ReportWire

Tag: Southwest Airlines Co

  • Southwest plans to cut flights in Atlanta while adding them elsewhere. Its unions are unhappy

    Southwest plans to cut flights in Atlanta while adding them elsewhere. Its unions are unhappy

    DALLAS (AP) — Southwest Airlines plans to eliminate about one-third of its flights to Atlanta next year to save money as it comes under pressure from a hedge fund to increase profits and boost the airline’s stock price.

    The retreat in Atlanta, where Southwest is far smaller than Delta Air Lines, will eliminate more than 300 jobs for pilots and flight attendants, although they will have a chance to relocate, according to the company.

    A Southwest official said Wednesday the airline needs to cut unprofitable routes, and “demand for Atlanta doesn’t support our level of flying.”

    While the airline’s planners “try everything they can before making hard decisions like this one, we have to make this change to help drive us back to profitability,” the Atlanta-based official, Tiffany Laurent, said in a memo to employees.

    Shares of Dallas-based Southwest fell 4.6%.

    Southwest executives are expected to detail other changes that it plans to make when it holds an investor meeting Thursday. The session is in response to Elliott Investment Management’s campaign to shake up Southwest’s leadership and reverse a decline in profits over the past three years.

    Southwest will cut 58 flights per day and reduce its presence at Hartsfield-Jackson Atlanta International Airport from 18 to 11 gates, according to the Southwest Airlines Pilots Association, which says the news is painful for Atlanta-based employees.

    “It is simply amazing that the airline with the strongest network in the history of our industry is now retreating in a major market because this management group has failed to evolve and innovate,” the union said in a memo to pilots.

    Bill Bernal, president of the Transport Workers Union local representing Southwest flight attendants, said his union is outraged by the reduction of Atlanta jobs. He said Southwest assured the union that it would grow in Atlanta.

    “This is gaslighting at its finest,” Bernal said in a memo to union members. “Yet again, flight attendants are paying the price for poor management decisions.”

    A Southwest spokesperson responded, “Decisions like these are difficult for our company because of the effects on our people, but we have a history of more than 53 years of ensuring they are taken care of.”

    While retreating in Atlanta, Southwest published its schedule through next June on Wednesday, and it includes new routes between Nashville and six other cities along with five new red-eye flights from Hawaii to Las Vegas and Phoenix. Those additions start in April.

    Earlier this year, Southwest pulled out of four smaller markets and announced it would limit hiring in response to weakening financial results and delays in getting new planes from Boeing.

    More notably, CEO Robert Jordan said in July that Southwest will begin assigning passengers to seats and set aside nearly one-third of its seats for premium service with more legroom.

    Source link

  • Southwest Airlines to cut service and staffing in Atlanta to slash costs

    Southwest Airlines to cut service and staffing in Atlanta to slash costs

    A Southwest Airlines plane takes off from Hartsfield-Jackson Atlanta International Airport (ATL) in Atlanta, Georgia, US, on Friday, July 12, 2024. 

    Elijah Nouvelage | Bloomberg | Getty Images

    Southwest Airlines is planning to reduce service to and from Atlanta next year, cutting more than 300 pilot and flight attendant positions, according to a company memo seen by CNBC.

    The changes come a day before Southwest’s investor day, when executives will map out the company’s plan to cut costs and grow revenue as pressure mounts from activist investor Elliott Investment Management.

    Southwest told staff it isn’t closing its crew base in Atlanta. Instead, it will reduce staffing by as many as 200 flight attendants and as many as 140 pilots, for the April 2025 bid month.

    The airline also isn’t laying the crews off, but they will likely have to bid to work from other cities.

    Read more CNBC airline news

    Southwest will reduce its Atlanta presence to 11 gates next year from 18, according to a separate memo from the pilots’ union.

    It will service 21 cities from Atlanta starting next April, down from 37 in March, the carrier said.

    “Although we try everything we can before making difficult decisions like this one, we simply cannot afford continued losses and must make this change to help restore our profitability,” Southwest said in its memo. “This decision in no way reflects our Employees’ performance, and we’re proud of the Hospitality and the efforts they have made and will continue to make with our Customers in ATL.”

    The unions that represent Southwest’s pilot and flight attendants railed against the airline for the staffing and service cuts.

    “Southwest Airlines management is failing Employees while impacting Customers. Management continues to make decisions that lack full transparency, sufficient communication with Union leadership, and most alarmingly, a lack of focus on what has made the airline great, the Employees,” said Bill Bernal, the flight attendants’ union president.

    A Southwest spokesman confirmed the changes and said the carrier will “continue to optimize our network to meet customer demand, best utilize our fleet, and maximize revenue opportunities.”

    Travelers check in at a Southwest counter at Hartsfield-Jackson Atlanta International Airport (ATL) in Atlanta, Georgia, US, on Tuesday, July 23, 2024.

    Elijah Nouvelage | Bloomberg | Getty Images

    The airline had already pulled out of certain airports, some of which it experimented with during the pandemic to focus on more profitable service.

    Southwest is not only facing changing booking patterns and oversupplied parts of the U.S. market but aircraft delays from Boeing, whose yet-to-be-certified 737 Max 7 airplanes are years behind schedule

    The airline’s COO, Andrew Watterson, told staff last week that it will have to make “difficult decisions” to boost profits.

    The reduction in Atlanta, the world’s busiest airport and Delta Air Lines home hub, is the latest development for the airline. In July, Southwest announced it plans to get rid of open seating and offer extra legroom on its airplanes, the biggest changes in its more than half-century of flying.

    Also on Wednesday, Southwest released an expanded schedule, selling tickets through June 4. In addition to the planned cuts in Atlanta, the carrier said it will boost service to and from Nashville, Tennessee. It will also start offering overnight flights from Hawaii, beginning April 8. Those include service from Honolulu to Las Vegas and Phoenix; Kona, Hawaii, to Las Vegas; and Maui, Hawaii, to Las Vegas and Phoenix.

    Don’t miss these insights from CNBC PRO

    Source link

  • Why a Wall Street downgrade of Costco is not a reason to sell the stock

    Why a Wall Street downgrade of Costco is not a reason to sell the stock

    Source link

  • U.S. airlines cool hiring after adding 194,000 employees in post-Covid spree

    U.S. airlines cool hiring after adding 194,000 employees in post-Covid spree

    A pilot performs a walkaround before a United Airlines flight

    Leslie Josephs/CNBC

    U.S. passenger airlines have added nearly 194,000 jobs since 2021 as companies went on a hiring spree after spending months in a pandemic slump, according to the U.S. Department of Transportation. Now the industry is cooling its hiring.

    Airlines are close to their staffing needs but the slowdown is also coming in part because they’re facing a slew of challenges.

    A glut of flights in the U.S. has pushed down fares and eaten into airlines’ profits. Demand growth has moderated. Airplanes are arriving late from Boeing and Airbus, prompting airlines to rethink their expansions. Engines are in short supply. Some carriers are deferring airplane deliveries altogether. And labor costs have climbed after groups like pilots and mechanics inked new contracts with big raises, their first in years.

    Annual pay for a three-year first officer on midsized equipment at U.S. airlines averaged $170,586 in March, up from $135,896 in 2019, according to Kit Darby, an aviation consultant who specializes in pilot pay.

    Since 2019, costs at U.S. carriers have climbed by double-digit percentages. Stripping out fuel and net interest expenses, they’ll be up about 20% at American Airlines this year and around 28% higher at both United Airlines and Delta Air Lines from 2019, according to Raymond James airline analyst Savanthi Syth.

    It is more pronounced at low-cost airlines. Southwest Airlines‘ costs will likely be up 32%, JetBlue Airways‘ up nearly 35% and Spirit Airlines will see a rise of almost 39% over the same period, estimated Syth, whose data is adjusted for flight length.

    Easing hiring

    Friday’s U.S. jobs report showed air transportation employment in August roughly in line with July’s.

    But there have been pullbacks. In the most severe case, Spirit Airlines furloughed 186 pilots this month, their union said Sunday, as the carrier’s losses have grown in the wake of a failed acquisition by JetBlue Airways, a Pratt & Whitney engine recall and an oversupplied U.S. market. Last year, even before the merger fell apart, it offered staff buyouts.

    Other airlines are easing hiring or finding other ways to cut costs.

    Frontier Airlines is still hiring pilots but said it will offer voluntary leaves of absence in September and October, when demand generally dips after the summer holidays but before Thanksgiving and winter breaks. A spokeswoman for the carrier said it offers those leaves “periodically” for “when our staffing levels exceed our planned flight schedules.”

    Southwest Airlines expects to end the year with 2,000 fewer employees compared with 2023 and earlier this year said it would halt hiring classes for work groups including pilots and flight attendants. CFO Tammy Romo said on an earnings call in July that the company’s headcount would likely be down again in 2025 as attrition levels exceed the Dallas-based carrier’s “controlled hiring levels.”

    United Airlines, which paused pilot hiring in May and June, citing late-arriving planes from Boeing, said it plans to add 10,000 people this year, down from 15,000 in each 2022 and 2023. It plans to hire 1,600 pilots, down from more than 2,300 last year.

    It’s a departure from the previous years when airlines couldn’t hire employees fast enough. U.S. airlines are usually adding pilots constantly since they are required to retire at age 65 by federal law.

    Airlines shed tens of thousands of employees in 2020 to try to stem record losses. Packages of more than $50 billion in taxpayer aid that were passed to get the industry through its worst-ever crisis prohibited layoffs, but many employees took carriers up on their repeated offers of buyouts and voluntary leaves.

    Then, travel demand snapped back faster than expected, climbing in earnest in 2022 and leaving airlines without experienced employees like customer service agents. It also led to the worst pilot shortage in recent memory.

    In response, companies — especially regional carriers — offered big bonuses to attract pilots.

    But times have changed. Even air freight giants were competing for pilots in recent years but demand has waned as FedEx and UPS look to cut costs.

    American Airlines CEO Robert Isom said in an investor presentation in March that the carrier added about 2,300 pilots last year and that it expects to hire about 1,300 this year.

    “We will be hiring for the foreseeable future at levels like that,” he said at the time.

    Despite the lower targets, students continue to fill classrooms and cockpits to train and build up hours to become pilots, said Ken Byrnes, chairman of the flight department at Embry-Riddle Aeronautical University.

    “Demand for travel is still there,” he said. “I don’t see a long-term slowdown.”

    Read more CNBC airline news

    Source link

  • Air travel is getting worse. That’s what passengers are telling the US government

    Air travel is getting worse. That’s what passengers are telling the US government

    WASHINGTON (AP) — Air travel got more miserable last year, if the number of consumer complaints filed with the U.S. government is any measure.

    The Transportation Department said Friday that it received nearly 97,000 complaints in 2023, up from about 86,000 the year before. The department said there were so many complaints that it took until July to sort through the filings and compile the figures.

    That’s the highest number of consumer complaints about airlines since 2020, when airlines were slow to give customers refunds after the coronavirus pandemic shut down air travel.

    The increase in complaints came even as airlines canceled far fewer U.S. flights — 116,700, or 1.2% of the total, last year, compared with about 210,500, or 2.3%, in 2022, according to FlightAware data. However, delays remained stubbornly high last year, at around 21% of all flights.

    So far this year, cancellations remain relatively low — about 1.3% of all flights — but delays are still running around 21%.

    More than two-thirds of all complaints last year dealt with U.S. airlines, but a quarter covered foreign airlines. Most of the rest were about travel agents and tour operators.

    Complaints about treating passengers with disabilities rose by more than one-fourth compared with 2022. Complaints of discrimination, while small in number, also rose sharply. Most were about race or national origin.

    The Transportation Department said the increase in complaints was partly the result of more consumers knowing about their rights and the ability to file a complaint. The department said it helped Southwest Airlines customers get more than $600 million in refunds and reimbursements after the carrier canceled nearly 17,000 flights during December 2022. Southwest also paid a $35 million fine.

    Airlines receive many more complaints from travelers who don’t know how or don’t bother to complain to the government, but the carriers don’t release those numbers.

    The Transportation Department is modernizing its complaint-taking system, which the agency says will help it do a better job overseeing the airline industry. However, the department now releases complaint numbers many months late. It did not issue figures for the second half of 2023 until Friday.

    ___

    The Transportation Department’s online complaint form is at https://secure.dot.gov/air-travel-complaint

    Source link

  • CNBC Daily Open: Micron slides, Amazon’s $2 trillion

    CNBC Daily Open: Micron slides, Amazon’s $2 trillion

    A trader works on the floor of the New York Stock Exchange (NYSE) during morning trading on March 4, 2024 in New York City. 

    Angela Weiss | Afp | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Clinging on 
    The     S&P 500 and the Dow Jones Industrial Average just about finished the session in positive territory. The Nasdaq Composite, on course for an 18.6% gain in the first six months of the year, rose 0.49%. After trading mostly in negative territory, Nvidia made a small gain following the previous session’s 7% surge. The yield on the 10-year Treasury rose as investors parse comments from Fed officials and await key inflation data due Friday. U.S. oil prices rose amid escalating tensions in the Middle East. 

    Micron slides 
    Shares of Micron fell almost 8% in extended trading on Wednesday as its revenue forecast failed to top analysts’ expectations. The computer memory and storage maker expects revenue of $7.6 billion in the current quarter, in line with estimates. Micron’s shares have doubled in the past year as its most advanced memory is needed for AI graphics processing units. CEO Sanjay Mehrotra said the company’s AI-oriented products were likely to increase in price and its data center business grew 50% on a quarter-to-quarter basis.

    $2,000,000,000,000
    Amazon‘s market capitalization surpassed $2 trillion for the first time on Wednesday, joining the ranks of tech giants like Apple and Microsoft. The surge in megacap tech stocks has been driven by investor excitement around generative AI. Amazon’s stock has risen 26% this year, outpacing the Nasdaq’s 18% increase. The stock rose 3.9% on Wednesday. Separately, CNBC’s Annie Palmer reports Amazon plans to launch a discount store in bid to fend off Temu and Shein. 

    Southwest cuts guidance
    Southwest Airlines cut its second-quarter revenue forecast due to difficulties adapting its revenue management to recent booking trends. Despite the revised outlook, the airline still expects record quarterly operating revenue. Activist investor Elliott Management reiterated calls for leadership changes, “Southwest is led by a team that has proven unable to adapt to the modern airline industry.” Higher costs and increased capacity have impacted fares and profits across the industry, while competitors like Delta and United have benefited from the return of international travel. Southwest shares fell 4% before recovering to end the session just 0.2% lower.

    Asian stocks fall, yen weakens
    Japan’s export-heavy Nikkei 225 and the broad-based Topix fell as the yen weakened to a 38-year low against the U.S. dollar, raising the prospect of intervention. Finance Minister Shunichi Suzuki warned the country was “deeply concerned about FX impact on economy,” per Reuters. Elsewhere, Hong Kong’s Hang Seng index led the rest of the Asia-Pacific region lower, tumbling 2%, and mainland China’s CSI 300 was down 0.6%. Australia’s S&P/ASX 200 dropped 0.58% and South Korea’s Kospi dipped 0.37%

    [PRO] Investing in India
    India’s unexpected election results haven’t dampened Causeway Capital Management’s bullish outlook. Although portfolio manager Arjun Jayaraman predicts modest short-term returns for the BSE Sensex index, he suggests ETFs that could benefit from higher returns.  

    The bottom line

    There was a surge of activity in the auto industry that may have been overshadowed by Volkswagen's $5 billion investment in the loss-making EV maker Rivian. While VW makes solid cars, its electric vehicles are plagued with glitchy software. As CNBC's Sophie Kiderlin notes this investment will take years to yield returns. Analysts, however, are wary of the current "EV winter" marked by tepid demand and increased competition. Despite these challenges, Rivian's stock surged 23%, reflecting investor optimism.

    Elsewhere in the industry, Waymo, Alphabet's self-driving car unit, expanded its robotaxi service to all users in San Francisco. Meanwhile, General Motors's Cruise autonomous vehicle division appointed former Amazon and Microsoft executive Marc Whitten as its new CEO. This leadership change follows a series of collisions that led to investigations and the suspension of Cruise's license in California, heightening public skepticism about driverless technology.

    While Waymo is steadily rolling out its services and Cruise is restarting its operations, Tesla has yet to introduce its long-promised robotaxi. Elon Musk's projections for a 2020 launch and fully autonomous driving by 2018 have yet to materialize. Nevertheless, Musk envisions Tesla as a potential $7 trillion robotaxi enterprise. The unveiling of Tesla's robotaxi on Aug. 8 will be closely watched to gauge its competitive edge.

    Rivian shareholder Amazon joined the exclusive $2 trillion market cap club, alongside Alphabet, Nvidia, Apple and Microsoft. This milestone comes as Amazon aggressively cuts costs.

    While enthusiasm for AI remains high, Wall Street experienced a more measured session as investors sought to lock in profits from the Nvidia-driven surge. Despite the current optimism, strategists caution that the S&P 500 might face a correction over the summer. CNBC's Sarah Min explores the factors behind Citi's projections and a series of recent upgrades.

    — CNBC's Hakyung Kim, Brian Evans, Alex Sherman, Samantha Subin, Annie Palmer, Ece Yildirim, Michael Wayland, Sophie Kiderlin, Spencer Kimball, Leslie Josephs, Sarah Min, Sheila Chiang and Lim Hui Jie contributed to this report.

    [ad_2]
    Source link

  • CNBC Daily Open: Sticky inflation muddies water for Fed

    CNBC Daily Open: Sticky inflation muddies water for Fed

    A man shops for fruit at a grocery store on February 01, 2023 in New York City.

    Leonardo Munoz | Corbis News | Getty Images

    This report is from today’s CNBC Daily Open, our international markets newsletter. CNBC Daily Open brings investors up to speed on everything they need to know, no matter where they are. Like what you see? You can subscribe here.

    What you need to know today

    Stocks rally
    Wall Street     closed higher on Tuesday with the S&P 500 hitting a fresh record, up 1.1%. The blue-chip Dow gained over 200 points, while the Nasdaq added 1.5% as U.S. inflation data came in mildly higher than expected in February. 

    Record shareholder payouts
    Shareholder payouts hit a record $1.7 trillion last year, according to a new report by British asset manager Janus Henderson. Nearly half of the world’s total dividend growth came from the banking sector, which delivered record payouts as rising borrowing costs lifted lenders’ margins, the report found. 

    Boeing crisis hurt airlines
    CEOs from several airlines say Boeing’s delivery delays have forced the carriers to change their growth plans. Boeing’s crisis has deepened since a door plug blew out midflight from an Alaska Airlines Max 9 in January. Southwest Airlines, Alaska Airlines and United, are some of the top buyers of Boeing’s aircraft that have been impacted by its problems.

    Citadel on rate cuts
    Inflation tailwinds remain and the Fed shouldn’t cut rates too quickly, says Citadel founder and CEO Ken Griffin. “If I’m them, I don’t want to cut too quickly,” he noted, adding that it will be “more devastating” if they have to change direction after initially cutting rates. “I think they are going to be a bit slower than what people were expecting two months ago in cutting rates.”

    [PRO] Buy or sell Nivida?
    Nvidia’s stock has surged over 200% in 2023 alone, powered by the global AI frenzy. Is it time to take profit or should investors stay the course? Experts who currently hold the chip giant’s stock share their insights.   

     

    The bottom line

    Once again, inflation came in hot for a second straight month.   

    February’s consumer prices data was a touch better than January’s troubling inflation print. 

    Still, core inflation — which excludes food and energy — was stronger than expected, up 0.4% last month, which reflects lingering stickiness in price pressures.

    Investors don’t expect that latest data to move the needle on the Fed cutting rates in June. That could be why markets have had a more muted reaction to the news.

    “We have the numbers we have and this wasn’t great news for the Fed but markets don’t see it as a big threat to rate cuts later in the year,” Kathy Jones, chief fixed income strategist at Charles Schwab, said on X.

    Yet, the hot print poses a problem for the Fed and muddies the water for its deliberations on the coming rate cuts.

    “The long-term disinflation trajectory probably has not changed, but the path to the Federal Reserve’s 2% target will be choppy,” noted LPL Financial chief economist Jeffrey Roach. “Expect to see markets struggle with what this means for Fed policy.”

    There is a lot riding for Wall Street when the central bank meets next week. Investors’ main focus will be on whether the Fed will continue to pencil in three rates for this year or will officials decide to change course.

    Source link

  • How Denver International Airport became one of the fastest-growing airports in the world

    How Denver International Airport became one of the fastest-growing airports in the world

    Last year was Denver International Airport’s busiest on record.

    While airline stocks have yet to fully recover to pre-pandemic levels, passengers have returned in droves — and millions of them are flying through the Colorado hub.

    “We will end 2023 much higher than our forecast at about 78 million passengers annually,” said Phil Washington, CEO of the Denver International Airport. “So this has been tremendous growth.”

    The airport, known as DIA to Colorado locals, opened in 1995. It was originally built to handle 50 million passengers per year, but now that number is expected to reach more than 100 million people per year by 2027, according to DIA estimates.

    OAG, a global travel data provider, said Denver went from the 21st busiest airport in the world in 2019 to the sixth in 2023. 

    United Airlines is Denver’s biggest operator with 46.7% market share, followed by Southwest at 30.7% and Frontier Airlines at 9.7%, according to DIA.

    The midcontinent airport has become United’s busiest hub. It recently invested nearly $1 billion in Denver to add more gates, flights and destinations, and opened the largest lounge in its network.

    “About 60% of our customers are connecting from other places. Forty percent of our customers are local Denver, and it’s a fast growing city,” said Jonna McGrath, vice president of Denver Airport operations for United Airlines. “We want to grow before 2030 to about 650 flights a day.”

    CNBC got a behind-the-scenes look at United’s Denver operations and explored how the airport and the airline plan to keep up with demand.

    Watch the video to learn more.

    Source link

  • Judge blocks JetBlue-Spirit merger after DOJ's antitrust challenge

    Judge blocks JetBlue-Spirit merger after DOJ's antitrust challenge

    LaGuardia International Airport Terminal A for JetBlue and Spirit Airlines in New York.

    Leslie Josephs | CNBC

    A federal judge Tuesday blocked JetBlue Airways‘ purchase of Spirit Airlines after the Justice Department sued to stop the merger, saying the deal would drive up fares for price-sensitive consumers by taking the discount carrier out of the market.

    JetBlue’s proposed $3.8 billion purchase of discounter Spirit would have produced the country’s fifth-largest airline, a deal the carriers had said would help them better grow and compete against larger rivals like Delta and United.

    “JetBlue plans to convert Spirit’s planes to the JetBlue layout and charge JetBlue’s higher average fares to its customers,” U.S. District Court Judge William Young wrote in his decision. “The elimination of Spirit would harm cost-conscious travelers who rely on Spirit’s low fares.”

    The decision, handed down Tuesday, marks a victory for a Justice Department that has aggressively sought to block deals it views as anti-competitive.

    “Today’s ruling is a victory for tens of millions of travelers who would have faced higher fares and fewer choices had the proposed merger between JetBlue and Spirit been allowed to move forward,” Attorney General Merrick Garland said in a statement. “The Justice Department will continue to vigorously enforce the nation’s antitrust laws to protect American consumers.”

    The DOJ alleged in its lawsuit, filed in March, that JetBlue’s acquisition of the budget airline would force many passengers to pay higher fares by eliminating Spirit and “about half of all ultra-low-cost airline seats in the industry.”

    Spirit has grown rapidly in recent years by offering cheap fares and fees for everything else from seat assignments to carry-on luggage, a no-frills model that has become a favorite punchline for late-night comedians.

    “Spirit is a small airline. But there are those who love it,” Young, who was appointed by former President Ronald Reagan, wrote in his ruling. “To those dedicated customers of Spirit, this one’s for you.”

    Spirit shares plunged after the ruling and ended the day down 47%, while JetBlue’s stock gained about 5%.

    Spirit’s market capitalization as of Friday’s close was $1.66 billion, less than half of JetBlue’s proposed purchase price. The Miramar, Florida-based airline has been struggling with grounded airplanes due to an engine manufacturing issue and softer-than-expected travel demand.

    Stock Chart IconStock chart icon

    Spirit Airlines and JetBlue Airways stock after a federal judge blocked the carrier’s proposed merger.

    JetBlue and Spirit said in a joint statement that they disagreed with the ruling and were evaluating next steps.

    “We continue to believe that our combination is the best opportunity to increase much needed competition and choice by bringing low fares and great service to more customers in more markets while enhancing our ability to compete with the dominant U.S. carriers,” the carriers said.

    A different U.S. District Court judge in Massachusetts sided with the Justice Department last year to block JetBlue’s regional alliance with American Airlines in the Northeast, a partnership that allowed the carriers to coordinate routes and schedules.

    JetBlue and Spirit said Tuesday that “JetBlue’s termination of the Northeast Alliance and commitment to significant divestitures have removed any reasonable anti-competitive concerns that the Department of Justice raised.”

    Hard-won deal

    JetBlue fought hard for Spirit. It launched a hostile takeover bid weeks after Frontier Airlines and Spirit agreed to merge in a cash-and-stock deal. Frontier’s business model is more similar to Spirit’s, and both airlines have similar fleet configurations, unlike JetBlue’s more full-service model which stands in contrast to Spirit’s discount strategy.

    After Spirit’s board rejected JetBlue’s initial takeover offer, Spirit CEO Ted Christie said in May 2022 that he didn’t think a JetBlue deal would be approved by regulators, citing the American Airlines partnership and JetBlue’s plan to take seats out of the market.

    “It will not happen in our opinion and for that reason our board has rejected it and to imply otherwise again, we think is insulting,” he said on CNBC’s “Squawk Box” at the time.

    Spirit shareholders ended up rejecting the Frontier deal and months later approving a sweetened JetBlue proposal in October 2022.

    New CEO

    Young’s decision leaves New York-based JetBlue grappling with next steps, tasking incoming CEO Joanna Geraghty with steering the airline on a new path. Geraghty was announced as successor to CEO Robin Hayes after he said earlier this month that he would retire.

    JetBlue argued access to Spirit’s similar fleet of Airbus planes would allow it to grow quickly when planes and pilots are in short supply, growth it said it needs to compete against bigger airlines. The carrier operates in highly congested airspace in New York and other cities, and had planned to use Spirit as a way to gain access to more routes and travelers.

    Years of previous consolidation left United, Delta, American and Southwest in control of about three-quarters of the domestic market.

    JetBlue planned to remodel Spirit’s yellow planes by removing the branding and seats from the tightly packed jets to provide more of a full-service model.

    “Although Spirit’s yellow aircraft livery would not immediately be repainted as JetBlue planes, at the moment the merger is consummated, Spirit and JetBlue would no longer be competitors,” Young wrote in his decision.

    Don’t miss these stories from CNBC PRO:

    Source link

  • Flight cancellations pile up as winter storm, 737 Max 9 grounding disrupt travel

    Flight cancellations pile up as winter storm, 737 Max 9 grounding disrupt travel

    An Embraer E175LR passengers aircraft of American Eagles airlines (C) taxxing before take-off to Pittsburg is seen at La Guardia Airport on January 9, 2024.

    Charly Triballeau | Afp | Getty Images

    Airlines canceled about 2,000 U.S. flights Friday as they grapple with winter weather and the grounding of Boeing 737 Max 9 planes. 

    Storms in the Midwest helped drive more than 4,500 delays, with major disruptions around Chicago and Detroit, major hubs for the largest U.S. carriers, according to flight-tracker FlightAware.

    About 40% of flights at Chicago’s O’Hare International Airport, a hub for United Airlines and American Airlines, were canceled after a snowstorm led to an over two-hour ground stop. Detroit Metropolitan Wayne County Airport, a hub for Delta Air Lines, had about 20% of flights Friday either delayed or canceled due to the storms.

    Southwest Airlines, which has a big operation out of Chicago Midway, canceled more than 400 flights, while more than 900 were delayed.

    United canceled about 10% of its mainline flights and delayed about 20%.

    Last week, the Federal Aviation Administration grounded Boeing 737 Max 9s after a door plug blew off an Alaska Airlines flight, so the jets can undergo inspections. That grounding has continued to disrupt travel for both United and Alaska Airlines, the only two U.S. airlines that operate the aircraft.

    Alaska Airlines said Friday it would cancel all flights on the Max 9 through Sunday as it waits for documentation from Boeing and the FAA to begin inspections.

    About 20% of the carrier’s flights were canceled Friday and more than 10% were delayed, FlightAware data showed. Alaska said that between 110 and 150 flights per day would be impacted by the grounding of the Max 9. 

    “We regret the significant disruption that has been caused for our guests by cancellations due to these aircraft being out of service,” the company said.

    Source link

  • Boeing’s financials won’t be hurt by latest 737 Max issues, analysts say. The company’s size is one reason.

    Boeing’s financials won’t be hurt by latest 737 Max issues, analysts say. The company’s size is one reason.

    Alaska Airlines, United Airlines and Turkish Airlines have all grounded their Boeing 737 Max 9 airplanes after part of one such jet tore away during an Alaska Airlines flight on Friday. But despite the potential safety risks for travelers and further damage to Boeing’s
    BA,
    -8.03%
    reputation, some Wall Street analysts, for now, have downplayed the financial impact for the jet maker.

    In part, they pointed to the company’s status as one of two major players in aircraft production — the other being Airbus
    EADSY,
    +3.52%    .
    They also cited a tighter supply of available aircraft and limited near-term impact, at least while investigators try to figure out the cause of the incident.

    Those airlines and others took the action over the weekend after a panel on a jet blew out about 10 minutes into Alaska Airlines Flight 1282 at an altitude of about 16,000 feet.

    No one died in the incident. But the Federal Aviation Administration ordered the temporary grounding of certain Boeing 737 Max 9 aircraft. The order covered 171 planes.

    Shares of Boeing fell 8.2% as the stock weighed on the Dow Jones Industrial Average
    DJIA.

    Still, some Wall Street analysts on Monday said to buy the stock anyway. They said the latest difficulties with the aircraft — which follow the 2019 grounding of Max jets by many nations following two fatal crashes — were unlikely to have a big near-term financial impact.

    BofA analysts, in a research note dated Sunday, said that “at this point in time, due to the duopoly nature of the industry, we do not see this impacting orders for any of the 737 MAX variants. However, if the hits to the program do keep coming … at some point, the flying public may lose confidence in the 737 MAX which could ultimately impact sales.”

    The analysts said it wasn’t clear yet whether the blowout on Friday was due to an assembly mistake at Boeing, an improper installation from fuselage maker Spirit AeroSystems or oversight issues elsewhere. But they noted that the aircraft was relatively new, having been delivered on Oct. 31. And they said that “some scrutiny must be saved for regulators as well, as the FAA is ultimately responsible for certificating these aircraft before delivery.”

    Spirit AeroSystems’ stock
    SPR,
    -11.13%
    was down 11%.

    Analysts at William Blair also said they didn’t expect a big hit to Boeing’s financials.

    “While the Alaska Airlines door plug accident was terrifying, we do not believe that it will have a major financial impact, unless another incident occurs after the aircraft returns to service,” they said in a note on Monday.

    Analysts there estimated that over the past two months, the Max 9 made up less than one-fifth of Boeing’s total deliveries. They said those deliveries would only be “modestly impacted over the first quarter as it could take some time to determine the cause.”

    Of the 23 analyst ratings on Boeing’s stock tracked by FactSet, 18 are buy ratings or the equivalent.

    Read more: How Boeing’s latest 737 Max problem is hurting the Dow

    However, Morgan Stanley analyst Ravi Shanker said the 737 Max 9 issues will likely disrupt first-quarter results for United Airlines
    UAL,
    +2.78%
    and Alaska Air
    ALK,
    -0.21%    .

    “This will hopefully be a situation resolved in days/weeks rather than months, but it will also serve as a reminder of how fragile airline capacity can be despite the overhang of capacity,” Shanker said in a Monday research note.

    United Airlines’ stock rose 2.4% on Monday, while Alaska Air’s dipped by 0.3%.

    Along with United Airlines, Alaska Airlines and Turkish Airlines, Copa Airlines and Aeromexico grounded about 40 Boeing 737 Max 9 planes, according to reports.

    According to Deutsche Bank analysts, the affected fleet accounts for 16.1% of Alaska Airlines flights and 6.6% of United flights, although United has more 737 Max 9 aircraft than Alaska.

    Other airlines with the plane in their fleet include Jet Airways of India with one plane, Jin Air of Korea with three, KLM Royal Dutch Airlines
    KLMR,

    with five and Korean Air Lines
    003490,
    -1.52%
    with nine, according to Planespotter.net.

    European regulators also grounded the 737 Max 9 for inspection.

    Some major airlines do not have any 737 Max 9s in their fleets, including American Airlines
    AAL,
    +7.21%    ,
    Southwest Airlines
    LUV,
    -0.10%
    and Air Canada
    AC,
    +3.42%    ,
    according to reports.

    Also read: Shares in Boeing slump, supplier Spirit AeroSystems tanks, after panel blows out

    Source link

  • Southwest CEO vows last year's Christmas meltdown 'will never happen again'

    Southwest CEO vows last year's Christmas meltdown 'will never happen again'

    Southwest Airlines Executive Vice President Bob Jordan speaks as he is interviewed by CNBC outside the New York Stock Exchange (NYSE) in New York City, U.S., December 9, 2021.

    Brendan McDermid | Reuters

    With the peak Christmas travel season just days away, Southwest Airlines‘ CEO vowed that the carrier will not have a repeat of last year’s meltdown that stranded thousands of customers and cost the airline more than $1 billion.

    “It will never happen again,” Bob Jordan said at an event Thursday at the Wings Club in New York.

    Last year, Southwest canceled close to 17,000 flights over the crucial Christmas and New Year’s holiday period as it failed to recover from severe weather that gripped most of the country. Rival carriers were also affected but recovered more quickly.

    Southwest struggled with staffing issues as storms left flight attendants and pilots out of position for their next flights, thousands of passenger bags piled up, and planes were behind on de-icing.

    The carrier has been stocking up in de-icing and other winter-weather equipment to prepare for the season throughout the year. It has also upgraded technology.

    “Winter will not be perfect,” Jordan said. But he added that the airline is prepared for the season, pointing to a quick recovery after heavy snowfall in October at its key airport in Denver.

    Source link

  • Southwest, pilots' union near a preliminary labor deal, the last of the major U.S. airlines

    Southwest, pilots' union near a preliminary labor deal, the last of the major U.S. airlines

    Southwest Airlines Boeing 737-700 aircraft is seen landing at dusk time at Ronald Reagan Washington National Airport in Arlington, Virginia.

    Nicolas Economou | Nurphoto | Getty Images

    Southwest Airlines and its pilots’ union are closing in on a new contract that would raise pay for the carrier’s more than 11,000 aviators and end months of contentious negotiations, weeks ahead of the crucial holiday travel season.

    The company and the union have agreed on pay, retirement and other items but are working on an implementation schedule, the Southwest Airlines Pilots Association said in a message to its members on Thursday.

    Delta Air Lines, United Airlines and American Airlines have already finalized multibillion-dollar labor agreements with pilots this year as unions pushed for pay hikes, better scheduling and other improvements after the Covid pandemic derailed contract talks.

    If a preliminary agreement is approved by Southwest pilots’ union board in the coming weeks, it would then go to pilots for a ratification vote.

    The union and the airline declined to provide specifics of the deal.

    Southwest and the union “are working hard to close out the few remaining items,” an airline spokesman told CNBC. “Southwest remains committed to reaching an agreement that rewards our Pilots and places them competitively in the industry.”

    Southwest reached a preliminary agreement with its flight attendants’ union earlier this fall that includes 36% pay increases for cabin crew members.

    A labor deal with its pilots would end a period of tense negotiations between the company and the union, which recently included laying groundwork for a potential strike, though strikes are extremely rare in the airline industry.

    It would also become the latest in a string of big labor deals this year, including agreements between Hollywood writers, actors and studios as well as between automakers and the United Auto Workers union, following strikes.

    Source link

  • More companies, especially airlines, warn higher costs will eat into profits

    More companies, especially airlines, warn higher costs will eat into profits

    An American Airlines 787 is loaded with cargo at Philadelphia International Airport.

    Leslie Josephs/CNBC

    More companies are warning that a surge in the cost of fuel and employee pay hikes will eat into profits this quarter.

    Companies from aerospace manufacturers to package delivery giant UPS are digesting big new labor deals. Meanwhile, unions from the auto industry to Hollywood are pushing for better compensation. Airlines, whose biggest expenses are jet fuel and labor, are getting hit particularly hard.

    Delta Air Lines on Thursday cut its adjusted earnings forecast for the third quarter to between $1.85 and $2.05 a share, down from an earlier forecast of $2.20 to $2.50. Delta said it is paying more for fuel than it expected but said maintenance costs were also more than it anticipated.

    U.S. jet fuel at major airports averaged $3.42 a gallon as of Tuesday, up 38% from two months ago, according to Airlines for America, an industry group.

    On Wednesday, American Airlines trimmed its earnings forecast, following revisions at Alaska Airlines and Southwest Airlines. American expects to adjusted earnings per share of between 20 cents and 30 cents in the third quarter, down from a previous forecast of as much as 95 cents a share, citing more expensive fuel and a new pilot labor deal.

    The company expects to recognize a $230 million expense for that new contract, which includes immediate 21% raises for pilots, and compensation increasing more than 46% over the duration of the four-year contract, including 401(k) contributions.

    Elsewhere, labor unions from Detroit to Hollywood have pushed hard for raises, better benefits and schedules in new contracts. UPS and the Teamsters union representing about 340,000 workers at the package carrier in July reached a new labor deal that includes raises for both full- and part-time workers, and narrowly avoided a potential strike.

    UPS workers ratified the agreement ratified last month. By the end of the five-year contract, a driver could make $170,000 in pay and benefits, the company said.

    Earlier this week, the delivery giant outlined the costs associated with the deal and said it the expenses from it will increase at 3.3% compound annual growth rate over the next five years.

    “Year one costs more than we originally forecast,” said Brian Newman, the company’s CFO, said on an investor call this week. He said it will cost $500 million more in the back half of 2023 than expected, he said.

    As of midday Thursday, the United Auto Workers and Detroit automakers appeared far apart on labor talks for new labor deals, setting up “likely” strategic strikes at the companies after an 11:59 p.m. ET Thursday deadline, UAW President Shawn Fain said Wednesday night. The union has sought more than 30% hourly pay increases, a reduced 32-hour work week, and other improvements.

    Other unions are also seeking higher compensation. The Hollywood writers and actors strikes began in May and mid-July, respectively, with members demanding better pay to match changing industry dynamics in the entertainment-streaming era.

    American Airlines offered flight attendants 11% pay increases the date a new contract starts, and 2% raises after that. But the Association of Professional Flight Attendants said the union wants 35% increases at the start of a new deal, followed by 6% annual raises.

    Unions have complained that workers didn’t get raises during high inflation in recent years since the Covid pandemic derailed talks.

    Strong travel demand has helped the largest carriers more than cover their higher expenses. But some carriers are seeking cracks in sales just as a slower travel period after summer begins. Spirit Airlines on Wednesday said it expects a deeper loss than previously forecast and lower revenue.

    Frontier Airlines warned Wednesday that “in recent weeks, sales have been trending below historical seasonality patterns,” and forecast an adjusted loss for the quarter.

    – CNBC’s Michael Wayland and Gabriel Cortes contributed to this article.

    Source link

  • Southwest Airlines’ stock slides 6% premarket as airline says revenue has not recovered to prepandemic levels

    Southwest Airlines’ stock slides 6% premarket as airline says revenue has not recovered to prepandemic levels

    Southwest Airlines Co.’s stock
    LUV,
    +2.05%
    tumbled 6% premarket Thursday, after the airline said its revenue has not yet recovered to prepandemic levels and it’s adjusting its 2024 flight schedule to reflect changes to customer patterns. The airline made the comments as it reported second-quarter earnings showing net income of $683 million, or $1.08 a share, for the quarter, down from $760 million, or $1.20 a share, in the year-earlier period. Adjusted per-share earnings came to $1.09, matching the FactSet consensus. Revenue climbed to $7.037 billion from $6.728 billion a year ago, ahead of the $6.997 billion FactSet consensus. Revenue was a record driven by strong demand for leisure travel. “Further, we continue to expect $1.0 billion to $1.5 billion of pre-tax profit contribution in full year 2023 from strategic initiatives outlined at our Investor Day last December,” Chief Executive Bob Jordan said in a statement. “Based on current revenue and cost trends, we expect record operating revenue and a profitable outlook again for third quarter 2023 and continue to expect year-over-year margin expansion for full year 2023.” Still, the airline said its network is largely restored, but not yet optimized.  “We are working to align our network, fleet plans, and staffing to better reflect the current business environment,” he said. The company is now expecting revenue per available seat mile to fall 3% to 7% in the third quarter and for available seat miles to be up 14% to 15% for the full year. The stock has gained 7% in the year to date, while the S&P 500
    SPX,
    -0.02%
    has gained 19%.

    Source link

  • Boeing slips 6% after warning of reduced 737 Max production and deliveries due to parts issue

    Boeing slips 6% after warning of reduced 737 Max production and deliveries due to parts issue

    Boeing 737 Max airplanes sit parked at the company’s production facility on November 18, 2020 in Renton, Washington.

    David Ryder | Getty Images

    Boeing on Thursday warned it will likely have to reduce deliveries of its 737 Max airplane in the near term because of a problem with a part made by supplier Spirit AeroSystems.

    Boeing said its supplier informed the company a “non-standard” manufacturing process was used on two fittings in aft fuselages. It said the issue affects certain 737 Max 8 planes, the company’s most popular model, with customers including American Airlines and Southwest Airlines. It also affects certain 737 Max 7, the 737 8200 and P-8 planes.

    Boeing said the problem was not an “immediate safety of flight issue and the in-service fleet can continue operating safely.”

    Boeing has notified the Federal Aviation Administration of the issue and is working to inspect and address the fuselages as needed, the company said. The FAA said Boeing notified it of the issue and also said there is no immediate safety issue.

    However, the issue will likely affect a significant number of undelivered 737 Max airplanes, both in production and in storage,” the manufacturer said in a statement.

    “We expect lower near-term 737 MAX deliveries while this required work is completed. We regret the impact that this issue will have on affected customers and are in contact with them concerning their delivery schedule,” Boeing said in a statement. “We will provide additional information in the days and weeks ahead as we better understand the delivery impacts.”

    The problem, the most recent in a string of production issues, hits Boeing as it scrambles to increase production and deliveries of its best-selling plane while customers await new jetliners to capitalize on a rebound in travel. 

    Shares of Boeing were down 6% in premarket trading Friday. Shares of Spirit AeroSystems were down roughly 14%.

    Spirit manufacturers some of the fuselages used in Boeing jets and said in a statement it notified Boeing of a “quality issue” with certain 737 models.

    “Spirit is working to develop an inspection and repair for the affected fuselages. We continue to coordinate closely with our customer to resolve this matter and minimize impacts while maintaining our focus on safety,” the company said.

    It’s the latest production problem for Boeing and its customers. Boeing earlier this year paused deliveries of its 787 Dreamliners for several weeks to address a data analysis flaw, and in 2021 and 2022 it struggled with other production flaws on the wide-body jets that halted deliveries for months.

    The company on Tuesday reported March deliveries of 64 planes, the highest tally since December, amid an industry-wide shortage of new jets.

    Airline executives have cited aircraft supply constraints as among the chief challenges in ramping up flying ahead of the peak travel season.

    “We’re aware of the issue and working with Boeing to understand how it may impact our MAX deliveries,” an American Airlines spokesman said in statement.

    Southwest said in a statement that it expects the issue to impact its delivery schedule of new Max planes and that it is discussing the details of that timeline for this year “and beyond.”

    United said it didn’t expect any “significant impact” to its capacity planes for this summer or the rest of 2023.

    — CNBC’s Leslie Josephs and Phil LeBeau contributed to this report.

    Source link

  • Here are Wednesday’s biggest analyst calls: Apple, Tesla, Amazon, SoFi, Target, Goldman Sachs & more

    Here are Wednesday’s biggest analyst calls: Apple, Tesla, Amazon, SoFi, Target, Goldman Sachs & more

    Source link

  • U.S. stocks climb as GDP report shows economy taking Fed’s rate hikes in stride

    U.S. stocks climb as GDP report shows economy taking Fed’s rate hikes in stride

    U.S. stocks opened higher on Thursday as optimism over Tesla’s earnings results and a stronger-than-expected GDP report left investors in a better mood following Wednesday’s intraday selloff.

    How are stocks trading
    • The S&P 500
      SPX,
      +0.40%
      rose by 34 points, or 0.8%, to 4,049.

    • Dow Jones Industrial Average
      DJIA,
      +0.05%
      gained 145 points, or 0.4%, to 33,889.

    • Nasdaq Composite
      COMP,
      +0.89%
      advanced 174 points, or 1.5%, to 11,487.

    The Dow Jones Industrial Average finished Wednesday’s session up 10 points after falling roughly 400 points at the lows earlier in the session. The S&P 500 finished little-changed after erasing its early losses, while the Nasdaq ended lower.

    What’s driving markets

    Stocks opened higher after a flurry of economic data including a fourth quarter GDP report that came in stronger than expected, but the focus was on the latest batch of earnings, which helped to revive investors’ optimism following disappointing guidance from Microsoft Corp.
    MSFT,
    +1.35%
    earlier in the week.

    The economy grew at a robust 2.9% annual pace to close out 2022, according to the first estimate of fourth quarter GDP, released Thursday morning — the latest sign that the U.S. economy is holding up well despite the Federal Reserve’s aggressive interest-rate hikes.

    “Thursday’s GDP report suggests that the economy is relatively strong even in the face of aggressive measures by the Federal Reserve to calm inflation,” said Carol Schleif, chief investment officer, BMO Family Office, in emailed commentary.

    Stocks rose after the data were released as investors found solace in the latest signs that a soft landing for the U.S. economy — a scenario where growth slows, but a recession is avoided — remains possible, or even likely.

    “This is a bit of a relief rally,” said Christopher Zook, chairman and chief investment officer of CAZ Investments.

    However, corporate earnings and guidance are still the primary concern for investors, along with expectations about when the Federal Reserve will cut interest rates, Zook said.

    The labor market also showed signs of strength despite more reports of layoffs in the tech, finance and media spaces, as the number of Americans filing for unemployment benefits fell to their lowest level since April. Investors also digested durable goods orders for December. New home sales for December will be published at 10 a.m. ET.

    Investors also celebrated a surge in Tesla Inc.
    TSLA,
    +9.64%
    shares premarket after the firm released well-received results that showed record quarterly profits.

    Disappointing guidance from technology behemoth Microsoft had clobbered stocks on Wednesday as traders worried it signaled not just difficulties for the sector but also broadly worsening economic conditions.

    However, before the end of Wednesday’s session, Microsoft shares had recovered most of their 4.5% loss and the S&P 500 finished the session almost exactly where it began, according to data from FactSet.

    As for the Federal Reserve, the central bank is expected to slow the pace of interest rate hikes when it next week raises its policy rate by 25 basis points to a range of 4.5% to 4.75%.

    Companies announcing results on Thursday include: McDonald’s
    MCD,
    -0.28%    ,
    Intel
    INTC,
    -0.34%    ,
    Comcast
    CMCSA,
    +0.86%    ,
    Visa
    V,
    +0.15%    ,
    Dow
    DOW,
    -1.16%    ,
    Whirl pool
    WHR,
    -0.91%    ,
    Western Digital
    WDC,
    +3.72%
    and Northrop Grumman
    NOC,
    -0.90%    .

    Companies in focus

    Source link

  • Delta Air Lines sales, profits top estimates in strong finish to 2022

    Delta Air Lines sales, profits top estimates in strong finish to 2022

    Delta Air Lines Airbus A330neo or A330-900 aircraft with neo engine option of the European plane manufacturer, as seen departing from Amsterdam Schiphol AMS EHAM International airport.

    Nicolas Economou | NurPhoto | Getty Images

    Delta Air Lines‘ fourth-quarter profit topped analysts’ expectations, and its revenue grew from three years ago, the latest signs of consumers’ willingness to shell out for air travel.

    The airline generated $13.44 billion in the final three months of 2022, topping the $11.44 billion in sales it brought in three years earlier. High costs ate away at some of Delta’s profits, but its net income still totaled $828 million, down from $1.1 billion in the same three-month period of 2019.

    Delta CEO Ed Bastian said in a news release the carrier “rose to the challenges of 2022, delivering industry-leading operational reliability and financial performance.”

    Here’s how Delta performed in the fourth quarter, compared with Wall Street expectations based on Refinitiv consensus estimates:

    • Adjusted earnings per share: $1.48 vs. $1.33 expected.
    • Adjusted revenue: $12.29 billion, excluding refinery sales, vs. $12.23 billion expected.

    Airlines have largely been upbeat about the fourth quarter, despite concerns about a recession and weakness from some retailers and other businesses. On Thursday, American Airlines hiked its revenue and profit forecast for the period, sparking a broad rally in the sector.

    That was even after severe winter weather disrupted flights coast to coast over the year-end holidays, prompting mass cancellations. Southwest Airlines in particular struggled to recover and said its meltdown could cost it more than $800 million. American and Southwest report on Jan. 26.

    Delta expects to earn 15 cents to 40 cents a share on an adjusted basis in the first quarter of 2023 and for its sales to increase 14% to 17% over the same quarter of 2019. It forecast full-year 2023 earnings of $5 to $6 a share.

    Delta’s shares were down more than 4% in premarket trading.

    This is breaking news. Check back for updates.

    Source link

  • FAA orders airlines to pause departures after system outage

    FAA orders airlines to pause departures after system outage

    Shannon Stapleton | Reuters

    Hundreds of U.S. flights were delayed Wednesday morning after the Federal Aviation Administration suffered an outage of the system that sends messages to pilots.

    The FAA said on its website that domestic departures would be paused until 9:30 a.m. ET. The agency said it was working to restore the Notice to Air Missions System.

    The White House said Transportation Secretary Pete Buttigieg had briefed President Joe Biden on the outage. “There is no evidence of a cyberattack at this point, but the President directed DOT to conduct a full investigation into the causes,” White House press secretary Karine Jean-Pierre said in a tweet.

    More than 1,200 U.S. flights were delayed on Wednesday by 7:25 a.m. ET, according to FlightAware.

    “This technology issue is causing significant operational delays across the National Airspace System,” said Airlines for America, an industry group that represents major U.S. carriers, including Delta, American, United, Southwest and others.

    Austin-Bergstrom International Airport in Texas said in a tweet that arriving and departing passengers should expect delays throughout the day.

    This is breaking news. Please check back for updates.

    Source link