3 Links I Love: American Dropping the Hammer, Project New Norwegian, Avatar Billions

Links I Love

This week’s featured link

An update on Booking and Ticketing PracticesAmerican SalesLink
I can’t link directly to this, but if you scroll down on the page and look for the title under the “Latest Communications” section, you will see that American is getting ready to drop the hammer. It told travel agents that playing games to skirt the rules with things like hidden city ticketing will now be more heavily policed. Automation is coming to help crush the rebellion.

Image of the week: This is a chart from Hawaiian’s most recent earnings. This is what it looks like when an airline realizes that making fares stupidly-cheap will not help in a time of severe inelasticity. In other words, if you were going to Hawai’i, you would pay the going rate. For full year 2020, yields were identical to 2019. Oh sure, traffic fell off a cliff, but those who remained paid a decent fare.

Two for the road

Project New Norwegian (NN)Norwegian Airlines
Norwegian has a new presentation talking about its plan to emerge from reorganization. There’s nothing surprising here. It’s an airline that’ll run 50 airplanes this year with nearly all flying touching the Nordic countries. In other words, it’s the part of the airline that always worked and made sense stripped away from the insanity. Whether or not there’s still room for this airline to exist remains to be seen.

A new airline worth over a $Billion before it’s first flight leaves the ground?Avatar Airlines
I too plan to be worth a billion dollars before Avatar’s first flight, but that doesn’t mean it will happen.

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14 comments on “3 Links I Love: American Dropping the Hammer, Project New Norwegian, Avatar Billions

  1. Got a billion dollars and starting an airline? Sounds like a great way to become a millionaire!

    (Paraphrasing Richard Branson…)

  2. 1) Wasn’t Avatar most recently a Las Vegas based airline run out of a strip mall?
    2) I am pretty sure you most certainly will be worth a billion dollars before Avatar’s first flight!

  3. With regards to the crackdown on hidden city ticketing etc, I’m actually with AA. If airlines were regularly making 40% margins I might feel a little differently, but even in the best of times airlines didn’t make much money (as a % of revenue) relative to many companies of similar size and employee counts. However, it’s within airlines’ rights (and, one could argue, part of their obligation to shareholders and employees, as part of maximizing long term profits) to price discriminate for any (non-legally protected) reason they choose, whether that be for charging more for a nonstop, less for a trip that involves a Saturday night stay, or more for people who wear a blue shirt.

    Those who dare to play the games (hidden city ticketing, etc) can take the risks. Rather than trying to go after the passengers for money, however, I’d like to see airlines identify passengers who have done hidden city ticketing in the past, then identify the passengers’ future itineraries where they are likely to do hidden city ticketing again. That way, for those itineraries the airline can “upgrade” the passenger to a nonstop flight at the last minute, preferably when they are already at the airport; heck, maybe even throw in an upgrade to an exit row or first class. If the passenger wasn’t planning to game the system they benefit; if they were, they get inconvenienced.

  4. Once upon a time I rescued a kitten and named it Debit Memo. Truth can be stranger than fiction!

  5. Surprised you didn’t mention that AA’s stock is in play with the “Wall Street Bets” crowd right now.

  6. Ah Avatar/Family Airlines and their fleet of 747s. That must still be your most commented on post. Wasn’t if over 800 comments at one time?

  7. I needed a laugh today, and the Avatar Airlines “press release” (likely to be read only by people like Cranky who follow Avatar mainly to make fun of them) really delivered.

    They plan to raise $800 million through private equity offerings…sure, and I plan on buying an Aston Martin tomorrow. No PE investor is going to touch their business model. And I loved the Photoshopped picture of an Avatar check-in desk with loads of passengers.

    Looking forward to a press release from “Netherlands Aircraft Company next.

    1. To be fair, a “quick peak” of their future is probably much more accurate than the “quick peek” that they meant to say. :-)

  8. So, is anyone signing up for Avatar’s investment seminar? I would, but who needs a bunch of con-artists hounding me for $$$?

  9. I won’t even START to read an article that has two spelling/language mistakes in the title alone…
    Where do they even have the money from to have an office or a phone to tweet from?

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Cranky Flier