In the nearly four years since the Covid-19 pandemic upended air travel, the largest US airlines have returned to profitability. The CEOs of two upstart airlines that launched in the middle of the pandemic say they’re about to join them. Avelo and Breeze Airways, two low-cost carriers that debuted in 2021 when US air travel demand was more than 30% below pre-pandemic levels, have both grown their operations rapidly. They’ve launched dozens of new routes across the country, and their founders say their strategy of linking cities where there’s less competition from large carriers is paying off. Think Los Angeles’ Hollywood Burbank Airport, rather than Los Angeles International, or Islip, Long Island, over New York City. “When you have Goliaths, and you’re just David, it’s really hard,” said Avelo Airlines CEO Andrew Levy. Delta, American, United and Southwest together control about three-quarters of the US market, according to Cirium data. Avelo says it flew 2.3m customers in 2023, and that its planes were more than 80% full on average. Breeze flew more than 2.8m travelers last year, and its flights were 77% full, according to the company. The carriers are still tiny. For comparison, Southwest Airlines, the largest domestic carrier, flew more than 137m passengers last year. Yet, Avelo reported its first profitable quarter in the last three months of 2023, and a company spokesperson said the airline will likely turn an annual profit in 2024. It brought in revenue of $265m for the full year 2023, up 74% from the prior year. Levy said he had expected the airline to turn a profit sooner, but high fuel costs during a period of broad inflation and Russia’s invasion of Ukraine two years ago pushed back the timeline. Breeze is also on track for its first profitable year in 2024, said CEO David Neeleman. Story has more.<br/>
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Ryanair Holdings said it will only receive 40 Boeing Co. Max jets before the end of June rather than the 57 unites originally anticipated, forcing the airline to reduce flight frequencies across its network as its sole aircraft provider grapples with manufacturing issues. As a result of the delays, the carrier’s annual passenger forecast will drop to just under 200m, compared with a previous goal of 205m for the fiscal full year ending March 2025, according to a statement on Friday. Ryanair has already put some cutbacks in place such as Dublin, Milan Malpensa and Warsaw Modlin, which CEO Michael O’Leary said are higher-cost airports. The CEO said Boeing management continues to have his “wholehearted” support. Boeing was thrown into turmoil in early January after a panel on a 737 Max 9 jet operated by Alaska Airlines blew off shortly after takeoff. The incident forced Boeing to slow its output as regulators review quality controls and customers scrutinize the planemaker. Even before the incident, Boeing had trouble sticking to delivery schedules agreed with Ryanair. “We are very disappointed at these latest Boeing delivery delays,” the Irish budget carrier said in the release. Ryanair will work with Boeing to take deliveries from July to September, but the airline said it won’t be able to sell seats on these aircraft this summer because of the uncertainty around the delays. The company cautioned that the shortfalls in deliveries, coupled with the grounding of some Airbus SE aircraft because of engine maintenance issues, will result in “slightly higher air fares” across Europe during the peak summer period.<br/>
Aer Lingus should offer pilots a “meaningful pay increase” after confirming that it earned E225m profit last year, the pilots’ union said on Friday. The carrier reported that profits grew 400% last year to E225m, but Luis Gallego, CE of its owner International Airlines Group (IAG), warned that it would stall investment in the Irish company until a pay row with pilots was resolved. Responding to the comments, first officer Daniel Langan, vice-president of finance of the Irish Air Line Pilots’ Association (Ialpa), said it was “incumbent on Aer Lingus management to offer a meaningful pay increase to its pilots” that reflected inflation and its strong financial performance. Ialpa welcomed the growth and profits that Aer Lingus announced on Thursday, Langan added, and was committed to aiding management in expanding the business.<br/>
South Korean low-cost operators Jeju Air and T’way Air swung to their first annual profit since the Covid-19 pandemic, helped by strong demand on Japan and Southeast Asia operations. Both carriers also reported record revenues for the year to 31 December 2023, as efforts to diversify operations – Jeju Air with an increased focus on cargo and T’way with medium- to long-haul operations – pay off. Jeju Air reported a full-year operating profit of W170b ($128m), compared to the W178b loss in the year-ago period. The figure is its highest-ever operating profit in its 18-year history, and about 68% higher than its previous record profit in 2017. Full-year revenue stood at W1.72t – more than double than 2022 – as passenger travel demand remained robust through the year. The airline introduced two new aircraft in the final quarter of 2023, helping boost capacity through the year-end peak travel period. Jeju also notes a steady increase in cargo revenue, with the introduction of dedicated freighters to its fleet. The airline’s fledgling cargo business now has two 737 freighters in it fleet, and is hoping to grow its cargo operations in the near term. As for T’way, it recorded an annual operating profit of W138b, swinging from the W105b loss in 2022. T’way saw its revenue for the year more than double to W1.35t, amid “rapid increase in demand” for its short-haul operations to Japan and Southeast Asia. The airline also notes demand for medium-haul flights - to Sydney and Singapore - is growing. <br/>