Alaska Airlines is speeding up its transition to an all-Boeing fleet with new plans to retire the Airbus A321neo aircraft it inherited from Virgin America early. And in unexpected news, the Seattle-based carrier will also retire the De Havilland Dash 8-400s in favor of an all-Embraer E175 regional fleet. Alaska will operate a fleet of 323 737s and E175s by the end of 2023, and plans to grow to 400 aircraft by the middle of the decade. The airline said the fleet simplification will help drive down costs and streamline maintenance. “The quicker we could get to a single fleet, the better,” CFO Shane Tackett said earlier this month. He added that a simplified fleet could help realize $50-70m in annual costs savings. “One fleet is way simpler than two fleets to operate,” he said. The carrier also will benefit from staffing simplicity, with no need for reserve Airbus crews. Alaska has long made clear it wanted to get rid of the 71 Airbus aircraft it gained through its 2016 acquisition of Virgin America. It removed the 31 A319s and A320s during the pandemic, and has replaced them with new Boeing 737-9s that began arriving last January. The airline will return the remaining 30 A320s it inherited from Virgin America by early 2023 at the latest. Alaska cancelled its longstanding order for 30 A320neos finally late last year. The fate of the 10 A321neos has long been unclear. For a time, Alaska said it valued the range and capability of the A321 for certain missions, for example on flights between the West Coast and slot-constrained airports like Washington National. But it recently changed course. “I would not be surprised if we found a home for those [A321s] before the lease expiry,” Tackett said earlier in March.<br/>
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Alaska Airlines is turning two of its midlife Boeing 737-800s into cargo planes, a bet that the pandemic boom in air freight will continue to generate revenue even after more passengers return to travel. The Seattle-based airline, the country’s fifth-largest, already has three smaller Boeing 737-700s dedicated solely to air freight. It’s a small number for a carrier whose mainline fleet stood at 217 planes at the end of 2021, but the pandemic has made cargo more important to airlines. Covid forced passenger carriers to cut flights, reducing belly space in planes around the world that would normally carry everything from live animals, packages, produce and pharmaceuticals. That drove up demand — and prices — for air cargo. Alaska has put out a request for proposals to convert the two planes to air cargo and hasn’t yet settled on a supplier. The increase in its cargo fleet could extend beyond the two planes, but it hasn’t yet committed to adding more. “I don’t think the magic number is two,” said Adam Drouhard, the airline’s managing director of cargo. The new planes will be dedicated to serving destinations in the state of Alaska. Companies including Boeing have been adding capacity to convert more passenger jets to cargo planes to capitalize on the trend. Cargo analyst Stephen Fortune said the conversion of a passenger jet into a freighter, which entails ripping out passenger seats and overhead bins, reinforcing the plane’s floor, and cutting a cargo door for easier loading, can cost around $5m.<br/>
Southwest on Thursday unveiled its new fare class: a second-cheapest option it hopes will reel in customers willing to pay up for more flexibility. The “Wanna Get Away Plus” fare sits just above the “Wanna Get Away” fare and just below its “Anytime” fare. It will allow travelers to make same-day changes to their tickets without paying the difference in fare that the lowest tier requires. Customers who opt for the new fare, or classes above the new fare will also earn more frequent flyer miles than the lowest tier, and be able to transfer flight credits to another RapidRewards member, a new feature. Southwest passengers will continue to get to check two bags for free. The new fare type is the latest effort by an airline to increase revenue after two bruising years of the Covid pandemic. Carriers like Delta, American, United and JetBlue in recent years have rolled out no-frills basic economy tickets, which don’t include perks that used to come for free, such as advanced seat selection. Airline executives haven’t been shy that they hope passengers will pay more to avoid those cheap fares, while many business travelers’ employers avoid them altogether because they are so inflexible. Southwest’s new fare goes on sale in Q2. The Dallas-based airline announced last year that it would launch a new type of fare but didn’t provide details. Air travel demand, particularly for domestic leisure trips, and higher fuel prices are already pushing up fares. <br/>
Low-cost carrier Cebu Pacific widened its full-year operating loss for 2021, led by a drop in passenger revenues as travel demand collapsed amid the pandemic. For the full year, the airline reported a operating loss of Ps23.2b ($444m), compared to the Ps20.8b loss it made in 2020. The airline blamed the resurgence of new coronavirus variants - and resulting lockdowns - for a decline passenger revenues, which fell 50% year on year to Ps6.3b. Cargo “continued to flourish” amid robust demand, with the airline reporting an uptick of 20% in takings to Ps6.5b. Full-year costs fell 10% to Ps39b, as the airline reduced flying around the middle of the year during a surge of Delta variant infections. These were “supplemented by the various cost cutting initiatives undertaken such as right-sizing of its network, fleet, and manpower”. Cebu Pacific widened its net loss in 2021, at nearly Ps25bi compared to Ps22.2b in 2020. The carrier is optimistic in its outlook for 2022, noting that forward bookings “steeply increasing” in the months ahead. The Philippines fully reopened its borders to vaccinated travellers in February, a move that is expected to provide a boost to the country’s aviation and tourism sectors. Cebu Pacific says it expects domestic capacity to hit pre-pandemic levels by the second quarter of the year.<br/>