United Posts Nearly $1B Profit, Quietly Hands $561M to Keep Flight Attendants from Revolting

United Airlines had a decent Q2 by normal standards — $973 million in profit, $3.87 adjusted EPS, and $15.2 billion in revenue –but the real highlight was a $561 million “please don’t hate us” check to its flight attendants. That one-time expense is part of a tentative new labor deal that includes boarding pay, retroactive raises, hazard compensation for Newark sits, and enough financial backpay to make even the Polaris passengers jealous. Management called it a “labor accrual adjustment.” Everyone else called it “expensive, but necessary to keep the drinks and snacks flowing on-board.”

Despite that eye-watering lump sum, United still beat Wall Street expectations and cheerfully reminded everyone it was the best-performing airline in New York City airports this quarter—which is kind of like winning “Best Behaved” at a toddler birthday party on a Spirit flight. Premium cabins and loyalty revenue stayed strong, and United is now forecasting full-year earnings in the $9 to $11 per share range. The airline also warned of a soft Q3, but after writing a half-billion-dollar apology letter to its crew and still walking away with nearly a billion in profit, maybe they’ve earned a break. Just don’t expect a full can when getting a ginger ale in economy — that would be a bridge too far.

Delta Doubles Down at LAX

Delta is adding to its LAX operation, unveiling two shiny new nonstop routes: daily flights to Hong Kong aboard its A350 flagship and three daily hops to Chicago/O’Hare via 737-800s. Both will begin next June and are crowded markets with Delta being far from the only carrier on the route.

The Hong Kong run marks its comeback after pulling out in 2018, ramping up capacity with roughly 30 one-stop regional connections — and remixed cargo volume, too — while also leaning on its SkyTeam and JV partner located in Seoul. LAX-HKG features competition from both United and Cathay Pacific flying the route as much as 5x daily. Meanwhile, LAX–ORD is hypercompetitive, already being served by American, United, Frontier, and Spirit, not to mention Southwest flying to LAX and several of its co-terminals from Chicago/Midway. We think TWA may still have a B707 or two as well and Braniff is rumored to be running a giant orange B747. But in Delta’s defense, it makes too much sense to debut ORD-LAX along with the HKG flight when one considers that Chicago is known as the Hong Kong of northeastern Illinois.

With the opening of its new Delta One Lounge at LAX, featuring massage chairs, sushi bars, gold-plated glassware, and a one-way mirror to look at the poor people in the main terminal, plus upgraded Sky Club space at ORD, Delta is making sure passengers feel pampered before takeoff. 

West Coast, Best Coast? Avelo Says No

In a plot twist that shocks absolutely no one who’s tried to turn a profit flying from Burbank to Bend — and who amongst us hasn’t? — Avelo Airlines is ghosting the West Coast. The airline will shut down its base in Burbank and end all West Coast flying by December 2, pulling out of California, Oregon, Washington, Montana, and Nevada. What started as a pandemic-era West Coast dream has turned into an East Coast reality check, with Avelo deciding battling it out in New Haven with Breeze and fighting for Florida snowbirds and Cancún partygoers is a better route to profitability losing less money than California leisure markets and Humboldt County protestors.

CEO Andrew Levy insists this move has nothing to do with recent controversies over ICE deportation flights, angry airport commissioners, or airport lawn signs reading “No Avelo.” Instead, he blamed “challenging” financial returns in the region — which we assume means “no one was paying enough to sit in 29-inch pitch on a Tuesday.”

The airline will redeploy planes and people to its East Coast and Mexico/Caribbean ops, where the vibes are warmer and the yield, apparently, higher. So long, Burbank, you’ll always be Avelo’s first love. To quote the great poet/philosopher Axl Rose…

Nothin’ lasts forever
And we both know hearts can change
And it’s hard to make a profit
In the cold November rain

For more on Avelo’s struggles, please visit Tuesday’s post on crankyflier.com.

West Coast, Best Coast? Breeze Says Yes

One person’s trash is another person’s miscalculated folly that will cost it time, revenue, and energy treasure? The ink wasn’t dry on Avelo’s announcement that it was leaving the West Coast and its Burbank base, when Breeze told the world its winds are blowing westward next spring.

Filling the hole vacated by its ULCC rival, Breeze Airways announced Thursday that it will nicely bring its service Westward Ho beginning in March with service from five airports: Burbank and Eureka in California, Redmond/Bend and Eugene in Oregon, and Pasco, Washington. Burbank will lead the way with five destinations — the other four in yesterday’s announcement and Breeze’s current home turf of Provo.

For more on Breeze’s move out west, please visit Thursday’s post on crankyflier.com.

Newark Pulls a Newark

Newark Liberty International turned in an award-worthy meltdown on Monday, even with the low expectations we have for the airport. Torrential downpours soaked the tri-state area, turning runways into waterparks, while the FAA hit pause with a ground stop so long even Spirit passengers gave up what little hope they had. Delays topped three hours, taxiway holds lasted more than double that, cancellations stacked like Jenga blocks, and a faulty radar system in Philadelphia joined the fun to spice things up. Somewhere, an overworked controller probably just threw their headset into the Hudson.

By mid-afternoon, it was less airport and more “urban endurance challenge.” Flash floods, tech failures, ATC staffing shortages — it was basically Newark playing all the hits. Passengers spent quality time rediscovering every inch of Terminal A’s food court (hope you like Auntie Anne’s), and airlines got another lesson in weather roulette. But let’s be honest: if you booked a Monday summer flight through Newark and didn’t bring emotional support snacks, that’s on you. It wasn’t a meltdown. It was performance art. And Newark? She nailed it.

• Air Arabia Abu Dhabi is increasing its operational capacity by 60%.
• Air France will start blocking middle seats in business on its HOP! regional jets.
• Air Transat completed its $565 million debt restructuring.
• Azul‘s bankruptcy plan blew into action after it received court approval.
• Condor will add stripes to four more A330-900s.
• Emirates is suspending its second daily flight to Perth in October. But adding a third daily frequency to Dublin. Win some, lose some.
• Etihad completed a codeshare agreement with Greek carrier SKY Express. Chilean-based SKY Airline had no comment. The carrier also is adding seven new routes from Abu Dhabi.
• GlobalX has its own airplane and everything.
• Gulf Air is adding service to New York/JFK, the first flight to the U.S. for the carrier since 1997. Wait ’til it hears about the TSA.
• Horizon Air resumed E175 deliveries.
• IndiGo is converting options on 40 A350s to firm orders. But not too firm.
• ITA completed a codeshare agreement with Air Canada.
• KLM is finally going to serve Kittilä, Finland.
• LATAM is now offering SIM cards. At press time, we have not received confirmation if the cards will work in Simbai, Papua New Guinea.
• PIA is returning to the UK. Congrats to everyone.
• Porter completed a sale-and-leaseback from four E195-E2s.
• Qantas is adding B737-800s to cover up delivery delays of the A321XLR.
• Spirit is bringing its bright yellow airplanes to Macon, Georgia. That should fix everything.
• SprintAir — which does not paint its planes in bright yellow — is in some trouble in Norway.
• Southwest is bringing checked bag fees and assigned seating to the U.S. Virgin Islands.
• Virgin Atlantic plans to remove its bars from its widebody aircraft.
• Wizz Air is ending its Abu Dhabi-based subsidiary. But don’t despair, it’s growing in Romania. Win some, lose some.

Operator: “911, what’s your emergency?”

Me: “My wife, she’s going into labor and I don’t know what to do.”

Operator: “Don’t worry, we’ll get through this. Is this her first born?”

Me: “No, this is her husband.”