Monthly Archives: February 2013

PlaneBusiness Banter Now Posted!

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Hello everyone! This week’s issue of PlaneBusiness Banter is now posted!
This week we offer up a varied mix of things for you to chew on including in-depth 4Q earnings reports on SkyWest and Spirit Airlines.
Long and the short? Both airlines turned in good numbers for the fourth quarter, but guidance for both airlines going into 2013 looks even better. No surprise that shares of both airlines took the top spots last week for the sector.
On the airline distribution front, we talk this week about a new API that Farelogix just rolled out that we think is pretty cool. The product will allow airlines to more closely control the point of sale and merchandise its product more efficiently. In addition, the API works nicely with existing platforms and whatever GDS company an airline is currently using. None of this “either/or” stuff.
Could United Airlines be the first airline to implement it? We think so.
Trust me. We’re all for letting airlines do a better job marketing their product. Notice I didn’t say …”seat.” That’s because today, a seat on one airline can be much different than a seat on another airline. But the way those seats are sold and marketed hasn’t changed much since the dark ages.
We also update you on the latest AMR/US Airways transition news, and we talk about how this nasty and very stupid “sequestration” fight in Washington could negatively affect the airline industry — and its passengers.
Don’t get me started.
All this, along with much more, including and lots and lots of letters — in this week’s issue of PlaneBusiness Banter.

PlaneBusiness Banter Now Posted!

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Good evening earthlings!

This week’s issue of PlaneBusiness Banter is now posted.

Three guesses what we are talking about this week? (The first two don’t count.)

That’s right — the American Airlines/US Airways merger.

We’ll give you our take on what was announced, what was said that we don’t think is necessarily true, and why we think it’s still a great move not only for American Airlines and US Airways but for the U.S. domestic airline industry in general.

Oh, we talk about the situation at Boeing too. Anyone want to bet as to whether the FAA allows Boeing to put in a “fix” to the battery problem while investigators here and in Japan continue working to find reasons for the two battery issues that occurred in January?

I don’t think the FAA will do it, but apparently Boeing is going to make the pitch on Friday that a different battery design will prevent such things from happening again.

We talk a little bit about earnings this week, as we give a short and sweet summary on the recent results announced by both SkyWest and Spirit. More on the results from both airlines in next week’s issue.

We also look at the pre-announced earnings from Lufthansa.

But the most surprising news this week concerns the bankrupt shares of AMR, parent of American Airlines. As was announced last week, equity shareholders are going to receive a return on their equity investment. Late Wednesday night, JP Morgan analyst Jamie Baker issued a note in which he initiated coverage on the shares again. We’ll tell you why he thinks investors might want to take a look at the shares.

I know. Who would have thought?

Pigs have flown.

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

Errant Thoughts On The US Airways and American Airlines Merger



Last week I tweeted on Thursday that I would post an update on the American Airlines/US Airways merger on PlaneBuzz.

But on Friday, after having attended the airlines’ press conference in the Admiral’s Club in Terminal D at Dallas Ft. Worth Airport, and after having pontificated on the PBS Newshour and other media outlets about it all, I came to the conclusion that there really was not a lot more to say that had not already been said.

Or as US Airways Chairman and CEO Doug Parker said at the conclusion of last week’s press conference, “Thank you all for coming today, although I’m not sure why you needed to, as you’ve been reporting everything we announced for weeks.”
For PlaneBusiness Banter subscribers, it’s been more than a year.

Since last week however, there have been a few thoughts that have crossed my mind and I thought I’d take the time to share them with you today.

1. I don’t have a problem with American Chairman and CEO Tom Horton’s $20 million “heave-ho” package. We’ve seen other CEOs in this industry walk away with a heck of a lot more. The most obvious example would be former United Airlines Chairman and CEO Glenn Tilton. Then again, former US Airways‘ Chairman and CEO Stephen Wolf and President Rakesh Gangwal had to back up a Brinks truck to haul their “bye bye” packages away.

2. I do have a problem with Tom Horton staying through the first AMR board meeting in 2014. That’s too long. He needs to leave the building as soon as the deal closes. I’ve heard too many less-than-positive things connected to the recent “overstay” of Glenn Tilton at United Airlines. Tom needs to take his $20 million and go.

3. American Airlines’ employees need to stop trying to figure out what the new regime will or will not do. The first agenda for Doug Parker is to put together the management team that will lead the new airline. After that, this group will begin to put together the complete roadmap in terms of the transition process. Until then anything and everything else is pure speculation. Period.

4. But by far, the biggest question I have been asked following last week’s activities is the same one that was asked by JP Morgan’s debt analyst Mark Streeter on the analyst call that was held prior to the press conference last Thursday. And the question was asked in the press conference as well. That question involves whether or not the folks from Tempe plan to do anything about the “new” American livery.

While you aren’t going to hear Doug Parker or Scott Kirby say so anytime soon — it is my belief the new livery is a dead duck. It is going to go away.

Then again, because it is such a shining testament to the arrogance, tone deafness, and inept management ability of the current management team at American Airlines, maybe it needs to stay around awhile.

By the way, yes, I did get to see the new livery in person last week at the press conference. The Boeing 777-300 in the new livery was parked outside the Admiral’s Club on the concrete. Verdict: It’s worse in person. It is as bad as everyone has told me who had already seen it in person. The grey is flat and dull. It is not silvery. Then there is that tail.

Put it all together and you get an Army transport plane with a cockatiel tail thrown on the rear end. The US Airways’ aircraft sitting next to it on the concrete looked positively stately and elegant by comparison.

I’ll be talking more about the livery issue in this week’s issue of PlaneBusiness Banter. And why we aren’t going to hear much from Tempe on the subject any time soon.

Then again, we haven’t even started on the rumors American wants to roll out grey uniforms for its pilots. Would make sense. Would go right along with the Greyhound-ish logo that is supposed to represent an Eagle. So that makes perfect sense to me.


Until then — Happy Presidents’ Day everyone! Tomorrow it’s back to work for us as we return to the Worldwide Headquarters. May you all enjoy the rest of your Monday!

PlaneBusiness Banter Now Posted!

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Hello everyone!

Oh my, oh my! It is rather exciting in the DFW Metromess tonight. Reports indicate that the UCC, and the board of directors at both American Airlines and US Airways have approved a merger between the two airlines.

Whew. Finally!

We should see a formal release around 7:30 in the morning, an analyst call after that, and a press conference at DFW International at 10 AM. At some point later in the day the members of the US Airways’ management team will fly back to Phoenix for a press event there.

Details leaked this afternoon indicate that the deal is pretty much what we have outlined previously in PBB – a 72/28 equity split, current US Airways Chairman and CEO Doug Parker will become CEO of American Airlines, the headquarters will be in Dallas.

However, it does appear that while current AMR Chairman and CEO Tom Horton will stay on in a non-executive role — his stay will be much shorter than the 2-year period that had been rumored a couple of weeks ago. Sounds like he may stay only into the early part of 2014.

Happy Valentine’s Day!

But hey, we have a lot of other things we are talking about in this week’s issue of PlaneBusiness Banter. We have complete reports on the recent fourth quarter earnings reported by Air Canada and WestJet. We also take a summary look at the numbers from both Ryanair and Singapore Air.

We also have the December 2012 and full-year DOT Air Travel Consumer Report rundown.

In addition, we spend a lot of time this week talking about Boeing. And dendrites. And Dr. Goodenough.

No, I’m not making this up.

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

PlaneBusiness Banter Now Posted!

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Greetings earthlings!

This week’s mega-earnings issue of PlaneBusiness Banter is now posted. This week we take an in-depth look at the recent earnings results from Hawaiian Holdings, Allegiant Travel Company, JetBlue, and Alaska Air Group.

We also take a look at the latest capacity analysis by analyst Dan McKenzie with Buckingham Research; we take a look at the latest news concerning Boeing’s little problem with the 787; we look at Imperial Capital analyst Bob McAdoo’s latest comments on United Airlines; we have a couple of reader letters we found interesting this week; and finally, yes, without further ado, we talk about the American/US Airways merger.

You’ve all read the headlines. You’ve all heard the escalating chatter this week. Yes, it does appear that we will hear the details of a proposed merger between US Airways and American Airlines next week. Tuesday or Wednesday to be exact.

It’s about to get really busy around here.

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