Skip to main content

Aviation Industry Updates: May 31, 2022

By May 31, 2022June 7th, 2022Industry News

Alaska Pilots Vote To Authorize Strike | Stage Set For A Showdown

  • The vast majority of Alaska Airlines‘ nearly 3,100 union pilots have voted to go on strike.

  • In the vote conducted by the Alaska Airlines master executive council of the Air Line Pilots Association, 99% of pilots voted in favor of a strike, with 96% of eligible pilots participating, the union said.
  • Wednesday’s results do not necessarily mean the pilots will actually walk off the job.
  • However, it does open the door for a strike if the National Mediation Board, the federal labor relations board for the airline industry, gives the pilots permission to do so. On the flip side, Alaska’s management could theoretically choose to lock its pilots out.
  • There are two key things that would need to happen before any lockout or strike. First, the NMB would need to release both the company and the union from mediation. This would be followed by a mandated 30-day cooling-off period. So, if there was to be a strike, it would likely be a long way off, but it would also likely come during peak summer travel season.

The Points Guy

Southwest & JetBlue Report Second-Quarter Revenue Different Than Expected

KEY POINTS:

  • The travel rebound is shaping up to be even stronger than airlines expected, helping to make up for rising fuel prices. Southwest Airlines and JetBlue Airways said on Thursday that their revenues in the second quarter were on track to be higher than the companies had projected.
  • The announcements are the latest sign that people are increasingly planning leisure and business trips despite an increase in coronavirus cases across the country. Many travelers also seem unbothered by high prices for tickets, hotel rooms and rental cars. Flights booked within the United States for this weekend cost an average of $394, a 28 percent increase from the same weekend in 2019, according to Hopper, a travel booking app.
  • Southwest said in a securities filing that it expects revenues from April through June to increase between 12 and 15 percent from the same period in 2019, up from a previous projection of an 8 to 12 percent increase. And while fuel prices are expected to be 5 to 11 percent higher than previously expected, higher revenue will “more than offset” that rise in costs, the airline said. Based on current trends, Southwest said it “expects solid profits and operating margins” for the second quarter and the rest of the year.
  • JetBlue similarly said that business was improving and that it was on track to collect record revenue this summer. Ticket bookings are exceeding the airline’s expectations, with revenue for the current quarter expected to be “at or above” the high end of its previous estimate. Revenue per seat per mile flown is expected to be more than 20 percent higher than in the second quarter of 2019, the airline said.

New York Times

Spirit CEO: JetBlue’s Offer ‘Defies Common Sense’

KEY POINTS:

  • Monday Spirit Airlines hosted a webcast discussing their board’s decision to unanimously reject JetBlue’s unsolicited tender offer and reiterate their support for the merger agreement with Frontier airlines. On the call were CEO Ted Christie, Ms. DeAnn Gable, Senior Director of Investor Relations, and Andrew Finch, the Co-Chair of the Anti-Trust Practice Group in the Litigation Department at Paul Weiss.
  • Ted Christie began the webcast strongly rejecting the JetBlue proposal “JetBlue’s offer is not reasonably capable of being consummated JetBlue’s regulatory case is weak and defies common sense. By their own admission. They [JetBlue] expect the DOJ to sue, to block the JetBlue acquisition. So I have to wonder if JetBlue is purposely downplaying the substantial regulatory risk.
  • It’s inconceivable to us that acquisition of Spirit by JetBlue gets approved unless they abandoned the NEA. The anti-competitive Alliance with American airlines JetBlue has demonstrated that preserving this Alliance with American and not its acquisition of Spirit is its first prize. When we were engaged in discussions with JetBlue, we asked if they would abandon the NEA in order to get regulatory approval for a proposed transaction with Spirit. They refused. If they think approval is so likely why refuse to do whatever it takes to get the deal done.”
  • Christie continued, “But at the simplest level, a JetBlue transaction is about a high-fare carrier trying to buy a low-fare carrier, reducing capacity, and raising fares. Common sense tells you that is not a favorable story for regulators. In my opinion, JetBlue knows it faces a low probability of approval, which is why it’s shifting the risk on Spirit’s stockholders with inadequate compensation.”
  • Mr. Christie didn’t mince words when questioning JetBlue’s motivation for the proposal: “I believe it’s a cynical attempt to disrupt our merger with Frontier because a Spirit-Frontier combination poses a competitive threat. Why else would JetBlue wait over seven weeks after we announced the Frontier deal to submit the acquisition proposal. And why did JetBlue wait to launch the tender offer until just after we mailed our proxy statement for the Frontier merger?

SubStack

Southwest To Add 125+ Planes By End Of 2023 | Where Are All The Pilots Coming From?

KEY POINTS:

  • Southwest Airlines wants to add 125 to 140 planes to its fleet by the end of 2023 as it tries to bounce back from cutbacks during the pandemic.
  • With seats increasingly full heading into the summer travel season, Southwest chief financial officer Tammy Romo said demand is strong from customers and the company needs more aircraft from Boeing to continue growing.
  • “One of our priorities is restoring our network,” Romo said Thursday at the Wolfe Transportation and Industrials Conference in New York. “That’s probably 125 airplanes’ worth of growth, and we’re hoping that we are restored by the end of next year.”
  • Dallas-based Southwest is among several airlines trying to bounce back after reducing capacity in 2020 and 2021, but it is facing headwinds including a shortage of pilots and flight instructors along with slow deliveries from its sole aircraft manufacturer, Boeing.

Dallas Morning News

Weekly TSA Numbers

04192022 TSA Numbers

Additional Articles

Upcoming Expos & Conferences