In years past, Southwest Airlines has been known to consistently make a profit.  However, Southwest wasn’t able to keep up in the economic downturn and the end of hedged fuel prices. Then the airline saw three quarters of losses, but no more!

Southwest announced today [...]]]>

Southwest Airlines Boeing 737 heading out of Las Vegas

In years past, Southwest Airlines has been known to consistently make a profit.  However, Southwest wasn’t able to keep up in the economic downturn and the end of hedged fuel prices. Then the airline saw three quarters of losses, but no more!

Southwest announced today that it made $54 million during the second quarter this year. This is far less than the $321 million they made during the same time last year, but better than being in the red.

Of course, like most of the world economy, Southwest is not fully in the clear. They are still taking a careful approach to the near future. Southwest chairman and chief executive officer Gary Kelly points out that, “demand for business travel remains weak, and we continue to stimulate traffic with more discounted and promotional fares.” He isn’t confident that Southwest will see a profit for the third quarter. Southwest is cutting about 4% or 1,400 employee positions through early-out offers, hoping to keep the airline profitable.

To compare, Continental Airlines posted a loss of $213 million, American Airlines posted a $390 million loss and United Airlines posted a $28 million profit. Additional airlines should be posting their second quarter results in the next day or so.

It is not often when a group of people can come together, see the big picture, and be willing to take a cut in pay to potentially save a company. The British Airline Pilots Association voted 94% to cut their salaries by 2.6% and save the company about $42million [...]]]>

Two British Airway's Boing 777s

It is not often when a group of people can come together, see the big picture, and be willing to take a cut in pay to potentially save a company. The British Airline Pilots Association voted 94% to cut their salaries by 2.6% and save the company about $42million per year. No one wants to have their salary cut, but 800 other staff members already agreed to work for free and thousands more took additional pay cuts. The pilots can see the writing on the wall and realize it might be better to sacrifice short-term, to save the company in the long-term.

Virgin Atlantic  and British Airways have had a cold war going on for years, according to Sir Branson. Now he is taking advantage of British Airways’ admission of financial difficulty by urging the British government not to [...]]]>

Virgin and British Aiways Boeing 747-400's racing for the finish (yes, I am sure this is photoshopped)

Virgin Atlantic  and British Airways have had a cold war going on for years, according to Sir Branson. Now he is taking advantage of British Airways’ admission of financial difficulty by urging the British government not to financially assist the legacy carrier. He states that British Airways is, “not worth much.”

Although Sir Branson might be trying to stir up trouble, British Airways is not in the best financial shape. British Airways’ CEO Willie Walsh has a self-imposed June 30 deadline which he calls, “a fight for survival.”

He recently asked all 40,000 employees to work up to four weeks without pay in an effort to keep the airline afloat.

Sir Branson, who founded the privately held Virgin Atlantic, obviously has much invested if British Airways fails. “We and others are standing by ready to take on their routes and runway slots at Heathrow if they get into serious trouble,” Sir Branson stated re-assuring the government their nation would still have a viable transportation network.

A British Airways spokes person calls Sir Branson’s comments as “fantasy.” The airline stated, “There are no talks with the Government and there will be no talks. We have opposed state aid and our position has not changed.” Both British Airways’s CEO Walsh and finance director Keith Williams have announced they will work for free during the month of July.

Even if British Airways pulls through and Branson is just in fantasy-land, it is never a good sign having an airline (or any company for that matter) asking its employees to work for free.  In this economic time, nothing is impossible and it will be interesting to see how this plays out.

Cuts, cuts, cuts. Airlines cutting routes, planes, and people seem to dominate the airline news. However this cut, has a little positive spin to it.

In 2008 US Airways had to let go over 1,300 positions, something no company enjoys. With declining revenues, US Airways had to make additional cuts, but [...]]]>

US Airways tails.

Cuts, cuts, cuts. Airlines cutting routes, planes, and people seem to dominate the airline news. However this cut, has a little positive spin to it.

In 2008 US Airways had to let go over 1,300 positions, something no company enjoys. With declining revenues, US Airways had to make additional cuts, but didn’t want to resort to laying off additional people. Instead, the airline is asking flight attendants to volunteer to take 4 to 16 months off to allow the airline to save some cash.

The airline currently has over 6,600 flight attendants among their 33,000 employees.

I wasn’t able to find anywhere if the employees would be paid, so I contacted the kind folks over at US Airways. They stated that the leave is an “unpaid furlough”, but “flight attendants will be able to keep their flight privleges during the furlough.”

US Airways are not the only ones talking about future job cuts. Air France is looking at 3000 cuts, Delta 2000, American 1600, and on and on.

Part of me wonders how many of these cuts are needed and how many are these just an opprotunity to eliminate people at a time where it is becoming more and more accepted to lay off large numbers of hardworking people.

Air India has been having more problems than curry setting off fire alarms. The airline announced it will be paying 31,000 employees two weeks late.

“The national carrier is facing perhaps its toughest ever crisis,” said Kapil Kaul who is the chief executive officer.

The airline saw [...]]]>

Air India Boeing 777-337 (ER) VT-ALK Chattisgarh

Air India has been having more problems than curry setting off fire alarms. The airline announced it will be paying 31,000 employees two weeks late.

“The national carrier is facing perhaps its toughest ever crisis,” said Kapil Kaul who is the chief executive officer.

The airline saw a loss of over $800 million in the last financial year and the future outlook isn’t looking much better.

Employees now are struggling to figure out how to pay their own bills, since banks won’t be willing to push off bills for another two weeks.

Hopefully this can be resolved soon since one of the biggest morale  killers is not getting paid.

Weight equals money and when a fully loaded Airbus A380 can weigh over a million pounds, airlines don’t want to be adding any unnecessary weight. The airline industry has become very creative with adding new fees to bring in additional revenue, but they are also looking at creative ways [...]]]>

The good old airline spork.

Weight equals money and when a fully loaded Airbus A380 can weigh over a million pounds, airlines don’t want to be adding any unnecessary weight. The airline industry has become very creative with adding new fees to bring in additional revenue, but they are also looking at creative ways to lessen weight and save money.

Northwest Airlines (err, I guess Delta) is now cutting spoons on their flights to help save weight. Sure one little spoon might not seem to make a big difference, but a Northwest Boeing 747-400 holds more than 400 people — that’s a lot of spoons (why don’t they just bring back the spork?)

They aren’t the only airline considering utensil overhaul. Japan Airlines has decreased the size of their cutlery (which not only saves money in weight, but for purchase price of the actual product). Other airlines are cleaning their planes more (dust = weight), not supplying magazines and carrying less water on board.

I am sure this concept will catch on. From cutting pillows, to the type of fabric being used in seats, to having less gadgets (boo), to maybe even someday accounting for passengers’ weights (hopefully not, but RyanAir might be crazy enough), the airlines will probably continue to look for  cost-cutting measures, especially as they move toward better fuel-efficiency.

Southwest Airlines will now charge $25 for an unaccompanied minor and $25 for overweight or a third piece of luggage. They will also allow pets to fly and will charge a “pet fare” of $75. Up until last fall Southwest did not post a loss in 17 years, but it [...]]]>

Winglet to winglet on Southwest Airlines

Southwest Airlines will now charge $25 for an unaccompanied minor and $25 for overweight or a third piece of luggage. They will also allow pets to fly and will charge a “pet fare” of $75. Up until last fall Southwest did not post a loss in 17 years, but it has had to post losses for the past three quarters, mostly due to their locked in fuel prices.

Southwest Airlines CEO Gary Kelly stated, “We truly believe in setting the right customer expectation and not charging for those amenities that a customer would ‘expect’ to get for free.” He also points out that all other major airlines in the US already charge these fees.

Although it might be disappointing that Southwest is adding some minor fees, I think it can be understandable in the given airline industry climate.

The US Department of transportation is reporting that airlines raked in more than $1billion in just baggage fees last year. And why not, people don’t seem to be too angry or upset about this. However, two airlines are looking to up the fees even higher.

United [...]]]>

Delta carryon only check in counters at MSP

The US Department of transportation is reporting that airlines raked in more than $1billion in just baggage fees last year. And why not, people don’t seem to be too angry or upset about this. However, two airlines are looking to up the fees even higher.

United Airlines and US Airways will $5 more for checking a bag (a total of $20 for the first bag and $30 for the second). But you can knock off $5 per bag if you check them in online.

It is great that airlines are making more money, but these fees make it more and more difficult to find a few space to place baggage in an overhead-bin due to so many people carrying more on. And for $50 to check two bags one-way…on some flights it might be cheaper just to buy a second seat for your bags!

At a time where airlines are cutting jobs, services, airplanes, while raising fees – it seems odd that American Airlines has decided to move forward with paying out $14million in bonuses — or does it?

There is no denying that moral [...]]]>

AMERICAN AIRLINES Airbus A300 & Boeing 777 at JFK, New York, USA. Sept 2008.

At a time where airlines are cutting jobs, services, airplanes, while raising fees – it seems odd that American Airlines has decided to move forward with paying out $14million in bonuses — or does it?

There is no denying that moral at some airlines are reaching record low levels. About 72,000 American Airline employees might feel a little less down when they see their performance based bonuses (averaging $200).

According to American Airlines, the incentive program seems to be working – with customer service up 3% and on-time service up 23%.

I think it can be hard for airlines to realize what their greatest investment can be…not planes, new technologies, or routes, but investing into their employees. On a flight with all the “toys,” no fees, and on the newest plane can be great, but if the customer service received is horrid, it can leave a very lasting impression.

Unless you haven’t been watching the news and this is the first time reading this blog you are well aware of this wonderful global economic mess we are in. Businesses have been looking at ways to cut back and save a few dollars.

One of their solutions is putting their [...]]]>

Virgin Atlantic's Upperclass Suite

Unless you haven’t been watching the news and this is the first time reading this blog you are well aware of this wonderful global economic mess we are in. Businesses have been looking at ways to cut back and save a few dollars.

One of their solutions is putting their frequent travellers back in coach instead of paying for Business or First class. This leaves airlines with a large hole in their revenue with premium passengers down 21% in February and almost 17% in January of 2009.

With these additional empty front seats, airlines have to start asking - is it time to re-arrange their aircraft? Will business travellers be upgraded back to the front of the plane when the economic turmoil is over or will businesses enjoy the money it saved on airline tickets and continue to only pay for economy seats?

Airlines, like British Airways, who rely heavily on long-distance premium travellers for their revenue are hoping to see more frequent travellers returning to the front of the plane soon.

Alaska Airline MD83 at SeaTac

Alaska Airlines has gotten rid of all the blankets and pillows from all 114 planes in its fleet. The airline states it is in response to the recent Swine Flue outbreak and want to increase the sanitization efforts in its planes. They have also been using [...]]]>

Alaska Airline MD83 at SeaTac

Alaska Airlines has gotten rid of all the blankets and pillows from all 114 planes in its fleet. The airline states it is in response to the recent Swine Flue outbreak and want to increase the sanitization efforts in its planes. They have also been using a virus killing cleaner inside the cabins to take care of any flu viruses left on their aircraft.

Although I have always been a little un-easy using a “shared” blanket and pillow, I wonder why they haven’t gone the route of some other airlines and allow passengers to purchase their own set of blanket and pillow they can keep?

It has been about a year since all these wonderous bag fees have started. Southwest (which I have called the “new frills airline” a few times already) has resisted any of these fees and keep all their prices pretty straight forward. Now they are saying they feel they have earned more [...]]]>

Southwest Boeing 737

It has been about a year since all these wonderous bag fees have started. Southwest (which I have called the “new frills airline” a few times already) has resisted any of these fees and keep all their prices pretty straight forward. Now they are saying they feel they have earned more money with having no fees, since customers are choosing Southwest over airlines that do charge fees.

However, other airlines are sticking to their fees with bringing millions more in in revenue. In fact more airlines are increasing and adding new fees.

Alaksa Airlines just announced they will start charging fees and US Airways will charge $5 extra if a passenger doesn’t pre-pay for baggage fees.

Personally, I understand the fees. I mean the airlines are hurting and people are willing to pay for them. However, it has become nearly impossible to do a true cost comparison for tickets, not knowing what your final price will be.

As airlines cut flights, that means they don’t have the need for as many planes. Some of those planes are still very airworthy and it is not time for them to be destroyed. A large number of these planes end up in one of a few desert holding [...]]]>

Boeing 747's at an airline graveyard

As airlines cut flights, that means they don’t have the need for as many planes. Some of those planes are still very airworthy and it is not time for them to be destroyed. A large number of these planes end up in one of a few desert holding yards (not graveyards, since some of them “come back to life”).

About 1,700 planes over the past few years have been taken out of service due to lower demand and older age. According to Ascent Worldwide, plane storage has increased 29% in the past year to over 2,300.

For planes that are still airworthy and hopefully will fly again one day, it can be quite costly to keep them passing their mandated maintenance. Storing a Boeing 747 with hopes of flying again can run about $60,000.00 per year. Yes, that is pricey, but much cheaper than having to buy another 747 in a few years if ticket sales go up again.

Visiting one of these desert parking lots can be very exciting and sad for an airline enthusiast.

Source: AP Image: AP

There are some pretty crazy fees for airlines now-a-days. From checking a bag, to getting a pillow. But these are some of the weirdest (and some dumbest) ones I have seen.

There has been a lot of bad economic news for the airline industry for a long while now. But many individuals are starting to feel the pain of the suffering economy by losing their jobs.

To assist those unfortunate people who lose their jobs, JetBlue Airways is offering a full [...]]]>

Let's Honk for JetBlue

There has been a lot of bad economic news for the airline industry for a long while now. But many individuals are starting to feel the pain of the suffering economy by losing their jobs.

To assist those unfortunate people who lose their jobs, JetBlue Airways is offering a full refund to anyone “who experiecnes involuntary full-time job loss prior to their trip.” This is quite helpful for those who planned a nice vacation before receiving a pink slip for sure (even though that is probably a time where they need a vacation the most).

The JetBlue Promise Program also allows people to be confident in purchasing new tickets, if their job is on the line. Of course there are the normal restrictions (must give 2 weeks notice, your flight must be booked from Feb 1 to June 1 2009, and you must lose your job on Feb 17th or later). All that being said, it is kind of nice an airline helping out someone who might need a nice vacation right about now!

Source: JetBlue.com Image: jetblueflickr