Southwest Airlines has begun a one year countdown to the day the Wright Amendment will disappear.
The Amendment, named after former US House Speaker Jim Wright, restricts Southwest’s ability to fly from in-town Dallas Love Field. Originally Southwest was restricted to Texas and the immediately adjacent states. The Amendment has been modified several times. Today the carrier may fly anywhere within the US beyond the exceptions with one stop. Love Field is now restricted to 20 gates; Southwest controls all but a few of them.
The restrictions were put into place to protect the then-new Dallas-Ft. Worth Regional Airport, which was constructed mid-way between the two cities. All the airlines at the time served Love Field and when DFW was created, they all agreed to move to the new airport and close Love Field to airline traffic. Except Southwest, which didn’t exist at the time of the agreement but which began service from Love in the interim between the signing of the agreement and the opening of DFW. The attempts by Braniff International Airways and
Trans Texas International (nee TRANS Texas) to put Southwest out of business are industry folklore.
The fear was that Southwest and Love would hurt DFW and the airlines competing from the distant airport, including American Airlines. When Southwest a few years ago launched a full-scale attack on the Wright Amendment, American led the charge to block the effort. The compromise was the gate restriction, the one-stop service and a five year phase out.
Who could have foreseen that this now could help come to the rescue of American and US Airways as they fight the US Department of Justice’s attempt to block the merger of these two carriers?
Flight Test Programs: Here’s a quick update on the flight test programs underway right now:
Airbus A350XWB: The sole flying test platform in the A350XWB program has accumulated 150 hours since its first flight just before the Paris Air Show in June. The second test plane is due to enter the program this month. The program is believed to have completed its VMU (unstick) testing.
Boeing 787-9: The second member of the 787 family has accumulated 40 flying hours since its first flight on Sept. 17. Aviation Week has a good article on the flight test progress. The airplane is nearing its flutter testing.
Bombardier CSeries: Flight Test Vehicle 1 returned to the skies Tuesday after two weeks since its first flight Sept. 16. Further software upgrades and analyzing test results were stated as the reasons for the gap. The airplane reached 25,000 feet and Mach 0.60 in its second test flight, which lasted four hours.
New A320/737 cabins: Interior maker Zodiac has designed retrofit cabins for the Boeing 737NG and the Airbus A320 families. The 737NG cabin is similar to the Boeing Sky Interior installed on every new 737, but Boeing didn’t offer this as a retrofit to the installed base. Zodiac’s design actually carries more luggage than Boeing’s. The Zodiac A320 cabin is similar.
Only Qantas Airways has purchased Zodiac’s 737 interior and so far there are no customers for the A320 version. But this is about to change. Here is the story we wrote for APEX.
JetBlue Tails: The airline’s blog has a nice compilation of all its tail liveries here.
United Airlines announced it is adopting a new seat in coach to improve the passenger experience.
Its press release is here.
The new design includes:
Update, 2:30PM PDT: Boeing confirms that Tuesday is the target day for 787-9 first flight, time TBD and subject to weather and other factors.
Update, 3:30pm PDT: Bombardier says 9:30 EDT Monday is the scheduled first flight for CSeries. Twitter follow is #CSeries
It looks like it will be a busy week in aviation news. Bombardier plans the first flight of the CSeries tomorrow, weather permitting (it looks good). Exact time hasn’t been announced. Reuters reports Boeing plans the first flight of the 787-9 Tuesday, though we haven’t seen notice from Boeing on this yet. And we’re waiting any day for Lufthansa Airlines to announce its long-awaited wide-body order.
Lufthansa said to split order: Lufthansa Airlines reportedly will split its order for widebody airplanes between Boeing and Airbus, according to this Bloomberg report.
Air Force One: The Seattle Post-Intelligencer has a 42 slide photo display of Air Force Ones, past to present, that’s quite interesting.
Update: “Small Airbus:” If you listen carefully, someone at the end of the video notes that the CSeries “looks like a small Airbus 320.” We couldn’t help but chuckle at this.
S&P says don’t pay attention to our ratings: On the same day Delta Air Lines was named to the S&P 500, The Los Angeles Times had this article commenting on Standard & Poor’s legal defense of its investment grade credit ratings of companies involved in the 2008 financial collapse in the US that led to the global recession in 2008, affects of which are still felt today.
S&P’s defense included the argument that nobody should pay attention to its ratings, according to the article.
The ratings issue is important because airlines, lessors (and, of course, others outside aviation) covet investment grade ratings for the capital-intensive aerospace industry. Airlines and lessors need “cheap” money to buy airplanes. Air Lease Corp recently obtained its first investment grade rating, for example, something for which it issued a press release. Delta gained headlines for its return to investment grade status. Airlines have long used S&P, Moody’s and Fitch for rating equipment trust certificates used to finance airplanes.
The columnist for the LA Times is incredulous that S&P’s legal defense in the federal lawsuit is, essentially, nobody should pay attention to its ratings. It is indeed remarkable.
Final C-17 for US Military: Boeing’s C-17 program has been struggling to stay alive for the past several years and the challenge will get worse when Boeing hands over the final order to the USAF. The airplane’s survival depends now entirely on non-US sales, and these come few and far between. It’s also the last program of McDonnell Douglas; Boeing killed the MD-11, MD-80, MD-90 and MD-95 lines not that long after the two firms merged, though it did keep the MD-95 alive for a short time, renamed the Boeing 717.
Why States opposes AA-US merger: Micheline Maynard writes in Forbes why she thinks states have joined the US Department of Justice lawsuit to block the merger between American Airlines and US Airways. The actions have nothing to do with consumer protection, the alleged motive of the DOJ, she opines. Rather, the states’ interests are far more parochial.
ElectroImpact competes for 777X work: ElectroImpact makes wings for the Airbus A380 and A350 XWB and it’s headquartered in Boeing’s back yard at Everett (WA). Now it’s hoping to build wings for the 777X. This Seattle Times report tells the story.
Washington State’s future in aerospace: The Pacific Northwest Aerospace Alliance hosts its second annual series of luncheons with members of the Washington State Legislature to talk about what needs to be done for the future of aerospace in this state. The first lunch is in Bellevue (WA) September 24 and the second is September 26 in Spokane, the other major aerospace cluster in the state.
Confirmed Bellevue Panelists
• Sen. Nick Harper (D), District 38 – Everett
• Sen. Paull Shin (D), District 21 – Lynnwood
• Rep. Mike Sells (D), District 38 – Everett
• Rep. Bruce Chandler (R), District 1 – Yakima
• Rep. Larry Springer (D), District 45 – Kirkland
Confirmed Spokane Panelists
• Sen. Michael Baumgartner (R), District 6 – Spokane
• Rep. Timm Ormsby (D), District 3 – Spokane
• Rep. Kevin Parker (R), District 6 – Spokane
• Rep. Mark Schoesler (R), District 9 – Ritzville
Information and registration for Bellevue is here.
information and registration for Spokane is here.
Clever headline: The Street.com column has a clever headline this morning in a post written by Ted Reed concerning the on-going sales battles between Airbus and Boeing.
The US Department of Justice’s lawsuit to block the merger of American Airlines and US Airways displays a concern that comes a little late.
As far back as the Reagan Administration, DOJ had ample opportunity to take aggressive action to block mergers. It’s concerned now about hub concentration? The Northwest Airlines-Republic Airways merger eliminated competition at the Detroit and Minneapolis hubs, where both carriers competed. The TWA-Ozark merger eliminated Ozark’s hub at St. Louis.
The new American would control 69% of the slots at Washington Reagan National Airport, and this is a concern? Consider:
And so on.
There are actually few directly overlapping routes and no competitive hubs between US Airways and American.
DOJ is concerned about job losses? Even the unions support this merger.
DOJ is concerned about the effect on consumers? Welcome to the club. All the previous mergers mentioned above were detrimental to consumers, but these cleared DOJ.
If United-Continental and Delta-Northwest were OK, this merger is, too.
Two video interviews popped up this morning with key leaders of airlines: Tim Clark, president of Emirates Airlines, and Richard Anderson, CEO of Delta Air Lines. Each is more than 25 minutes.
Emirates’ Tim Clark:
Delta’s Richard Anderson via Bloomberg News is here.
US Export-Import financing is under attack again by Delta Air Lines and Republicans.
We understand why Delta is opposed. It believes that ExIm financing of Boeing aircraft to competitors puts it at an economic disadvantage.
But fees charged by ExIm made financing more costly and “market rate,” a move intended to remove the financing advantages. Some airlines, in fact, chose alternative financing as a result.
Delta claims ExIm hasn’t taken into account the impact on losing American jobs. We find this a stretch, since Boeing out-sources thousands of jobs with its industrial partnerships (particularly on the 787) and supply chain contracts. At one time, we seem to recall Delta out-sourced jobs to non-US locations.
Be that as it may, at least Delta has its self-interest at stake and one can’t truly fault the airline for this. But the Republicans are another matter. Although ExIm finances a variety of US industries, Boeing is the prime beneficiary and some Republicans claim this is nothing more than corporate welfare.
ExIm, which has been around since the Great Depression, provides financing that is similar to European export credit support offer to Airbus customers. If Republicans succeeded in killing ExIm (or if Delta does), then Airbus will have a clear advantage.
This falls into the category of “what are they thinking??”
There are two items of note for low-cost carriers that we find interesting:
Then there is this analytical piece from Seeking Alpha about a variety of potential mergers.
Aircraft List Prices: It took some doing, but we’ve collected the list prices of all the major commercial airplanes. The comparisons are interesting. We’ve tabulated these into seat categories.
List prices, of course, have no relationship to what customers actually pay. Discounts of 25%-30% are common and really good customers–like Southwest Airlines for Boeing–have been known to get discounts of up to 60%.
There are several notables in this list:
Is there any particular point to this? Not really–it’s just one of those facts that intrigue us and a host of aviation geeks.