Aviation Industry Updates: August 17, 2021

JetBlue Begins London Heathrow Service | Expansion Comes Next

• After finally beginning its long-awaited route to London Heathrow last week, JetBlue Airways CEO Robin Hayes said the carrier is already looking to garner more slots at the facility.

• In an exclusive interview with The Independent, Hayes downplayed the so-called competition among carriers for the lucrative route to London
  “Everyone thinks there’s all this competition,” he said. “There isn’t. There’s three large joint ventures across the Atlantic. They’ve enjoyed high fares for years. It’s amazing how much fares have come down since JetBlue started flying one daily flight to Heathrow.”

• JetBlue’s single daily flight to London pales in comparison to the number of offerings from American Airlines, British Airways, Delta and Virgin Atlantic.

• And despite using the single-aisle Airbus A321 aircraft, as opposed to a wide-body jet used by the competition, JetBlue’s seat pitch is at least an inch greater than other airlines – and the fares are lower.

• “We didn’t used to fly to La Guardia [in New York] – we elbowed our way in. We didn’t used to fly to DCA airport in Washington – we elbowed our way in. And we’re going to have to elbow our way into Heathrow,” Hayes said.

Travel Pulse

Southwest Sounds Alarm | Delta Variant Spurs Cancellations

KEY POINTS:

• Southwest Airlines Co warned on Wednesday that the spread of the Delta variant of COVID-19 had hit bookings and increased cancellations, hurting its chances at profit.

• The rapid surge in cases of the variant has pushed U.S. hospitalizations to a six-month high, prompting governments in areas such as Hawaii to reimpose restrictions and threatening a recovery in travel demand.

• Dallas-based Southwest cut its forecast for third-quarter operating revenue by three to four percentage points from its prior outlook issued just three weeks ago, the first major U.S. carrier to trim guidance as a result of the variant.

• The profit-warning marked a U-turn from the airline's upbeat statement last month that it would remain profitable for the rest of 2021.

• Last week, ultra-low-cost carrier Frontier Airlines also lowered its third-quarter forecast and warned the Delta variant was hurting demand.

Yahoo Finance

U.S./U.K. Travel Picks Up | Airlines Hope For Lifting Of Travel Ban

KEY POINTS:

• There were repeated calls in the U.K. this week for the U.S. to revoke the travel ban, which has been in place since March 2020.

• But as JetBlue launched its new London/New York service, there were signs of increased confidence, despite the airlines believing that the travel ban won’t be revoked before September and possibly as late as November.

• Heathrow airport is the busiest airport in the U.K. and before the pandemic, it was the busiest in Europe, but it has called on the government to do more to increase travel–in July, it said that 1.5 million people passed through its terminals, which is well below pre-pandemic levels.

• As reported by inews, it has asked that PCR tests be replaced with lateral flow tests (which are much cheaper and faster) and that the U.K. government pushes harder for the U.S. to open up its borders and reciprocate by rescinding its travel ban.

• The U.S./U.K. travel industry is lucrative. As reported by The Independent, almost 4 million travelers made the journey from the U.K. to the U.S. in 2019 (figures from the U.K.’s Foreign Office) while 4.5 million journeys were made in the opposite direction (VisitBritain figures).

• Before Covid-19, it was the London/New York route which carried the most people–almost 3 million annually.

Forbes

North Atlantic Routes | Competition Heats Up

KEY POINTS:

• The skies over the north Atlantic are still unusually empty. But a new battle for a share of some of the busiest and most lucrative flight paths in the world is already under way.

• US airline JetBlue defied the aviation crisis by launching its first transatlantic service this week, promising to spark a price war with rivals including British Airways and Virgin Atlantic.

• Fares for return trips start at £329 in economy and £999 in business class, significantly cheaper than many rivals.

• Within hours of the inaugural flight landing under cloudy skies at London’s Heathrow airport, JetBlue’s British chief executive Robin Hayes was trumpeting victory over the “very high fares” of his rivals.

• Hayes said prices have fallen across the board since his airline announced its pricing plans in May, and took credit for it. “I am 100 per cent certain it is because of JetBlue,” he told the Financial Times.

• Transatlantic flights are the crown jewel in global aviation. Worth an estimated $9bn a year in revenue before the pandemic, established airlines have relied on them for a steady stream of corporate customers and wealthy holidaymakers willing to pay high prices to sit in premium class seats.

• “On long haul, there is a lot to look forward to, but in the short-term, to get passenger volumes recovering more quickly, we do need the government to relax travel restrictions,” Gatwick’s chief executive Stewart Wingate said.

Financial Times

Weekly TSA Numbers

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