Category Archives: PlaneBriefs

PlaneBusiness Banter Now Posted!

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

This week we bring you all the good stuff from this week’s JP Morgan Aviation, Transportation and Industrials Conference. This conference is always timed perfectly — it lets airlines update 1Q guidance, and it also allows them to look out into 2Q as well. All the major U.S. carriers presented, including United Airlines, American Airlines, JetBlue, Southwest Airlines, Delta Air Lines, and Alaska Airlines, in addition to Air France, IAG, and WestJet. 

We also take a look at who could win and who could lose if the New York and New Jersey Port Authority decides to remove the current perimeter rules in effect at LaGuardia.

Oh, and then there is that cat fight going on in Georgia between legislators and Delta Air Lines. But is this really just about taking the airline’s jet fuel tax exemption away? No, as is usually the case with politics, there is more to the fight than meets the eye.

Meanwhile, across the pond, reports this weekend claim that British Airways apparently hacked into the laptops and phones of employees back during the nasty union/management fights in 2011. The catch? The airline owned the phone and/or computers. Interesting story on how all of this came to light.

It was a horrible week for airline stocks last week. Wasn’t too much better for the market as a whole, but the airlines took it on the chin especially hard.

Meanwhile, the price of crude dropped again, but the price of jet fuel rose. We’ll tell you why.

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

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Hello everyone! This week’s issue of PlaneBusiness Banter is now posted!

It’s another heavy earnings week issue this week as we take an in-depth look at the recent 4Q14 earnings reported by American Airlines, JetBlue, Allegiant, and Hawaiian. We also have the PlaneBusiness Earnings Summary for WestJet, which reported earnings Tuesday.

So which airline surprised us with their report — and not in a good way? That would be Hawaiian Airlines. If you’re wondering why shares of the stock fell of a cliff after the airline reported earnings, we’ll tell you why.

As for American, while some investors decided that lower-than-anticipated RASM guidance for 1Q15 was something to get worried about, (and one analyst actually downgraded the stock as a result of concerns over short-term sluggishness) I am not worried.

For that matter, Delta Air Lines announced lower than expected PRASM estimates for December on Tuesday.

Things are sluggish out there right now.

Now American has both its pilots and its flight attendants set with new JCBAs, the airline can devote more time and attention to other integration issues.

Best integration news we heard in the call? The airline has almost completed all the steps necessary to obtain single carrier status.

We were happy with JetBlue’s call as well. I like the attitude of the new management team. I think whatever drama has been sitting over the management team at JetBlue has finally left the building. That is a good thing.

Allegiant? What can I say? I hate the business model. But the airline continues to make money. With fuel dropping, it is only going to make more money.

We also talk about the situation developing with alliances — particularly with the Middle Eastern carriers, European carriers and U.S. partners. In case you missed it, Qatar announced a 10% stake in IAG Holdings last week, and today Korean Airlines announced a codeshare deal with American on Seoul/DFW routes. Why is this a big deal? Because Korean is a founding member of the SkyTeam alliance. Not sure what the folks in Atlanta think about this development.

All of this, and more, including the latest update on oil prices, in this week’s issue of PlaneBusiness Banter. 

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Hello earthlings. Long time no talk. My apologies. I attempted to upgrade our version of WordPress for the blog last week and ended up, apparently, eliminating the post announcing that last week’s issue had been posted.

Bad Holly. I was clearly out of practice.

Yes, well, that brings us to this week, our second back in the saddle since our usual three-week Holiday Hiatus.

This week we’re talking about 4Q14 earnings. Delta Air Lines rolled out of the gates today with their numbers. They were in-line. I didn’t hear anything on the airline’s call that was out of line. However, with the dramatic drop in the price of fuel, the airline is now on the wrong side of some pretty major fuel hedges.

Followers know what I think about fuel hedges. I think the practice should be discarded, or if used, used only minimally.

Note that United Airlines just shed some of their hedges. And of course American Airlines has no hedges. They sold them all off shortly after the merger was completed.

Southwest Airlines,  on the other hand, does continue to hedge.

This Thursday, United, Southwest, and Alaska will report 4Q14 numbers. Next week we get to hear from Hawaiian Airlines,  Allegiant, JetBlue and American Airlines.

It’s going to be, for the most part, a record breaking earnings season. For one reason — oil.

In other news, we take yet another look at the JCBA that the pilots at American are currently voting on. Last week we took a long look at how we go to where we are now. This week I give you my take after wading through a raft of domicile blasts, talking to pilots on both sides, and members of management at American.

In a rather surprising move, we also had a lot of emails this week from unhappy Southwest Airlines pilots. I mentioned the union negotiations at the airline rather briefly last week, but it was enough to generate a healthy response.

It looks like the question on the labor side for 2015 is: which is going to be the biggest story of the year — the IAM’s attempt to gain representation of the flight attendants at Delta Air Lines, or the ongoing labor situation at Southwest?

FYI, the IAM is putting on one hell of a representational effort at Delta. Take a look at the union’s IAM Delta website if you don’t believe me. I don’t believe I’ve seen a more professionally designed site for a representational effort by any union.

In other news we talk about Bombardier’s woes, the newly launched Airbus A321LR, the first commercial A350 WXB Qatar flight, and United’s about-to-be-announced deal for at least 10 Boeing 777-300ERs.

As for airline stocks, it was as rather slow week, not a lot to report on that front, other than the 26% plus decline in shares of Bombardier. 

We also have a great look this week at the most recent comments from three of Wall Street’s top airline analysts — their look at 4Q14 and their look out to 2015 and which stocks they like.

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

PlaneBusiness Banter Now Posted

hollyxmasHello everyone! The last issue of PlaneBusiness Banter for 2014 is now posted.

We are talking about a lot of things this week — labor, oil prices, dropping fares in DFW, the Business Travel News Corporate Airline Survey, our trip to Atlanta to present to the Delta Air Lines Corporate Sales year-end event, the BTN Hall of Fame dinner in New York last week, the arbitration award involving the Association of Professional Flight Attendants and American Airlines, the latest update on negotiations between the airline and its pilots, and oh…so much more.

Unfortunately it was not that good a week for airline stocks — after Spirit Airlines spooked the industry with its less-than-expected traffic report last week. While the airline said it was thought the industry might be moving to a “price based on fuel and not demand model” most analysts claim this is not the case.

But one thing is clear. Fares are dropping sharply in the DFW area, as capacity has ballooned — the result of the demise of the Wright Amendment, upgauging of service by Delta into Love Field, and new service from Virgin America out of Love Field.

We also have our signature holiday column this week — our letters from airline CEOs to Santa, the latest DOT numbers, and a really terrific guest column that follows up on the recent column on the American re-banking of its MIA hub by PlaneBusiness Contributing Editor Brett Snyder.

Merry Christmas, Happy Hanukkah, Happy Holidays….and Happy New Year!

PlaneBusiness Banter will return on January 12!

PlaneBusiness Banter Now Posted!

home-typewriter copy 1The Turkey Week edition of PlaneBusiness Banter is now posted!

This week we get you up to speed on all the latest machinations in the airline industry, although it has been a pretty slow week. Something to do with that holiday on Thursday.

On the labor front, while originally the airline had said it was going to proffer arbitration last Friday,  as of this writing  the pilots and American Airlines are apparently still talking — no arbitration yet. Sounds like negotiations will continue next week.

Over at Southwest Airlines, the pilots asked the NMB for help with their negotiations last week. If I am not mistaken, this is the first time the pilot group has asked for help from the NMB.

In our column this week we talk about profit sharing. Why employees like it, why they understand it, and why we think that American’s stance against profit sharing is a mistake.

On the corporate travel front, we have the results from the latest Morgan Stanley Corporate Travel Survey. I’ll give you a hint. Delta Air Lines did very well.

On the stock front, shares of Virgin America once again led the group last week. All in all it was a rather so-so week for the sector.

On the exec front, Wal-Mart announced this week that former American CEO Tom Horton  is a new member of its BOD; while John Tague, former President of United Airlines, is the new CEO at Hertz. 

Frontier announced an order for bigger aircraft last week, Norwegian is back on the offensive, and the TWU, which represents the baggage handlers at Southwest Airlines, are making noise.

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

 

 

Holly

November 11, 2014

home-typewriter copy 1Hello earthlings! It has been one hell of a day here at the PlaneBusiness Worldwide Headquarters. American Airlines’ flight attendants voted down their TA this weekend, management at American issued its JCBA proposal to the pilots at the airline earlier today (with a twist), we have three in-depth earnings reports this week on SkyWest, Republic Holdings and Allegiant Travel, a comprehensive book review of Ted and Dan Reed’s new book on the American Airlines/US Airways merger, and we get you up to speed with what we were doing at Duke last week with the Travelport Ignite event, and what we were doing the week before when we visited with the folks at Delta Air Lines.  

All this and much, much, more, including the details on the Virgin America IPO.

It is one intense issue. That’s all I can say.

PlaneBusiness Banter subscribers can access the issue here. 

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1What is another word for….exhaustion? The latest edition of PlaneBusiness Banter, which I think probably runs at least 80 pages printed out — is now posted.

Yes, it is earnings time. That lovely time of year that rolls around every three months. This week we have in-depth looks at the recent earnings results from United Airlines, American Airlines, Alaska Air Group and Southwest Airlines. 

Short and sweet? No real big surprises, although Southwest and United spooked some investors with their less than expected PRASM guidance. But both airlines posted strong 3Q14 numbers.

As for American Airlines, the airline continues to post very strong margins and nice fat profits — while still very much in the early stages of its merger. Excellent job. Give these guys another year and who knows how much money they will be making.

Alaska Air Group? These guys just will not be stopped. Not by Virgin America. Not by Allegiant. And not, it appears,  by Delta Air Lines either.  Alaska posted an excellent quarter with nothing short of mind-blowing margins — while it continues to fight the increase in capacity in its home turf from Delta. 

Yes, in case you missed that movie a while back — we’re pretty certain the plotline went something like this. Delta says to Alaska, “Stop codesharing with American Airlines or we’ll huff and we’ll puff and we’ll blow your house down.”

Alaska responded, as best we can tell by essentially saying, “Bring it on.”

Fun to watch.

In addition to all the earnings fun this week, our curiosity was piqued by some comments that Scott Hamilton with the Leeham Group made this week. Those comments? Instead of buying new Boeing or Airbus widebodies, could Delta Air Lines maybe purchase some pre-owned Boeing 777-200ERs? Interesting thing to ponder. He might very well be right. That RFP is still hanging, and in Delta’s 3Q14 earnings call last week, CEO Richard Anderson discussed the RRP and talked about ownership costs, and this and that and ….the upshot is….. I wouldn’t be surprised to see Delta looking at some used widebodied aircraft. Certainly wouldn’t be the first time.

We presented at the Business Travel News “Travel Trends and Forecast” event last week in Chicago. My friends at United Airlines should be happy. Not only did I have two excellent flights on the airline last week, but there was a very palpable uptick in the positive feedback about the airline from the corporate travel manager group to whom I spoke. Much better than a year ago. The airline still needs to become more consistent in its operations  – but there is progress being made.

Fantastic week last week for the airline sector. We’ll update everyone on who did what.

All this, and lots and lots and lots more — 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.

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.