Aviation Industry Updates: February 9, 2021

Frontier Hiring | Stability Over Glamour

KEY POINTS:

• Only around 100 pilots will get to join the airline's ranks this time around despite potentially thousands of applicants and nearly 800 applications submitted in the first seven days.

• Pilots looking to get a foot in the door at the Denver-based carrier will have to be strategic in how they present themselves when applying.

• Here's what the airline looks for when hiring pilots; a pilot ready to choose stability over glamour, a safety-oriented and reliable pilot with good customer service skills, and a pilot that understands the business model.

• Pilots that make it past the application stage can expect a personal interview to gauge their attributes relating to customer service and safety. Then comes a panel interview with a human resources representative and a pilot followed by a situational-based interview where pilots will be put in a mock-cockpit and asked to make decisions.

• "We try to balance out pilots from corporate, pilots from regionals, and pilots from the military," Lambert said. "And it's not always the third, third, and a third, but we try to keep that mix as much as we can."

• About 50% of candidates that make it to the interview stage get hired. And if a pilot does manage to get in the door, it's always best to stick to the basics when interviewing.

Business Insider

737 MAX Ends 11 Month ZERO Emissions Run

KEY POINTS:

• Over the weekend, Southwest Airlines became the final domestic carrier to put the beleaguered jet back on its schedule. The Dallas-based carrier will restart MAX service on March 11, with four flights scheduled to take off at the same time across the network.

• Southwest’s MAX rollout plan is significantly more comprehensive than other carriers.

• For Boeing, Southwest’s move is welcome news. Unless plans change, every U.S. carrier will have the MAX back in the air come March 11. All eyes will then turn to other major markets, like China, which still haven’t recertified the plane.

• Pilots must also undergo new required training before they fly the plane once again. All Southwest pilots will be retrained prior to the March 11 relaunch, which includes some test flights without paying passengers.

• Gary Kelly, CEO of Southwest, recently flew on one of the carrier’s readiness flights, remarking on Twitter that “my flight today only reaffirmed my supreme confidence in the airworthiness of the MAX.”

• Southwest flyers who want to avoid flying on the MAX will have some added flexibility. Through May 31, customers may contact the airline for a fee-free change to a non-MAX flight within three days of the originally scheduled departure date.

Points Guy

United Execs Gunning For American

KEY POINTS:

• United Airlines has maintained a pretty intact fleet. The carrier was the only one of the big three not to withdraw hundreds of planes from its fleet.

• “I’ll start on just the fleet plan and point out that we want to maintain as much flexibility as we can on the fleet, so that aircraft are there to support the demand. The only decision we’ve made on retiring aircraft are a subset of our 757-200 fleet. The ones – there are about 13 of them that were powered by Pratt & Whitney engines that are among the oldest in the fleet – that for a number of reasons decided those are retiring, which has led to the charge we took in the quarter. The rest of the fleet, the mainline fleet in particular, will maintain flexibility.” Gerry Laderman, Chief Financial Officer at United Airlines

• Other carriers sought to accelerate fleet modernization and simplification plans. United Airlines, however, bucked that trend.

• In the second half of the year, the airline decided that having those planes sitting idle was pointless, so the airline started redeploying aircraft where capacity was necessary.

• United’s fleet will continue to grow in 2021. The airline’s 2021 deliveries are expected to total 24 Boeing 737 MAXs, 11 Boeing 787s, and four Embraer E175s bound for its regional fleet.

• So, when demand does return, United’s fleet will have grown, and it can add back capacity wherever necessary while also serving its new routes.

• At the end of the day, United Airlines is confident in its fleet and believes it will be the right size to capture demand when it returns – especially international demand. Some other airlines may end up being a little too small until new planes enter the fleet to capture the demand adequately. So, a big showdown is gearing up for whether airlines will be at the right capacity levels heading into a sustained recovery.

Simple Flying

Airlines End Worst Year In History | Liquidity At Record Highs

KEY POINTS:

• The US airline industry just closed the books on the worst year in its history, losing a combined $32 billion excluding special items. Yet it still ended 2020 awash in an ocean of cash.

• The nation's four largest airlines -- American (AAL), Delta (DAL), United (UAL) and Southwest (LUV) -- among them had $31.5 billion in cash on their balance sheets at the end of 2020. That's up from $13 billion a year earlier, before the pandemic hit.

• "Liquidity" has become a favorite buzzword of airline executives discussing their financial condition. Including the cash and yet untapped credit lines, the airlines have access to nearly $65 billion.

• The lion's share of the borrowing and cash, then, comes from from banks and Wall Street. Like a struggling family flooded with credit card offers, the airlines have a lot of people eager to give them cash.

• The airlines have sold bonds, borrowed money, mortgaged their planes, frequent flyer programs and other assets, and even sold additional shares of stock, a highly unusual move for an industry in this position.

• The airlines used buyouts and early retirement to cut about 16% of the staff they had at the start of 2021. In recent weeks, American and United sent out layoff notices to 27,000 employees between them, saying they could again be furloughed unless there is a third round of government assistance before April 1.

• But even as they trimmed the pace of cash burn, the four airlines combined blew through $115 million a day over the course of the final nine months of 2020. And they expect to continue burning through cash, albeit at a slower pace, in the first half of 2021. Building a substantial cash reserve is the only sure way to get through this unprecedented financial crisis, airline executives say.

• Other than Southwest, which just posted its first annual loss since 1973, the nation's other major airlines all have at least one bankruptcy in their histories. The industry's current strong cash position raises hopes that they can avoid that fate this time. But that depends on when traffic returns, and even the airlines aren't sure when that will be.

CNN

IATA: 2021 Off to a Bad Start

KEY POINTS:

• Full-year 2020 global air traffic plummeted 65.9 percent year over year from 2019, the sharpest drop in traffic in aviation history, according to the International Air Transport Association.

• Air bookings in January for future travel were down 70 percent year over year, which could further pressure airline cash positions and impede the timing of the recovery, according to IATA.

• IATA projects global air traffic in 2021 to be 50 percent year over year higher than in 2020, bringing it to 50.6 percent of its 2019 level.

• Similar to a recent Global Business Travel Association statement, IATA called for a more balanced, collaborative and consistent approach to handling the pandemic while enabling international travel. "We urge governments to work with industry to develop the standards for vaccination, testing and validation that will enable governments to have confidence that borders can reopen and international air travel can resume once the virus threat has been neutralized."

Business Travel News

Weekly TSA Numbers

[image_with_animation image_url="2510" alignment="center" animation="None" hover_animation="none" border_radius="none" box_shadow="none" image_loading="default" max_width="100%" max_width_mobile="default"]