Tag Archives: air canada

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg

Hello everyone. It’s that time once again. This week’s issue of PlaneBusiness Banter is now posted.

This week we take an in-depth look at the recent earnings reported by both WestJet and Air Canada. On the surface, WestJet easily bested its Canadian competitor in terms of its fourth quarter performance, but WestJet is now in the process of starting a new regional airline. We talk a lot this week about my concerns about this new “WestJet Express” operation.

Meanwhile, how is Air Canada going to increase its revenues? The airline’s problems in that department overshadowed the airline’s cost reduction performance in the fourth quarter. Meanwhile, cost forecasts for the first quarter are daunting.

We also update subscribers on the latest from the American Airlines bankruptcy, and we take a look at what happened to airline stocks last week. Hint: The frenzy of the last few weeks finally came to a screeching halt.

Pinnacle Airlines got some good news last week however — and that news sent its shares soaring. We’ll update you on all that news as well.

All this and much, much more, including a very active mailbag — this week in PlaneBusiness Banter.

Slow Monday

Hello all. I’m sitting here twiddling my thumbs, waiting for this week’s issue of PlaneBusiness Banter to be posted. I’m done with my part. Just waiting for the editor person to give me the all clear to hit the “post” button.

Actually it’s a bit more complicated than that, but you get the idea.

Was just nosing around the airline news from this weekend and today. That certainly didn’t take long.

After last week’s news-a-minute pace — today seems slower than a herd of turtles.

For those of you who are PlaneBusiness Banter subscribers, (and if you aren’t you should be), this is our final earnings issue for the quarter as this week I take a long look at the earnings announced by our two Canadian things with wings — WestJet and Air Canada.

One thing I have to say for Sean Durfy, CEO of WestJet. He sure knows how to get your attention. He opened up the airline’s earnings call by saying, “Our focus right now is navigating the short-term environment to achieve our long-term plans of becoming one of the five most successful international airlines in the world.”

PlaneBusiness Banter Now Posted

home-typewriter copy-1.jpg

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

It was a busy week for the Things With Wings last week.

First, American Airlines reported its second quarter earnings results. The airline lost a lot of money. $390 million to be exact. $319 million excluding special items. However, you’d never have known it if you listened to the airline’s earnings call — which seemed focused on one thing — liquidity. Oh, and capacity reductions. That’s fine, but there are other aspects of an airline’s operations I’d like to hear about.

Then we had the blockbuster news concerning Continental’s Chairman and CEO, Larry Kellner. As I write in this week’s PBB, even though the management backbench strength at Continental Airlines is strong, and the airline should be able to carry on just fine as Larry goes to seek his fortune in the equity investment game — it’s quite discouraging to see one of the industry’s best and brightest leave.

Following up on our piece in last week’s issue about United’s bone-headed (or would that be heavy-handed) attempts to get travel agencies to take on more financial risk — or rather some travel agencies — the airline said late last week that it is going to give agencies 60 days to implement the business operation changes it seeks.

This whole thing still reeks. Nothing the airline says rings true.

Southwest Airlines had its own place in the spotlight last week, or would that be the sunlight, as the airline had a 737-300 aircraft develop a hole in the roof while enroute from Nashville to BWI. Not what the airline wants or needs — especially considering the issues the airline has had with the FAA concerning fuselage checks in the past. Preliminary NTSB report says there was no evidence of previous corrosion at the site.

That was not the only bad news Southwest had last week. The airline was also notified that its debt rating with Moody’s is under review, signaling a potential downgrade.

The Senate produced its version of an FAA Reauthorization bill last week. How did it differ from the House version? It differed on quite a few items. We talk more about that in this week’s issue.

Those misguided folks at the US Airways Pilot Association, the pilot union that was created in an attempt to circumvent the original ALPA seniority award that was handed down after US Airways and America West combined forces — had their head handed to them on a plate by U.S. District Judge Neil Wake last week. Wake issued his final injunctive order on the case brought against USAPA by the former America West pilots. Yes, we talk about this too.

Oh, and speaking of USAPA, we also give them, and our readers, a handy step-by-step instruction of how you correctly determine just how much an airline executive makes, using SEC documentation. Apparently the folks at USAPA have a problem figuring these things out.

British Airways raids its guaranteed employee pension benefit larder, Air Canada gets all of its employees “on board” with its 21-month contract extension program, and 215 Delta pilots sign up for the airline’s sweetened “early-out” package. Somehow I think the guys in suits over in Atlanta had hoped that number had been higher.

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

If you are a subscriber, you can access this week’s issue here. If not, you can learn how you can become a subscriber by clicking here.

Air Canada Implodes


Well, we called this one.

Actually, I called it the day the airline came out of bankruptcy several years ago.

If you want to see what happens to an airline when the financial types pull off a slick version of bankruptcy (one in which inherent problems with an airline are not really changed — but bankers, hedge funds, and airline executives make off with a lot of cash in the process) you need look no further than the sickening situation that began at Air Canada when the airline came out of bankruptcy in 2004 and which will end when the airline ends up back in bankruptcy again. An event which is probably not that far down the road.

This week Montie Brewer, CEO of Air Canada was forced out of the airline as CEO. Technically, he “resigned.” Yes, well, that was only after he was told he was fired.

I don’t blame Montie for the position Air Canada finds itself in today. I blame Robert Milton, the former CEO of Air Canada, and all the rest of that airline’s top executives who made off with a s%^* load of money when the airline came out of bankruptcy in 2004. It was this group, along with the various banks and hedge funds that fueled the airline’s exit, all wrapped around a nice new holding company, ACE Holdings, that is to blame for the situation Air Canada is in today.

Milton was made Chairman, President and CEO of ACE.

Very convenient. And yes, the position has also been very lucrative.

To the bankers, to the hedge funds, and to Milton. And his friends.

And guess what? Two of the members of that Milton brain trust are now back at the top of Air Canada — Calin Rovinescu and Duncan Dee.

In an article in the Globe and Mail, Milton was quoted as saying, “Look at this as Calin’s and Duncan’s chance to make good things happen with a terrible backdrop.”

How so very convenient. I mean, what are friends for anyway?

Air Canada has been on the PlaneBusiness Titanic Watch for more than a year.