Aviation Industry Updates: December 8, 2020

Southwest WARNs 1200+ Pilots

KEY POINTS:

• Southwest sent notices of potential furloughs to thousands of employees Thursday in what represents the carrier's largest batch of notices issued so far.

• The WARN Act notices issued Thursday represent the largest number of notices Dallas-based Southwest has issued since it started issuing notices Nov. 6. The carrier also issued WARN notices to mechanics Nov. 18.

• Here are the workgroups affected by the notices, according to the company:
  • 2,551 ramp, provisioning, operations, and cargo agents
  • 1,500 flight attendants
  • 1,221 pilots
  • 1,176 customer service agents in ground operations
  • 370 customer support and services and source of support representatives
  • Six flight instructors
  • Four flight simulator technicians

• Depending on the workgroup, furloughs will take place March 15 or April 1 or within 14 days after those dates, the company said.

• Captain Jon Weaks, SWAPA president, said in a video message to pilots that Chairman and CEO Gary Kelly "put a dollar value on 49 years of Southwest Airlines culture and its commitment to our pilots who are part of its employee family — $220 million."

• "We have been engaged with our unions since early October seeking temporary cost reductions to help offset over $1 billion of overstaffing costs projected for 2021," Russell McCrady, vice president labor relations, said in a statement. "Our absolute goal is to preserve every job at Southwest Airlines; however, due to a lack of meaningful progress in negotiations, we had to proceed with issuing notifications to additional employees who are valued members of the Southwest Family.

The Business Journals

Delta & American Bookings Declining | How Long Will This Last?

KEY POINTS:

• The highly profitable business air travel segment remains essentially in zombie-status, but leisure travel perked up a little in recent months, and over Thanksgiving inched up further by a microscopic amount.

• On Friday, American Airlines released a statement, saying that “like others in the industry,” it “has seen a slowing in demand and forward bookings due to the recent acceleration of the pandemic.”

• Fourth quarter “daily cash burn,” the industry metric that was born out of the Pandemic, would come in at the high end of its previously estimated range of $25-$30 million per day “due to the slowing of demand and forward bookings referenced above and modestly higher fuel prices.”

• Delta said, “While we enjoyed an increase in travel volumes over the Thanksgiving holiday, in reality they were still less than half of what we normally fly during the holiday.”

• Like the entire industry, Delta is eagerly waiting for the vaccines. Its hope of reaching the breakeven point in the spring “has been bolstered by continued positive developments with vaccines,” it said.

• While the vaccines, if and when they become broadly available, will eventually allow leisure travel to recover at least partially, the big profitable segment of expense-account business travel isn’t going back to the old normal.

• Sure, there will be some business travel, but the old glory days of business travel are gone, nixed by corporate cost-cutters that have now found a functional alternative. And the airlines themselves have come to accept that.

Wolf Street

Weekly TSA Numbers

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