January 27, 2021

U.S. Government Considers Mandatory Testing for Domestic Travel

Dr. Marty Cetron, director for the Division of Global Migration and Quarantine at the CDC, said Wednesday that the federal government is considering placing a requirement of a negative virus test as a condition for domestic travel within the United States.

The federal government instituted a policy this week that requires most travelers entering the United States to provide a negative test to be permitted entry into the country, but that does not apply to domestic travelers… yet. President Biden directed the government to make recommendations that could make domestic travel safer for the public, and the administration is actively considering this idea. In additiona, those traveling over a weekend would be asked to show a negative test for Saturday Night Fever before being permitted to fly.

Were the requirement to be put in place it would be another obstacle for airlines to overcome in their efforts to repair their balance sheets after a brutal 2020. That’s why some ULCCs such as Spirit have considered a compromise, adding a fee if you’d like to be seated in the section with passengers who have tested negative, leaving other passengers to take their chances.


Boeing Posts Record Losses, Delays 777X Delivery to 2023

Boeing’s Q4 earnings report painted a bleak picture for the aircraft manufacturer, with the pandemic driving a stake through the airline’s business. Boeing posted a monstrous loss of $11.9 billion in 2020. The demand for widebody planes for long-haul service has dropped dramatically, and that along with the 737 MAX mess contributed to the negative result.

The good news kept flowing when Boeing also announced it would push the delivery of its 777X plane to late 2023. The 777X program has been besieged by delays, with Boeing originally expecting to begin deliveries of the airplane this April. But engineering issues combined with weaker demand and shifting focus to increased certification requirements for the MAX have slowed down production. The company took a $6.5 billion charge for Q4 for the 777X program alone.

Boeing posted a loss of $15.25 per share in Q4, after analysts had predicted a loss of just $1.80 per share. Boeing also posted a $468 write-down against “abnormal production costs” related to the 737 MAX. Q4 revenue dropped 15% from a year ago to 15.3 billion, with total loss for the quarter being $8.4 billion; compared to a loss of $1 billion in Q4 2019.

In an attempt to raise revenues in the short-term, Boeing will partner with Carmax to both buy and sell used aircraft on Carmax lots all over the country. Carmax will buy your used plane, even if you don’t buy one of theirs, making you an offer on the spot.  Prices will be non-negotiable, per Carmax policy, and Boeing will receive 70% of any plane Carmax sells on its behalf.


American to Clamp Down on Shady Travel Agents

In a message posted for travel agents on Tuesday, American Airlines said that it would be clamping down on agents skirting ticketing and fare rules when booking flights for clients.

American is specifically addressing these violations:

  • Churning
  • Hidden City Ticketing
  • Inactive Segments
  • Marriage Segment
  • Origin & Destination Manipulation
  • Hogging the armrest if you aren’t in the middle seat
  • Asking someone to close the window shade if you aren’t sitting in the window seat

Each of these — er, at least, the first five — come down to agents and/or travelers who are willing to violate the agreement of the ticket to find a more favorable fare. Airlines rarely have the time or wherewithal to investigate one-off instances by individual travelers to save a few bucks, but as the practice becomes more prevalent and technology improves, the airline is going to do what it takes to protect its revenue. Travel agents who are offenders can expect to see debit memos coming their way to pay the difference.


New Zealand Plans for Borders to Remain Closed for 2021

New Zealand is likely to keep its borders closed for all of 2021, according to Prime Minister Jacinda Ardern. New Zealand and Australia have been in discussion for several months about a Trans-Tasman travel bubble, but the prime minister is not confident of any sort of bubble anytime soon.

New Zealand’s strict policies to combat the virus have allowed the country to resume many normal operations domestically including the lifting of most restrictions and quarantine. The prime minister did say that if the country were to explore travel bubbles with Australia, it would likely be done on a state-by-state basis, and not for all of Australia. (We’re looking at you, Victoria, you problem child.) The decision would be based on the rate of positive cases and the success of vaccine distribution.

New Zealand, along with Australia, is expected to receive the first doses of vaccine for the general population to arrive sometime next month. Both countries do not expect to open their borders to the rest of the world until there is more evidence that vaccinated individuals still cannot transmit the virus.


Avatar Airlines Has a Billion Reasons to be Confident for Launch

Avatar Airlines, the Florida-based startup airline that plans to begin operating at some point between now and the end of civilization, plans to be valued at over $1 billion when it operates it first flight. The airline, which appears to take the idea of a New Year’s Resolution very seriously, plans to raise capital through two private equity offerings and an IPO instead of using debt.

Founder and CEO Barry Michaels said that his plan is “different,” and it sure is. Avatar plans to exclusively operate Boeing 747s with very high density. Each aircraft will have 539(!) economy seats on the lower deck, always priced at $99 one way or less. It will have 42 “office class” seats on the upper deck, priced at $179.

Avatar also plans to be a “flying billboard,” willing to raise capital by selling space all over its airplanes, both inside and out. Seems like a perfect idea for any business who’s struggled to market to the “birds that fly above 10,000 feet” demographic.

We would have assumed this is just some scam drummed up in a Reddit thread like buying a bunch of Gamestop stock, but this start-up plan has been around for several decades, pre-dating the existence of Reddit by far.


Airline Potpourri

  • American is extending Admirals Club access on all international flights to elite members Platinum & above along with passengers seated in business or first. This includes short international flights within North America & the Caribbean.
  • British Airways wants to move its daily flight to Accra (ACC), Ghana from Heathrow to Gatwick. And Ghana’s government is not happy.
  • Flair Airlines is adding 13 new B737 MAX 8 aircraft to its fleet. It acquired them by pinning the owner of the aircraft after a low blow when the referee was distracted.
  • Jetstar is sending its fleet of B787 aircraft to Alice Springs for extended storage.
  • United has joined the state of Hawai’i’s pre-clearance program. United fliers on all 110 of the airline’s weekly flights to the islands can submit their negative virus test online and receive a wristband when boarding to bypass arrival screening and head right to the bar beach.
  • Virgin Australia is operating at 40% of its pre-pandemic January capacity, lower than the 60% figure it expected to operate.

Andrew’s Moment of Levity

I went to the doctor today and got some news that was very hard to hear. I’m going deaf.