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Aviation Industry Updates: May 2, 2023

American Pilots Authorize A Strike Mandate


  • American Airlines Group Inc (AAL.O) pilots backing a strike mandate and Air Canada (AC.TO) pilots supporting a merger with a larger union.
  • American Airlines pilots approved the mandate ahead of the busy summer travel season to further pressure the Texas-based carrier for a contract, although the chances of them actually walking off the job remain slim.
  • The Allied Pilots Association (APA), which represents about 15,000 American Airlines pilots, held a strike authorization vote in April, even as the two sides closed in on an agreement in principle.
  • More than 96% of APA membership voted and over 99% voted in favor of authorizing a strike, the union said in a statement.
  • "We remain confident that an agreement for our pilots is within reach and can be finalized quickly. The finish line is in sight," American Airlines said in a statement.


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JetBlue Anticipates Merging With Spirit by Mid 2024


  • JetBlue expects to complete the merger with Spirit Airlines by the first half of 2024, the airline revealed in its Q1 2023 earnings release. 
  • The New York John F. Kennedy International Airport (JFK)-based airline said it continued to expect the “Spirt acquisition to close no later than 1H24”, with customers benefiting “greatly from this pro-competitive transaction to create a national low-fare challenger to the current industry landscape”.  
  • The United States (US) Department of Justice (DOJ) filed a lawsuit to block the proposed merger between the two airlines on March 7, 2023, where, alongside the Attorneys General of the 
    Commonwealth of Massachusetts, the State of New York, and the District of Columbia, it argued that the merger would eliminate competition and further consolidate the airline industry in the US. The lawsuit claimed that the merger would result in increased fares, reduced choice, and raising costs “for the flying public and harming cost-conscious fliers most acutely”. 
  • “As our complaint alleges, the merger of JetBlue and Spirit would result in higher fares and fewer choices for tens of millions of travelers, with the greatest impact felt by those who rely on what are known as ultra-low-cost carriers in order to fly,” said Merrick Garland, the US Attorney General. 
  • In response, JetBlue’s Chief Executive Officer (CEO) Robin Hayes said that the company believed the DOJ had got it “wrong” and missed the point that the merger “will create a national low-fare, high-quality competitor to the Big Four carriers which – thanks to their own DOJ-approved mergers – control about 80% of the U.S. market”.


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Southwest Scales Back 2023 Hiring Because of Boeing Aircraft Delays


  • Southwest Airlines is reducing its hiring targets for this year because of delays in new aircraft from Boeing the carrier’s CEO Bob Jordan said Thursday.
  • The Dallas-based airline expects to receive just 70 new 737 Max planes from Boeing this year, down from a previous forecast of 90, which will reduce its capacity growth plans by one percentage point, Southwest said in quarterly filing.
  • Southwest is one of Boeing’s best customers and operates a fleet of all 737s. It has orders for 564 Boeing 737 Max planes through the end of the decade, according to the quarterly report. Those aircraft are more fuel-efficient and will both replace older jets and help the company grow.
  • Jordan told CNBC’s “Squawk on the Street” following its quarterly report that the company planned to add a net 7,000 people to its staff this year, but will now have to “moderate” its targets.
  • The company didn’t respond to a request to elaborate on how much it will need to reduce its hiring plans.


ALPA Calls on DOT To Reject SkyWest’s 135 Operation


  • The Air Line Pilots Association (ALPA), which is the world's largest pilots union, has sent a letter directly to Pete Buttigieg, the Secretary of Transportation, and the rest of the United States Department of Transportation. The letter highlights the union's opposition to SkyWest's application for becoming a commuter air carrier authority. The airline has proposed a move from Federal Air Regulation (FAR) Part 121 to FAR Part 135.
  • SkyWest formally applied to the Department of Transportation to move much of its Essential Air Services (EAS) work from FAR Part 121 to Part 135. Part 121 is defined as the operation of a regularly scheduled air carrier. Whereas Part 135 is defined as an air carrier and operator certification.
  • Part 135 regulations allow for SkyWest to use lesser-qualified first officers. The ALPA alleges that this would lessen the safety regulations for SkyWest as an air carrier. When SkyWest made its initial application in early 2022, ALPA released a statement saying,
  • "[The DOT would] degrade the level of air safety for small communities by granting federal funds to permit a dominant and profitable scheduled airline to shift its work to a wholly-owned charter subsidiary and use lesser-qualified first officers in the process."
  • A type certification under Federal Air Regulations stays with the name of the airline. So, SkyWest Airlines applied for a new certification intending to branch many of its standard operations into a new SkyWest Charters section of the business. The new SkyWest Charters would operate 18 CRJ200s. These 18 aircraft would operate 25 different under-served routes in the United States. SkyWest Charters would operate under Part 135 regulations according to the proposal.
  • The remainder of SkyWest's business would stay as SkyWest Airlines and allow the airline to prioritize the dual-class fleet that SkyWest owns. SkyWest Airlines would remain operating under Part 121 regulations according to the proposal.

Simple Flying

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PAPA | MAY 18-19 | LAS

OBAP | AUG 9-11 | MSY

LPA | SEP 14-16 | ISM

RTAG | OCT 7-8 | FTW


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