Good evening everyone.
This week’s issue of PlaneBusiness Banter is now posted.
This week we have another mega-earnings issue, as we take a close look at the recent earnings calls from Hawaiian Airlines, Allegiant Travel Company, Spirit Airlines and Republic Holdings. Republic was the only one of the group not to post a profit for the first quarter.
Of course Spirit was in the news last week for other reasons — namely its decision to hike the charges for carry-on bags and for their initial refusal to refund a $197 ticket to a terminally-ill ex-Marine. By the time the week was over, the bag charge increases were still in place, but the airline’s CEO Ben Baldanza personally refunded the cost of the ticket and the airline contributed $5K to the Wounded Warriors organization.
For once the airline discovered that bad publicity was not better than no publicity.
In other news, Southwest Airlines and United Airlines slugged it out again in Houston Tuesday before an overflow crowd at the Houston City Council chambers.
Southwest wants to fly internationally out of Hobby Airport, and has asked the city for permission to build a new international addition to the current airport at a cost of roughly $100K.
But United is not amused. Especially since it just broke ground in January on a $700 million expansion and improvement of its facilities at IAH, which will include more international gate expansion.
Most interesting factoid from Tuesday’s testimony and questioning — on the day United Airlines broke ground on its new IAH expansion in January, Southwest’s Gary Kelly was talking to the Houston mayor about its desire to fly internationally out of Hobby.
Oh, this is such a cruel dog-eat-dog business.
This week we also have our latest AMR Bankruptcy Follies column. This week we look at the position of the bondholders in the bankruptcy process — why they want to get as much as possible back from the airline and how this return could be maximized as a result of a US Airways merger with American while it is still in bankruptcy protection.
Last week shares of Republic and Spirit were the laggards for the airline sector, but the price of oil plunged. That’s good news. So far this week — oil prices have continued to move downward.
As always — all this and more — in this week’s issue of PlaneBusiness Banter.