Southwest Turns a Profit, but Less Than Last Year
Southwest Airlines Q2 earnings report reflected a net profit of $683 million, a seemingly-tidy sum until it’s overshadowed by 2022’s Q2 when the carrier raked in $760 million in profit. Gross revenue increased to $7.04 billion, nearly 5% more than last year but it was unable to outrun an increase in expenses.
Expenses were up 12% for Southwest including fuel and up 7.5% when excluding fuel from the figures. The carrier says part of the issue was too much free or discounted travel being redeemed by customers once the airline removed the expiration date on pandemic-era travel vouchers. It also was hurt by customers wising up to the Early Bird offer scam, realizing that a B boarding pass would still get them the choice of aisle or window seats — and middles would also be available for the sickos.
Southwest expects revenue to drop as much as 7% during Q3 on a 12% increase on capacity. Southwest closed the quarter with $13.2 billion in liquidity and $8 billion in debt. It expects the debt to continue to be paid off as its therapy bill for frontline staff stemming from its Christmas meltdown last year falls further and further into the past.
Alaska’s Q2 Improves Greatly on 2022
Alaska’s Q2 earnings report disclosed a profit of $240 million, up significantly from its $139 million net a year ago. The profit came on a gross of $2.8 billion, the highest quarterly revenue figure in the airline’s history.
Alaska added 14 new airplanes to its fleet this quarter – eight B737 MAX 9s and six E175s, giving it 90 total airplanes between Alaska and Horizon. Its fuel bill during the last three months was just $573 million, a more than 25% drop from last year, which coupled with a 7% rise in passenger revenue led to the record quarter. Despite that good news, guidance for domestic weakness going forward spooked investors… meaning those same investors apparently missed the silver lining that they will now be able to get a way cheaper flight to Hawai’i.
The carrier ended the quarter with $2.4 billion in unrestricted cash which includes thousands of gallons of leftover milk from this month’s milk runs through Alaska, plus a bunch of gates it’s auctioning off in Anchorage because it’s choosing to bet that Northern Pacific will never actually operate a flight from the airport anytime in the next five years.
Frontier Reminds us that Sometimes Size Does Matter
Frontier Airlines is facing a $100 million lawsuit for allegedly using baggage sizers which were smaller than advertised – leading to customers being out of compliance with its one personal item policy. Bags which don’t fit into the sizer are considered carry-ons instead of personal items, and on Frontier, that comes with a $100 price tag instead of the free personal item when purchased at the gate.
The class-action suit was filed in Florida because of course it was, and claims that Frontier also purposely does not disclose the dimensions on its sizers, leading to the ambiguity. Amira Hamad who filed the suit said on her return flight on Spirit – whenever Spirit is the good guy in a story about fees, something has gone very wrong – and her bag easily fit in the sizer at the gate which is supposedly the same size as Frontier’s and has the dimensions listed for transparency.
The filing also states that Frontier encourages this policy by offering a bonus to employees who successfully charge the $100 fee for oversized carry-ons at the gate. Frontier declined comment on the story as it was too busy blocking availability for GoWild! passholders to get home from wherever they were to find time to rebuke the allegations in the lawsuit.
Iberia Joins Up with BA & Qatar
Iberia is going to see if three really is a crowd, especially in Qatar, as it’s joining oneworld partner British Airways’s joint business agreement (that’s British for joint venture) with Qatar Airways. The Spanish carrier will launch nonstop service between Madrid and Doha to strengthen the new partnership, with daily flights beginning December 11. Qatar is a significant shareholder in BA and Iberia’s parent company IAG, and it will continue to complement Iberia’s new flight with its own double-daily service between Madrid and Doha.
All three airlines share a common points currency in BA’s Avios, and the new agreement will allow customers to earn and burn Avios on any of the three carriers — provided they’re immune to fuel surcharges — along with being able to combine accounts and transfer between any of the three.
Iberia will operate the flight with a 288-seat A330-200 that is expected to wait on all passengers to board before taking off from Madrid as a protection against the Spanish population’s casual relationship with time and schedule.
United Becomes First U.S. Carrier with Braille in Cabin
United Airlines is becoming the first U.S. airline to install Braille signage to help blind and partially-sighted passengers find their way through the cabin. The airline knows the blind community is a chance for it to tap into a new market, and one it could thrive with. It’s rare United can market itself to an entire community of potential customers who won’t be able to see just how dirty and worn its airplanes are.
The carrier currently has just 12 planes outfitted with Braille markings to indicate rows, seat numbers, and other identifiers in the cabin, but it plans to update its entire fleet by the end of 2026. UA is working on other endeavors along with the American Council of the Blind (ACB ) including raised letters, numbers, and arrows in the cabin. It also increased the accessibility of its app for those with visual disabilities, because sightedness — or lack thereof — should not be a barrier to see why your travel plans are being disrupted on United again.
- Air Astana plans to retire its five E190-E2s by the end of 2025. If you had 2026 in the pool on when it would phase out the aircraft type, tough luck.
- Air Canada is on the move in Dubai, shifting to Terminal 3.
- airBaltic‘s request to codeshare with Delta was approved two years after the pair announced the planned partnership.
- Airlink lost in court for the third time in its efforts to reclaim about $50 million from SAA.
- American is adding two new cities from Phoenix — Pasco, WA and Tijuana. Both will begin February 15.
- BermudAir had its operating certificate approved. We’ll let you guess what national government signed off.
- British Airways flight 252 from Providenciales to Nassau and then on to London/Heathrow on Sunday was finger lickin’ good.
- Cathay Pacific is reopening its lounges in both Taipei and San Francisco.
- Delta flight 185 safely made an unscheduled stop in Rome on Monday following a hail of a storm that left damage on the aircraft’s nose and fuselage.
- El Al is considering launching Australian service sooner than previously planned.
- IAG has more cash on-hand that it seemingly knows what to do with, as it just bought a stake in a UK firm that expects to begin producing sustainable aviation fuel (SAF) by 2025. Again, if you had 2026 in the pool, doubly tough luck.
- Jet Airways says it’s good for the money it owes to creditors, despite all evidence to the contrary. To prove it is good for the cash, airline execs were seen literally flushing cash down the toilet saying “if we were worried about money, would we be willing to do this? No.”
- Jet2 had its busiest weekend of the summer last week — apparently having a pool and a grill is as popular as ever.
- JetBlue and American can still date other airlines after a ruling in federal court this week.
- KLM isn’t nearly as in-favor of green initiatives when someone else is calling the shots.
- Korean has a fancy new business class seat coming on its B777 and B787 fleet.
- Lufthansa filed an appeal to the EU Court of Justice in a case over the $6.6 billion the airline was loaned during the pandemic. Some EU regulators are complaining Lufthansa used the cash exclusively to study how many rebrands it could undertake in a 5-year period.
- One Air currently has an accurate name based on the number of completed flights in its airlines history. If it plans to keep that an accurate fact, a name change will be coming shortly.
- Philippine Airlines received permission to operate Manila to Seattle just 3.5 years after requesting permission.
- PNG Air announced via a jpg that it expects to finish its restructuring by the close of 2023.
- Turkish has a fancy new business class seat coming on its B777 fleet.
- United canceled a flight between Paris and Washington/Dulles all because the pilot wanted a little drink to calm his nerves.
Bird 1: “Uh oh, we’re in trouble.”
Bird 2: “Don’t worry, he’s only got one stone.”