Issue No. 907

A New Old WestJet

Canada's Second Airline Executes a Turnaround Plan

Pushing Back: Inside the Issue

First quarter earnings season picks up this week, but not before two major U.S. airlines reported their results last week. United delivered the disappointing first quarter loss it forewarned investors about, attributing it to a new normal of weak business travel during January and February. Offpeak periods, in other words, seem to have become even weaker than before. “We didn’t really appreciate fully the seasonality shift.”

But don’t despair, United reassures. Because peak periods appear to be even stronger. The Chicago-based airline added that overall demand remains rock solid, led by extremely robust longhaul international trends. That should favor an intercontinental-heavy airline like United, especially given steep capacity cuts by foreign rivals flying to the U.S. That’s United’s thesis anyway — that going forward, fortune will favor the longhaul. And that, it hopes, will compensate for a more challenging and costly post-pandemic operating environment.

Like United, Alaska suffered a first quarter loss, tainted by an even weaker-than-normal January and February. Also like United, the Seattle-based carrier is seeing ongoing demand strength while watching closely for signs of further macroeconomic stress. The U.S. economy, to be clear, is feeling the pinch from higher borrowing costs, an IT sector in recession, and a steep decline in housing activity. Manufacturing and cargo distribution show signs of stress too. But all the while, Americans continue to spend on services like health care, education, and — indeed — travel.

That’s generally true in Europe too, where EasyJet likewise said demand strength continues. It did lose money this winter, but that’s par for the course among most shorthaul airlines in Europe. With spring underway, profits are now in bloom, and EasyJet is feeling good about its full fiscal year.

Read on for a talk with WestJet's CEO, plus the latest on trends in Mexico. Why is flying in Africa so expensive? What's on Michael O'Leary's mind these days? That and more in this week's issue.

Airline Weekly Lounge Podcast

Last week, United and Alaska Airlines stepped to the plate with their first quarter financial reports. Both lost money, but why? Former Airline Weekly editor Madhu Unnikrishnan joins Jay Shabat to help make sense of the results. Listen to this week’s episode, and find a full archive of the Lounge here.

Weekly Skies

When the pandemic first struck in 2020, airline executives were quick to say there was no crystal ball to predict the future of the industry. Now, three years after the pandemic began and as it reaches its natural ebb, United…

Landing Strip

Grupo Aeroportuario del Pacifico (GAP), which operates several airports in Mexico including Guadalajara and Tijuana, again reported strong traffic and demand during its first quarter. Mexico has been one of the strongest airline markets during and after the pandemic. That's…

State of the Unions

Some pilots at American want to leave their union, the Allied Pilots Association, and link up with the largest pilots union, the Air Line Pilots Association. They will present their case to the APA board in June, setting up a potential…

Feature Story

Alexis von Hoensbroech made a leap last year when he left a 16-year career with the Lufthansa Group, including as CEO of Austrian Airlines, to lead Canada’s second carrier, WestJet.