Tag Archives: Lufthansa

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpgGood evening everyone. This week’s edition of PlaneBusiness Banter is now posted.

What, pray tell, are we talking about this week?

I’m sure you won’t be surprised to know we talk a lot about the escalating disaster that is American Airlines. I think a lot of people are missing the bigger picture in terms of what is happening at the airline. This is not just a “pilot/management” pissing match. It’s much worse.

Meanwhile, across the pond, we try to get you caught up with all the latest potential “coupling” updates, including whether Qatar is going to get cozy with British Airways, whether British Airways is going to buy the Irish government’s stake in Aer Lingus, and whether or not Ryanair’s Michael O’Leary is still remotely interested in actually buying a piece of Aer Lingus or not. Our answer? No.

Back on this side of the pond, Air Canada’s CFO Mike Rousseau rolled out a lot of additional details about that airline’s new low cost subsidiary last week to a CIBC analyst conference. The information got investors excited apparently, as shares of the airline posted the largest gain of any airline stock we track for the week.

Reports say that Delta’s refinery subsidiary has started to make jet fuel. Don’t know about you, but I’m still excited about this project.

Another project I got to get a first hand look at last week that got me excited was Lufthansa System’s new onboard wireless IFE system, BoardConnect. I sat down with the folks from Lufthansa Systems at the APEX Conference in Long Beach. No question about it — the concept is the best option I’ve seen out there. If I owned an airline, I’d install it on my airplanes.

We have our usual letters this week, including a rebuttal to American Airlines’ claim that my tweet concerning the pilot contract terms harkened mostly back to the April Term Sheet.

Virgin America announced its second quarter 2012 earnings on Monday. Richard Branson can honestly say he has an investment in a non-profit entity in the U.S. Still.

Oh, and of course we address the major aircraft-related question of the week — why is it that windows in airplanes don’t open? And who is going to do something about this?

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

PlaneBusiness Banter is Back!

home-typewriter copy 1.jpg

Hello everyone. It’s time once again to jump into the fray. Our Holiday Hiatus is over. Time to close out the story on 2011 and start the story of 2012.

The first issue of PlaneBusiness Banter for 2012 is now posted.

This week we talk a lot about airline stocks. We look at how they performed for the last week, the last month, the last quarter and the last year.

The good news? The sector posted a huge fourth quarter. Not so good news — yearly stock performance numbers were horrible. But hey, the quarterly numbers are much more important.

In addition, contrary to a number of wire service and financial news site headlined “end of year” airline stock stories that are floating about the Internet — we tell you which airline stock really posted the best return to investors in 2011.

And no, it’s not Alaska Air Group — as many stories say was the case.

We also update subscribers this week on the American Airlines bankruptcy. The airline is starting to announce route changes, and has announced some fleet news. But, as Deutsche Bank analyst Michael Linenberg reminded investors in a note last week, timing for the airline’s Section 1110 filing the end of this month means that we should hear a lot more from the airline in the next 2 1/2 weeks concerning which aircraft the airline wants to keep, which ones it wants to walk away from, and which ones it wants to renegotiate with lessors.

On the traffic front, December RASM estimates from those airlines that supply such things are coming in mixed. We tell you who has reported better than expected RASM performance, and who has disappointed.

Following up on traffic — a reminder. Airline earnings reports for the fourth quarter and year-end will begin to roll out in a little over a week.

Both JAL and Hong Kong Airlines are talking about potential IPOs in 2012, while Lufthansa was apparently just pulling Virgin Atlantic’s strings over bmi. The German airline finalized a deal with IAG, parent of British Airways for the airline, er, slots over the Christmas holiday. Not surprisingly Sir Richard says he is going to continue the fight to keep BA from getting its hands on bmi’s slots.

Unfortunately I don’t think his screams are going to matter to UK regulators.

On this side of the Atlantic, flight attendants for AirTran and Southwest announced a seniority agreement right before Christmas — good news for the airline.

Did Boeing meet its 2011 delivery goal? No.

How many more aircraft did Airbus deliver in 2011 than Boeing?

Are those “tiny” hairline cracks that have been found in the wing assembly of the A380s really a safety issue?

All of this, and a lot more in our first issue of the year.

If you aren’t yet a subscriber to PlaneBusiness Banter — why not? Find out how you can become one here.

This Week in PlaneBusiness Banter

You want to know how much money the airline industry had to shell out in additional GDS fees in 2009 as a result of the OTAs dropping their online booking fees?

We know the answer. At least we know how much Forrester Research estimates the airlines lost.

This week in PlaneBusiness Banter I sit down with Henry Harteveldt, VP and Principal Analyst with Forrester Research. We not only talk about the airlines and their additional GDS costs, we talk about onboard Wi-Fi and why AirCell’s pricing is too expensive, American’s lousy business class seats, Braniff, the shift that Forrester sees happening from legacy carriers to LCCs by corporate travel managers, and, of course, United’s decrepit onboard entertainment systems.

In other news, we look at the surprise Continental Airlines pulled on its pilot group last week. Hey, if the pilot group is going to keep waving the Delta Air Lines‘ pilot contract around — why not just give it to them? With a few minor revisions. That is exactly what the company has offered as a counter-proposal to what the pilots offered up in December.

Is this a good deal for the airline? For the pilots?

Meanwhile, Unite, the union that represents the cabin crew at British Airways made good on their promise to strike the airline this weekend. The airline estimates it has lost £7 million ($10.6 million) for each of the three days. It also says it will take the rest of the week to get itself re-positioned. Then– on Saturday, Unite has scheduled to begin a four-day strike against the airline.

Not to be outdone by the British Airways‘ cabin crew members, pilots at Germanwings and Lufthansa Cargo are now set to join Lufthansa pilots in a strike against that airline in April. After Easter. (That was considerate of them.)

This last week ISTAT held its annual conference in Orlando. We talk about the feedback we received from several subscribers who were in attendance — and yes, ILFC’s Steve Hazy was there talking up his new airline leasing venture.

Meanwhile, lots of regulatory news last week from the FAA, the NTSB, and the Office of the Special Counsel. We talk about all that — and yep, then there was that “Flight from Hell” on Virgin America last week. JetBlue saved the day. Ouch.

On the analyst front — Dan McKenzie with Hudson Securities issued an informative research note last week that looks at the changes in the competitive capacity game. We always like those.

All this — and a lot more. In this week’s issue.

Shares of SAS Surge on Talk of Potential Lufthansa Deal


Interesting news from across the pond today as Scandinavian carrier SAS said in a statement that the airline is conducting “talks about a possible structural solution.” That’s an interesting way to put it.

News reports say that Lufthansa is apparently about ready to make a takeover offer for the airline.

Shares of SAS were up 18% on the news, ending the day with a 16% increase, up to 55.25 kronor or $8.09.

According to Reuters, Lufthansa is mulling a bid for the airline after SAS approached Lufthansa. This news comes as Lufthansa is already in talks to buy Brussels Airlines. A bid by Lufthansa for Austrian Airlines also appears to be in the wings as well.

Bloomberg quoted Exane BNP Paribas analyst Geoff van Klaveren today, as he outlined the current position of SAS. “SAS is not in a financially strong position. SAS can’t be a standalone airline, so something will happen, whether it’ll be a complete takeover or a joint venture on something like long-haul flights.”

Meanwhile, Glitnir analyst Mats Hyttinge told the Associated Press that investors had speculated for a long time about SAS being a possible takeover target for Lufthansa, which has been looking at possible acquisitions for some time.

“I think it would be a good solution for SAS. They need financial backing,” Hyttinge said.

However, he noted that SAS’ complicated ownership structure could be an obstacle. “Considering there are several different states among the owners it would turn into a political process,” he said.

The Swedish government has been considering selling its 21.4 percent stake in SAS, while the Norwegian government, which owns 14.3 percent, has said it would rather buy more shares in the company, he said.

In Denmark, which also owns 14.3 percent, the signals have been mixed and a decision would probably depend on the price offered, Hyttinge said.