June 28, 2016
In the wake of Brexit, will the U.K. be able to remain in the European Common Aviation Area? We don’t know. But we do know that if the U.K. is relegated to some other status, it would obviously impact airlines inside and outside the U.K. In this episode we do a quick survey of airlines such as British Airways, Virgin Atlantic, Flybe, easyJet, Norwegian and Aer Lingus and attempt to size up each of their levels of exposure to Brexit fallout.
Frontier Airlines had a terrific first quarter, but not as terrific as its peers—does that matter? Air Mauritius has returned to profitability, but is it sustainable in a region that’s likely to only become more competitive? In Canada, NewLeaf is looking to take flight in July, and WestJet appears to be well aware of it.
June 21, 2016
Wherever you go in the airline industry, you’re never too far from Singapore Airlines, a carrier that played a primary role in—count ‘em— four of the bigger storylines last week. Singapore is pulling out of Brazil. In India, Singapore will likely be a key beneficiary of the end of the 5/20 rule. Singapore and United oddly seem to be rumbling on a San Francisco route. And Virgin Australia is asking Singapore and other investors for more money.
In non-Singaporean news, United Airlines unveiled a plan to generate $3 billion in value. The U.K. is voting on whether to leave the European Union and take its enormous aviation market along with it. We talk about whether Frontier’s day-of-week-specific flying signals a change in approach for the airline. And, lastly, is Alaska really considering keeping the Virgin America brand?
June 14, 2016
Scandinavia’s SAS posted a pretty rough quarter despite huge tailwinds from its healthy home economy and cheap fuel. Fierce competition, labor concerns and operational problems all share the blame. Is SAS’s long-haul strategy the answer? Or will it take a merger?
Meanwhile in Africa, Fastjet is failing fast, posting an ugly 2015 full-year result. Clearly, it is tough to be a start-up airline on a continent rife with bureaucracy and protectionism. The turboprop carrier Flybe achieved a small annual profit, which was a big deal. Will the airline’s resurgence continue? And for U.S. carriers Delta, American, United and JetBlue, unit revenue declines haven’t stopped—there was hope they would’ve by now—and costs have stopped falling. That’s a recipe for margin pressure.
June 8, 2016
United last week revealed its new premium experience named Polaris, which includes its business class cabin. Ironically, the big design features in the cabin are all about missing the experience, because United wants its passengers to sleep right through it. But in addition to being optimized for sleep, the cabin is also optimized for something else: seat density. Does United have the right formula here?
Also, how does Polaris compare to American’s and Delta’s business classes? Low oil prices are good for airlines in general, but are they good for airlines in oil markets? In this episode we do a quick survey of oil markets around the world and how their airlines are faring. Mexico’s Interjet posted a tepid profit in the first quarter. And American Airlines made a huge change to its loyalty program that was, well, yawn inducing.