Tag Archives: airlines

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Let’s try this again. It seems that our blog editor chose to eat my earlier post this evening. You guys know the drill. This week’s issue of PlaneBusiness Banter is now posted.

This week we talk a lot about American Airlines. Again. We also talk about the craziness going on in Europe where it truly is “Let’s Make a Deal” season. Aer Lingus, British Airways, Etihad, Virgin Atlantic, bmi. It’s a mad, mad, mad world out there.

Airline stocks had a great week last week — and one stock in particular shone the brightest. That stock was Spirit Airlines. The airline announced killer traffic numbers last week and shares took off in the low fare carrier as a result.

JetBlue announced its CFO, Ed Barnes, had resigned, effective immediately, after the close of trading Tuesday. We never like to hear that a CFO has resigned, effective immediately. In addition, given the timing of the news, just one week before the airline announces third quarter earnings, you have to believe this was a board of directors decision.

The DOT reported its August Airline Consumer Travel Report last week. We dissect the numbers and let you know who had a good month and who didn’t. Hint: JetBlue had an awful month — the result of the August storms that raked the East Coast. But US Airways and Continental Airlines both saw their performances slip for the month as well.

Of course the big news this week is earnings. Hawaiian Airlines kicked off the third quarter earnings season Tuesday with better than expected numbers, and Wednesday, American Airlines will report its third quarter loss. As has been the case for more quarters than we can remember, American should be the only major U.S. airline to post a loss for the quarter.

Thursday we hear the profit news from Alaska Air Group and Southwest Airlines.

As always, we talk about all of this — and much more — in this week’s issue of PlaneBusiness Banter.

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello earthlings. This week’s issue of PlaneBusiness Banter is now posted. In this week’s issue we take a follow-up look at the problem known as AMR. After our look at the airline’s Monday Meltdown last week, this week we give you more insight from an assortment of Wall Street analysts. The upshot? Bankruptcy is not going to save the airline, but at the same time, the airline does not appear to be anywhere near a filing.

The airline also announced cuts in capacity for the late fall and winter months. This news was probably the best news American Airlines could have uttered. Analysts liked the reductions. The airline says they are not a result of falling demand — but of higher fuel prices. Not certain, but the airline’s continued exodus of top-tier pilots just might have something to do with the airline pulling back on the reins as well.

Other airline stocks suffered as a result of AMR’s drop last week. US airline stocks were clearly the laggards in a week that saw the the rest of the markets do fairly well.

NextGen. FAA. Congress. Department of Transportation Inspector General.

Send chills up your spine yet? It should.

Last week the FAA and its project management of the NextGen project got raked over the coals by the DOT IG. But as we talk about this week in PBB, how can the FAA be expected to manage such a complex project when it can’t even count on having money to pay for paper clips from day to day — a result of how the agency is funded (or is not funded) by Congress?

Meanwhile, the European Court of Justice gave the EU a huge thumbs up last week on its plan to charge airlines around the world for their greenhouse gas emissions. Needless to say the airline industry is not happy about this.

Southwest Airlines’ CEO Gary Kelly talked to Bloomberg last week and he started throwing around some huge revenue numbers that he says the airline can produce — as a result of its AirTran acquisition. Only one problem. I’ve been talking to a number of industry people who don’t think he can.

What do you think?

Which reminds me. This week you, our subscribers, get a chance to tell me what the next airline merger will be. That’s right. Sharpen up those pencils and send me your two cents on just which merger could be next on our radar. And why.

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

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello everyone. We’re back from our August hiatus. Perfect timing too, as today airline execs took their turns talking to investors at the Deutsche Bank Aviation Conference. And what did most of them say? Demand has not slowed.

In addition, remember that the airlines were the beneficiary of that nice FAA tax collection snafu in August, which fattened their bank accounts with a little unexpected spending money. Tuesday a number of airlines gave more precise guidance as to just how much their bank balances were fattened, as a result of Congress being unable to act like adults.

All of this positive news caused the markets to reward the flailing airline sector with a huge turnaround today.

The depth and strength of airline exec comments today really did seem to be in direct opposition to how we, and everyone else on the planet, perceive the macro economic landscape. I was surprised at some of the PRASM estimates for September that were floated today. Much better than I had anticipated.

This week is also “catch-up” week as we update subscribers on what went down with the Southwest Airlines/AirTran pilot seniority list integration proposal in August. Essentially the AirTran ALPA MEC refused to send the proposal to the AirTran pilot rank and file for a vote.

As of now, both sides are supposedly “talking” but there is already a “drop-dead” date established with the negotiations. If nothing is resolved by that date — the matter will be arbitrated.

We also talk this week about the situation at American Airlines. The airline had 111 pilots opt for retirement on Sept. 1. This is an abnormally high number, (the average monthly total is 11) and it appears the airline may have a similar number, if not more, opt to retire the beginning of October.

We talk about whether this is an “insider sentiment” that indicates the pilot group believes a bankruptcy is around the corner — or if it is simply a reflection of the sharp downturn in the value of AMR shares over the last quarter. (There is a look-back period in terms of what date and stock price is used in calculating benefits.)

Of course, we talk about how the airline sector performed both last week and while we were on vacation. We also go over the July DOT Air Travel Consumer report.

Then there is the usual hodge podge of goodies including an update on Stelios and his latest attack on the EasyJet board of directors, Moody’s cut in Travelport’s debt rating, the update in the case between American and Sabre, the skinny on the person who bit the Alaska Airlines first officer, and much, much more.

Subscribers can access this week’s issue of PlaneBusiness Banter here.

Weeeee’re Baaaack

Figures. I return from vacation, start up the combines, drag out the harvesters, and look what happens to the blog. Actually the blog was screwball when I walked in here this morning. I’m not sure what the deal is, but it must be a Movable Type issue, as I have not been in here since 8.24.11. I am completely and totally not to blame.

Yep. That’s my story and I’m sticking with it.

We’re off to see if we can figure out what the problem is here. Actually what that really means is I am going to send an email to the one person I know who can tell me what is wrong, and hopefully fix it. Me, myself? No, I am not capable of figuring out such tedious nonsense.

In the meantime, I’m off to peruse the feedback from today’s Dahlman Rose Global Transport Conference in New York.

Talk to you later.

PlaneBusiness Banter Posted!

home-typewriter copy 1.jpg

Hello everyone. This week in PlaneBusiness Banter we’re talking about the second quarter earnings season that begins next week. We also give you the complete rundown of the current airline stock target prices — compliments of the usual airline industry analyst contingent.

We also look at the most recent DOT Airline Consumer Travel Report for May. This month was a real grab bag of results — with airlines the usually doing well not doing well in certain measures, other doing better than expected — and then there was American Airlines. And American Eagle. The not-so-dynamic duo were clearly the worst performing airlines of the group. We were so impressed, we were moved to unanimously award the two airlines a tandem “Goat” award for their industry-lagging performance.

That reminds me. You know how airline executives always pepper their comments about how their particular airline has such “industry-leading” performance in this and that? When was the last time you heard someone say their airline is an industry laggard?

The EU is convinced that all the airlines of the rest of the world need to participate in its Emissions Trading Scheme. Needless to say the Air Transport Association, the IATA, and U.S. airlines don’t agree. The shrill cry against adding airlines to the list of ETS participating companies rose sharply last week — along with threats of an all-out trade war.

Last week airline analysts lined up to initiate coverage on shares of Spirit Airlines. Without exception they were all bullish on the shares. Their enthusiasm helped push shares of Spirit up 11% for the week.

Speaking of Wall Street, jet fuel posted a sharp uptick of more than 6% last week, even though the price of crude oil was only up a little more than 1%.

United Airlines pulled out the stops last week as it feted its most traveled frequent flyer. They even named a 747 after him.

On the merger front the proposed LAN/TAM deal is on hold as government regulators take more time to look at possible antitrust implications. I find this rather amusing, since LAN basically owns the Chilean market.

Pinnacle’s new CFO used to work for Pinnacle’s CEO when he was CEO at Frontier Airlines, Lufthansa is going to start flying passengers on biofuel on Friday, and more.

All in this week’s issue of PlaneBusiness Banter .

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello everyone. This week’s holiday week issue of PlaneBusiness Banter is now posted. Since yesterday was July 4th, you know what that means. That’s right –this week’s issue includes the legendary 2011 “Ode to a Hot Dog” column.

Aside from our usual July 4th fun and frivolity, we do have some serious business to talk about this week in addition to our yearly review of weenies.

Four major U.S. airlines are now talking to aircraft manufacturers about potential new aircraft orders. We look at what some of the industry’s more knowledgeable observers think we could see in terms of new orders.

In Australia, aviation regulators grounded Tiger Airways Australia last week. We talk at length about the reasons for the ruling, the fact that most of the major investors in the airline have essentially cashed out, and why the move by CASA should not have come as a surprise to the airline.

Another week, news of another low-cost airline in Asia. Last week Qantas and Japan Airlines announced that they are forming a joint venture — the purpose of which is to start a new low-cost Asian airline.

Meanwhile, across the pond, Flybe and Finnair have combined forces purchasing Finnish regional carrier, Finnish Commuter Airlines.

On the labor front, we had two major union representational votes last week. The flight attendants at United Airlines and Continental Airlines went to the ballot box to pick a union representative for their combined group in June. Last week the National Mediation Board announced that the Association of Flight Attendants won the election — but by a closer vote than I think the AFA had expected.

While over at Republic Holdings, pilots for all of the holding company member airlines voted in favor of one union representative. And which union was that?

In terms of airline stocks, last Thursday marked the end of the second quarter. Which airline stocks performed like champs during the second quarter — and which ones lagged behind?

We also take a look at the current mean estimates for the usual suspects heading into the second quarter. How has analyst sentiment changed since the end of the first quarter?

Lots of letters to the editor this week, including one of the most unusual notes I’ve ever received. Hint: It has nothing to do with airlines.

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

Subscribers can access this week’s issue here.

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello everyone!

We are a bit late posting our blog post tonight. PlaneBusiness Banter has actually been posted for awhile. But it’s been a rather nasty night here at the Worldwide Headquarters. Had to go offline for a bit. Tornado warnings, tornado sirens, baseball sized hail, rain. Just a lovely evening.

That’s okay. It’s not Joplin and it’s not Tuscaloosa. Still very unsettling though.

Speaking of unsettling, we didn’t hear many unsettling comments spoken at the Bank of America/Merrill Lynch Global Transportation Conference last week. Airlines made their way to Boston where analyst Glenn Engel held court. This week I give you a summary of the high points from the Conference and talk a bit about why, even though airline execs continued to sing the praises of continued revenue strength, a number of analysts are convinced the airlines have hit the wall in terms of fare increases and passenger demand pushback.

I was over at Southwest Airlines last week, as the airline held their annual shareholder meeting. After the meeting Chairman, President and CEO Gary Kelly held a press conference. Our take? I think the airline is now fully aware of the challenge it faces with the AirTran merger. It’s time to get to work.

In other news, Delta Air Lines and US Airways announced a newly revised slot swap proposal late Monday. Our take on the revised deal? We still like it just as much as we did when the two airlines first proposed the deal almost two years ago.

But I doubt American Airlines likes the deal very much. If the Feds approve the deal, it will give Delta Air Lines a huge leg up on its New York expansion — as US Airways will hand over 132 slot pairs at LGA to the Atlanta-based airline. In return, US Airways will get $66.5 million in cash and 42 new slot pairs at Washington’s DCA. Oh, and rights to fly to Sao Paulo.

The deal will strengthen the network of both airlines. For very little money.

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

Subscribers can access this week’s issue here.

Okay. I’m going back to the closet.

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello everyone. It’s that time again. This week’s mega 100-plus page issue of PlaneBusiness Banter is now posted. This week we take an in-depth look at first quarter earnings and earnings calls from Delta Air Lines, US Airways, JetBlue and Hawaiian Holdings.

Best quote from the earnings calls this week came from Delta CEO Richard Anderson, as he tried to stress to analyst Dan McKenzie with Rodman and Renshaw that the airline is not interested, as are some competitors, in chasing market share. (Wonder who he was talking about?)

No, the airline is very serious about “keeping our capital commitments in check, generating free cash flow, putting that cash flow back on the balance sheet and keeping our capacity in line with what will produce an operating margin.”

07northwest.190.1.jpg

Richard’s follow-up comment: “This isn’t a hobby.”

Love it.

US Airways posted a good first quarter — even though the airline has no fuel hedges in place. That’s right. None. I love that as well. I think the airline is onto something, i.e., screw fuel hedging. If you run an airline as a well-managed business, you should be able to manage your expenses and revenue through capacity changes.

That goes back to the Delta mantra they kept emphasizing throughout its call as well. Essentially, if a route is not making money — it’s going to go away. Chasing market share is stupid. Managing for profits and margins is smart.

We also take an extended look at the recent results from both JetBlue and Hawaiian Holdings. Two very different airlines — two very different business plans. JetBlue continues to grow — and its dominant-carrier Boston presence speaks to that point. Hawaiian has decided to grow long-haul to the West, including new routes to Japan. How are the new routes faring? Hint: The airline will probably post a loss in the second quarter.

We talk about all of this, we muse about whether or not the death of Osama Bin Laden will eventually let us walk away from TSA Security Theatre, and well, of course we talk about Kate’s dress as well!

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

Subscribers can access this week’s issue here.

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

This week’s issue of PlaneBusiness Banter is now posted. This week’s issue is one of those “kitchen sink” issues. First we peer into the financial reports of the four largest airline pilot unions — ALPA, APA, SWAPA and USAPA — spurred by my wonderings about just how much the US Airways’ pilot union, USAPA, is paying out in legal fees. Boy, did I open a nice big Pandora’s box. Who says we only have to dissect the financial statements of the airlines?

Then there is American Airlines. No, the airline is apparently not in talks to do a deal with Mexicana, even though press reports south of the border indicated otherwise over the weekend.

Meanwhile, tomorrow is not only the day that American Airlines announces its first quarter loss. It is also protest day for American employees. Concurrent with the airline’s executive level bonus allocations, the Association of Professional Flight Attendants are going to be protesting — and I would bet there will be some other airline employees contributing to the effort.

On the corporate travel front, American filed suit against Travelport and Orbitz last week. They even dropped the “Sherman” antitrust bomb in their filing. Yep, American thinks there is some anti-trust issues here. Travelport and Orbitz, not surprisingly, think this is merely a play for leverage.

Speaking of earnings, we have a line-up of heavyweights on Thursday, followed by another heavy day next Tuesday. We get you up to date on analyst expectations and reporting dates.

If it is time for first quarter earnings, then Proxy Statements are also in the mix. Those are those horribly confusing and hard-to-figure out SEC filings that tell us just how much the top executives at the airlines took home in compensation during 2010.

Southwest Airlines filed their proxy statement last week, and, well, let’s just put it this way. Remember when the airline used to have the lowest top-tier compensation levels in the industry — and they made a big deal about the fact this was the case? And they were proud of the fact? It’s not the case anymore.

Oh, we talk about that, we talk about how airline stocks did last week, we talk about the TSA’s patdown of the six-year-old, we alert you to a museum collection of air sickness bags, and we talk about a lot more — in this week’s issue of PlaneBusiness Banter.

Subscribers can access this week’s issue here.

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Good evening earthlings! This week’s issue of PlaneBusiness Banter is now posted.

This week I talk a lot about US Airways. For good reason. I attended the airline’s “Unplugged” Media Day last week. The airline used the occasion to announce it is upgrading its regional airline fleet with first class cabins. But that was not the only news to come out of Tempe. We’ll give you the low down.

That doesn’t mean we’re done talking about Southwest Airlines and its recent fuselage problem. Nor have the late night talk show hosts.

Last week Southwest Airlines CEO Gary Kelly and American Airlines CEO Gerard Arpey both sat down with Terry Maxon from the Dallas Morning News at the SABEW Conference in Dallas. Gary talked about the Southwest incident and Gerard talked about the recent bogus offer to buy the airline from that outfit in Florida. Yes, as we assumed, the SEC is looking into it.

Speaking of Dallas, the DOT reported its February Air Travel Consumer Report last week. As expected, it was not a good month for airlines based in Dallas. (February ….ice…snow…Superbowl on ice.)

Expedia and American Airlines kissed and made up this week. But this news leaves a lot of very ragged and messy things to clean up on the corporate travel terrain. We like TheBeat’s Jay Campbell’s take on the news. We’ll share his take with you.

While pilots for United and Continental Airlines keep working on a new contract, all is not apparently warm and fuzzy on the United Airlines pilot side of the house. Reports say that there was a recall vote originally scheduled for Monday’s UAL ALPA MEC meeting. The intended victim? The pilot’s current MEC Chairwoman, Captain Wendy Morse.

Meanwhile the flight attendants at American Airlines offered up a deal for the airline. An immediate 6% raise for its members — and the rest of the contract details would be tabled for 18 months. The airline said no.

Speaking of American — April 20 is just around the corner. That’s the day you can expect to see protests from airline employees over the airline’s latest PUP bonus distributions.

We talk also take a look this week at just how much additional revenue and/or capacity cuts the airlines would need to make — in order to cover the current price of fuel for the remainder of the year. That’s a sobering chart. Thanks to Dahlman Rose analyst Helane Becker for the analysis.

As always, all this, and more in this week’s issue.

Subscribers can access the issue here.