CTC – Corporate Travel Community each week brings you a roundup of the most thought-provoking and interesting comments from those industry leaders in the know.
Capital A CEO: Philippines is lacking in low cost airports
Capital A CEO Tony Fernandes stated the Philippines is lacking in the development of low cost airports. Mr Fernandes said: “Not everyone needs fancy business class lounges, marble floors, walkalators everywhere. It’s not about building palaces – it’s about building facilities that fit the market”. He added: “There is another type of airport, the low-cost airports – cheaper, faster to build and affordable for the public”.
Lufthansa Group CEO: Demand for air travel remains high, with no slowdown currently in sight
Lufthansa Group CEO Carsten Spohr stated the group “developed extremely positively” in 1H2023. Mr Spohr highlighted “demand for air travel remains high, with no slowdown currently in sight in spite of the challenging macroeconomic environment”. He noted in particular that the group’s passenger airlines “continued to expand their capacity accordingly, reaching around 90% of the pre-crisis level in the summer months”. Mr Spohr added the group expects to add “more than 30 new aircraft this year as we continue our fleet modernisation”, while “preparations for the conversion of the Lufthansa long-haul fleet to our new ‘Allegris’ cabin interior are in full swing”.
Delta Air Lines CEO: Travel demand to remain ‘really, really high’ for ‘some time to come’
Delta Air Lines CEO Ed Bastian stated travel demand is “really, really high” and is expected to stay strong “for some time to come”. Mr Bastian said the term ‘pent-up demand’ does not “even begin to describe what we’re seeing”, adding planes are full and cash sales are exceeding records, with Delta having had its 20 highest recorded cash sales days in 2023.
PLAY CEO: Carrier has now reached the necessary operational scale
PLAY CEO Birgir Jónsson labelled 2Q2023 “a real milestone” as it marked “the end of our initial ramp-up phase concluding with the delivery of our tenth aircraft in early Jun-2023”. Mr Jónsson said that as the carrier has “now reached the necessary operational scale after a very steep growth period for the last two years”, it is also able to report “an operational profit after the quarter, that our unit costs are on target, and that we have a healthy cash position”. He added the financial results “are better than we anticipated and support our previously stated forecast of reaching an operational profit for the full year”.
JetBlue Airways CEO reports summer airfares ‘lower than expected’, demand remains high
JetBlue Airways CEO Robin Hayes, via the carrier’s 2Q2023 earnings call, reported summer 2023 airfares have “come in lower than everyone in the industry had expected” as the carrier forecasts 3Q2023 revenue to decrease by 4% to 8% year-on-year. Mr Hayes noted demand remains high, with load factors exceeding 90%.
Wizz Air CEO: Summer 2023 ‘going well’ operationally and from a revenue perspective
Wizz Air CEO József Váradi stated summer 2023 is going well operationally and from a revenue perspective. Mr Váradi said: “We have made significant progress against our main objectives of reinstating best in class profitability at the back of delivering high-capacity growth and improving operational metrics during the quarter. The security of our Airbus orderbook and prior operational adjustments helped us deliver a markedly improved performance”
Spirit Airlines summer demand ‘softer than expected’: CEO
Spirit Airlines president and CEO Ted Christie stated peak summer 2023 demand has been “softer than expected” resulting in lower airfares on routes served by the carrier. Mr Christie noted 2023 results appear weaker in comparison to “exceptionally strong” domestic and short haul international demand in 2022, adding the industry is seeing a shift towards long haul international markets.
SWISS CFO: ‘pandemic firmly behind us’
SWISS CFO Markus Binkert commented: “Like the rest of the airline sector, we benefitted from the fact that people’s desire to fly remained substantially higher than the capacities currently available”. He added: “This first half operating result is one of the strongest we have ever achieved … and it confirms to us that we now have the corona pandemic firmly behind us”.
Southwest Airlines to restore fleet utilisation by end of 3Q2023, optimise network: CEO
Southwest Airlines CEO Bob Jordan reported the carrier is equipped to restore fleet utilisation to pre-COVID-19 levels by the end of 3Q2023. Mr Jordan stated Southwest has also restored the “vast majority” of its network with plans to optimise its short haul routes into 2024, allowing the carrier to ensure it has “the right number of flights in the right places” as business travel has “plateaued below pre-pandemic levels”.
Ethiopian Airlines continuing to face inflation and supply chain challenges: CEO
Ethiopian Airlines Group CEO Mesfin Tasew stated high inflation is resulting in high operating costs and high fuel prices for the airline. Mr Tasew also said the shortage of spare parts due to supply chain issues “is a real challenge”, commenting: “Sometimes we have difficulty flying all airplanes, we have to ground some of the aircrafts until we get the parts”. Mr Tasew expects supply chain problems to be resolved within three years. He also said the continuing recovery from the COVID-19 pandemic may result in overcapacity and a decrease in airfares. Mr Tasew said Ethiopian “will have to re-evaluate its cost structure and… work very hard on our cost-saving initiative to stay still competitive”.
KLM supply lagging behind: CFO
KLM CFO Erik Swelheim stated “the circumstances for aviation are extremely positive” with “huge demand for tickets”, however noted “KLM’s supply lags behind”. Mr Swelheim said production capacity at KLM is lower than at other airlines, with the carrier currently 12% below 2019 capacity levels. He added this is due to fleet and personnel availability, with the carrier having to hire aircraft at high costs in order to be able to operate sufficiently.
Jetstar Airways CEO: Flights are ‘going to leave on time’
Jetstar Airways CEO Stephanie Tully said the LCC is working to improve delays and cancellations, adding flights are “going to leave on time”. Ms Tully said: “We turn 20 next year, we’ve flown 400 million people since our inception and we play a unique role in Australia”, noting: “We democratised travel”.
Air Peace may launch London service by Oct-2023, in talks on Houston route: CEO
Air Peace chairman and CEO Allen Onyema stated the airline hopes to commence operations to London before Oct-2023 “or there about”. Mr Onyema also held discussions with the Nigerian Ministry of Aviation and Aerospace regarding potential services to Houston. Mr Onyema commented: “We have the capacity to do more legacy routes like Atlanta, New York when international aero politics permits. We are very ready and these routes are coming very soon”. He added: “Other African and international routes will follow subsequently”.
Tourism Industry Aotearoa preparing for ‘good second summer of recovery’: CEO
Tourism Industry Aotearoa CEO Rebecca Ingram “What the last year has highlighted is the need to keep adjusting for a different kind of future”. Ms Ingram added: “Indications are we are in for a good second summer of recovery. We have our eyes set on the longer term with much work underway to do our part to make positive impacts on the environment and communities we are part of”.
