Airlines

Category Archives for Airlines.

American Airlines Asks Flight Attendants To Take Leave With No Pay

by Gary Leff

Mar 17 2020

American Airlines is telling flight attendants they have “great options” to choose from to voluntarily reduce the airline’s workforce: retirement and no pay but two years of benefits, or leave with no pay but benefits. Pilots are being offered about two-thirds of pay.

Unless there’s some sort of commitment not to furlough employees as part of taking the government bailout package airline CEOs and their lobbyists have been pushing for, I’d expect to see furloughs coming next.

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What Should Flight Attendants Be Doing To Stay Safe?

by Gary Leff

Mar 17 2020

Most coverage has been about passengers – being afraid to fly, not allowed to fly by their companies, being advised to avoid risk. The President of the United States is advising against discretionary travel that is still mostly permitted. Yet day in and day out airline crew continue to show up at airports, get on planes, and interact with passengers. They’ve continued to work flights to Europe and Asia that many passengers have been unwilling to take.

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New Golden Age For Frequent Flyers Is Just Around The Corner

by Gary Leff

Mar 17 2020

A lot of people are grounded right now. Most of us are going to travel again. And we’re sure going to be itching to do so.

No matter what happens with the business of any of the airlines, we’re going to have big airlines to take us where we want to go. They are going to have tons of empty seats for awhile – which means deep discounts, award availability, and aggressive mileage promotions.

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Paid Travel Subscriptions Need To Waive Fees For Several Months (Or Else You Should Cancel Now)

by Gary Leff

gogo plane
Mar 17 2020

Suspending paid services like Gogo and Expert Flyer makes sense. Don’t spend money on a service you aren’t using right now. From a travel company’s perspective they can generate some revenue from customers who forget to cancel, but it’s better to keep all of their customers long term by making it unnecessary to cancel. Many who give up the services temporarily won’t come back

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Virgin Atlantic Launches Status And Bonus Miles Promotions While Seeking Government Bailout

by Gary Leff

virgin atlantic
Mar 16 2020

Delta-controlled Virgin Atlantic has its hand out for government subsidies on the one hand, while running new bonus miles and elite qualifying promotions on the other.

I still think it’s too early to move the needle on travel with promotions, but Virgin is in a different boat than U.S. programs whose status years run with the calendar. They don’t have the option of waiting to extend elite status.

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Important Principles For Government Aid To The Airline Industry

by Gary Leff

Mar 16 2020

What we care about as a society is that an airline industry exists. The reason for government intervention is to prevent economic contagion (the spread of one failure to another). That was the argument for bailing out banks during the financial crisis, and it doesn’t exist in the same dimension with airlines. Nonetheless the industry is an important one once we’re ready to recover.

However the planes will still exist. The airports and gates will still exist. Skilled pilots and mechanics will still need work. The only reason to intervene will come later, if at all. Once airlines are in bankruptcy the relevant question is if they keep flying. And that’s dependent on available new capital during the bankruptcy process. Shareholders should take their haircut first.

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Is Not Cutting Flights As Deeply As Competitors A Brilliant Strategy Right Now? [Speculative]

by Gary Leff

Mar 16 2020

The normal approach is to cut spending everywhere possible, from capital expenditures to labor. It’s harder to cut employee salaries but Delta is throttling down spend on contracting firms and consultants. It is parking up to 300 planes.

So far flight loads haven’t been as bad as you’d expect, overall think of planes as 60% full towards the end of last week. That’s probably higher than we’ll see going forward.

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United Airlines Tells Employees To Expect Job Cuts

by Gary Leff

united plane
Mar 15 2020

United Airlines sent out a press release this evening, a copy of a letter to employees under the signatures of outgoing CEO Oscar Munoz and soon-to-be CEO Scott Kirby in which they lay out how bad they expect the novel coronavirus to be for the business – and in the middle of the letter they reveal that it “no longer appears realistic” to “avoid [taking] steps that affect [employee] paycheck[s].”

The airline reports that this weekend they have been in discussion with its unions to reduce “payroll expense.”

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Insane: American Airlines Is Still Spending Money To Add Seats To Aircraft

by Gary Leff

Mar 15 2020

American Airlines has cut its international schedule by 75% and its domestic schedule by 30%. Load factors are dropping. People aren’t buying tickets. The one thing American Airlines has too much of is seating capacity. And the one thing American Airlines has too little of to make it through this crisis is money. That’s why they’re running to the government for assistance.

And yet they’re continuing their ‘Oasis retrofit’ program where they replace the interiors of domestic aircraft to add seats to planes, making them less comfortable for passengers.

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