Change in ownership position at GOL; worst is over for Southwest; Spirit pilot strike looms
Shares in Brazilian LCC GOL gained 4.6% yesterday, following a 3.4% reduction on 09-Jun-2010. AllianceBernstein and its affiliate AXA Investment Managers announced the acquisition on 09-Jun-2010 of 8.7 million preferred shares in the carrier, corresponding to 6.6% of all shares of such class. This is a minority investment that does not involve a change in the composition of corporate control or a change in the management structure of GOL.
- GOL shares gain following acquisition of preferred shares by AllianceBernstein and AXA Investment Managers.
- Southwest Airlines CEO predicts a slow recovery for business travel demand, stating it could take several years.
- Southwest Airlines pressuring Boeing for a more fuel-efficient aircraft to replace the B737.
- Southwest Airlines focusing on enhancing customer experience, including the installation of internet connectivity in aircraft.
- Spirit Airlines cancels services ahead of a potential pilot strike.
- Daily share price movements of selected LCCs on 10-Jun-2010.
Recovery in business travel could take 'several years': Southwest CEO
In North America, Southwest Airlines CEO Gary Kelly stated that business travel took a "huge hit" during the recession, adding that it could take "several years" for business travel demand to recover from the "terrible" year in 2009. He added that the carrier's results have improved in 2010 compared with 2009 levels, stating, "the domestic airline industry is in much better shape now than it was a year ago".
Southwest pressuring Boeing for B737 replacement
Mr Kelly added that the carrier is pressuring Boeing to develop a more fuel-efficient next generation aircraft to replace the B737 (although he added that he does not expect to see it any time soon) and continued to maintain that the carrier has no plans to implement baggage charges.
Southwest to focus on customer experience enhancement
He added that 90% of management's efforts are focussed on improving customers' experience. As part of this, the carrier plans to commence the installation of internet connectivity in its aircraft during 2010. The carrier also plans to launch international operations and implement unspecified upgrades to its rewards programme in 2011. Shares in Southwest gained 1.8% yesterday.
Spirit Airlines cancels services ahead of pilot strike
Also in the US market, ultra-LCC Spirit Airlines, which has reported ongoing labour troubles in the past few years, has cancelled some of its services ahead of an impending strike deadline from its pilots. The pilots have announced their intention to strike on 12-Jun-2010 if a contract negotiation cannot be reached with Spirit's management.
Selected LCCs daily share price movements (% change): 10-Jun-2010
