Breeze Blows Directly Into Avelo’s Face
Breeze Airways added 11 new routes this week all from Avelo’s biggest stronghold – New Haven, CT. Avelo has based much of its early growth around HVN, an airport which did not have commercial service before Avelo moved in earlier this decade, and an airport which is about to see a bloody battle between the two LCCs.
Breeze will begin flying from New Haven this December, and it’s expected to fully build up to ten destinations by February, several of which it will go head-to-head with Avelo on. The destinations for Breeze from HVN are:
- Charleston (4x weekly)*
- Fort Myers (5x weekly)*
- Jacksonville (2x weekly)
- New Orleans (2x weekly)*
- Norfolk (2x weekly)
- Orlando (5x weekly)*
- Raleigh/Durham (2x weekly)
- Richmond (2x weekly)
- Sarasota (2x weekly)*
- Vero Beach (2x weekly)
- West Palm Beach (5x weekly)*
*routes are where Avelo and Breeze will compete with both carriers flying the city pair
Alaska’s FAs Reject Contract
Alaska Airlines and its FA union came to a tentative agreement earlier this summer that — as always — was subject to a vote of the full union, and the union rejected the agreement this week, sending the two parties back to the bargaining table.
The tentative agreement included boarding pay (which is really robbing Peter to pay Paul), back pay, and average pay increases of about 33%, in addition to hazard pay when working any flights to or from Newark. The FAs would have received an immediate raise of 24% with their pay jumps growing through each year of the three years proposed in the deal.
92% of the union’s membership participated in the vote, and more than two-thirds — 68% — voted to reject the deal. The union says it’ll survey its members to determine what issues need to be addressed, which is all well and good, but you have to wonder why they didn’t already do so before the first tentative agreement.
Elliott Takes Aim at Southwest
Elliott Investment has been shadowboxing around Southwest Airlines for several weeks now in an effort to spur change at the carrier, and the activist hedge fund now now as seeks to replace ten of the 15 individuals on Southwest’s board of directors.
This is an escalation in Elliott’s quest to take a larger say in the day-to-day operations of the carrier, and comes after Southwest has seen its stock price drop nearly 25% over the past year. Elliott’s nominees include former executives from all over the industry including former Virgin America CEO David Cush and former Air Canada CEO Robert Milton.
Southwest has tried to work with Elliott to make changes, while Elliott has chosen to go more with a brute force approach. Both groups are seeking support from the carrier’s other shareholders and stakeholders, with Southwest currently expected to present a business transformation plan at its Investor Day later this fall.
Canada Jetlines Shuts Down
Canada has lost another airline as Canada Jetlines ended flight operations on Thursday when it was unable to raise the cash it needed to continue operating. The carrier now plans to file for creditor protection and will potentially liquidate its remaining assets in exchange for poutine coupons.
Canada Jetlines began flying two years ago next month with a fleet of just four A320s. It flies flew mostly from its base in Toronto to warm destinations in the southern U.S., Caribbean, and Mexico. The airline ran through two CEOs in the last couple weeks which is rarely a recipe for success. Canada Jetlines becomes the second prominent Canadian carrier to cease operating this year, following Lynx which was shut down in February.
Three of its four aircraft were being ferried back to Canada — they were on wet-leases to overseas carriers — while the fourth is parked in Morocco right now. The airline posted a $9.2 million loss in 2022 and a $6.4 million loss last year. It was not expected to turn a profit this year, but at this point, we’ll never know.
Alaska and Hawaiian Merger Wins in Court
Judge Derrick Watson threw out a lawsuit in U.S. District Court in the District of Hawaii this week that attempted to block the merger between Seattle-based Alaska Airlines and Honolulu-based Hawaiian. The plaintiffs in the case said the merger would cut routes and raise prices, but Judge Watson ultimately ruled the passengers did not have legal standing to sue over the transaction.
The plaintiffs plan to appeal the ruling, asking an appeals court to block the merger, but are unlikely to emerge victorious. The elimination of this potential suit is one of the final hurdles for the two carriers as they await a ruling from the DOJ on potential antitrust concerns.
- Air Baltic is adding 10 A220s.
- Air Canada is resuming service between Ottawa and London/Heathrow next year. The flight will complement the carrier’s current service between Toronto and London (ON).
- Air Europa added a new Dreamliner.
- Alaska is investing in JetZero and in exchange it received a very cool looking drawing of an airplane in its livery.
- Avelo will begin flying to New Orleans from its New Haven base with 2x weekly service beginning November 14.
- Azman Air — it’s really a thing, we double-checked — is suspending service until October.
- BA took a loss in court over its pandemic-era hiring strategy.
- Canadian North is offering capacity assistance to WestJet for the weekend after about 10% of WestJet’s fleet was damaged by a hail storm in Calgary.
- Delta flew the Olympic Flag from Paris to Los Angeles after the closing ceremony of the Olympics. The flag flew displayed in a galley in the back of the LA 28-painted A350. The space in the galley for the flag cost the IOC 200,000 SkyMiles.
- Denver Air Connection is taking over EAS service between Atlanta and Jackson (TN).
- easyJet still hopes to fly about 2/3 of its schedule to Portugal despite the strike planned at four airports in the country this weekend.
- Edelweiss will begin 2x weekly flights between Zurich and Seattle next summer.
- El Al placed an order for up to 31 B737 MAX aircraft.
- Ethiopian Airlines is partnering with the Ethiopian government to build a new airport about 30 miles outside of Addis Ababa that will be the largest in Africa.
- Fiji Airways is paying off its debt.
- JetBlue signed an interline partnership with Tradewind Aviation.
- Jetstar Asia is adding nonstop service between Singapore and Colombo beginning this November, operating 5x weekly.
- LATAM might buy as many as 30 Embraers. Also it might not.
- Qatar is adding caviar to 13 business class routes.
- SAS delisted itself from stock exchanges in Copenhagen, Oslo, and Stockholm this week.
- Thai AirAsia will begin 4x weekly service from Bangkok to Kathmandu on October 2.
- United is now full of confidence when it comes to Boeing. And all it took was a free lunch.
- Virgin Australia ordered eight E190-E2s.
- WestJet is now the official airline of the CFL. To celebrate, all customers will receive 110 yards of yarn during boarding.
- Wizz Air began offering an “All You Can Fly” pass. It launches September 25, and will allow up to 10,000 memberships. Flights will be available without a blackout date and will come with one personal item. Carry-ons and checked bags will be extra. The price has not yet been released.
I saw a brand new clock in the garbage the other day. Such a waste of time.
8 comments on “Cranky Weekly Review Presented by San Francisco Bay Oakland International Airport: Avelo Feels a Stiff Breeze, Alaska’s FAs Reject Agreement…”
Wonder which airline is funding the passanger lawsuit to block the Hawaiian-Alaska merger? Seems Southwest may have the most to lose.
Delta might not want that merger either because it could allow Alaska to use the 787s to fly long haul out of SEA.
Joseph Alioto, the lawyer behind this lawsuit, seems to specialize in these kinds of lawsuits. Perhaps in the hope of getting the parties to pay up for stopping the nuisance suits.
https://beatofhawaii.com/attorneys-blocking-jetblue-spirit-merger-now-targeting-hawaiian-alaska-airlines-deal/
https://www.ch-aviation.com/news/49284-san-francisco-lawyer-attempts-to-block-alaskavirgin-merger
The lawyer in question, Joseph Alioto, Jr., is the son of former San Francisco Mayor Joseph Alioto. According to the father’s Wikipedia page:
“He and his son Joseph Jr. lost a major malpractice case against a cattle rancher in 1980. He received millions in legal fees after counseling the Oakland Raiders win against the City of Oakland.[18] In 1991, he and his son went to battle in court against each other over legal fees in the Raiders case.”
Sounds like a fun family.
Missed putting a star on RDU-HVN. Avelo flies that route I think 4 or 5x weekly.
Apparently Breeze put an Avelo route map on their route planning dartboard.
CF will have plenty of Alaska related news to talk about when he comes back; the merger decision (positive or negative) should come shortly. Passenger lawsuits have never been successful in blocking US airline mergers so it isn’t a surprise this one failed as well. The DOJ’s case is what matters.
The AS FA rejection of their contract makes it likely that half of the US airline FAs including at least those for AA, AS and UA will spend the fall trying to get a deal over the finish line with a fair amount of noise likely. AS previously guided to a hit to 3rd quarter earnings to settle w/ the FAs so that will be reversed. AA and UA could easily spend a half billion dollars to settle retro with their FAs and spend hundreds of millions more in labor costs in order to get deals approved by their FAs.
and if the AS-HA merger is approved – some concessions are likely the reason why the DOJ has extended the date for approval/rejection – then a years-long process of integration will take place.
It is worth noting that AS’ profit margins were depressed for years after its Virgin America acquisition and the same thing will likely be the case if the HA merger moves forward. AS’ first priority will be stemming HA’s losses; any new forays won’t happen for years.
If the AS/HA merger is approved it might be smart for AS to go straight into JCBA with the FAs. The FA had their chance at a deal and then improvements in the JCBA. I don’t think management will give the FA a chance at TA2 and then JCBA. Union even said that was the likely outcome in their FAQs on the agreement.