Tag Archives: tom horton

PlaneBusiness Banter Now Posted!

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Hello everyone. It’s that time again. That’s right — it’s earnings time in PlaneBusiness Banter.

This week we roll out our “All-New” PlaneBusiness Earnings Review format, which I hope subscribers will find easier to dissect, peruse, and digest.

This week we take our in-depth look at the results reported last week by Delta Air Lines, US Airways, Southwest Airlines, and United Continental Holdings, parent of United Airlines.

Short and sweet? Delta Air Lines blew away the competition in 2012, but US Airways had a record breaking profitable year as well. It really is gratifying to see two major U.S. airlines turning out such great financial results.

United? The slog of its merger integration continues. 2012 was not a good year and it was really not a good quarter for the airline. However, we certainly detected a change in tone on the airline’s call this quarter — for the better — and we are looking forward to watching the airline as it tackles 2013.

While it seems the airline now knows what it has to do — now it has to do it.

Then there was Southwest Airlines. (We’ll talk about Alaska Air Group and its results in next week’s issue, along with Allegiant, Hawaiian and JetBlue.)

The results from Southwest were not overly impressive. In addition, analyst Jamie Baker with JP Morgan got into a rather interesting discussion with management at the airline concerning “brand.”

In a follow-up note to investors, Baker made the point that it seems the airline continues to make decisions based on brand, and not necessarily maximization of returns to investors and improved profitability.

It is an interesting concept, and we basically agree with him.

Of course we talk about about the American Airlines-US Airways merger process. Lots of things to talk about on that front this week, including our take on the rumors that Tom Horton, who is currently Chairman, President and CEO of AMR, might possibly stay on with the merged airline in some capacity — perhaps Chairman.

To say this story caused an avalanche of emails at the Worldwide Headquarters today would be an understatement.

Then there is Boeing — and that little problem of battery fires on its 787s. Boeing reported earnings today. We’ll catch you up on the latest with the company’s comments concerning the 787, and we update you on the latest progress in the hunt to find out just what the problem is.

All this, and much, much, more, including the Republic Holdings/AMR/Embraer deal, in this week’s issue of PlaneBusiness Banter.

PlaneBusiness Banter Now Posted!

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

You know the drill. We lead off again this week with coverage of American Airlines.

This week we talk about how the airline now believes its seat problem is a result of passengers throwing gunk in between them. You buyin’ this? No, we aren’t either.

Monday also saw American CEO Tom Horton hobnobbing with IAG Chairman Willie Walsh in New York, as Qatar was officially announced as the latest member of the oneworld alliance. Actually the fact that Walsh managed to sweet-talk Qatar into the fold was the real story here.

But needless to say, American was quick to use the opportunity to do some positive spin of its own as the airline conveniently released its September traffic and PRASM estimates the same day.

Meanwhile, just hours before, Etihad’s marketing agreement (with more to come) with Air France/KLM was announced.

I said it when Qantas announced its deal with Emirates — the alliance system is dead. We’re going to see some big changes on this front going forward.

Airline stocks had a great week last week — with shares of US Airways and Delta leading the pack.

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

PlaneBusiness Banter Now Posted!

home-typewriter copy 1.jpg Hello everyone. Happy Fourth of July! This week’s holiday issue of PlaneBusiness Banter is now posted.

This week we take a look at the latest news from American Airlines bankruptcy, including the extension for exclusivity that the airline and the Unsecured Creditors Committee have agreed to. Does this change anything? We think not, and we explain all the fine print of what it does mean.

Meanwhile, as expected, the board of directors of the Allied Pilots Association voted to send out the last best tentative agreement with the company to the rank and file for a vote. All of that will take us into August — one of the main reasons the exclusivity date was pushed back.

The “intensive” two week closed doors locked-down negotiations between the pilots at Continental, United, and the airline came to a close last week. But no contract was to be had. We are still optimistic, and we think the timing of the announcement concerning the results of the Delta Air Lines‘ pilot contract had a bit to do with what happened here as well.

Meanwhile, while all this was going on, Holly was in Chicago last week, attending and speaking at the Association of Travel Marketing Executives conference. More on all that in the our next issue. While I was in Chicago, I also got to take a tour of the United Airlines new network operations center. Wow. What a trip that place is. More on all that in this week’s issue as well.

In our AMR Bankruptcy Follies column this week, we tip our hat to our customary “Ode to a Hot Dog” column and give it a new twist, as we explore the top ten reasons American Airlines’ CEO Tom Horton doesn’t like hot dogs.

And oh, then there were the first quarter earnings that Virgin America issued on Tuesday afternoon. Yep, that’s right. The old “Vanguard” method. You know how that works. You issue bad earnings news on a day when no one is paying much attention. Like on the afternoon before July 4th.

That’s okay. We were paying attention, as were some of our subscribers.

The numbers were, in a nutshell, horrible. We ask — how long can this operation continue?

All this and more, including our second quarter airline stock performance review (in which US Airways handily took top honors) in this week’s issue of PlaneBusiness Banter.

PlaneBusiness Banter Posted!

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Hello all.

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

This week we have a little bit of this and a little bit of that. First, we look at the latest effort by American Airlines to present its view of the world, i.e., its “truthiness” regarding its future prospects as a “Standalone” airline. Now the airline has resorted to asking business partners for what amounts to a reference letter.

Amazing what a company has to do when it can’t find one independent Wall Street analyst to say they endorse the plan you say is your best option coming out of bankruptcy.

Meanwhile on the other side of the world, oneworld partner Qantas just lost $1 billion in market capitalization as investors clearly are not happy with the fact the airline is now slated to post its first annual loss since the stock went public in 1995. The stock dropped to such low levels last week that the airline has been forced to hire an advisor to help keep potentially hostile takeover bids away. But I doubt that the hiring of such a firm will be of much use. Former CEO Geoff Dixon is supposedly heading up one such group.

Meanwhile, Emirates said this week it remains on track to enter into a “commercial” agreement with the airline — but not as an equity partner.

U.S. major airlines seem poised to begin slapping $25 fees on oversized carry-on bags. We like the move — and don’t think passenger rights groups should be upset over all this. All the airlines are doing is leveling the playing field and stopping the abuse of the carry-on rules as they exist now. So everybody — just chill. The fees that are being considered are for “oversized” bags. Not normal bags.

Airline stocks had a fairly good week last week — while the rest of the markets stumbled. Again — the more fuel prices decline the better it is for airlines.

At the IATA Conference in Beijing this week the IATA set out an ambitious goal — to bring peace to the fight between airlines and GDS companies. We’ll see how all this shakes out.

Meanwhile China and the EU stepped up their game of chicken over China’s unwillingness to participate in the EU’s carbon emissions scheme.

Singapore Airlines launched its low fare long-haul “Scoot” last week. Not a product I am jumping up and down to fly on — but it’s yet another attempt by a major Asian airline to tap into the low fare market.

All this and more, including a ton of reader mail, in this week’s PlaneBusiness Banter.

PlaneBusiness Banter Now Posted!

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Good evening everyone.

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

We are a bit late in posting this week — the result of PlaneDad move-related duties. I am happy to report that he is now in his new home in Texas, but the whole process took more time this week and last than I had anticipated.

Hopefully we’ve gotten the most time-consuming issues behind us.

Meanwhile, this week in PlaneBusiness Banter, there are two main stories we’re talking about. One — the reaction of United Airlines to the city of Houston’s decision to allow Houston Hobby to expand — allowing Southwest Airlines and other airlines to fly internationally from Hobby. While we knew this was going to be the city’s decision, even we were somewhat taken aback with some comments made by the airline and its CEO, Jeff Smisek after the city council vote took place.

We talk about what the airline could have done — as opposed to what it did do – in this week’s issue.

We have a new edition of AMR Bankruptcy Follies this week. This week’s we’re talking about Chinese food and mystery meat. I’ll let you guys figure it out.

We also heard from a number of our subscribers about the “Town Hall” meeting AMR CEO Tom Horton conducted last week at the airline’s headquarters. Funny. The entire presentation, particularly the Q&A session contents are not all on the official “Scrubbed” version of the session that the airline has posted for public consumption.

But essentially, I think Mr. Horton needs to be reminded that he is not the one who is going to decide whether American merges with another airline or not, or who that airline may be. That responsibility lies with the bankruptcy court, particularly the Unsecured Creditors Committee.

Etihad broke out the checkbook again last week, while David Neeleman’s Azul bought out rival Brazilian airline TRIP. This also means that SkyWest, which had invested in TRIP will get a payout. Over time.

Will Pinnacle Airlines move back to Minneapolis? Yes — if the folks in Minneapolis have anything to do with it. I also tend to think it will probably happen, as Delta continues to downsize its presence in Memphis.

Oh, and that big sell-off in airline stocks Monday? Don’t pay any attention to it. If you are a savvy investor you saw it for what it was — an overreaction to the Delta May PRASM estimate numbers. But Delta is an exception to the rule. We’ll tell you what two analysts had to say about the situation.

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

PlaneBusiness Banter Now Posted!

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Hello everyone.

For those of you who are subscribers and print out PBB, I warn you — this one is probably going to be more than 150 pages. Yes, it is a return of the “Killer Earnings Issue.” (Insert screams here.)

This week we’re looking at the recent earnings calls of Delta Air Lines, United Airlines, US Airways, and JetBlue Airways. Only one of the four made a profit. Do you know which one?

The laggard in the bunch was definitely United Airlines. The airline’s 1Q revenues clearly showed the effect of the airline’s SHARES cutover. The problem? The airline still has a number of cutover issues that have yet to be resolved — and these issues directly affect the ability of the airline to capture additional revenue and/or they concern upgrades.

Between all this and the usual problems that any merger comes with — this year is looking more and more like a transitional year for United.

Delta AIr Lines, on the other hand, produced excellent revenue during the quarter, as did US Airways and JetBlue.

As we also note in our comments about US Airways’ results, the airline continues to be a great poster child for our “Just Say No to Fuel Hedging” campaign.

The airline posted a relatively small loss for the quarter — with no fuel hedges in place.

This week, Delta Air Lines announced that yes, it is going to purchase an oil refinery. When you stop snickering, I’ll tell you why I like the move.

Hawaiian Airlines‘ shares had a nice gain last week — the result of better than expected earnings results and strong guidance. Meanwhile. shares of US Airways picked up even more ground last week. For the year, our favorite trading stock (per our comments in January) has picked up more than 103%.

Of course no issue of PBB would be complete now without the latest addition of the AMR Bankruptcy Follies. This week we talk a little about Harvey Miller — the ex-Lorenzo attorney who is AMR’s lead restructuring counsel. We also tell you how much he is charging AMR by the hour. After you recover from that nugget, you can read our take on the airline’s attempt to negate the significance of the airline’s three unions and their signed term sheets with US Airways, and we talk about some of the comments that came out of last week’s court testimony.

Yes, apparently AMR did have another strategy besides the ‘Cornerstone Strategy.” It was the “Limp-Along” or “Kick the Can” strategy.

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