A surge of no-frills seats at the biggest US carriers potentially will backfire as passengers discover all the perks they’re giving up, said the CE of discounter Spirit Airlines. Prohibitions on changing a reservation or bringing a roll-on bag may disappoint some customers of the new fares at American Airlines and United Continental, Spirit CE Bob Fornaro said Wednesday. While Spirit charges for carry-ons and even soft drinks, at least customers know what they’re getting, he said. American and United started selling so-called basic economy fares on certain routes this week, stepping up efforts to win back customers siphoned off by Spirit and Frontier Airlines. “A lot of their best customers can be the most upset,” Fornaro said. “It’s not a brand new product, it’s a pricing scheme.” <br/>
unaligned
Billionaire Warren Buffett’s purchase of a massive stake in the 4 largest US airlines — including Southwest (LUV) and American — may be more than a change of heart about an industry he has historically and famously berated. It may a first step in a major airline takeover in a major airline takeover, according to market rumblings and Morgan Stanley analysts. “We view a full-scale acquisition of an airline by Berkshire as a possibility and not worth dismissing, particularly if the stocks weaken,” Morgan Stanley analysts said in a note to clients Wednesday. Southwest is the leading candidate for a buyout, the Morgan Stanley analysts wrote. “Of the Big 4, we highlight LUV’s domestic focus, robust and sustainable FCF (free cash flow), range of growth opportunities, defensible cost structure, and more tenured management team". <br/>
India’s new regional carrier Zoom Air, has launched Bombardier CRJ200 regional jet service with aircraft acquired from a third party. The carrier operates from the Indira Gandhi International in New Delhi and will serve 16 destinations, connecting smaller cities and towns across the country. Zoom Air was established in 2013 under the brand name Zexus Air and took delivery of its first CRJ200 in Sept 2016. The carrier began operations Feb 15 with Delhi-Kolkata-Durgapur services. “The CRJ200 aircraft greatly complement our business model and will help our growth strategy, while providing excellent operational flexibility and passenger comfort,” Zoom Air CE and director Koustav Dhar said, adding the aircraft will allow the new airline to access new routes and destinations that are currently underserved. <br/>
Rapidly expanding Eurowings has phased out its last Bombardier CRJ900, becoming an all-Airbus operator and closing its history as a regional carrier. Eurowings operated its last 90-seat CRJ900 flight Feb 15. All 23 CRJ900s have all been replaced with Airbus A320s. The LCC has operated all versions of the CRJ regional jets. Together, all its CRJs operated 560,400 flying hours without any accidents. “Eurowings is growing faster than the [European aviation] market itself,” Eurowings MD Michael Knitter said recently. “Not only with more aircraft, but also by exchanging our 90-seat Bombardier regional jets with 180-seat A320s.” Lufthansa established Eurowings as a pan-European LCC platform, which should grow quickly to 100 aircraft as competition from LCCs increase to a 50% market share in Europe. <br/>
Thai AirAsia (TAA) has bolstered its leadership in Thailand's domestic air travel business with a further gain in market share last year. TAA increased its share of total domestic passenger traffic to 29.5% last year, up from 28.5% the previous year, to reflect its aggressive expansion. Arch rival Nok Air ranked second, with its market share slipping to 20.3% from 24.8% in 2015 as the airline experienced market turbulence. The most critical event for Nok Air was a pilot shortage, triggered by the February exodus of pilots after a bitter organisational dispute that led to a mass cancellation of flights and dented the carrier's reputation. Thai Lion Air increased its share to 18.7% from 13.9% as the carrier strengthened its position, according to combined figures from AoT. THAI Smile, increased its share to 10.5% from 8.7%. <br/>
Norwegian Air International has added a third US airport to serve the Irish flights that it plans to announce Thursday. The airline is due to give details of its proposed low-cost transatlantic services from Ireland at a launch in Cork Airport after winning approval from the US govt and aviation regulator. According to reports, it has also won approval to fly to Bradley International in Connecticut. The airline is already known to have lined up 2 other US airports, Stewart in New York state and TF Green in Providence Rhode Island. Norwegian will fly 12 times a week from Dublin Airport from next summer, serving both Stewart, which is about 90km from New York, and Providence, which is a similar distance from Boston. Cork will have 3 flights to Providence, but could get further services to Stewart at some point in the future. <br/>
India’s airlines have ordered about 850 planes valued at about US$85b in recent years. SpiceJet says that’s still not enough to meet demand. SpiceJet, which last month ordered as many as 205 Boeing jets worth $22b, is being rather conservative with its purchases, the carrier’s chairman Ajay Singh said Wednesday. Demand will surge with more Indians starting to fly, fuelled by economic growth in smaller towns, he said. “With all the orders that all the Indian airlines have placed, counting for replacements, we will have 800 planes in 10 years from now,” Singh said. “That’s not a lot of planes. That’s the same number of planes that Southwest Airlines has today.” India is among battlegrounds in emerging markets for planemakers as a rising middle class flies for the first time. <br/>