight 1804 to Amsterdam. Airport spokesman Walter Roemer said the pair were not armed. The Fokker 50 jet was at its “point of departure” when police grabbed the two suspects. The plane took off an hour later and landed at Schipol airport in the Netherlands without further incident. No other flights at Cologne airport were affected.

ICARO Fokker 28 HC-CDT (cn 11222) overran runway 35 at Quito’s Mariscal Sucre International Airport this morning, crashing through a brick wall and coming to rest about 400m from the end of the runway. None of the 62 passengers or crew aboard the aircraft were seriously injured in the accident, which happened as the pilots attempted to abort the jet’s takeoff.

The FAA yesterday approved the merger transition plan submitted by Delta Air Lines and Northwest Airlines that envisions the carriers moving to a single operating certificate within 15-18 months. “The plan outlines the methodology, processes, tools and timing to maintain the safety of the day-to-day operations and to achieve a single operating certificate,” the airlines said in a statement. DL Senior VP-Maintenance Operations John Laughter added that FAA’s acceptance of the plan is “a significant milestone in our efforts to bring together our two airlines.” The merged airline, to be called Delta, will operate a mainline fleet of nearly 800 aircraft and employ approximately 75,000 workers worldwide.

The Federal Aviation Administration rushed approval of the Eclipse 500 very light jet, even though it had unresolved design problems, according to testimony to be presented to Congress on Wednesday. Transportation Department Inspector General Calvin Scovel says his investigation found the FAA knew about the “deficiencies,” according to testimony prepared for a hearing before the U.S. House aviation subcommittee. The Eclipse 500 is one of a brand-new class of small jets, promoted by the FAA as a potential solution to congestion around large airports and as a convenient, fast transportation alternative for small communities that can’t support commercial air service. The FAA denies the charge.