transcript
Speaker 1:
[00:07] Hello and welcome to Episode 367 of AvTalk. I am Ian Petchenik here as always with Jason Rabinowitz.
Speaker 2:
[00:18] What's going on, Ian?
Speaker 1:
[00:19] Oh, so much, Jason. So, so very much. Last week was one of those weeks where, if you're a long time listener to the show, you'll know that we record in the middle of the week roughly, and maybe 70% of the time, big news breaks just after we finished recording the show.
Speaker 2:
[00:43] No, it's at least 70% of the time, probably more.
Speaker 1:
[00:46] Last week was certainly one of those weeks. So, we will get to all of that in just a little bit. I need to mention that this week we've got a great chat with NATS Director of Operations Control, Steve Fox. We're going to talk about how NATS, which is the Air Navigation Service Provider for the UK, prepares for the busy summer season, which is scheduled to see almost as many flights this year as they did in 2019. So, almost back to where we were pre-pandemic, and that is going to keep them busy. So, we're going to talk about how they plan for that and when they start planning for that. Spoiler alert, it's a lot earlier than you think. But first…
Speaker 2:
[01:34] We'll see if that holds true this year, the way things are trending.
Speaker 1:
[01:37] Fair enough, fair enough. We are going to talk about some flight cancellations, but first we're going to talk about airplanes thankfully not colliding, but coming close enough that technology plays a large role in those airplanes not colliding.
Speaker 2:
[01:54] I guess that's some bad good news, right?
Speaker 1:
[01:57] Yeah. There have been a few examples this week of aircraft coming closer in proximity than they should, though thankfully there have been no actual collisions. In reverse chronological order, let's head to JFK first and talk about the parallel runways, Runway 31 left and Runway 31 right. American Airlines Flight 4464 was cleared to land Runway 31 left at JFK, while Air Canada 8554 was cleared to land Runway 31 right. The American flights turned to runway heading, overshot the approach path to Runway 31 left, and brought it close enough to the Air Canada flight to have both aircraft respond to TCAS resolution advisories instructing the aircraft to de-conflict their paths, which they did. Both aircraft went around and landed a short time later.
Speaker 2:
[02:54] Honestly, I'm a little surprised this doesn't happen more often, especially at JFK, especially with this configuration where you have the parallel approaches to 3-1s, and the aircraft on 3-1 right will typically approach from the north or the east, and the aircraft to 3-1 left will approach from the south, and the aircraft on the 3-1 left will have to make a big basically a 90-degree left turn to line up with the runway. I'm a little surprised that it doesn't happen a little more often where someone cleared to 3-1 left, accidentally mistakes it for 3-1 right, because that's the primary arrival runways, 3-1 right. So yeah, a little surprised it doesn't happen more often than it does, because 3-1 left is not an uncommon runway to land on, but it's far less common than 3-1 right. But maybe this is why Air Canada decided we don't want to go to JFK anymore, as they actually announced the end of JFK surface the same week, I think.
Speaker 1:
[03:49] Yeah, they will not be operating into JFK for the summer season. They're going to be done through October.
Speaker 2:
[03:57] Yes, this was, I think, Air Canada's only announced route or city suspension, specifically attributed to do high fuel costs. I suspect that the route just didn't do very well to begin with, and it was just a very easy one to cut very minimal operation there. But that's two stories rolled into one. How about that?
Speaker 1:
[04:15] There you go. Let's head down to Nashville, where a similar situation but on departure occurred. This is two Southwest Airlines flights. Southwest 507 was directed to turn right by air traffic control during a go-around, putting it into the path of the departing Southwest 1152. The 1152 is departing one of the runways, 507 was approaching on the other, had to do a go-around. The air traffic controller directed them to turn right rather than follow the standard missed approach procedure there, and those two jets came within about 500 feet vertically, with the departing 1152 passing over Flight 507.
Speaker 2:
[05:02] Yeah, this is much, much, much worse than the JFK incident. That was simply they overshot a turn. This was one aircraft being explicitly directed into the path of another aircraft by air traffic control. This is a whole other class of incident, I'm sure, in my mind and anyone investigating this as well. This is very, very not good.
Speaker 1:
[05:23] And another TCAS RA situation there as well.
Speaker 2:
[05:28] Yes, one of the hardest working technological protocols in the aviation industry.
Speaker 1:
[05:33] Absolutely, this week for sure.
Speaker 2:
[05:35] It can never take a break.
Speaker 1:
[05:37] And then let's head further south to Bogota, where this, I don't want to call it an incident, incidents occurred, and this is one of those things where we talk about any number of factors going into something happening, or the Swiss cheese model or however you want to term it. What ended up happening is that a Lufthansa flight conducted a go-around because they felt they were too close to the preceding aircraft. That's the long and short of it. But media landscape being what it is these days, it got turned into a whole thing in which the Civil Aviation Authority of Columbia issued not one but two statements about this non-incident event.
Speaker 2:
[06:22] But why issue a statement at all? This is a completely routine nothing.
Speaker 1:
[06:28] I think what happened, and granted, 98 percent of this discussion happened in Spanish, and my Spanish is not good enough to entirely follow this, and machine translation being what it is, I'm not 100 percent confident. I completely understand the issues here. However, let's talk about the aviation aspect of what happened, and then we can talk about what happened afterwards. Qatar Cargo 8174 and Lufthansa 542 were both on approach to Bogota. Both were on RNP approaches. Both were following their approaches correctly. Lufthansa and Qatar were both approaching Bogota at a time when one of the runways had just become unavailable due to an aircraft issue. Both of those aircraft were placed on the left runway rather than having the option to use the right runway as well. So, Qatar 8174 is in front of Lufthansa 542, descending for the left runway at this point, and Lufthansa 542 is behind and above it. It sounds like from both the air traffic control, it looks like from the ADS-B data, that Qatar slowed down more than Lufthansa was either expecting them to or more than Lufthansa did. And so, Lufthansa got closer and closer to Qatar. Lufthansa queried the air traffic controller. Are we still clear to land on this particular runway? The controller, sounding non-plus, said yes, this is the runway you're headed to. And so Lufthansa said, we're gonna go around because they didn't feel like there was enough spacing.
Speaker 2:
[08:17] Totally normal and something they are explicitly allowed and I would say encouraged to do. If they don't feel comfortable for whatever reason, it is their right and duty to go around and come back again later.
Speaker 1:
[08:31] And the ATC communications from the Lufthansa crew and the air driving controller were all extremely professional. The Lufthansa crew said, hey, are we still clear to land on this runway in this sequence? The controller said, yes, you are. Lufthansa said, okay, we're going around. Controller said, okay, here are your vectors. And they went around and they landed perfectly on the second approach. From there, as our current media landscape is often want to do, things went in directions that I did not think or intend them to go. And it became, I think, domestically a situation where folks used the event as a launching platform for criticizing the government, rather than viewing it for what it was.
Speaker 3:
[09:26] And nothing happened.
Speaker 2:
[09:28] There's nothing to criticize.
Speaker 1:
[09:30] Well, but as true as that may be, when has that ever stopped anyone?
Speaker 2:
[09:34] That's a great point.
Speaker 1:
[09:35] And so I think that's where the CAA felt the need to issue, not one, but two statements. In my mind, the statements were a little defensive, I think, rather than saying, the statement I would have issued would be, we applaud the pilots and the air traffic controller for making safe decisions. A go-around is exactly the right call in these sort of circumstances and we're committed to the safe operation of airspace. That's all they really needed to say.
Speaker 2:
[10:05] Yeah, I mean, people could have also said shut up, but I understand why I couldn't.
Speaker 1:
[10:11] This, Jason, may be why you don't work in media relations or public relations.
Speaker 2:
[10:15] Maybe we need more people like me in media relations to tell people to shut up.
Speaker 1:
[10:18] Or maybe we do.
Speaker 2:
[10:19] Maybe I'm honest with them.
Speaker 1:
[10:20] But at the end of the day, what happened, the situation that developed could have been managed better originally, but circumstances being what they were, it was handled appropriately. I really didn't understand beyond it sounded like it was part of a political agenda, the criticism that was brought there. But we'll see if there's a third statement put out.
Speaker 2:
[10:45] Sure. Don't understand any of what happened there, except for a completely ordinary aviation, nothing.
Speaker 1:
[10:52] Exactly. Let's head across the ocean to Europe where there is grave concern, not just about the cost of jet fuel these days, but about its availability. We are almost two full months into the war in the Middle East. At the moment, there is a ceasefire between the United States and Iran and Israel and Iran. But the Strait of Hormuz, through which approximately one-fifth of the world's oil travels, is currently blocked. Today, multiple ships were fired upon by Iran and brought to the Iranian coast, one of which was at least severely damaged. So ships are just not transiting the Strait because of Iran, but also because the US is maintaining a blockade on Iranian ships. So that's a huge capacity hit. And as we've talked about in previous episodes, a lot of that capacity goes towards supplying jet fuel, among other things, jet fuel to Europe. Europe today, the European Commission today rather, put forth a plan that is non-binding. It offers some actions that it wants to partake in. It's called Accelerate EU. The idea is to provide strategic guidance for working together to combat the lack of jet fuel basically, including national emergency measures and coordinating the refinery production capabilities as best they can. But it's also geared towards shifting anything that can possibly be shifted away from fossil fuels to electrification or renewables other ways.
Speaker 2:
[12:45] Which in this industry is not going to happen overnight or over...
Speaker 1:
[12:48] Right. It's not just geared towards the aviation industry, but a lot of it is geared towards refilling national storages if they can, using perhaps transportation capacity reserved for military applications, possibly, as well as coordinating the movement of where there is jet fuel to possibly where there is not based on national level coordination. So a lot going on behind the scenes. But the long and the short of it is there isn't enough jet fuel necessarily to go around.
Speaker 2:
[13:24] Hey, that's not great at all in any way. It doesn't seem like it's going to get better by the next week's podcast or the one after that or the one after that. We're already seeing airlines take some, I don't want to say drastic measures, but I guess maybe okay actually saying that because just about the minute we stopped recording last week, Lufthansa announced a, well, amid its own issues with its own strikes for the third time in this month already, announced a slew of changes to both stem some losses from some of its subsidiaries and also to cut back on the amount of jet fuel it was using. It's pretty wide ranging thing, but also that's a little smoke and mirrors. But firstly, which was most surprising and came with absolutely no notice, Lufthansa City Line, which is like Lufthansa City. This is the regional jet operator that operated for Lufthansa to smaller destinations who shuttered outright with two days notice. But I believe one of those days was actually during the strikes. So basically shut down overnight with absolutely no notice. They had blamed it on it already being a loss making airline and it just couldn't sustain it anymore. So that was that. So overnight, Lufthansa just vanished an entire subsidiary airline, which is kind of crazy.
Speaker 1:
[14:49] And it's purely coincidence that they shuttered the entire airline that happened to have pilots engaged in a labor dispute.
Speaker 2:
[14:57] Now, I'm sure it has nothing to do with that. But they blame the aircraft getting old and it being not a profit making operation, which I'm not really sure the point of that was to make a profit, to feed your other flights, which do hopefully generate a profit. But I don't even think the airline's fleet was all that old, was it?
Speaker 1:
[15:18] I mean, there were some pretty elderly CRJ 900s, as well as a few elderly or old A319s. So I get it. And to be fair to, I'm not sure to be fair to who, but to point out, Lufthansa Group had already planned to get rid of the CRJ 900s by the end of the year. So this is an acceleration of fleet removal. And it's an acceleration of shutting down this particular airline, of which Lufthansa Group has, I think, as of this week, 916 different airlines and brands. I'm exaggerating, but I don't think I'm not sure.
Speaker 2:
[15:58] It might be 917 by the end of the day.
Speaker 1:
[16:00] This is true. You do never know. And so, they are accelerating this shutdown, saying that it's purely based on the cost of jet fuel and things like that. At the same time, they announced the retirement of the A340-600 fleet. So, there are four of those left. Those will retire at the end of the IATA summer schedule, so in October.
Speaker 2:
[16:26] Yeah, I heard this before, but these are cockroach aircraft, so maybe they go in October, maybe they need them forever again.
Speaker 1:
[16:34] We will see, as well as two 747-400s, which will be grounded at the end of the IATA summer season.
Speaker 2:
[16:41] Two of them, though, right? That's two of their eight, so take a deep breath, everyone. Lufthansa is not outright retiring the 747-400. They have two of them retiring out of a total of eight, seven of which are currently operating right now. And they also have 18 747-8, so the 747 as a whole isn't going anywhere. They are just for some reason parking two of them and telling us about it.
Speaker 1:
[17:06] I would assume, and we can look into this further, I would assume that those two that are going to be parked are probably due for some heavy maintenance, and rather than do that heavy maintenance, it's easier just to leave them on the ground. The Lufthansa Group also announced what sounds like a massive cut to its flight program beyond the cuts that we've already talked about. They're cutting 20,000 flights between May and October. But Jason, roughly how many flights do you think the Lufthansa Group operates between May and October?
Speaker 2:
[17:43] I'm going to say this is approximately 1% to the original schedule.
Speaker 1:
[17:47] Exactly. It's less than 1% to the original schedule.
Speaker 2:
[17:50] Look at this show notes work.
Speaker 1:
[17:53] There are only three destinations that are losing service from Lufthansa Group entirely.
Speaker 2:
[18:02] You're going to pronounce those cities right now, aren't you?
Speaker 1:
[18:05] I am going to try to pronounce two of them, and then I'm going to leave the third one for you, Jason.
Speaker 2:
[18:16] I didn't agree to that.
Speaker 1:
[18:18] Stavanger in Norway, Zhejiang in Poland, and then a second Polish city called?
Speaker 2:
[18:26] Rezao? Sure. Why not?
Speaker 1:
[18:27] No, I already said that one.
Speaker 2:
[18:29] Oh, yeah. I wasn't paying attention. Honestly, there aren't enough letters in here that make any sense for me to pronounce, so you're going to have to give it a go.
Speaker 1:
[18:39] The German name is Bromberg.
Speaker 2:
[18:42] Sure.
Speaker 1:
[18:43] The Latin name for the city is Bigostia. That's probably as close to proper Polish as I'm going to get.
Speaker 2:
[18:53] Yeah.
Speaker 1:
[18:55] The name will be in the show notes. As we often do, we will request some pronunciation assistance from a user and a listener. That would be much appreciated. You can email us at podcast.fr24.com and let us know how to pronounce that. But those are the only three cities losing service from Lufthansa Group. There are other routes that will no longer be operated by Lufthansa itself, but those flights will be covered by one of the 276 other airlines that are part of the Lufthansa Group.
Speaker 2:
[19:29] Yes. Anyone going to these cities, if you are planning on connecting to Frankfurt, maybe you're going through Brussels now or if you're going through Munich, maybe you're going through, where's Erdogan, who even knows, but you'll be fine.
Speaker 1:
[19:42] Ita or Brussels or you could be going to Vienna now with Austrian or Zurich or with Swiss. You have a multitude of options. These cuts, while the top line number sounds like so many flights, it's actually fewer than 1 percent of Lufthansa original schedule. So while it's not great to see that airlines are cutting tens of thousands of flights, ostensibly to save money because jet fuel has gotten so expensive, it's important I think to keep the proportions in mind for now. That's not to say if things remain as they are, we won't see truly monumental cuts. We're just, I don't think we're there yet.
Speaker 2:
[20:27] We may get there, but not yet.
Speaker 1:
[20:29] Let's take a break, and when we come back, we'll chat with Steve Fox from NATS about how they're preparing for this summer and what they're expecting to see over the NAT tracks as well as in UK airspace. So stay with us, we will be right back. Welcome back, we are now joined by Steve Fox, who is the Director of Operations Control for NATS Enroute. As we enter the busy summer season, we're here to talk with Steve about how they plan for all of those aircraft in such a small airspace. Steve, thank you so much for joining us.
Speaker 3:
[21:10] Thank you so much, Ian, it's an absolute pleasure to be here, thank you very much.
Speaker 1:
[21:14] So let's talk about the upcoming summer season. It is the busiest time of the year, and there are globally scheduled to be more flights than ever before. How do you approach that from an air navigation service provider perspective?
Speaker 3:
[21:33] Yes, it's a great subject to talk about, Ian, because it actually starts way back. We look a year ahead of what's coming up into the summer of the following year. So we've been looking at summer 26 from around June, July of summer 25 of what to expect. And the planning process for us really starts on understanding how the current year you are in is operating. So during summer 25, we saw some of the trends of traffic flows that happen, and some of the challenges that the European system faces across the board in terms of delay. We'll look at that and build that into our planning from a very early stage into what sectors we need to open for summer 26 and this year coming. And that's how the summer season starts for us. And then it's a gradual process towards the end of the year, working with Eurocontrol in Brussels and our ANSP partners. We also work closely with the airlines and airports themselves to understand what demand they are expecting to see. And we have various forums, various engagement sessions with our airline partners that build us as a picture of what that summer is going to look like.
Speaker 1:
[22:42] What are some of the different tools in your toolbox that you can use to accommodate the level of traffic that you see over summer period?
Speaker 3:
[22:50] We have a number of different tools that predict what that traffic demand is going to be like. I like to see it as we've got a triangle of tools. One is a modeling capability where we can open various sectors and move different traffic flows through that. And that provides us with an idea of what delay we would see in certain configurations. We also look back at previous trends. Which is the other part of the triangle. What did we see in previous seasons? And how does that affect what we project going forward? And the final piece of that is the contextual expertise from our highly skilled workforce that we know have seen and felt how the traffic is. And we build that into the planning process as well. The key bit to it all is those traffic forecasts. And we plan on various base cases that we are predicted to receive and then we have to take account to whether the traffic will be higher or lower than what we are predicting as well.
Speaker 1:
[23:47] And how does the unpredictability of summer weather play into all of this? I know before we started recording, we were talking about wind at Heathrow and the variability across summer thunderstorms and wind and things like that. How does that all fit into how you model what the airspace is going to look like?
Speaker 3:
[24:07] Weather is the most variable element of air navigation service providers' performance. If we just look at 2024 and 2025 from a UK perspective, the summer months were actually quite moderate in terms of thunderstorms, which tends to be the biggest disruptor. I think the first thing to talk about is the traffic variance between winter and summer, particularly in the UK. So in the UK, we'll be averaging around 5,500 movements over the winter period until clock change. And then in the peak summer, that moves up towards 8,000. So the resilience in the aviation system across the board is significantly less in the summer. So the impact of weather over particularly the core period of July, August can significantly affect the overall performance of delay. And in 2023 in the UK was the example we saw there, where there was significant lightning strikes, particularly in the days on the busy days like a Friday, which carries more traffic than you would see on a Saturday night, for example. And that variation can severely impact how this summer looks and the delay feels, particularly to the passengers and the airlines that are operating through those sectors that are impacted by those thunderstorms.
Speaker 1:
[25:20] And when flights are impacted, how does the air traffic control system prioritize flights? Or is it just up to airlines to say we want this flight to be prioritized over this flight?
Speaker 3:
[25:32] It's a really interesting way because in Europe, the slot allocation is through Eurocontrol, the network manager and their automated systems. So when the flight plan is filed, it goes into the Eurocontrol system. And when an avgation service provider in Europe requires a regulation, and the regulation is always required because of safety, because it's to limit the capacity and control the demand going through any piece of airspace that's impacted by that weather. And that causes a regulation. And the slot allocation system of Eurocontrol allocates each aircraft going through that piece of airspace, a departure slot from the airfield in Europe that it's leaving from. And depending on the severity of the capacity constraint through the piece of airspace, that determines how bad that delay is. At that point, the airlines in Europe have a choice, and that is looking to reroute round it if that's available, or take in the delay. And clearly, when you get significant delay through pieces of airspace, that can have a knock-on impact on the entire European network and schedule. So we in the UK could be heavily impacted by a thunderstorm over Eastern Europe, because a lot of the traffic flows we see in Europe is the holiday market that you see from the UK, from the UK airports down to the sunny climates of Turkey and Greece. And that what we call the South East Axis is heavily capacity constrained in the summer months. So thunderstorms over those areas can significantly impact UK delays without that weather even being a problem in the UK itself. And this is a really difficult thing for passengers and sometimes even the airlines themselves to see and feel is that why am I getting delay out of the UK due to weather when it's clear blue skies in the UK. And that's how so interdependent the system is in Europe and how one area of Europe can have such a bad day, but another area is completely immune from any delay whatsoever.
Speaker 1:
[27:34] We talk about that a lot on this podcast, how weather elsewhere can impact your flight and how airlines have only recently begun to try and communicate that to their passengers because you'll have folks yelling at gate agents, well, it's perfectly sunny here, it's perfectly sunny where I want to go, why is my flight delayed? I think it's interesting to see it at the passenger level, the airline level, and then the navigation service provider level. I think that's a whole interdependent system that we don't often see in action.
Speaker 3:
[28:05] Absolutely.
Speaker 1:
[28:06] Where does NATS fall in as far as the recent changes on the oceanic access and the rules for transatlantic travel? How has that made the job easier as far as dealing with a higher level of traffic, or does that not really impact the amount of traffic, just how they're operating?
Speaker 3:
[28:27] The oceanic traffic, Ian, has been the record increase that we've seen across our entire network in the UK. It's significantly over 2019 levels, and if we use 2019 as the benchmark of air traffic demand, because those were the busy years, over two and a half million movements in the UK of traffic. Over 10 percent of the oceanic traffic has been seen since 2019, this year, and it's still increasing. That affects a lot of our sectors in the UK, so a lot of the airspace above central London, and then the airspace above Manchester and the north west of the UK, which is the typical traffic flows that then move into the oceanic NAP tracks, and that comes from Europe, it can come from even the Middle East. That traffic has increased significantly, and so that goes into all of our planning processes of how we manage our sectors. But essentially, at some point, we get to the saturation factor of there's so much demand trying to get through a small piece of airspace that we do end up with occasional regulation. So we factor that into our planning. So all of our summer planning that we've been doing this year, has been looking at those oceanic movements. And yeah, record traffic levels have been seen year on year since post-pandemic recovery.
Speaker 1:
[29:48] What about new technologies that have either come online in the past few years or are currently in development? Is there anything that you can speak to that kind of ameliorates some of these capacity restrictions or have the potential to do so?
Speaker 3:
[30:02] I think we've had a number of examples of that with system developments in the UK. One was space-based ADS-B over the ocean. The ocean is a procedural air traffic service as opposed to radar controlled. And the introduction of space-based ADS-B enabled controllers now to see aircraft going through the ocean and has enabled a reduction in spacing and that has increased capacity significantly going through the Atlantic, which has also enabled that traffic growth. It was an excellent example of technology improving the situation. And one of the other ones we've introduced is actually on the approach function at Heathrow, pair-wise in our intelligent approach products, which enables the wake category of aircraft to be put close together, depending on what aircraft types they are. And that has increased again, reduced separation amongst certain city pairs, which has increased capacity into Heathrow and significantly reduced delays at such a capacity constrained airport. So there are two real examples over the last few years of what we've learned to increase the capacity within UK of that ever increasing demand.
Speaker 1:
[31:13] I know that airlines often have a magic number in mind for the number of flights that they want to operate as far as the commercial schedule is concerned. And that number often isn't necessarily the number that the navigation service provider, whether it's NATS or the FAA in the US or anybody else worldwide, can actually handle. We just talked about a couple of new technologies that have already increased capacity, but is there anything that you would have in mind from a technological standpoint or a procedural standpoint that could enable further capacity increases based on the airline's wishes? Or are we just getting to the point where airlines need to maybe understand that they can't operate that many flights?
Speaker 3:
[31:59] So in the UK, airspace modernization, and this is not just a NATS issue, it's a UK-wide challenge. Airspace modernization has always been number one on that list. But as we know, airspace modernization takes time. It needs that system integration before you can then apply airspace change with new technologies on top of that. That is the future, particularly with free route airspace in the UK and in the upper levels. And that's what we've moved towards. We've actually just introduced only last month, new free route airspace within the Preswick, Scottish area. It's actually over the northern UK. And that we expect to improve capacity and improve flight efficiency over that area. So airspace modernization is key to enabling airlines to operate more flights until we can deliver that. It's a case of managing the traffic that commercial aviation wants to put in the air. And as understanding the impact of that and ensuring that in our planning, we are communicating with our airlines and airport colleagues to understand the impact of that increase in demand as it goes through, which we always do anyway ahead of that summer planning that we've talked about.
Speaker 1:
[33:14] Before I let you go, I want to just take a brief look at the numbers overall. How many flights are we talking about for the upcoming summer season? If you can give me a ballpark.
Speaker 3:
[33:24] It's going to be around 2.53 million flights in the UK this summer, and it was about 2.58 flights in 2019. We are getting extremely close. Depending on the current situation in the geopolitical world, we could see even higher numbers than the 253 that I've just said.
Speaker 1:
[33:49] Is that total flights or is that just in route?
Speaker 3:
[33:53] That's total flights in UK airspace.
Speaker 1:
[33:56] The last question I have for you is, when it's all said and done at the end of the summer, and you look back on these things, do you immediately start planning for the following year, or do you take a breath and go, okay, that was a lot of flights, we need to catch our breath?
Speaker 3:
[34:13] Ian, I would love the chance to catch my breath. But actually, the planning starts again mid-season, so we will be looking at what's happening through May and June and already in July, building towards what we think that will look like in the following year. And then as we get out of the summer, we start an extensive look back at our performance, traffic flows, everything across the operation as to what was successful. And we then hold in November a meeting with our customers and it's a two-day meeting where we go through everything we've learnt and what we will be putting to the planning phases. And then the year after, in the March, and we've just held that a few weeks ago, we hold another one with our customers to tell them what we are expecting after we've gone through a winter of planning and preparation based on those lessons learnt from the previous years.
Speaker 1:
[35:06] Steve Fox is the Director of Operations Control for NATS Enroute. Steve, I want to thank you so very much for joining us and wish you the best of luck for this upcoming summer season.
Speaker 3:
[35:16] Thank you, Ian. It's been a pleasure. Thank you.
Speaker 1:
[35:24] Now we are back to the business of the sky, and oh boy, is there a lot of business to get to.
Speaker 2:
[35:30] So much business.
Speaker 1:
[35:32] And going bankrupt season, and getting a loan season. So let's start with the good news. Boeing reported its earnings this week, and things are looking up. They made a ton of money. And not only that, they are losing less money.
Speaker 2:
[35:53] Hey, for Boeing, that's the most you could hope for.
Speaker 1:
[35:56] And a lot of their additional revenue was accounted for from the sale and delivery of more airplanes, which is, you know, good.
Speaker 2:
[36:08] The thing they should be doing. Fantastic.
Speaker 1:
[36:11] We are also getting some exclusive reporting from the AirCurrent that Boeing is currently flight testing its fix for the engine anti-ice issue that has been holding back certification of the 737 MAX 7 and MAX 10. Boeing says it expects to certify both of those aircraft this year and then begin deliveries next year. They're also preparing to ramp up production from 42 to 47 per month on the MAX line. So things looking up for Boeing.
Speaker 2:
[36:43] Yeah, about time. Feel like it's been the entire duration of this podcast since episode one where we could say that, but things seem to be trending in the correct direction for a good while now. I mean, maybe the MAX 7 and 10 get certified, maybe this year, maybe we see the 777X certified, maybe later this year into next year, who knows? It's unfortunate that it took so long and that a lot of airlines who wanted the MAX 7 or the few that ordered it and the MAX 10 have kind of moved on with their fleet plans. They specifically have united with the MAX 10, has completely shifted its strategy to the 321neo for its transcontinental operation. But you know, better late than never. Now they just have to, what's the status of that exemption for the aircraft monitoring system that they had to have before 2026? Is that even still a thing? Are these aircraft still grandfathered in somehow?
Speaker 1:
[37:37] You know what? I don't know. There's all sorts of exemptions upon exemptions upon exemptions for the 737. So that's a good question, Jason, whether or not we're going to hit against another limit rather than just the anti-icing.
Speaker 2:
[37:52] Nothing's easy.
Speaker 1:
[37:53] Nothing is easy. But they expect to have those aircraft certified this year. So obviously something is going their way. Last week, we talked about an unserious proposal for the merger between United Airlines and American Airlines. And there was a lot of breathless reporting and we said it's not going to go anywhere. And it didn't go anywhere. But American Airlines went so far as to issue a release that said it's not going to go anywhere. They said, quote, while changes in the broader airline marketplace may be necessary, a combination with United would be negative for competition and for consumers, and therefore inconsistent with our understanding of the administration's philosophy toward the industry and principles of antitrust law.
Speaker 2:
[38:32] Sure, I feel like it might be a little bit of Streisand effect here where you're saying to put, don't pay attention to this and people are going to pay attention to it even more, but it didn't really seem to be that way. Everyone who knew anything knew that this was absolutely nonsensical, and apparently American had to put out a release saying, guys, this is ridiculous. Stop it. I don't think United would ever entertain the idea of merging or acquiring American, and if it did, I'm not sure it would know even what to do with it. So yeah, happy to have that behind us for now.
Speaker 1:
[39:04] United Airlines also reported their earnings this week, and in that earnings call, CEO Scott Kirby said, no, I'm not going to talk about this, and we're not going to address consolidation rumors. But they did discuss the fact that they had pretty good earnings despite the rise in fuel expenses. But the one thing that I wanted to pull out is really this stark example of can be described as the K-shaped economy where you have the extreme growth of premium products and premium revenue and the lack of growth everywhere else, or in this case, the strong growth in basic economy fairs.
Speaker 2:
[39:49] Yeah, which tells us something pretty clear that people are more cost sensitive now, and we know airlines don't actually want people booking basic economy fairs. They want people booking up, spending the extra money for main cabin regular economy or whatever. Basic economy is there as a last ditch effort to get you to not fly Spirit or Frontier or whatever. They don't want their passengers flying that. So if more are booking basic economy on United, yeah, that is, I think, a warning sign in general for the larger economy, let alone just the airlines.
Speaker 1:
[40:23] Yeah.
Speaker 2:
[40:24] But at the same time, Scott Kirby also says, hey, fuel is going up. We are not going to absorb that cost on our own. So we're going to pass along the savings to you in the form of potentially 15 to 20 percent higher fares coming to a booking site near you soon. Hey, that sucks, doesn't it?
Speaker 1:
[40:43] It sure does.
Speaker 2:
[40:44] If only it wasn't completely self-inflicted for absolutely no reason whatsoever. It only gets worse as we go down the show notes here. It just keeps getting worse.
Speaker 1:
[40:54] It does keep getting worse because as the airlines get smaller, their ability to absorb those costs and expenses decreases. JetBlue this week received or agreed to a $500 million loan plus a $250 million credit facility that they can draw on later with using 22 Airbus aircraft between A320 and A220 as collateral. The airline CEO also put out a statement this week that said the airline is not considering bankruptcy, and they have the resources to weather those higher fuel costs.
Speaker 2:
[41:31] He said they're not considering bankruptcy for this year.
Speaker 1:
[41:36] Well, so that statement was in direct response to JetBlue founder and former executive David Nealon. Saying that JetBlue could go bankrupt this year.
Speaker 2:
[41:46] Yes, we are not considering bankruptcy this year. Check back January.
Speaker 1:
[41:51] There's also been a lot of reporting that indicates JetBlue is searching for a possible buyer or merger partner, which given everything that's happening would make some good sense. That said, the airline has not committed to that publicly. We'll see how JetBlue fares as the year goes on. We won't need to wait a year or throughout the rest of the year to see how Spirit is faring. As we talked about last week, they were pretty close to liquidation, or at least that's what reports indicated. This week, Spirit is asking the federal government for money. The Wall Street Journal is reporting that the government could loan Spirit up to $500 million and receive warrants for a stake in the airline in return. There is some speculation, mostly between Jason, Ned Russell, and I that this is a way to bridge them to a merger with another airline, which I think makes good sense here, given that 500 million is not going to go that far.
Speaker 2:
[43:01] No. These days, 500 million is a bridge loan to nowhere, really. It will buy them a couple weeks, maybe. I almost feel like that if they are truly in these dire straits right here, maybe liquidation and parting out of the airline is the better choice rather than having it limp along and not be able to repay that $500 million loan at some point. I don't know. Some of my tax money would be going to that loan. I feel like it's not great idea because if Spirit was barely hanging on before the price of fuel doubled or tripled, it's certainly not going to make any sense now. Will United come in and scoop up Spirit? I don't know. It certainly isn't going to be JetBlue at this point since JetBlue is maybe on the market. It just doesn't seem like there is a place for Spirit. I'm torn on this one, Ian, because when COVID hit, all the airlines got a government-backed loan. It was not an exchange for equity. It was a loan that the airlines paid back with interest to weather the storm and get them through to the other side. This feels a little different because apparently the US government would get a stake in the airline. It could be, I don't want to say government-controlled, but government, what's the end game here? If the US government extends them a $500 million loan and also gets a stake in the airline, to what end? Why would they want that? What are they going to do with it?
Speaker 1:
[44:17] I think this would be a similar situation to the automaker bailout that happened in 2008, 2009, where the government took warrants in those companies, was eventually paid back, was able to sell those shares for a profit for the government. And that worked, but automakers are very different than an already struggling airline that was already, by all accounts, on the brink of shutting down. So it's a similar setup, perhaps, but a very big difference in the circumstances in which the companies find themselves.
Speaker 2:
[44:59] Yes, those US automakers, if they cease to exist, there would not be an automaking industry in the US beyond that point. And that was not something that the country could allow. You need to have that kind of manufacturing capacity. The US does not need Spirit. The US will get along just fine without Spirit. It can get along without a couple of airlines. It would be fine. The industry will still be there the day after Spirit ceases to exist. So I just don't see what the end game is here. A lot of speculation of, oh no, it's going to be a government controlled entity. They're going to get all their passengers' data. Well, I hate to break it to you. They've already got all your data. The airlines fork over a ton of it.
Speaker 1:
[45:41] Oh man. No, it's just no.
Speaker 2:
[45:45] It doesn't work that way. Have you heard of the TSA? They know you're coming.
Speaker 1:
[45:50] You've made reservations.
Speaker 2:
[45:52] It's right there. You have the P&R and everything.
Speaker 1:
[45:55] Boy. Oh boy. Oh boy.
Speaker 2:
[45:56] I don't know. People are very paranoid. But in this, I just would see what the end game is. It doesn't make sense. I'm frankly impressed. Spirit's got the juice here to make this even happen. But our government seems to be totally into doing as many stupid things as possible these days. So why not one more?
Speaker 1:
[46:14] In a moment of government rationality then, perhaps, the FAA has put into place a cap on flights at Chicago O'Hare this summer. The airlines between United American and others had originally proposed a scheduled maximum of 3,080 flights.
Speaker 2:
[46:35] Sure, what could possibly count wrong?
Speaker 1:
[46:37] The FAA said, no, we're not doing that. Because last summer, at its peak, there were approximately 2,680 total daily operations. Last summer, O'Hare managed slightly fewer than 500,000 operations, with an on-time performance average that was approximately 75%. And only 56% of departures experienced no delay whatsoever. Only 58% of arrivals experienced no delay whatsoever.
Speaker 2:
[47:15] Just yesterday, our good friend Christina was on a flight out of ORD, and I think there was a cloud or a raindrop somewhere in the Midwest, and it resulted in 40-minute taxi out times and runway closures and all sorts of nonsense. And it's only April, and that wasn't even a thunderstorm. I think it was just a cloud. Well, you live in Chicago. How was the weather yesterday?
Speaker 1:
[47:35] I do. There were some lightning, but not a lot. And it was about 10 minutes.
Speaker 2:
[47:41] Either way, I don't think ORD would be able to handle 3,080 flights a day, because that's insane. I can't even reckon in my brain what that field would look like on a day where there is lightning and also they're trying to pump out 3,080 flights a day.
Speaker 3:
[47:57] It doesn't compute.
Speaker 1:
[47:59] So, the capped number between the affected airlines is now 2,078 flights per day.
Speaker 2:
[48:07] We couldn't have just rounded it down by an even thousand. It had to be 1,002.
Speaker 1:
[48:14] I'm sure there's some formula that was used.
Speaker 2:
[48:16] It's the two that saves the operation.
Speaker 1:
[48:19] That's exactly what it is. In addition to having the number, we also have the meeting minutes or transcription from the meeting between the FAA and the airlines. And some of those are just really worth reading. And I just, the comments by United Vice President, Quayle and others are just so good. And I'm trying to find the one right now that I thought was really just kind of emblematic of a, sorry, not Dan, Dan, former Vice President, Patrick Quayle.
Speaker 2:
[49:01] The one that starts off that says, which one of these is not like the other?
Speaker 1:
[49:05] That's a good one. Okay, so we'll do that one. And I like where Patrick Quayle says, quote, Robert Isom, their CEO, chose this. I think we can all agree, Robert Isom is not Robert Crandall, but he's the CEO of the company and he chose to do this. Robert Crandall being the former CEO of American Airlines and one of the Titan heavyweights of the US aviation industry. Here's the one that Jason was talking about earlier. It starts with which one of these is not like the other? That's Patrick Quayle again. Mr. Edwards, who is Dan Edwards of the United States government. The red box is different. Mr. Quayle quote, the red box is different. So my question, Dan, is, this is sheer madness. No, hang on. This is sheer madness. I'm trying to figure out who done it. Okay. Was it Professor Plum? Was it Colonel Mustard or was it Mr. Green? Was it in the library? Was it in the dining room or was it in the conservatory? Because you're using either the lead pipe, the candlestick or the gun. Who done it?
Speaker 2:
[50:04] What? And it goes on.
Speaker 1:
[50:06] This is not right. This is not right.
Speaker 2:
[50:07] You're blowing up precedent. I don't have to be a loiter to tell you that you're out over your skis. You are blowing up precedent. So yeah, things got heated and kind of comical. I would have loved to see an actual recording of this, which I'm sure exists somewhere, but we will never see it. But you gotta love when they get animated like this and start, you know, quoting board games.
Speaker 1:
[50:31] Yeah, I did not expect clue and a rather obscure idiom to make an appearance here, but here we are.
Speaker 2:
[50:40] Yeah, and towards the end of it, who's Mr. Connolly in this transcript?
Speaker 1:
[50:44] I think that Connolly is a United Airlines lawyer, but I'm not 100% sure.
Speaker 2:
[50:49] But Mr. Connolly, at the end of this quote goes, we've heard vague references to distorted market schedules, none of which are in the notice and described in sufficient detail for us to be able to analyze or address or understand the concerns. Okay, that's pretty lawyery, that's fine. But he goes on to say, it seems like a windowless office in DOT made this change halfway through this process with no sunshine or visibility into your methodology. So even the lawyers here are pissed off and making fun quotes about windowless offices with no sunshine.
Speaker 1:
[51:22] Yeah, I mean, there's a lot going on here. But bottom line, they cut 1002 flights out of the daily schedule affecting United and American. This is a real win for American, really, because United added so many flights and the cap affects United disproportionately. Though United had all of these flights that never made any sense in the first place.
Speaker 2:
[51:45] Well, United Kirby outright said, ha ha ha, these flights are not serious. Look at us go. We were padding the schedule. Nonsense. Like act not in those words, but yeah, they never.
Speaker 1:
[51:56] That was his message. And the FAA used those words against him in this order. That statement is specifically put in the footnotes and cited as partial necessity for this order.
Speaker 2:
[52:11] Love, love to see people's words biting them back. Love it.
Speaker 1:
[52:16] Let's head to the Middle East for just a bit because we have a few updates there before we get to the end of the show. Doha Airport is welcoming back foreign air carriers in a slow and staggered resumption of service. We're starting to see foreign airlines operating in Tiktok for the first time since the end of February. Flight Dubai being one of those major carriers that's beginning service there. If you're feeling extremely brave, Eastern Iranian airspace is currently open. The Western half of the country is still closed to all traffic, but Iran has opened up a portion of the Eastern airspace. If you're brave, stupid, maybe you want to fly there.
Speaker 2:
[52:55] I don't think any airline has taken them up on that offer just yet.
Speaker 1:
[52:59] No. Outside of Iranian airlines, no. But some Iranian airlines have already been using that space for some time. Then Syrian airspace has completely reopened. Previously, Syrian airspace was restricted in both the arrival and departure paths that you could take, as well as which airports were available. Those restrictions are gone now and Syrian airspace has reopened completely. Move in the right direction, assuming that this ceasefire continues to hold. We end the show, Jason, saying goodbye to an airline, sort of, because we already said goodbye to this airline, didn't we?
Speaker 2:
[53:39] We did, but now it's officially gone. Hawaiian Airlines is no more. Alaska seemingly, without incident or any sort of public incident, at least, cut over the operations of Hawaiian Airlines over to Alaska Airlines, the PSS cut over, which, for any of you insiders in the industry, know that that is a massive, massive deal, which takes a ton of preparation and can sometimes go not very well, but all seems to have gone very well. And the HA code, the Hawaiian Code for Flights, is gone. Everything now is Alaska. But this is a little bit of a weird case since Hawaiian Airlines has a brand name thing still around. So Hawaiian lives, but not as far as the FAA is concerned, I guess.
Speaker 1:
[54:28] All right. The dual branding thing, I'm still trying to wrap my head around that. I get what they're going for. We'll see if it lasts long term.
Speaker 2:
[54:36] It's going to last for as long as the public demands it lasts.
Speaker 1:
[54:41] Aha. Aha. There it is. Well, Jason, we've made it to the end of this episode, and you are back to enjoying the environs of Atlanta this week. So I wish you the best with that. Slightly jealous of where you got to eat dinner last week.
Speaker 2:
[54:58] Yes. Last time my company had a big gathering, it was at the Smithsonian Uvar-Hazy Center, and last night it was at the Delta Flight Museum, which has been massively renovated since the last time I was there. That was a ton of fun. Fortunately, the airplanes in the parking lot were not open for tours, but the inside and the spirit of Delta, the 762 is a pretty good place to have a beer.
Speaker 1:
[55:19] Excellent. I'm not jealous at all. I don't know what you're talking about.
Speaker 2:
[55:22] No, I didn't think you would be. I didn't bring it up for a reason. You did.
Speaker 1:
[55:26] Fair enough. This has been Episode 367 of AvTalk. I am Ian Petchenik here as always with Jason Rabinowitz.
Speaker 2:
[55:36] Thanks for listening.