Delta Air Lines announced (20-Oct-2011) 'Economy Comfort' – a premium economy cabin product launched on long-haul international flights earlier in 2011 – will be added to its entire mainline fleet of more than 550 aircraft, in addition to more than 250 two-class regional jets. The product will be installed in the first three-to-five rows of the economy cabin by removing a negligible number of seats from the current cabin configuration on all of Delta's domestic B767, B757, B737, MD88, MD90, DC9, A320 and A319 aircraft, and all two-class regional jets including the CRJ900, CRJ700, E170 and E175 aircraft types by summer 2012. The breadth of this installation means flights to Canada, Mexico, the Caribbean, and Central and northern South America will also offer the Economy Comfort product. The first of these converted aircraft will be a B757, which will enter service in Nov-2011. [more - original PR]
Delta Air Lines to introduce 'Economy Comfort' on entire mainline fleet
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Air Canada Part 1: low cost rouge is a pillar of growth; but further expansion might be constrained
During the past year Air Canada has found itself defending its double-digit capacity growth, stressing that 90% of its capacity in 2015, 2016 and 2017 is being deployed to its international network – an entity the company believes is far from reaching maturity. Recently the airline has outlined plans to introduce a raft of new long haul flights to Europe and Asia operated by Air Canada mainline and its low cost arm – Air Canada rouge.
Air Canada stresses the pillars of its international expansion – Boeing 787 widebodies and the establishment of its low cost subsidiary rouge – enable the company to enter international markets it once considered unviable due to higher costs. During the summer of 2018 rouge will nearly reach its 50 aircraft cap, and Air Canada needs to start determining if there are further opportunities to grow its low cost unit. Those evaluations will partially dictate Air Canada’s overall growth levels beyond 2018.
In the short term Air Canada is not seeing any broad changes in consumer behaviour, reflected in its solid booking curves. Weaker markets in Western Canada, hit by the downturn in the oil sector, are stabilising as capacity cuts have resulted in a rational supply-demand scenario.
This is Part 1 in a two part series on Air Canada. The second instalment will focus on the airline’s costs and balance sheet management.
Alaska, jetBlue and Southwest cost projections; good in the short term but long term challenges loom
Just as the large three global US airlines – American, Delta and United – work to contain their unit costs, their rivals Alaska, jetBlue and Southwest are committed to keeping their respective unit costs in line as the current revenue environment in the US remains weak.
The latter three airlines face different cost dynamics in the future. Alaska is attempting to embark on a merger with Virgin America, which will inevitably create some cost pressure as the full integration gets under way. Southwest is in the middle of complex pilot and flight attendant negotiations, which makes predicting its cost performance in the near- to mid-term difficult. At some point jetBlue will also conclude a new pilot contract that will affect its cost structure.
Cost performance results for Alaska, jetBlue and Southwest for 2Q2016 and the full year look reasonably favourable, although Alaska has refined its 2016 targets slightly, driven in part by increases in performance-based pay. But its costs should remain competitive compared with its peers, and solidly lower than those of the larger network carriers.