unaligned

Southwest lost $159m in Q1 as the financial impact of its holiday meltdown stretched well into 2023. The carrier canceled more than 16,000 flights in the final days of December when staffing software couldn’t keep pace with scheduling changes during coast-to-coast storms. The incident resulted in a $325 million revenue impact for Q1, Southwest said. The company had warned of a loss for the quarter in January and said it logged an increase in customer cancellations early this year. Southwest shares were down more than 3% in afternoon trading after releasing results. Here’s how Southwest performed in the first quarter, compared with Wall Street expectations according to Refinitiv consensus estimates: Adjusted loss per share: 27 cents vs an expected loss of 23 cents; Total revenue: $5.71 billion vs an expected $5.73b. Revenue rose more than 21% from a year ago to $5.71b. Southwest’s net loss for the period of $159m is likewise an improvement over the same period last year, when it lost $278m. The Dallas-based carrier said it expects revenue headwinds into the second quarter but said it expects a profit for the three months ending June 30. Revenue per available seat mile is expected to be down 8% to 11% in Q2 from last year, with capacity up 14%, Southwest said. The carrier said its sales outlook was impacted by about $300m “breakage revenue” because of a “higher-than-normal amount related to flight credits issued during the pandemic that were set to expire unused.” Southwest said it eliminated expiration dates on flight credits last summer.<br/>

Southwest Airlines is reducing its hiring targets for this year because of delays in new aircraft from Boeing, the carrier’s CEO Bob Jordan said Thursday. The Dallas-based airline expects to receive just 70 new 737 Max planes from Boeing this year, down from a previous forecast of 90, which will reduce its capacity growth plans by one percentage point, Southwest said in quarterly filing. Southwest is one of Boeing’s best customers and operates a fleet of all 737s. It has orders for 564 Boeing 737 Max planes through the end of the decade, according to the quarterly report. Those aircraft are more fuel-efficient and will both replace older jets and help the company grow. Jordan said following its quarterly report that the company planned to add a net 7,000 people to its staff this year, but will now have to “moderate” its targets. The company didn’t respond to a request to elaborate on how much it will need to reduce its hiring plans. Jordan said the company is trying to be “prudent” about its expectations for deliveries, which have repeatedly been delayed. “You plan way in advance to set your schedules, to set your capacity, and you’re wrong. It’s just really difficult to change that close in,” Jordan said. The carrier plans to reduce flight plans in the last few months of the year because of the delays, COO Andrew Watterson said on the quarterly call on Thursday.<br/>

Southwest Airlines is ready to move on from the technology meltdown that upended operations back in December. That doesn’t mean its reputation has recovered. “There is definitely work to do to get confidence in Southwest back to where it was pre-pandemic,” Chief Executive Officer Bob Jordan said in an interview Thursday after the carrier reported first-quarter results. “We’re focused on that every single day.” The carrier was blasted by passengers, lawmakers and regulators over the late-year chaos, when its systems were overwhelmed by a winter storm, forcing the cancellation of more than 16,000 flights during the crucial holiday period. Southwest on Thursday said it faced a $380m hit in the quarter in part because customers rebooked their travel with other airlines in January and February. The company has since completed nearly all reimbursements to affected travelers and it’s strengthening its focus on ensuring on-time operations, Jordan said. As to whether passengers are avoiding Southwest, the CEO said that was no longer the case by March. While the company missed Wall Street’s profit expectations, it reported record revenue for the first quarter and sees strong demand going forward. “I do hear anecdotes” about customers pledging not to fly Southwest, Jordan said. “It doesn’t show up in the results.”<br/>

Wizz Air Holdings Plc said expansion into India will become possible with its new long-range Airbus SE A321 models, potentially opening up a lucrative vein of future growth as demand for air travel surges in the world’s most populous nation. “There’s great potential in India, as the country has seen an immense development,” Wizz CEO Jozsef Varadi said in an interview in Budapest today. “I think it may help Europe tackle its employment issues, while its emerging middle class will boost tourism. We’re looking into opportunities there, but this is more a medium-term issue.” Wizz Air has 47 of the long-range Airbus A321 XLR on order, with deliveries set to start sometime in 2024. The aircraft will allow the budget carrier to expand its operating parameter further east to markets including the Middle East, where Varadi said there’s also greater demand. Varadi said the low-cost airline has seen growth in all its key markets, including western Europe as well as the eastern part of the European Union and the Middle-East. Predicting a busy summer and return to higher capacity, the CEO said he doesn’t expect a slump into the latter part of the year during the seasonal downturn. Business travel is also rebounding as conferences pick up again and people resume face-to-face meetings after the pandemic. One of the factors holding back Wizz is a “slight lag” in Airbus deliveries, Varadi said. The European planemaker has struggled with output, a combination of parts shortages and a lack of skilled workers. Airbus CEO Guillaume Faury said this week that supply-chain snags may extend into next year, while he’s confident he can maintain the company’s annual delivery goal of 720 jets. <br/>

Britain's Jet2 said it has invested in a Sustainable Aviation Fuel (SAF) production plant in northern England, as airlines jostle to secure supplies of the green fuel ahead of 2030 targets. The low-cost carrier said on Thursday that it was making a "major investment" in the Fulcrum NorthPoint facility, being developed by Fulcrum BioEnergy, but declined to give figures. Production is expected to start in 2027, the company added. Airlines across the world are pinning their hopes on SAF, which uses waste such as cooking oils to reduce emissions by up to 80% compared to fossil fuels, to decarbonise flying before new electric and hydrogen-powered options expected in 2035. The EU announced binding SAF targets for European airlines on Wednesday, while Britain has said it will introduce a SAF mandate in 2025 requiring at least 10% of jet fuel to be sustainable by 2030. Britain's Department for Transport has offered support in the form of GBP165m in grants to help companies constructing SAF plants. "We continue to engage extensively with industry leaders regarding any barriers to investment in sustainable aviation fuels," it told Reuters. But airlines and SAF producers want the government to do more and faster. "The big message is we just need to do this more quickly," said Jonathon Counsell, group head of sustainability at IAG, the owner of British Airways.<br/>

Saudi Arabia’s sovereign wealth fund is in talks to buy a stake in Flynas, a low-cost carrier that’s a key pillar of the kingdom’s attempts to bolster its tourism sector, according to people familiar with the matter. Goldman Sachs Group is advising shareholders on the potential sale to the Public Investment Fund, the people said, asking not to be identified as the information isn’t public. The airline is partly owned by Prince Alwaleed Bin Talal’s Kingdom Holding Co., in which PIF bought a 17% stake last year. Flynas had also been planning a potential listing, the people said, though this might be delayed if the stake sale to PIF goes ahead. The carrier has been weighing an IPO since 2008 and in 2018 hired Morgan Stanley, Citigroup Inc. and NCB Capital for a potential deal, Bloomberg News reported. Flynas, Goldman Sachs and PIF declined to comment. Representatives for Kingdom Holding weren’t immediately available for comment. Saudi Arabia has been pumping money into the aviation industry to make the country a top tourism destination as it diversifies away from fossil fuels. As part of these efforts, Flynas is establishing local units in two more countries and expanding its existing jet orders with the aim of becoming the Middle East’s biggest low-cost airline and one of the five largest globally. Saudi Arabia is also setting up an airline and building a new airport in the capital, both of which will be owned by PIF. <br/>

Taiwan’s Starlux Airlines, which bills itself as a high-end carrier, plans to launch new US routes once a year as part of a major push into long-haul travel, company executives said. The Taipei-based company, one of a handful of airlines to launch during Covid, celebrated its first intercontinental flight, from Taiwan to Los Angeles, on Wednesday. With some rival legacy Asian carriers still recovering from the pandemic, there’s a gap for new entrants to grab market share. “We are fairly confident that we can expand our North American network by opening at least one new route every year in the next couple of years,” Starlux Chairman Chang Kuo-wei said. Chang, a qualified commercial pilot, flew and landed the Starlux Airbus SE A350 earlier that day. Chief Strategy Officer Simon Liu said Starlux expects to launch flights to and from San Francisco before Christmas. Liu also sought to play down delays in Airbus deliveries. Although Starlux is wholly reliant on the European planemaker for its jet orders, Liu said the issue was “not really serious.” Chang, a former Eva Air Corp. executive, left Eva in 2016 and went on to launch Starlux, which is Taiwan’s third airline in a crowded marketplace, in 2020 just as Covid was spreading.<br/>