Never thought I'd say it, but with Covid and now potential towards WWIII, "at least we only fly within North America."


That should actually be helpful.

My concerns aren't just oil and inflation, it's also the situation with Ukraine and Russia (Putin's) ambitions.

Meh. That works if we're the only airline cutting capacity. We're not, others are too. That sounds like the herd mentality of woe-is-us but look at the bigger picture.

 

"Other" airlines. The only airline mentioned in your article is Allegiant, who also is having recruitment problems. I'm still not convinced this is a fuel issue.

I believe this is a staffing issue masquerading as a fuel cost issue.

 

The obscene amount of trips that dropped into open time over the last couple days would seem to back up staffing/training issues. There were a ton of sims, prime 2 day Hawaii, and 2 day SE trips all mass dumped into open time. Exactly the trips they hold out for SE and ETOPS qualification. It seems like the training department is falling seriously behind. I don't know if it is because of new hire attrition or just not being able to stay on schedule, but it's significant.

 

Yes it's a global commodity, there's always excess capacity, and there's always even more capacity that's not economically viable at $50/bbl. The market will accomodate demand.

Might take weeks or many months to spool up enough to make a big difference. If it drags out, addition capacity can be explored and developed within a couple years... big oil knows where those reserves are, knows the price-point, and has a plan.

Also, again, global commodity. With high prices RU can sell oil at a discount (still well above normal levels) to PRC and various other axis powers... they will naturally buy, for the discount if not to show solidarity among rogue nations. That means they're buying less on the open market, which will free up supply for the rest of the world. RU is going to need the money, so I'm sure they'll find a way to sell to somebody.

 

Up to two weeks ago, staffing was the biggest problem at Alaska. ALPA, for the first time in my tenure here was finally in a position where the company knew it needed to start to listen.
Then came Putin and Oil quickly became the serious issue. Alaska has some of the best hedges in the industry right now, that allows us to probably comfortably handle the next 6 months as long as $200 oil doesn’t happen. Three or four days ago $200 oil seemed eminent.
Training is way behind, we are still losing pilots, and staffing is still a concern. Revenue has not tapered over the last few days, it has remained very strong.
Alaska biggest concern is $6 gas taking a significant bite out of the average Americans wallet, leaving little or no room for discretionary spending. This is the largest concern right now, staffing will become the concern again only if the economy holds. If $100-110 oil stays for a significant period of time, we are headed for a recession and Alaska will slow its growth plan. I think we will still grow through the downturn, but not at the rate we planned only a short few days ago. There is already talk of pulling some to most Airbus capacity in the next 6 mos.

 

Sounds like a brilliant move! Only Alaska and Allegiant have announced capacity cuts while the big boys continue to hire. Another knee jerk reaction.

 

In fairness we know the big guys will cheerfully hand out furlough notices on day one of new-hire class.

 

JetBlue just announced 4% capacity reduction in April and 6-8% in May, and expect reductions into the summer. Between staffing, operational issues, and wokeness, it sounds like B6 and AS were made for each other!

 

The big three are servicing so much debt, they can’t slow, the have to charge forward and pray. If this doesn’t swing around fast, they will all be in terrible shape, begging for money from Uncle Sam. Maybe there is a reason Alaska has never claimed bankruptcy and each of the big three have🤔. Or maybe you are just way smarter then the idiots running this place, maybe your brilliant 🤔

 

We’ll see. The plan may change by the end of the day.