unaligned

Ultra-low-cost carrier Frontier Airlines plans to cut a third of its passenger capacity to a pair of its core leisure destinations – Las Vegas and Orlando – by summertime in the USA. “To be clear, we’re not retreating from our network footprint in either market,” CE Barry Biffle said during Frontier Group Holdings’ quarterly earnings call on 6 February. “We’re merely cutting what we believe is marginal, unprofitable flying.” Frontier’s decision to cut flights to bread-and-butter US cities comes amid heightened competition in the North American low-cost segment, with Frontier, Spirit Airlines, Sun Country Airlines, Breeze Airways and Avelo Airlines all jostling for market share with major US carriers. “One of the largest challenges many low-cost and ultra-low-cost carriers faced in 2023 was the industry’s oversupply of capacity in leisure markets, with Las Vegas and Orlando being two significant examples,” Biffle says. “Both markets have experienced rapid and disproportionate growth compared to 2019, when demand and capacity were far more balanced.” Airlines are scheduled to keep increasing passenger flying to both cities throughout this year, Biffle says, cutting into profit margins for low-cost carriers that specialise in service to vacation destinations. As a result, Frontier will focus its network growth on “exploiting higher-fare, visiting-friends-and-relatives markets” in the year ahead, he says: ”No one’s more aggressive and engaging in self-help to address overcapacity in leisure markets.” Frontier is planning to cut its summertime schedule to Las Vegas and Orlando, with the intention of allocating passenger capacity elsewhere Denver-based Frontier previously described struggling in its core markets during Q3 of last year, especially outside of peak travel periods. However, the carrier successfully operated its busiest-ever winter holiday travel period, with 15% more departures during peak December and January times than the prior-year period. “While I’m pleased with the operational performance,” Biffle says, ”I’m disappointed in the absolute result.”<br/>

Westjet has announced its return to the P.E.I. market, with the airline saying it will offer direct flights between Charlottetown and three Canadian cities this summer: Toronto, Calgary and Edmonton. The flights to and from Toronto's Pearson Airport will begin May 17 and will operate every Monday, Friday and Saturday until Oct. 17. The airline announced on Tuesday it will also offer six weekly non-stop Alberta flights — four to Calgary and two to Edmonton. Calgary flights start May 18, while Edmonton resumes on June 12. WestJet said in July 2022 that it would not offer any winter flights to and from Charlottetown that winter, and then did not resume the Toronto flights for the summer season either. The airline's discount operator Swoop did fly from Charlottetown to Toronto and Hamilton. The news comes following a record year for passenger travel at Charlottetown Airport, and 2024 is shaping up to be another strong year.<br/>

EU competition regulators opened an in-depth investigation on Monday into French airline Corsair's revised restructuring plan and whether this can restore its long-term viability with limited distortions to competition.<br/>France last year sought EU approval to change a restructuring plan approved by the European Commission in 2020 for the pandemic-hit carrier, saying that exceptional unforeseeable external events had a particularly unfavourable impact on Corsair. The investigation will also examine whether Corsair's own or market's contributions to the restructuring costs are sufficient and free of any aid and if the state aid is proportionate and that France gets the right remuneration for subsidies, the Commission said. Based at Paris-Orly airport, Corsair services the French outermost regions of the Caribbean, including Martinique and Guadeloupe, and Africa.<br/>

Kuwaiti carrier Jazeera Airways’ full-year net profit fell by nearly 70% to KD6.2m ($20.1m), as it experienced a substantial decline in yield. Jazeera Airways’ revenues to the end of 2023 reached KD198m – a rise of 8.8%. But the budget airline says a “sudden and large influx of capacity” from Gulf airlines has exerted pressure on ticket prices “across the board” and resulted in a “large drop” in yield – some 20% in Q4 and 17% over the year. Jazeera made a net loss of KD7.1m in Q4, much deeper than the KD683,000 in the same period of 2022. But the airline is maintaining a “positive outlook” for the current year, as it implements cost-cutting initiatives including renegotiation of several service contracts. Jazeera took delivery of four A320s over the second half of last year, giving it a fleet of 23 aircraft. The carrier had to wet-lease two aircraft last summer to compensate for delivery delays, but it will expand its fleet to 24 by the end of Q1 and has “no plan” to pursue wet-leasing for summer 2024. Chair Marwan Boodai says the airline’s performance last year was influenced by overcapacity and a “challenging regulatory, geopolitical and regional landscape”. But he points out that the carrier remained profitable, while higher loads – reaching 78.2% – and a greater market share put it in a “strong position”. Jazeera aims to increase its fleet to 35 over the next five years, and broaden its network to over 100 destinations compared with the 64 it served last year. It is also looking to raise its average load factor above 80% within three years.<br/>

South Korean lawmakers have passed a bill mandating the country’s airlines to report their annual carbon emissions, as part of efforts to comply with global standards, and to “systematically” manage CO2 output. The bill, passed on 1 February, covers all operators which own at least one aircraft with a maximum take-off weight of 5.7t or above, or operators whose carbon emissions exceed 10,000t per year, states the Ministry of Land, Infrastructure and Transport (MOLIT). Under the ‘International Aviation Carbon Act’, airlines will submit their annual carbon emissions to the ministry, which will then calculate the amount of carbon offsets which the carrier will have to purchase. MOLIT adds that the legislation will help compliance with ICAO’s market-based CORSIA carbon-offset and reduction scheme. The bill will also see penalties meted out on airlines who fail to maintain or cut back on their emissions, as well as to those found to have falsified emissions data. “By establishing a legal foundation for systematically offsetting and reducing… carbon emissions through the enactment of the International Aviation Carbon Act, we will be able to actively respond to international environmental regulations and promote policies for [net-zero emissions in 2050],” the ministry states. <br/>

Korea's top low-cost carrier Jeju Air said Tuesday it swung to a net profit in 2023 on the back of a post-pandemic recovery in travel demand. Net profit came to 130.8b won ($98m) last year, a turnaround from a net loss of 173.9b won the previous year, the company said in a regulatory filing. Sales spiked 145.4% year-on-year to 1.72t won, with operating profit reaching 169.8b won, compared with a 177.5b won operating loss a year earlier. Jeju Air said its 2023 top line and earnings hit all-time highs since the company was founded in 2006. The budget carrier attributed its stellar performance to its strategy of preemptively securing short- to mid-haul flight routes to respond to pent-up travel demand following the lifting of most COVID-19 restrictions. Last year, the company ranked No. 1 in terms of air traffic among flag carriers connecting Korea to Japan, Guam, Saipan and the Philippines, according to data compiled by the transport ministry.<br/>