Business Travel Briefing
For July 16-July 30, 2020
American Airlines revives a code-share and frequent flyer deal with JetBlue Airways. Alaska Airlines adds a dozen routes at LAX, including transcon runs to Florida. Frightening numbers from Delta's second-quarter "earnings' report. Tel Aviv delays flights another month. Hawaiian Airlines slows its mainland roll again. And more, including the daily Coronavirus update.

In good times and bad, in the midst of a pandemic and before, we've known one thing about American Airlines chief executive Doug Parker: He hates to fly planes and he really hates to fly his planes in competitive environments. Although American has never reached the peak fortress mentality of US Airways--Parker had that carrier operating 98 percent of its service to or from hubs--it is clear that American has been retreating since Parker took the helm after the 2013 reverse merger. He has gutted both its New York and Los Angeles operations, settled for unthreatening No. 2 status at both Chicago/O'Hare and Phoenix and largely focused on his fortresses at Miami, Charlotte, Philadelphia and DFW. Parker has shunned Asia, mostly relying on Oneworld partners such as Cathay Pacific and Japan Airlines, and turned waves of Europe flying over to joint-venture partner British Airways. The strategy has made American the weakest of the Big 3, saddled with debt and facing gaping holes in its domestic network. The solution? Alliances with Alaska Airlines and JetBlue Airways. Seattle-based Alaska Air this week said it was aiming to join Oneworld before the end of this year rather than next summer as originally announced. And today (July 16) Alaska announced a dozen new routes from Los Angeles, where American is now a weak sister. Besides some expected new routes around the Pacific Northwest, the Mountain states and Hawaii, there are two fascinating Florida transcon routes: daily flights to Tampa and four weekly flights to Fort Meyers. Meanwhile, American and JetBlue are hoping to revive a code-share/frequent flyer deal they first forged a decade ago. Details of the scheme revealed today were sketchy, but it's aimed at shoring up American's pitiful domestic footprint at Boston/Logan and Kennedy, two JetBlue hubs. American claims the deal will allow it to relaunch flights from JFK to Athens, Rio De Janeiro and even Tel Aviv, a city American has avoided like a plague been historically reluctant to serve.

Everyone knew that the second quarter would be a bloodbath for U.S. carriers. After all, travel barely reached 25 percent of 2019 volume on the best days and the quarter included April, when flying fell below 90,000 passengers a day. Still, first-out-of-the-box Delta Air Lines' 2Q earnings and analyst call this week included astounding numbers. To wit: second quarter revenue fell by more than $11 billion to just $1.5 billion. The adjusted pre-tax loss was $3.9 billion, the operating loss was $4.8 billion and the net loss was $5.7 billion. Those numbers exclude $3.2 billion of charges that the carrier said were directly related to the Coronavirus. The daily cash burn of $27 million at the end of June was awful, but an "improvement" from the $100-million-a-day cash burn in March. More than 45,000 of the airline's staff have taken various short-term leaves and furloughs and 17,000 employees have already signed up for a permanent buyout. Delta also took a $200 million charge against its 49 percent stake in Virgin Atlantic. And, oh, yeah, there's this: Delta expects third-quarter revenue and flight capacity to run somewhere between 20 and 25 percent of 2019 levels. "We're in a stall right now," explained chief executive Ed Bastian.

Gee, this is shocking: good news. Portland International (PDX) in Oregon has opened the 830-foot extension of Concourse E. The six-gate complex debuted Wednesday (July 15) and is the new home of Southwest Airlines. The facility has PDX's legendary carpet as well as several new local food and beverage outlets. Most notable: virtually unobstructed views of Mount Hood. Meawhile, across the country in Nashville, the airport today (July 16) opened the first six gates of its Concourse D project. It, too, will house Southwest Airlines flights. The 115,000-square-foot project is part of a $292 million overhaul of BNA that also will add ticketing space and renovate the existing terminal.
        The Club, the network of airport lounges operated by the same company as Priority Pass, is reopening more locations. Club branches at London/Heathrow and London/Gatwick reopened Saturday (July 11). The Baltimore/Washington and Cincinnati lounges reopened this week. Next week, the operation says branches at Charleston and New Orleans will resume service.
        Airport concessions such as restaurants and shops stand to lose $3.4 billion by the end of 2021 due to the pandemic, according to a trade association representing the shops.

It shouldn't come as a surprise in these wild and crazy times, but many airlines are not making good on their published claims of launching service. WestJet, for example, had been adamant that Calgary-Rome service would launch as scheduled in May. But, you know, Coronavirus. Now the flight has been pushed back to May, 2021, and on a reduced schedule. The Boeing 787 service will start as a weekly run and slowly increase to three weekly. Meanwhile, El Al is having a devil of a time resuming flights. After grounding itself in April, it relaunched a skeleton service and then stopped flying again earlier this month. It said last week that it would resume flights on August 1. Now this week comes word that the relaunch of the relaunch will be delayed until the end of August. And Royal Air Maroc has pushed back its restart until at least mid-August. When it does resume flying, RAM says it'll offer a daily flight from Casablanca to New York/Kennedy, down from twice-daily before the pandemic, and three weekly to Washington/Dulles, down from five in the before times.

Hawaiian Airlines won't be relaunching as many mainland flights as originally announced. With the state of Hawaii delaying even its restricted reopening until September, Hawaiian Airlines says it'll limit its mainland service in August to the West Coast. Long-haul service to New York and Boston is off the board again.
        Gare du Nord, the busiest railroad terminal in Europe, will get a 600-million-euro makeover. Serving 222 million passengers a year, the Paris hub for Eurostar trains to Brussels, Amsterdam and London will triple in size. The station first opened in 1864 and is also the hub for Thalys, France's high-speed rail service; handles four suburban commuter lines; and is connected to two Paris Metro lines. The goal is to get renovations, aimed to triple the terminal's size, done by the 2024 Summer Olympics in Paris.
Texas-based American Airlines publicly lectured Texas Senator Ted Cruz this week after he was photographed without a mask on an American commuter flight. The photo quickly went viral on social media. But the picture was taken by a Democratic Party operative and seemed to capture Cruz while he was drinking--or nursing--a cup of coffee. Cruz's team also publicly insisted that the Republican senator was wearing a mask during the flight. However, American's decision to "affirm the importance of [the mask] policy" with Cruz indicates that the cabin crew must have been unhappy with his compliance and/or attitude during the flight.