In other airline industry news last week…
- United Airlines will launch daily nonstop service from Chicago to Sarasota beginning November 4, 2012 using Boeing 737-800 aircraft. This marks the ninth city United is slated to serve in the Sunshine State and a company spokesperson was particularly keen on mentioning the route’s ability to open up United’s global network from Chicago for Sarasota-originating passengers. Separately, flight attendants represented by the Association of Flight Attendants (AFA) ratified a new labor contract. A total Continental-United combined contract has yet to be realized, but United is optimistic that joint negotiations will go well.
- American Airlines again hemorrhaged money this past January posting a net loss of $234 million. Fuel was the carrier’s largest expense at $704 million for the month, followed by labor costs of $601 million. In better news, American will re-launch service between Chicago and Dublin beginning April 4 with a daily two-class 767-300 nonstop, and add an additional daily nonstop from Miami to Kingston, Jamaica for the busy summer season.
- Full-time employees working for Delta Air Lines at Minneapolis-St. Paul Airport are concerned over the carrier’s use of Ready Reserve temporary workers at the airport. After acquiring Northwest in 2008, Delta put a vote out and employees decided to oust union representation at MSP. As full-timers retire, other long-term staff are concerned the airline will simply increase the amount of Ready Reserve staff who earn significantly less than their airline-hired counterparts, thereby jeopardizing their jobs and pay.
- The recent FAA Reauthorization Bill passed into law opened up long-awaited slots for airlines to fly transcontinental flights out of Washington’s (Reagan) National Airport. United will begin a daily DCA-SFO nonstop, Delta a DCA-SLC trip and American DCA-LAX in the coming months. US Airways also has the right to add a flight, but has yet to name a destination. Additional slots are to be opened up to new entrant carriers who must file applications by March 12, 2012 for approval consideration.
Actually, on an operating basis, AMR was almost breakeven in January. They lost $5 million from operations. Most of the other loss was from $155 mil of charges related to terminating/modifying leases on 7 757s, 1 MD80, 1 A300, and 39 Super ATRs. Those terminations will end up being a net benefit overall so think of this expense as an up-front investment in future cost reduction. They still have $4.14 billion of cash, not much less than when they started chapter 11, so I am fairly certain this company will survive in some form.