Category Archives for Airlines.
Some unscrupulous people request wheelchair assistance at the airport when they don’t need it, using their ‘injury’ for a whole bunch of benefits: skip the security line, early boarding, and even better better seats on board.
El Al is spinning off its frequent flyer program at a $500 million valuation. The entire airline, including the frequent flyer program, has a market cap of less than $180 million. They’re not alone. American’s frequent flyer program was appraised at up to $30 billion (and they borrowed $10 billion against it) while their market cap is less than $9 billion.
Spirit Airlines sent me their release indicating that tomorrow will not be the day that shareholders vote on whether to sell to Frontier Airlines.
Instead the shareholder meeting will be adjourned and reconvened on July 8. Spirit wouldn’t do this if all their ducks were lined up to gain approval for the Frontier deal that their board has endorsed.
Bernie Sanders, like all of us, has some valid gripes about air travel today. He’s come out with a set of solutions he’d like the Department of Transportation to impose through new regulation. This includes forcing airlines to skip crucial maintenance, and requiring flight attendants to work when they’re sick with Covid-19.
JetBlue’s proposed deal to acquire Spirit Airlines is better for Spirit shareholders than Frontier’s is. Spirit management supports the Frontier deal, and it will probably be approved. JetBlue is offering 40% more for Spirit Airlines than Frontier is. With Spirit’s shares falling to slightly below Frontier’s offer, the market thinks the successful suitor will be Frontier, not JetBlue.
However a Frontier deal for Spirit is actually better for consumers, even though JetBlue’s product is better than the one offered by either airline.
Virgin Atlantic is launching two positive changes for its Flying Club frequent flyer program. They’re guaranteeing to release a minimum number of award seats when loading a flight into the schedule, and they’re allowing Gold elite members to book any seat they want that’s for sale as an award ticket by spending double miles.
Somewhat counterintuitively the introduction of double miles awards without capacity controls are actually the bigger deal here for the program, I think.
Delta is running a flash sale on business class SkyMiles awards to Europe. Prices start at 148,000 miles roundtrip, which is roughly what other programs normally charge. But it can be half what Delta frequently charges, and availability is pretty good. But you have to act fast.
New aircraft are coming, but they’re farther off than they’ve been promised. And electric air taxis just got even farther off still, thanks to the U.S. federal government. In fact these planes are looking at delays of years. Some manufacturers may not have the financing to get through certification in the current market environment.
When Frontier Airlines raised its offer to buy Spirit Airlines and gave the Spirit Airlines board cover to again endorse a merger between the two airlines (walking away from a much bigger offer from JetBlue that faces greater anti-trust scrutiny) it seemed like game over. The new offer even got the endorsement from two independent proxy advisory firms.
JetBlue isn’t done though. They’ve come out with a new, increased offer in advance of Thursday’s Spirit Airlines shareholders meeting, a last ditch effort.
Airlines lost billions of dollars during the pandemic. But their leaders shed costs, in many cases by downsizing staff and brought in government subsidies (designed to keep them from shedding staff). It was a test of leadership, and CEOs were rewarded handsomely for the task.
It’s a wet hot American summer of flying through delays, cancellations, and long lines at airports. It may be a comfort to know that airline CEOs were well paid bringing it to us.
Gary Leff is one of the foremost experts in the field of miles, points, and frequent business travel -- a topic he has covered since 2002.
Co-founder of frequent flyer community InsideFlyer.com, emcee of the Freddie Awards, and named one of the "World's Top Travel Experts" by Conde' Nast Traveler (2010-Present) Gary has been a guest on most major news media, profiled in several top print publications, and published broadly on the topic of consumer loyalty. More About Gary »
