JetBlue Airways pilots voted to reject a tentative agreement that would have given the airline contractual relief to implement its planned partnership with American Airlines Group, their union said Tuesday. New York-based budget carrier JetBlue and international major American Airlines announced plans for a strategic tie-up in July to give them more muscle in the US Northeast as the industry plots its recovery from the coronavirus pandemic. For any agreement to proceed, the Air Line Pilots Association (ALPA) representing JetBlue pilots said management must provide assurances over job safety. “Job security, especially during turbulent points in our industry, is a main concern of every pilot,” Chris Kenney, chairman of the JetBlue unit of ALPA, said. “We are disappointed in the results of the vote,” a JetBlue spokesman said, noting the company and ALPA had worked together on the tentative agreement. “We are committed to our alliance with American Airlines and plan to move forward so we can deliver its benefits to both crewmembers and customers,” he said.<br/>
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JetBlue plans to strategically cut its basic economy fares to better compete with ultra low-cost carriers in key markets while boosting the benefits of standard and premium tickets by guaranteeing overhead bin space and eliminating change fees. The move, announced on Tuesday, is the latest example of airlines’ efforts to expand ticket options and flexibility in an industry upended by the coronavirus pandemic. Ultra low-cost carriers grew nearly 90% in JetBlue’s markets in the three years before the pandemic and have continued to fly a significant amount of capacity over the past year. One competitor carrier overlapped with nearly half of JetBlue’s US and international routes, and around 80% in places like Fort Lauderdale and Orlando, Florida before the pandemic, the company said. “We recognize that we’re competing in a very fragmented marketplace,” JetBlue President Joanna Geraghty said. “When you look at certain customers who purchase almost entirely on price, we want to make sure that we are squarely in their decision set.”<br/>
El Al said Tuesday it raised 250m shekels ($77m) in a sale of options on the Tel Aviv Stock Exchange, meeting a key condition for a state-backed loan needed to repay the flag carrier’s debts. The airline said some $50m came from controlling shareholder Eli Rozenberg, a 27-year-old student who bought the cash-strapped carrier in October, and $27m from institutional investors. El Al has reported losses for two years and racked up debt to renew its fleet. It suspended scheduled passenger flights last March at the outset of the coronavirus outbreak when Israel closed its borders to foreign citizens. <br/>
Southwest Tuesday forecast slower cash burn in the current quarter as leisure bookings and demand improve in February. The US budget carrier said it expects average core cash burn to be about $15m a day in Q1, compared with the $17m it estimated previously, sending its shares up more than 2% in trading before the bell. Southwest, however, said business travel demand and bookings remained depressed. US airlines expect demand to improve this year as vaccines become more widely distributed but have warned that the strength of any rebound will depend on the pace of vaccine rollouts and the easing of travel restrictions. So far, the US vaccine roll-out has been patchy and many European countries are discouraging travel and implementing more travel curbs to contain the spread of new infections.<br/>
Irish airline group ASL Aviation Holdings has ordered another 10 737-800 Boeing Converted Freighters (BCFs), bringing to 21 the number of those jets it intends to acquire. The orders are conversions of previously held options. ASL, based near Dublin, took those options alongside a firm order for 10 737-800BCFs that it placed at the Paris air show in 2019. The company subsequently committed to receiving one other 737-800BCF, bringing to 21 its total commitments for the modified freighter, it says. Deliveries of the 737s to ASL will run “up to 2023”. With the deal, Boeing holds orders and order commitments to sell more than 150 737-800BCFs, the airframer says.<br/>
Ryanair's fight against state aid for airlines will put loosened EU rules to the test on Wednesday when the bloc's second-highest court decides on support offered to Air France and SAS. Under EC state aid rules loosened since the start of the pandemic, EU countries have offered more than E3t in aid to companies in various sectors across the 27-member bloc. In its first judgments on those rules, the Luxembourg-based General Court will assess a French scheme allowing airlines to defer certain aeronautical taxes. It will also rule on Sweden's loan guarantee scheme for airlines. Ryanair has filed 16 lawsuits against the Commission, both against state aid to individual airlines such as Lufthansa, KLM, Austrian Airlines and TAP, as well as against national schemes that mainly benefit airlines. Ryanair in its filings to the court faulted EU competition enforcers by allowing EU countries to grant aid only to airlines with EU operating licences issued by their countries. EU flag carriers generally need only one operating licence from their home country to operate across the bloc. Ryanair said the Commission also erred in assessing the proportionality of the aid to the damage caused by the pandemic.<br/>
IndiGo CE Ronojoy Dutta expects significant growth to come from India’s smaller cities and regional towns. Dutta notes that airline profitability in India was formerly driven by major routes between key cities, such as Mumbai-Delhi, or Delhi-Bangalore. As a proportion of profitability, however, secondary routes between smaller cities are becoming more important. “Given the way the Indian market is growing, regional cities are very strong,” he says. Dutta has particularly high marks for New Delhi’s Udan Regional Connectivity Scheme (RCS), which aims to bring connectivity to small towns throughout India. On 11 February, IndiGo said it would add 22 flights to regional cities, including a new Agartala-Aizawl route under the RCS. Both cities are in India’s far northeast. Agartala has a population of 438,000, while Aizawl has around 300,000. Other regional routes launched on the 11th included Bhubaneswar-Patna, Jaipur-Vadodara, Chennai-Vadodara, Bengaluru-Shirdi, Patna-Kochi, and Rajahmundry-Tirupati. Dutta says starting services to small towns can be a risky proposition for airlines, but government subsidies for the first two years of service greatly de-risk the decision for airlines.<br/>
South Korea’s budget air carriers sank deeper in the red as they were forced to idle international flights and sell domestic tickets at dirt-cheap price to survive the Covid-19 pandemic. Jeju Air disclosed on Monday 114.6b won ($104.24m) in consolidated operating loss for Q4 2020, widened from 70.1b won losses three months ago and 45.1b won a year earlier. The loss was 64.4% larger than the market consensus compiled by Seoul-based financial data provider Yonhap Infomax. Net loss also expanded 32.7% on quarter to 45b won over sales of 52.2b won, down 12.4% on quarter and 83.1% on year. Jin Air, a budget carrier under Korean Air Line, posted a consolidated operating loss of 184.7b won in 2020, up 278% against a year ago on sales of 271.8b won, down 70.1% over the same period. Asiana Airline’s smaller carrier Air Busan’s operating loss totaled 196.9b won on sales of 189.4b won, down 70.1% on year. T`way Air, which will release its earnings report this Friday, is projected to have logged an operating loss of 130b won in 2020.<br/>