Spirit Airlines pilots, represented by the Air Line Pilots Association (ALPA), rejected (07-May-2010) the National Mediation Board’s (NMB) proffer of arbitration on 05-May-2010, triggering the start of a 30-day cooling-off period. The union now awaits the NMB’s notification of the day on which the 30-day clock starts and the date for a possible strike. [more]
Spirit pilots decline arbitration; strike looms
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Airline strikes: 2016 a peak year for Europe's legacy airlines. Wakeup time, as LCCs pick them off
Pilot strikes at Lufthansa. Again. A strike ballot among British Airways cabin crew. A guilty verdict for Air France workers who assaulted an executive during a union protest. These were all headlines in late Nov-2016, following Air France pilot and cabin crew strikes in summer 2016. Labour relations at Europe's three biggest legacy airline groups are an ongoing challenge.
A CAPA report in Jun-2016 highlighted the growing number of articles on CAPA's website mentioning the word 'strike'. It raised the possibility that if the rate continued through the year, 2016 could be the biggest year for strike-related articles since before the global financial crisis. With a little under a month still to go, this year has already comfortably passed this milestone.
To a large extent labour unrest grows as airline industry profits increase. However, rather than hoping for an industry downturn to reverse the rise in the cycle of strikes, airline CEOs are talking tough – a line long taken by IAG's Willie Walsh. Lufthansa's Carsten Spohr has said that taking on the pilots is "about the future of Lufthansa", noting that it has “no chance of survival" if it gives in to pay demands (Bloomberg, 24-Nov-2016).
Spirit Airlines expresses cautious optimism about pricing improvement in the sagging US market
Similarly to the largest US global network airlines, the ULCC Spirit is welcoming signs of a modest improvement in the US pricing environment. The company’s decline in total unit revenues year-on-year in 3Q2016 slowed to single digits – compared with some of the steepest decreases recorded among US airlines for the past year. If the overall trends in the US market stick Spirit’s sequential unit revenue improvements should continue, reflected in projected further improvement in 4Q2016. However, unlike some US airlines, Spirit is not offering a specific timeframe for a return to positive unit revenue.
Spirit also posted sequential improvement from non-ticket revenue declines in 3Q2016. The airline has been battling soft pricing in baggage fees tied to lower ticket prices. It has been in the process of incorporating ways to shore up non-ticket revenue, including adopting more dynamic pricing of its ancillary products.
Throughout 2016 Spirit has retained a number of smaller-gauge Airbus A319s as it adopts a pivot in its network strategy – to smaller markets. Looking forward, the company is not ruling out talks with other manufacturers about its long-term fleet needs, reasoning that with Airbus’ strength among low cost airlines other airframers are ultimately going to act aggressively to secure new business.