Spanish Government to provide credit for airlines, WestJet upgraded
Vueling's shares were up 1.8% yesterday, following the previous day's 10.1% gain, on news that the Spanish Government will offer airlines EUR600 million of credit through the Official Credit Institute (ICO).
The measure will expand credit lines already available to Spanish airlines, which have struggled from reduced demand levels due to the economic crisis.
WestJet upgraded – strong cash balance presents numerous options for the Canadian LCC
WestJet, meanwhile, gained 1.9%, following an upgrade by RBC Capital Markets. RBC raised WestJet's shares from "sector perform" to "outperform" and raised its share price target, stating Canada's second largest airline has a good cash balance at a time of numerous opportunities.
WestJet, which on Wednesday closed a CAD172 million (USD161 million) financing agreement, is expected to increase its cash balance to USD830 million after the transaction.
It has been speculated that WestJet, which expects to enter into codeshare arrangements with various airlines in 2010, could expand to include a foreign equity partner.
Frontier emerges from bankruptcy protection
Frontier Airlines, meanwhile, emerged from bankruptcy protection yesterday, as a wholly-owned subsidiary of Republic Airways Holdings. Frontier Airlines and Lynx Aviation will continue to operate under their same names, offering the same flight schedules, customer amenities and frequent flier benefits as in the past. See related article: Frontier Airlines emerges from bankruptcy under Republic Airways’ wing. Can the good times last?
US airline shares fell on Thursday, reflecting overall weakness in the market and increased oil prices. JetBlue’s shares led the slump, down 8.5%, with AirTran (-7.5%), Southwest (-6.4%) and Allegiant (-3.7%) also weaker.
Selected LCCs daily share price movements (% change): 01-Oct-09