AA, JetBlue Post Year-End Earnings
American Airlines beat already-revised analyst predictions for Q4 as it posted a profit of $843 million on $13.2 billion in gross revenue. The gross revenue jumped 17% from Q4 2019, and came despite operating a smaller airline, with capacity down 6.1%. AA ended the year $127 million in the black with Q4 pushing it to an annual profit after being in the red for the year’s first nine months.
The airline paid about $3.50 per gallon of fuel, an almost 50% hike from last year. American expects Q1 capacity to be up 10% from last year, with expenses to stay even or down as much as 3% in Q1 of 2023. AA ended the calendar year with $12 billion in liquidity, including thousands of “American Loves Mesa” bumper stickers that have been sitting next to the dumpster at its Fort Worth headquarters for months.
American’s BFF (but only in the Northeast, if anyone asks) JetBlue also announced its earnings report this week, led by a $24 million profit for the year’s final quarter. It increased capacity by 2.4% in Q4 compared to 2019, leading to a gross revenue of $2.4 billion – the highest Q4 in company history. It paid $3.70 per gallon at the pump, and that includes fuel it “borrowed” from Spirit siphoning it out of the yellow airplanes when ground crew was counting money from fees and not protecting the airplanes.
For the full year, JetBlue lost $298 million on $9.2 billion of gross revenue. On the bright side, the gross revenue is an increase of 52% from last year. On the not-so-bright side, its $9.5 billion in expenses is a 55% increase from last year.
It ended the year with $1.2 billion in cash. Its assets include short-term investments, long-term marketable securities, and a fee-loving, yellow-painted airline that is super pumped to become part of JetBlue because that’s totally what it wanted all along, promise.
United Puts Its Money on the Table, Purchases a Portion of Mesa
After tabling discussions at one point, United Airlines solidified its stake in Mesa, the scorned lover of AA, and United’s newest dance partner. UA purchased 10% of the regional carrier, valued at about $10.5 million. The deal consisted of United purchasing 4.04 million shares of Mesa at Monday’s closing price of $2.61 per share.
Mesa previously received a $10 million revolving loan from United — which comes due next January — and other financial commitments. The additional commitments were not disclosed but were rumored to be two complimentary nights at the Newark Airport Hilton and a United Club pass for one, valid through March 31.
UA also earns a seat on Mesa’s board of directors, but its right to have a seat at the table would go away if its ownership of Mesa ever dips below 5%. Additional terms of the agreement include an increase in rates to help Mesa cover the pay raises it instituted late last year – a deal that runs through 2025.
United is no stranger to putting money on the table for its regional carriers, as it also owns a 40% share of Commuteair and is a 19% stakeholder in Republic.
Federal Government Begins Probe into Southwest’s Christmas Blues
The Department of Transportation is beginning its investigation into Southwest’s meltdown which occurred at the end of last month. The airline canceled almost 17,000 flights between December 21 and December 31, operating just enough flights to put coal in the stocking of every one of its customers on Christmas Eve and Christmas Day.
The government is turning its attention to determine if the carrier “engaged in unrealistic scheduling of flights which under federal law is considered an unfair and deceptive practice.” Unfortunately for DOT investigators, their first day on the case happened to be two weeks ago when the FAA’s NOTAM system went down, preventing it from traveling where it needed to be. Some in the industry believe the investigators attempted to pursue an overzealous scheduling of flights for their investigation, which could be considered an unfair and deceptive practice.
Southwest said it would cooperate with the investigation, even offering to upgrade the DOT sleuths to Wanna Get Away Plus fares when traveling on official business. The airline said in a statement that its holiday flight schedule was thoughtfully designed with the backing of a solid plan to operate it with ample staffing, all of which went awry when
someone unplugged a router at their Dallas HQ a nationwide deep freeze knocked tipped the first domino to help send its operation off the rails.
Alaska, Southwest Both Profit in 2022
Alaska and Southwest both ended 2022 in the black, although Southwest’s final tally wasn’t nearly as positive it thought it would on December 20 of last year.
Alaska finished ahead by $58 million for the year on $9.6 billion of gross revenue, the highest figure in airline history. Alaska retired its the rest of its A320 fleet and nine Q400 aircraft during Q4 before putting its final Q400s out to pasture earlier this week.
Southwest finished with a $539 million profit after a loss of $220 million in the final three months – almost all coming from its late December nightmare.
The $539 million profit figure is down 80% from the $2.3 billion WN earned in 2019. It’s $23.8 billion in revenue outpaced 2022 by 6%, with a 48% spending bump at the pump from 2019.
Alaska finished the year with $2.4 billion in cash, while Southwest ended with $12.3 billion. Alaska is using its cash holdings to upgrade its offices in Seattle, improve crew rooms at hubs across the country, and raffle off one free admission to the Space Needle at each flight departing Seattle for the next month. Southwest is using its cash reserves to team up with Big Pharma to create a magic amnesia pill that focuses exclusively on the last 10 days of 2022.
Hawaiian Pilots Primed for Payday
Hawaiian Airlines could now have the highest paid pilots across the cargo industry as the carrier prepares to begin flying for Amazon later this year.
The union reached an agreement with the carrier on a four-year deal which bumps pilot pay to record-high levels of compensation, potentially topping the comp packages for pilots at cargo heavyweights FedEx and UPS. Hawaiian’s pilots will vote on the deal in the coming weeks beginning today, and it is expected to be approved without much trouble.
Amazon is paying Hawaiian a fixed monthly fee per aircraft, a per-flight hour fee and a fee for each flight cycle operated. The first two converted A330 freighters will begin flying in the second half of this year, and the cargo deal is expected to add about 160 pilots into the Hawaiian pilot family.
With the agreement, Hawaiian captains could earn up to $376 per hour, with that increasing to an hourly rate of $436 by 2027. Other perks in the new CBA include a $10 gift card valid at all O’ahu ABC Store locations and one free pineapple per family per quarter.
- Air France is bidding adieu to Minneapolis/St. Paul
- Air Transat will close its Vancouver base later this year.
- Alaska picked Intelsat to upgrade the streaming quality on its E175 fleet. It’s also banning plastic cups onboard its flights. Passengers will now be served beverages in a trough that will be passed row-by-row during flight.
- Amazon Air is primed to begin service in India.
- Buffalo Airlines — which we checked, and it’s an actual airline but not based in Buffalo — is expected to receive its first B737 soon.
- Delta is ending service to Nagoya, Japan (NGO) at the end of next month. Meanwhile, it received government approval to operate New York/JFK to Sao Paulo. Easy come, easy go.
- Ethiopian is filling the void in the historically underserved route between Copenhagen and Addis Ababa.
- Finnair sidled Gabriela Hiitola with tons of baggage this week, naming her the Senior VP of Finnair Cargo.
- Hawaiian doesn’t give an F about anything, as it is resuming 3x weekly service between Honolulu and Fukuoka on April 28.
- LOT is continuing to seek compensation in the form of lots of money from Boeing while Smartwings is doing the smart thing and teaming up with LOT.
- JetBlue grew the enrollment in its TrueBlue loyalty program in 2022 by 50% and that’s before taking into account all the Frontier executives who signed up as an inducement to get it to back out of the Spirit Sweepstakes.
- PLAY is ready to add curling and ice hockey to its list of preferred activities.
- Ryanair is cutting one route out of Zagreb.
- S7 Airlines grounded its A320 fleet.
- Saudi RIA, which is an airline — sorta — needs a new CEO after Tony Douglas stepped down following two grueling months on the job.
- Solomon Airlines is lending pilots to Air Vanuatu.
- Southwest entered into a tentative agreement with its dispatchers, agreeing to dispatch 17% raises to the group.
- SWISS announced with great precision that it intends to name 20 A220s after tourist destinations. One day you will be able to fly SWISS aboard the San Bernardino.
- United pilots are united in their new union chair.
- Uzbekistan Airways ordered 12 A320neos. In a busy week for the Uzbek people the airline is trying to flip a bunch of airplanes.
- WestJet will resume service between St. John’s and Tampa with a weekly Spring Break flight in March and April.
I know a bunch of good jokes about umbrellas, but they usually go over people’s heads.
The Solomon Airlines link is incorrect (links to Ryanair story)
Brett the DOT investigation link is broken.
When did Sao Paolo become Argentinian? ;-)
Go easy on Ethiopian… they have been flying to Scandinavia for many years. There’s more demand between Ethiopia (or central Africa) and Scandinavia than one might think…
Shouldn’t JetBlue be funneling fuel from Frontier? I mean Frontier did make Jetblue overpay for Spirit.
Always happy to see an Airplane! movie reference.