PlaneBusiness Banter Now Posted!

home-typewriter copy 1This week’s edition of PlaneBusiness Banter is now posted.

Delta Air Lines kicked off the 3Q14 earnings season last week. The airline reported in-line earnings — beating analyst consensus by a couple of pennies.

Net income was $357 million or $0.42. Excluding items, net income rocketed to just over $1 billion, or $1.20. The analyst consensus forecast had been for EPS of $1.18, so the airline came in pretty much in line.

The airline disclosed no real surprises in its earnings call, but there were some fireworks when JP Morgan analyst Jamie Baker pushed CEO Richard Anderson on the subject of capacity.

If that wasn’t enough, one of the industry’s most energetic analysts, and the analyst who recently downgraded shares of Delta Air Lines, Hunter Keay with Wolfe Research, was not on the call. We’ll fill you in on why that was the case.

In other news, airline stocks rebounded last week from their Ebola sell-off madness, we get you updated on the craziness that is surrounding the tentative agreement vote for the American Airlines flight attendants, there was a recent change at the top at ExpressJet, and much, much more.

All in this week’s edition of PlaneBusiness Banter

 

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1This week’s edition of PlaneBusiness Banter is now posted.

This week we talk a lot about Ebola. Not hysterically. Rationally.

Unfortunately we seem to be the exception.

Last week, heightened fears over potential demand destruction in the airline industry, as a result of fears over the death of one person in Dallas sent shares of airline stocks plummeting like rocks. With the news that a nurse who attended to the man who died last week had tested positive for Ebola breaking over the weekend, things didn’t get much better for airlines Monday either.

Meanwhile, the U.S. is watching as the price of crude oil and the price of jet fuel continues to drop to multi-year lows, and airlines continue to report good guidance, generally speaking, for 3Q14 numbers. Both of these should be resulting in positive moves, not negative, for airline stocks.

But last week traders were trading on headlines. Not fundamentals.

Monday it was the same story.

In other news, we’ll tell you what we found interesting at this year’s The BeatLive Conference which was held last week in New Orleans. Yours truly presented the look at the airline industry for the corporate travel audience, while Kevin Krone, SVP of Marketing at Southwest Airlines, was on “The Hot Seat” this year. Kevin did a great job — and while he said that the airline is now about to announce an upsell produce anytime soon — it is going to announce some “onboard improvements” in the not-too-distant future.

No other hints were given.

We update you on the DOT Air Consumer Travel Numbers for August; we get you up to speed on the new approach A4A looks like it is going to take as it hits Congress up once again for a comprehensive FAA reauthorization funding bill, we give our thumbs up to the JetBlue decision to hire former Wall Street analyst Kevin Crissey as its new director of IR, we tell you what airline analyst took the First Team analyst spot in the 2014 Institutional Investor surveys, and oh, so much more.

All in this week’s edition of PlaneBusiness Banter. 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1This week’s edition of PlaneBusiness Banter is now posted! Last week was a wild one in the airline industry between fears associated with the first case of Ebola diagnosed in the United States, weather, continued ATC issues in Chicago, end of quarter stock performance, and fireworks down in Dallas, where the Dallas City Council told Delta Air Lines it had two weeks to vacate Love Field.

Say what? 

We’ll get you updated on who has apparently done what to whom to get us to this point and what will probably come next.  (Hint….lawsuit.)

There were other legal wranglings last week including a suit that now will go back to a lower court involving some unhappy Spirit flyers; and American’s request to the DOT to transfer slots it awarded to Delta for its Haneda routes — to American. We’ll tell you why American thinks it should be allowed to  move the service to LAX, and fly a daily flight to Japan.

We update you on the latest concerning the flight attendant TA voting at American, and we also give you our take on why pilot negotiations seem to be falling behind the original 30-day timetable at American. Hint: We don’t disagree with what we hear are the reasons.

Southwest Airlines took the top stock performance honors for the third quarter. We tell you which airlines did well, and which ones did not — as we go down the results for the third quarter.

Speaking of, 3Q14 earnings are right around the corner. We give you the dates you’ll not want to miss. Essentially most of the big players (with the exception of Delta, which reports on Oct. 16) will report the following week. Oct. 22-23 are going to be very busy days.

El Al seems to have a problem on some of its flights — orthodox Jewish men who refuse to sit next to …gasp….women! Meanwhile, United Airlines announced it has hired its third CIO since the merger of United and Continental. Will the third hire be the charm?

The biggest news from last week — the continued decline in the price of oil and jet fuel.

The importance of this cannot be underestimated in terms of the industry and lower costs.

We’ll tell you more about why we think this is not a short term thing.

All this and more — in this week’s issue of PlaneBusiness Banter. 

 

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1A great Monday afternoon to everyone! How are you? The latest edition of PlaneBusiness Banter is now posted!

This week we have a busy issue as we talk about the impact of the FAA fire at its Aurora Center outside of Chicago, (we also give you our take in a column about just why the FAA is NOT the problem here — it’s a much broader issue involving a total lack of recognition of how important aviation and transportation is to our economic well-being in the U.S.)

The FAA is simply the most convenient whipping boy.

Let’s move up a level, shall we? Let’s talk about funding. Or better yet, lack of.

 

We also discuss the fascinating back and forth that occurred last week — after Delta announced across the board raises for its employees and an advance on their 2014 profit sharing benefit.

While we acknowledge that this is great news for Delta employees — this just wasn’t a case of Richard Anderson donning a Santa hat two months early.

There were a couple of things going on here, including the IAM’s current card campaign going on for the Delta flight attendant group, and American Airlines’ tentative agreement with its flight attendant group — which was just about to be sent out the door — when the employee memo at Delta went viral.

That TA had given flight attendants at American “industry leading” numbers. Well, after the announcement from Richard, that was no longer the case.

The result? The APFA went back to management at American and got…more money.

Meanwhile, if we’re strictly talking pay rates, the flight attendants at Southwest Airlines still top everyone.

Oh, let’s see. We have new A380s arriving at DFW this week, we have Emirates apparently putting the screws to Airbus to get them to re-engine the A380, we have another new livery to show you (and this one is gorgeous) and oh yes, we talk about Sean Menke’s new gig at Hawaiian Airlines.

As for stocks, it was a lousy week for airline stocks last week. Meanwhile, analysts are busy tuning up their 3Q14 estimates, as this quarter comes to a close.

Oh, and yes, Wolfe Research analyst Hunter Keay downgraded shares of Delta Air Lines last week. Not unexpected. We agree with the reasons he gave. We go over these in this week’s issue too.

All this, and much, much, more in this week’s issue of PlaneBusiness Banter!

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Good evening everyone. The latest issue of PlaneBusiness Banter is now posted.

We are a day late this week. (But not a dollar short!) I thank everyone for their patience. Yours truly was part of a fabulous event on Sunday in Philadelphia. I was part of a case study presentation given to the Arthur Page Society – a group comprised of top level executives and corporate communications officers of Fortune 500 companies. The topic? The role communications played in the American Airlines/US Airways merger.

Leading the presentation was American Airlines CEO Doug Parker and EVP of People and Communications Elise Eberwein. In addition to myself, the panel included Laura Glading, President of the Association of Professional Flight Attendants; Scott Shankland, former national officer with the Allied Pilots Association; Gregg Polle, Managing Director, Moelis & Co.; Paul Denis, Partner, Dechert LLP; Hilary Rosen, Managing Director, SKDKnickerbocker, and Kelly Sullivan, Partner, Joele Frank.

It was a great experience. In addition, it was striking to sit back and reflect on just exactly was accomplished. It’s a deal that I doubt will never be repeated in this industry. Or maybe any other industry.  By that I mean — a smaller company successfully pulled off a hostile takeover of a larger company — while that larger company was in bankruptcy protection.

What was the “secret sauce”? As I talk about in this week’s issue, it wasn’t the price. In fact the deal was not “priced” until very late in the process.

No, it was — communication. Intense, constant, coordinated and strategic communication.

Yep. It was a cool way to spend a Sunday.

In other news, it was a blockbuster week for union news last week, as we had a TA announced with the flight attendants at American Airlines; the APA was certified by the NMB as the bargaining agent for the pilot group (bye bye USAPA); the customer service workers at both US Airways and American will now be represented by the same joint representation that was in place at US Airways — the Teamsters and the CWA; Piedmont pilots approved a new contract; and United Airlines rolled out a very impressive “Early Out” offer for flight attendants that pays out as much as $100K. (Depending on years of service.)

Whew!

On top of all this, I was in Washington last week, where I moderated a panel at Airlines for America’s Aviation Summit. Great experience. Great list of speakers throughout the day. I give you some of the better quotes from the sessions in this week’s issue. Oh and I’ll also introduce you to the man who controls more shares of stock in U.S. airlines than any other investor.

Yep. True.

All this and much, much, more in this week’s edition of PlaneBusiness Banter!

 

Holly

September 15, 2014

 

home-typewriter copy 1Hi everyone. A very tired group of die hards here this evening/morning at the Worldwide Headquarters. Going to be short and sweet as I need to catch a plane in about six hours. How short and sweet? This week’s issue of PlaneBusiness Banter is now posted. There ya go!

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Good evening everyone! We’re baaack!

Yes, vacation is over, and it’s time to get back to work. Or at least that is what I kept telling myself last week. As a result, this week’s issue of PlaneBusiness Banter is now posted.

This is one of our “catch-up” issues. It’s rather difficult to compress three weeks into one issue, but I tried to talk about those topics we thought were most noteworthy. Or at least mention them!

On the stock side, August was a great month for airline stocks. The dog days of August are often times not that friendly to the things with wings, but that was not the case this  year. The only negative about August was the sharp decline in jet fuel inventories that occurred right before Labor Day in the Northeast. The shortage caused jet fuel prices to jump more than 6% that week, as inventories fell to record lows.

All is now back to normal on that front as a number of  tankers have been able to get into New York Harbor and offload their cargo.

In other news, Southwest Airlines and Frontier Airlines will both roll out new liveries this week. Pics of both were leaked over the weekend. We posted the Southwest Airlines livery last night. Here is a shot of the new Frontier livery. The green livery with the feathered “F” harkens back to previous branding at the airline — years ago.

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In other news, we talk a bit this week about the union activity over at American, get you updated on that, although I did not get into detail about the decision by American to pull flying from Envoy and give it to PSA. A number of the folks we wanted to talk to just simply weren’t able to be tracked down before we published. I’ll revisit this move by the airline this week.

Speaking of this coming week, look for analysts to be watching the traffic reports issued by the airlines very carefully this week. Delta reported less than robust PRASM numbers for August last week, and analysts will be watching everyone else to see if it is a one-off for Delta only, or if the rest of the industry is showing any signs of weakness as well.

Tomorrow morning, I am off to the Southwest Airlines Media Day. More on that in next week’s issue.

Have a great week everyone. Talk to you again next week.

First Shot of New Southwest Airlines (NYSE:LUV) Livery

Nothing like coming back from vacation with a bang. That’s what I say. Yes, I am back from vacation and this week’s PlaneBusiness Banter will be posted tomorrow. (Sunday.) In the meantime, look what a little bird just dropped into my hand. A photo of what I believe is the new Southwest Airlines livery that will be unveiled Monday morning at the airline’s headquarters as part of its Media Day event. (Yes, I will be there.) As for where this came from, I’ll never tell. But don’t say I never do anything for you guys. Southwest

PlaneBusiness Banter Is Now Posted!

home-typewriter copy 1Hello everyone. Our final issue of PlaneBusiness Banter for the summer has now been posted. This week we take an in-depth look at 2Q14 earnings results from Hawaiian Airlines, Allegiant, and Spirit Airlines. We also give you a summary of the recent earnings released by Air Canada, Republic Holdings, and SkyWest. 

As we had reported earlier this month in PBB, Republic did confirm in its earnings call last week that Chicken Taco is about to bite the big chicken leg in the sky. Republic is consolidating from three operating certificates down to two — so the existing aircraft that are currently flown by Chautauqua are being moved to the Shuttle America operating certificate.

So…it won’t be too much longer before we won’t have Chicken Taco to kick around anymore.

Meanwhile, up in Canada, we have to agree with one analyst who wonders if Air Canada really knows what the heck it’s doing with its rouge product. We wondered before they rolled it out, we wondered after they rolled it out, and we wonder even more now.  If you are going to do an alternative “low-fare” airline, then you’d better damn well offer lower fares. Like 30% to 40% lower.

Meanwhile on the international front, Etihad finally brought out the checkbook and antied up a nice chunk of change for a 49% interest in Alitalia. James Hogan, CEO of Etihad says that Alitalia should be “the sexiest airline in Europe.” Yes, that is what he said.

This equity investment creates some strange bedfellows — as Alitalia is still a member of the SkyTeam alliance, and Air France still owns a small piece of the airline.

We wonder what Delta Air Lines thinks about all this…..yes wondering minds want to know.

It was a rather so-so week for airline stocks, although Copa took a beating. The airline posted better than expected numbers for 2Q14, but guidance was not the best.

The DOT issued its June Air Travel Consumer Report last week. The numbers continue to reinforce the problem associated with mergers — they wreak havoc on operational metrics.

And I’m talking about all three of them — not just United/Continental. Southwest/AirTran continues to struggle, and American continues to drag down results for US Airways. 

Finally, we would be less than honest if we did not say that it was a hard week at the Worldwide Headquarters this last week. We lost a very good friend, as did many who worked at America West, US Airways, and eventually, American Airlines. That man was Bill McGlashen.

They don’t make men like Bill too often. We’ll miss his goofy sense of humor, his intelligence, his friendship, and his smile. Bill was only 55 and in excellent health when he was hospitalized with pneumonia roughly two weeks ago. None of us who knew him still believe he’s gone.

So — out last issue for August is a mix of all kinds of things this week.

Have a great rest of the summer everyone. We’ll talk to you again after Labor Day.

 

 

PlaneBusiness Banter is Now Posted!

home-typewriter copy 1This week’s issue of PlaneBusiness Banter is now posted. This week we take an in-depth look at the recent earnings reported by Southwest Airlines, JetBlue, and Alaska Air Group. We also have summarized takes at Ryanair, IAG, and Lufthansa. Finally, we have earnings summaries posted for Spirit and WestJet this week.

A bit of comment on the foreign flyers in the group – IAG, parent of British Airways, Vueling and Iberia, clearly took the top spot this quarter for the major European carriers. Meanwhile, Lufthansa, which had already pre-warned on earnings in June, reported numbers that were far worse. This, after Air France-KLM didn’t wow anyone with their 2Q14 earning last month either.

Another winner across the pond? Ryanair, which easily beat expectations for the quarter.

On this side of the pond we talk about Southwest Airlines and its aspirations, we muse about how we believe Alaska Airlines holds the bulk of the leverage in the Battle for Seattle with Delta Air Lines, and we talk about JetBlue and its transitional year.

We also take a short look at the recent earnings results reported by Spirit and WestJet. 

Which reminds me. Were you aware that WestJet plans to acquire wide-bodied 767s — which it intends to use to fly to Hawaii? Didn’t think so.

Switching gears, last week we attended the Global Business Travel Association (GBTA) conference out in Los Angeles. Just me and 6,000 of our closest friends.

We’ll give you the scoop on what the three major U.S airline CEOs — Richard Anderson, Doug Parker, and Jeff Smisek, had to say at the conference, along with a lot more.

As for airline stocks last week, it was a bad week — just as it was for the markets in general. Goat of the Week honors went to shares of SkyWest. 

All that — and more — this week in PlaneBusiness Banter.