Monthly Archives: October 2013

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Hello everyone. A nice Happy Halloween to you all!

This week’s issue of PlaneBusiness Banter is now ready for perusal by all card-carrying subscribers.

This week’s issue is a beast — a mega-earnings issue in which we take an in-depth look at the 3Q13 results issued last week by Delta Air Lines, US Airways, Southwest Airlines and United Airlines. We also have PlaneBusiness Earnings Summaries posted for Allegiant, Spirit, JetBlue, Hawaiian and Alaska Air Group. 

The long and the short? Delta Air Lines rocked the house, US Airways did extremely well, Southwest Airlines came in a bit better than expected, but United Airlines disappointed.

We also have the latest DOT Air Consumer Travel Report numbers this week.  Again — Delta Air Lines more or less dominated the results for the big four.

Of special note this evening, following up on court documents Monday in which American Airlines and US Airways and the Department of Justice disclosed that they had agreed on a mediator, the Wall Street Journal is reporting that US Airways and American are preparing a settlement package to present to the DOJ.

This is pretty much what we thought would happen. In fact, the Judge in the trial had told both sides to seek mediation.

But as I write in PBB this week, it’s all about those depositions. Once those start to be taken and both sides get access to the information contained in them, then the strength or the weakness of a particular case begins to take shape. According to the court on Monday, 19 depositions had already been taken from execs at both airlines. Another nine depositions have been taken from “other airline executives.”

I still think we will see a negotiated settlement of this case.

On that note, it’s time for us to sign off. It’s been a long day — very long issue this week.

Have fun later today. But don’t eat too much of the candy corn. That stuff is evil.

 

 

 

 

 

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Hello earthlings. I hope you all had a wonderful weekend. It certainly was a gorgeous one here in the DFW Metroplex. I love this time of year. I wish the clock could just stop and let us enjoy it all just a bit longer.

The latest issue of PlaneBusiness Banter is now posted.

This week we are all over the place. Literally.

Last week I traveled to Mexico City where I participated on a panel discussion as part of the Travelport e-Volve 2013 conference.  More than 1000 folks signed up for the event. I’ll tell you why I think the event was not only a positive in terms of Travelport and its attempts to build client relationships, but because it was an effective and efficient way for developers and buyers to meet one-on-one.

Speaking of corporate travel, this week I follow up with my rather short, yet cryptic comment last week in PBB about the Global Business Travel Association. This week I explain why I think the organization needs an extreme makeover — as it has strayed way too far from what its role is as a industry organization and morphed into a money-making machine.

I have news for GBTA — for-profit entities can do the “tradeshow” conference better. And they are. That’s not why people pay GBTA dues. Nor is it why they belong to GBTA chapters.

In other news, JetBlue announced its new city last week (Detroit) and American Airlines announced it was shutting down its Haneda/JFK route. The airline also announced new nonstop service between DFW and Hong Kong and Shanghai.

This week we have a great new piece of analysis by our PlaneBusiness airline dork, analyst, and contributing editor, Brett Snyder.

With all the flak out there these days about just how “low” the fares at Southwest Airlines are or are not, we decided to take a look at how fares and total revenues have fared (pun intended) at both Southwest, as well as its competitors, over the last few years.

I think subscribers will find the graphs quite telling.

First, fares and total revenues have shot up at Southwest at a much higher rate than any other airline in the U.S. since 2009. Second, this has helped to create a nice “comfy” pricing umbrella for the likes of Spirit, Allegiant, and Frontier to position themselves under.

It also means that the rest of the industry has benefited as well, as other airlines have also been able to raise fares.

But the third point is this one — just how much higher can Southwest raise fares? It would seem the airline is now in a rather precarious pricing situation.

So why did all of this start in 2009? Simple. That is when the previously-advantageous fuel hedges at Southwest turned in the opposite direction.

To put it another way, it’s when the airline finally had to deal with fuel costs on a similar level as its competitors. Result? Fares have rocketed.

Airline stocks enjoyed one heck of a great week last week, with shares of Spirit Airlines and bankrupt AMR leading the pack. We update you on the latest analyst musings about those bankrupt AMR shares.

A heads-up. This week U.S. airlines begin to report 3Q13 earnings. Seven airlines will report between Tuesday and Thursday.

Lucky us. :)

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

PlaneBusiness Banter Now Posted!

home-typewriter copy 1Hello everyone. This week’s issue of PlaneBusiness Banter is now posted. It was another travel week for moi, as I talked about all things airline-related last week at the Business Travel News 2014 Trends and Forecasts conference in San Francisco.

This week I travel to Mexico City, where I will moderate a panel at the Travelport Evolve Conference. Yep, you can rest assured that NDCs, GDS offerings, and merchandising platforms will be on the agenda!

This week in PlaneBusiness Banter we are talking about a wide variety of topics. First, I update everyone on the current situation with the American Airlines/US Airways merger. I’ve changed my mind on the chances for a potential settlement. I’ll give you all the details.

In addition, the big news from last week that rocked the aviation world has to be the fact that Airbus has wrestled Boeing out of its cozy situation in Japan. That’s right. Japan Airlines announced an order for Airbus A350s.

This was no small deal. Remember that All Nippon Airways is now in negotiations with both Boeing and Airbus for replacements for its aging 777 fleet. Now — all bets are off. Most watchers of the aircraft side of the business say the ANA deal is now a “must-win” deal for Boeing. 

Airline stocks had a relatively slow week last week, but two airline stocks posted nice double-digit gains — AIr Canada and Spirit. Do you know why? We’ll tell you.

We also review both the September RASM estimates and traffic numbers in this week’s issue. Short and sweet? September turned into a dynamite month revenue wise for the U.S. airline group — with one big exception. United Airlines. 

United had already pre-warned about lower than expected  3Q13 revenue performance. This was just the icing on an already somewhat less-than-tasty cake.

We also talk a lot this week about the problem of onboard Wi-Fi. It’s great. When it works. And for god’s sake, don’t make it free. There is not enough capacity and then it doesn’t work for anybody.

That’s a very short version of our discussion.

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

 

 

Holly

October 6, 2013

home-typewriter copy 1Hi there everyone. This week’s issue of PlaneBusiness Banter is now posted.

This week’s issue is a bit later then usual. Yours truly was flying around the countryside this week, and then I came down with a damn cold Thursday after I had returned to the Worldwide Headquarters. Blech.

However neither sniffling, sneezing or runny eyes could keep me from my appointed task. Just took me a while.

Oh my gosh. What a week. I started by flying to Tampa – St. Petersburg on Sunday, where I presented to the Society of Collegiate Travel and Expense Managers. Then Monday afternoon I was off to Miami and The Beat Live — a conference I’ve enjoyed attending and participating in for the last six years.

In this week’s issue of PBB, I’ll tell you what the hot buttons were at the conference. But I’ll give you some hints — complaints about lack of customer service at Concur; continued confusion and misinformation about IATA’s NDC proposal; and a rousing discussion about the place of technology in travel — what works, what doesn’t, and why not.

While all this was going on, Tuesday was one hell of a day in the airline industry as first, the Department of Justice tried to convince the Judge who in charge of the American Airlines/US Airways antitrust case that she should grant a stay — and delay the trial — because of the government shutdown.

The Judge not only told the DOJ no, there was not going to be a delay, she laid out the planned schedule for the trial again, adding that she anticipates ruling on the case no later than the middle of January. I like this woman more and more.

Then we have U.S. airlines over in Europe trying to bring home airplanes. But they can’t.

Seems that no U.S. airline will be able to take delivery of any aircraft manufactured outside the United States as long as the office that performs the registration tasks for aircraft remains closed — the result of the ridiculousness in Washington.

Don’t get me started on that topic.

Oh, and speaking of stupid political tricks, we had the flip that Texas Attorney General Greg Abbott did Tuesday, as he switched positions on the planned merger between American Airlines and US Airways.

He will no longer be a party to the DOJ case against it.

Not surprisingly, he said that politics played no role in his decision. Right. In return for this “support” the airline essentially promised nothing it was not already going to do in the first place. That’s okay. Everybody looked good. It provided a nice photo op. And now the pressure can be put on other attorneys general to get with the plan.

But this had NOTHING to do with the fact that a certain Democratic candidate for Governor (Abbott is the presumed Republican nominee) was announcing her candidacy on Thursday and certainly was not going to hesitate to use Abbott’s opposition to a merger that affects so many of his constituents in her comments.

No. Nothing whatsoever.

Just another week in Paradise.

Oh, and did I tell you how American Airlines sold me a day pass to an Admiral’s Club the other day when I checked in at Tampa for my flight to Miami? Only one problem. There is no Admiral’s Club in Tampa.

Fun with upsells.

Last week we also saw the end of 3Q13. (That’s third quarter 2013 for you who are not that Wall Street cognizant.)

How did the airline sector do for the quarter? Great.

This week we get you up on all that — and we talk about the latest tweaks and changes in analyst estimates and targets for 3Q13, following a number of airline updates to guidance. Essentially United Airlines surprised analysts on the down side for the quarter the week before, but both Delta Air Lines and US Airways issued guidance this week that puts both airlines on track to report earnings ahead of previous estimates.

Yee haw.

Subscribers can access this week’s issue here.