UPDATE 5 - September Airline Results Extravaganza

Here's a quick summary on all the airline results that I have seen so far:

AirTran
Sept RPM=950 Million (+11.6%) Load Factor=61.8 % (-9.4) ASM=1.5 Billion (+28.6%)
YTD RPM=10.4 Billion (+24.7%) Load Factor=74.1 % (-.2) ASM=14.0 Billion (+25.0%)

Alaska
Sept RPM=1.4 Billion (+5.9%) Load Factor=73.6% (+1.2) ASM=1.9 Billion (+4.2%)
YTD RPM=13.6 Billion (+6.0%) Load Factor=77.5% (+.9) ASM=17.5 Billion (+4.7%)

American (without American Eagle)
Sept RPM=10.6 Billion (-1.4%) Load Factor=75.5% (-.7) ASM=14.0 Billion (-.5%)
YTD RPM=106.2 Billion (+1.1%) Load Factor=80.5% (+1.8) ASM=131.8 Billion (-1.1%)

ATA (Scheduled Service)
Sept RPM=299.0 Million (-37.6%) Load Factor=74.5 % (+3.6) ASM=400.0 Million (-40.6%)
YTD RPM=3.1 Billion (-43.4%) Load Factor=80.0 % (+10.2) ASM=3.8 Billion (-50.6%)

Continental (Mainline and Regional)
Sept RPM=6.9 Billion (+11.5%) Load Factor=78.6% (+1.2) ASM=8.8 Billion (+9.9%)
YTD RPM=67.7 Billion (12.6%) Load Factor=81.0% (+1.7) ASM=83.6 Billion (+10.2%)

Delta
Sept RPM=9.1 Billion (-3.4%) Load Factor=74.6% (+1.5) ASM=12.2 Billion (-5.4%)
YTD RPM=88.2 Billion (-4.5%) Load Factor=78.8% (+1.5) ASM=112.0 Billion (-6.2%)

Frontier
Sept RPM=616.5 Million (+11.3%) Load Factor=67.6% (-3.4) ASM=911.6 Million (+17.0%)
YTD RPM=6.4 Billion (+17.7%) Load Factor=77.8% (+1.4) ASM=8.2 Billion (+15.7%)

Hawaiian
Sept RPM=548.8 Million (-4.0%) Load Factor=83.1% (-6.0) ASM=660.3 Million (+2.9%)
YTD RPM=5.1 Billion (+2.1%) Load Factor=86.8% (+0.1) ASM=5.9 Billion (+2.0%)

JetBlue
Sept RPM=1.6 Billion (+8.2%) Load Factor=72.6% (-5.1) ASM=2.3 Billion (+15.8%)
YTD RPM=17.5 Billion (+16.5%) Load Factor=78.8% (+1.5) ASM=21.3 Billion (+22.9%)

Northwest
Sept RPM=6.2 Billion (-5.5%) Load Factor=81.3% (+1.3) ASM=7.6 Billion (-7.1%)
YTD RPM=59.1 Billion (-6.5%) Load Factor=84.7% (+3.0) ASM=69.8 Billion (-9.8%)

Republic
Sept RPM=534,827(+49.0%) Load Factor=66.9% (+1.9) ASM=799,018(+44.7%)
YTD RPM=1.8 Million (+56.8%) Load Factor=72.9% (+4.7) ASM=2.5 Million (+46.5%)

Spirit
Sept RPM=299.0 Million (+15.0%) Load Factor=70.0% (-2.4) ASM=427.0 Million (+18.8%)
YTD RPM=3.4 Billion (-4.0%) Load Factor=72.4% (-1.0) ASM=4.3 Billion (-2.7%)

Southwest (System)
Sept RPM=5.2 Billion (+9.8%) Load Factor=67.2%(-.2) ASM=7.7 Billion (+10.1%)
YTD RPM=50.9 Billion (+12.9%) Load Factor=74.0% (+2.9) ASM=68.7 Billion (+8.4%)

United (System)
Sept RPM=9.3 Billion (+1.3%) Load Factor=79.5%(-.7) ASM=11.6 Billion (+2.3%)
YTD RPM=89.0 Billion (+3.5%) Load Factor=82.8% (+.9) ASM=107.6 Billion (+2.3%)

US Airways (Combined US Airways, America West and Regional)
Sept RPM=4.8 Billion (-4.8%) Load Factor=72.2 % (-.5) ASM=6.6 Billion (-4.2%)
YTD RPM=48.1 Billion (-6.8%) Load Factor=78.8 % (+2.1) ASM=61.1 Billion (-9.3%)

Update 1 - Added JetBlue
Update 2 - Added Frontier and Spirit
Update 3 - Added Southwest and alphabetized
Update 4 - Added Northwest
Update 5 - Added Hawaiian

United Says No Fair to JetBlue in O'Hare

JetBlue has publicly coveted service to Chicago for quite a while so yesterday's announcement that it is has formally requested landing rights at Chicago O'Hare (ORD) comes as no surprise. However, this unabashed attempt to step into the backyard of two of the biggest airlines in the US, United Airline and American Airlines, did not go unnoticed. United has quickly flown the protest flag but not for anything related to business or congestion at O'Hare. Instead, United appears to be arguing on a technicality by stating:

"JetBlue must operate in accordance with the regulatory rules of the road, just as all other carriers must do. Because its current request ignores those rules, it must be denied,"

While that may be true it is, at best, a delaying tactic. If the FAA sides with United then its only a matter of time until JetBlue refiles the right way. So what will the United's next protest be? JetBlue's colors clash with the ticket counters in the terminal? Okay that's kinda unfair and over-simplistic but still...

Wright Amendment Set to Fade Away

SURPRISE! After an inordinate amount of wrangling legislation to repeal the Wright Amendment has been approved by Congress and sent on to President Bush. Even last week it appeared this legislation was doomed due to a lot of unnecessary language aimed at insulating American Airlines and Southwest Airlines from anti-trust worries. That language was struck in favor of some much more vanilla statements in order to get the bill moving.
In an ending fitting of the whole process the Wright Amendment will not go out in a blaze of glory, no no no, that would be too simple. Instead, for the next 8 years flights to and from Dallas Love Field will still be restricted as follows:

...Southwest would immediately be able to sell through tickets for Dallas flights to and from any other cities it serves, as long as those flights stop at another Texas airport or airports in eight other states covered by the Wright law: New Mexico, Oklahoma, Kansas, Arkansas, Louisiana, Mississippi, Alabama and Missouri.

Asinine compromise in my opinion, what a bunch of monkey motion. But proof that big business swings a mighty big hammer at our capital. Sure, its smart business for American Airlines to try and delay anything that would benefit a competitor but how did Congress get talked into 8 years? Ah well what's done is done and hopefully President Bush will sign this quickly so that the countdown can begin.

American and Southwest Fly Into Union Airspace

Just a quick note to point out that both American Airlines and Southwest Airlines are headed into negotiations with their individual pilots unions. With all the attention being given to the flight attendant situation at Northwest its easy to miss quiet, civil negotiations. American and Southwest enter into these negotiations from different directions.

American Airlines comes at it as an airline struggling to see a profit again and still looking for every way possible to save money. American has already extracted pay cuts from their unions. Look for them to negotiate heavily for more flexible work rules to help them use crews more efficiently. Look for the pilots to shore up benefits and pensions. American and their unions have tended to butt heads in the past but the recent trend has been one of cooperation. That needs to continue.

Southwest approaches these negotiations having weathered a very long storm while continuing to grow and while posting profits. Southwest pilots are going to need to show some restraint here. It has been widely reported that the Southwest's profits have been possible only because of some brilliant fuel hedging decisions. This kept them in the black as fuel prices soared. As time has passed the strength of these fuels hedges have weakened. Fuel costs have retreated but no one expects them to stay there. Asking for large pay increases might not be the best thing for the long term good of their jobs. Southwest pilots, to their credit, have already granted the airline some of the most flexible work rules in the industry. I see this negotiation as tricky, you step back and wonder what more can be done? Both sides needed to keep the frugal Southwest spirit at the forefront.

International Routes are all the Rage

I have posted several times that the trend will be for legacy carrier in the US to build their international routes. Seriously, I said it here, here and even way back here and here. Why? First, they don't have much in the way of competition from low cost carriers. They are competing with other legacy carriers so the playing field is mostly level. Second, international routes have a better profit margin right now when compared to domestic routes where they face intense competition from low cost carriers.

China is one of the big battle grounds for international expansion. Not surprisingly the list of competitors is exclusively made up of legacy carriers. Northwest Airlines, American Airlines, Continental Airlines and United Airlines are all making their cases to the government (and the public) on why they should be chosen for new China routes that are will be awarded. The Cranky Flier has a really nice summary of how this competition is lining up and who may have an advantage. Go check it out.

When is Cheap Fuel Bad News?

After months of moaning about fuel prices every airline should be turning cart-wheels as fuel prices dip. Oddly enough, if you're American Airlines, United Airlines or Continental Airlines those lower fuel prices are not great news because you hedged on fuel last quarter at costs that are actually higher than current. Reuters has a good article that lays it out nicely. In summary, the oil companies are thanking these airlines for pre-buying a bunch of fuel at peak prices. So the benefit of this respite in fuel prices is somewhat muted for American, United and Continental. I was surprised to see Continental got caught in this gamble. Continental has stated in the past that they simply do not hedge on fuel. Smackdown quote goes to CreditSights airline analyst Roger King, "It was a complete blank-out on the basics of business management, Business school 101 says you have to hedge uncontrollable costs." Yeah...what he said.

NEWS: This Just In...American Airlines in Love!

American Airlines has issued a brief statement indicating that they will be begin the process to apply for service out of Love Field in Dallas. The press release simply states the move was prompted by the recent passage of a bill that exempts Missouri from the restrictions of the Wright Amendment. Notably absent from the release was the marketing spin pomp and circumstance that normally accompany an airline starting service at a new, or in this case...old, location.
UPDATE 1: They better get it done fast...Southwest is expanding again at Love Field. Run Forest run!

UPDATE 2: Quote from Southwest spokesman Ed Stewart, "It's one of the most ridiculous business moves I've ever seen,". Click Read More! for additional comments

RRRRRRiiiiggghhtt. Next Southwest will be saying "Pay no attention to the man behind the curtain"...or waving their hand in Jedi fashion "This is not the airport you seek". Come on Southwest. I mean seriously did you expect them to just walk away from Love Field at this point?

But check out American spokesman Tim Wagner as he steps up to the plate with this hum-dinger, "We agree that it's a bad choice, but we think we're making the best of two bad choices: To abdicate those passengers to other airlines or to compete for those passengers at Love Field"

Sit down...this is just getting good.

Folks, adding the state of Missouri back into the Love Field equation is not what's at the heart of the matter for American. In a larger sense its tacit acknowledgement from American Airlines that they believe the Wright Amendment is going to suffer a slow piece by piece death over some extended time frame. I think you will continue to see exemptions work their way through Congress until the Wright Amendment is effectively legislated out of existence. American recognizes they'd better get their foot back in the door before every other low fare carrier in the nation tries to get with the Love too. But that's just my opinion...what do I know...I never thought United would make it out of bankruptcy...oh wait...they haven't yet...but they say they will soon.

Good article here.