Cranky Weekly Review presented by Oakland San Francisco Bay Airport: Spirit Gasps for Air, Delta’s Mexican JV Does the Same


Book Now on Spirit, While Supplies Last

Spirit Airlines said in its recent 10-Q that there’s “substantial doubt” it can survive the next 12 months, which is a another way to warn us for “we might not be here by next summer, so don’t buy gift cards.” The yellow-liveried ULCC posted a $246 million loss in Q2, furloughed pilots, and is now dealing with a credit-card processor that wants more collateral before letting them keep swiping your $19.99 fares. Considering Spirit just crawled out of Chapter 11 a few months ago, this speed-run toward concerned status is almost impressive.

To keep the lights on, Spirit is selling off spare engines, airport gates, and any other asset that isn’t welded to an airplane. And for the right price, it might consider something welded to an airplane. It’s also banking on “premium” upsells, which is like selling VIP wristbands at a yard sale, and hoping bargain hunters flock back before the clock runs out. Without a major cash infusion, Spirit’s next big network update could be an announcement about its liquidation sale. Until then, the safest bet on Spirit might be the exit row — because you’ll be the first one out if the whole thing goes under.

For more on Spirit’s financial descent, please visit Thursday’s post on crankyflier.com.

Delta, Aeromexico Antitrust Immunity On Life Support

The DOJ sided with the DOT’s proposal to strip Delta and Aeromexico of their antitrust immunity, basically telling the SkyTeam pals that their Mexico City lovefest is over. Back in 2016, this immunity let them act like one big happy airline — coordinating schedules, pooling revenue, and setting fares together on U.S.–Mexico routes. But now that Mexico’s made Benito Juárez Airport about as open to new entrants as an exclusive country club, the DOJ says there’s no point in keeping the immunity alive.

If the DOT follows through — and ultimately that’s who’s call it is — Delta can still own part of Aeroméxico, but the days of synchronized flights and shared profits will be gone. In theory — one that we don’t actually believe — this could mean more competition and lower fares for travelers. In airline-speak, “more competition” often translates to “more creative ways to charge you for water.” Either way, the breakup seems to be coming, and it’s about to get awkward at the next SkyTeam family dinner.

Air Canada Braces for Weekend FA Strike

Air Canada’s mainline flight attendants, backed by an overwhelming 99.7% strike vote, issued a 72-hour strike notice on Wednesday that will go live at 1 a.m. ET tonight. The union claims AC’s offer of a 38% raise over the four-year life of the deal doesn’t compensate labor for nearly enough of the time they’re required to be at work, that FAs have taken a pay cut as inflation has risen over the past several years, and that a new hire working a full schedule is actually paid below Canada’s minimum wage.

In addition to a raises and other wage increases, reports say the union also wants a 15% bump in per diem for anyone traveling within 200 miles of Newark, an annual BOGO coupon at Tim Horton’s on each FA’s hiring anniversary, and a trough filled with maple syrup to be made available in crew rest areas on long-haul flights.

Air Canada is proactively canceling flights across its domestic, transborder, and international networks as it prepares for the labor labour action. The carrier is offering free changes for customers scheduled to travel this weekend to limit disuptions as much as it can. A limited number of Air Canada Express flights operated by either Jazz or PAL will continue to operate — but those two carriers only fly about 20% of AC’s customers per day and most people on them are connecting to a mainline or Rouge flight that’s unlikely to operate.

Southwest Heads to Rocky Top in the Tennessee Hills

If an airline that offers mostly domestic service with checked bag fees, assigned seats, and nothing that differentiates itself from anyone else is what Knoxville was missing, it’s missing no more. Southwest announced a 14-route expansion this week that included one new dot on its map — Knoxville, TN — which will receive five daily flights beginning March 5 with 2x daily service to Nashville and 1x daily flights to Baltimore, Dallas/Love, and Orlando. Knoxville, of course, is the home of the University of Tennessee, proud owner of a second-rate academic program and a third-rate football program, in addition to being the gateway to the Great Smoky Mountains National Park and UNESCO World Heritage Site Dollywood.

In addition to its expansion into eastern Tennessee, the carrier is responding to Alaska’s groweth in San Diego, adding seven new nonstops from the airport — all of which will compete directly with Alaska. Daily, year-round flights will operate from SAN to Eugene, Kahului, Portland (OR), Puerto Vallarta, and Seattle. It’s also adding one-offs to Bozeman and Spokane for spring break in March, and 2x daily service on three more unrelated markets that you could probably walk instead:

  • Chicago/Midway to Milwaukee
  • Little Rock to Nashville
  • Phoenix to Tucson

Lastly, Southwest will resume 2x daily flights beginning March 5 on four routes: Chicago/Midway to Des Moines, Tulsa, and Wichita, plus Dallas/Love to Oklahoma City.

JetBlue Announces Route Expansion

On Thursday, JetBlue threw down a route expansion that reads like a travel bucket list for sun-starved millennials: first-ever year-round flights to Vero Beach (from BOS and JFK), a return to Daytona Beach (ditto), nonstops from Long Island to Tampa and Fort Myers, plus new Caribbean and Latin America connections from Tampa to Punta Cana and Fort Lauderdale to Santiago de los Caballeros in the DR. TPA-PUJ will operate year-round while the daily FLL-STI service is seasonal for five weeks in December and January.

Boston travelers get their own parade of winter escapes — 1x daily servie to St. Thomas, Liberia (Costa Rica), St. Maarten, and Nassau, plus additional Saturday frequencies to Grand Cayman and Barbados around the holidays.

JetBlue will join Breeze in Vero Beach, forcing its corporate cousin to compete at the airport for the first time since it entered service — which doesn’t seem to be good news to those in Vero Beach. These latest attempts to get back to profitability for the carrier see JetBlue reinforcing its “what’s old is new again” strategy of ditching business-focused routes and instead connecting the northeast with Florida and the Caribbean, for which we’re very thankful, because if there’s one market underserved in the U.S. these days it’s the northeast to Florida.

  • Air Algérie completed its merger with Tassili Airlines.
  • Air India is suspending service to Washington/Dulles.
  • Air France-KLM is cutting its commitments to A350 freighters.
  • airBaltic is doing well.
  • Allegiant is adding four new routes and one breezing into one new frontier to put the squeeze on Spirit — Atlantic City because nothing says Atlantic City like sub-daily service on Allegiant from four airports on Florida.
  • Azerbaijan Airlines signed a codeshare with Gulf Air.
  • Brussels Airlines is finding success doing whatever the opposite of “bringing the heat” is.
  • Delta Flight 1830 to Guatemala City on Sunday was canceled when the B757-200 jet clipped another aircraft while pushing back in Atlanta. The passengers were offloaded and re accommodated the next day. The carrier plans to sue Crowdstrike to recoup any losses it incurred from the incident.
  • GOL is flying to Venezuela for the first time since 2016.
  • Hawaiian is ending flights from Honolulu to Boston, Fukuoka and Seoul/ICN in November.
  • Korean is launching a Rail & Fly program with Swiss Federal Railways for passengers on their Seoul/ICN – Zurich flight.
  • PAL Airlines was granted $6.5 million from the Canadian government to increase connectivity to cities that may or may not be real.
  • Ravn is, well, nevermore.
  • Scoot is scooting to new destinations in both Japan and Thailand.
  • SpiceJet‘s current capacity is underseasoned, so it plans to pepper in more wet-leased B737s.
  • STARLUX‘s new flight to Phoenix received a boost today as the carrier announced an interline agreement with American.
  • TAP Air Portugal received approval from the Portuguese president to begin privatization efforts.
  • Turkish plans a $320 million bid for just over a quarter of Air Europa.
  • t’way Air is i’ssuing nearly $29 million in 30-year bonds.
  • United reminds us all to be curious, not judgmental.
  • Wizz Air promises to get better, according to the person whose job it is to make sure Wizz Air gets better.
  • Wizz Air Malta is finally opening that Bratislava base we’ve all been waiting on.

A truck loaded with Vicks Vaporub overturned on the highway. Amazingly, there was no congestion for 6-8 hours following the incident.

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Andrew Avatar

6 responses to “Cranky Weekly Review presented by Oakland San Francisco Bay Airport: Spirit Gasps for Air, Delta’s Mexican JV Does the Same”

  1. Matt D Avatar
    Matt D

    Color me cynical, but I suspect that this whole “death watch” thing with Spirit is either a publicity stunt, a way to use the court of public opinion into getting a merger approved, or both.

    How does a company of that size go through Ch11 and be on the verge of it again in that short a period of time?

    Something just doesn’t pass the sniff test here.

    1. Anon Avatar
      Anon

      You can play various accounting tricks if one parent company owns lots of subsidiaries and you want to make a single subsidiary appear more or less profitable…. but when you have a big publicly listed company being audited by public accountants, it becomes much harder to use these cheap tricks. Furthermore, the accountancy firm auditing Spirit’s accounts (and whose name appears on the accounts) know that their “substantial doubt as to being a going concern 12 months from now” will go down REALLY badly with Spirit’s board – they can forget about any future audit fees from Spirit. Big flashing red alarm bells will be ringing in the boardroom accompanied by loud sirens. This should be read as a “Time’s (almost) up everybody, go be with your families now” statement

  2. tb Avatar
    tb

    Shots fired at Smokey…

    LOVE IT!!!

  3. CraigTPA Avatar
    CraigTPA

    With the potential death spiral of Spirit looking more likely by the day, I’d completely missed this JetBlue announcement. I’d always wondered why they hadn’t gone into Islip sooner, but they seem to be making up for lost time. Most of this looks like fairly conservative.

    No update as of now (4:35 ET on Friday) on Air Canada’s request for binding arbitration in the flight attendant dispute, the FA union has rejected the idea. Canadian law requires a carrier to book passengers on the next available flight on any carrier, and walk-up fares are skyrocketing in anticipation.

    https://www.ctvnews.ca/business/article/if-air-canada-cancels-your-flight-dont-accept-a-refund-passenger-rights-expert-says/

  4. Davey Avatar
    Davey

    Glad to see better service at Vero Beach. It’s a very growing area of Florida.

  5. Vols Avatar
    Vols

    As a proud Tennessee alum and Delta employee, I’d like to file a formal complaint with the UT shade. I expect the DOT to comment shortly.

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