missamo80

https://investor.alaskaair.com/news-...ts-along-covid

They've got cash burn down to $4m per day from $5m per day in the second quarter. Their goal is to get to $0 cash burn by the end of the year.

"We are gaining momentum as we climb our way out of this crisis," said Air Group CEO Brad Tilden. "Each of the last six months has been better than the month before in terms of flights offered and passengers carried, and to date, we've kept our net debt unchanged. Alaska has competitive advantages that continue to serve us well in this crisis, and we are fighting this battle with the most passionate and dedicated employees in the business."

missamo80

Seattle Times analysis: https://www.seattletimes.com/busines...ters-airlines/

sfozrhfco

Notable on the call that they are bringing back capacity at SEA sooner yet there is still no way they can get down to 0 cash burn while they block middle seats. They did not give any guidance as to when they would be able to get down to zero cash burn.

safari ari

WN just announced they are unblocking middle seats 12/1, wonder if AS will follow suit after the very airline-friendly report on air particles in the cabin, but if fewer airlines are doing it, it is only a matter of time they do so.

sfozrhfco

Management said they would be open to do it immediately but will take the next couple months to "educate" the public to be able to do it by Q1 2021. Airlines will be grasping at any study that shows that packing people together as close as possible on a plane is not high risk. Whether with rising cases of COVID the public will feel comfortable with that is another story.

missamo80

Alaska announced right in the earnings release they extended middle seat blocking through Jan 6, 2021.

missamo80

I found that part interesting too. The move from $5.5m to $4m daily cash burn in a single quarter strikes me as a sign that they've run out of places to cut. All the realistically could do is cut more capacity which leads to more layoffs for salary savings.

I wonder if they are backing away from trying to hit $0 cash burn by end of year given the somewhat upward trend in air travel? They have $3.8bn in cash and securities. At $4m burn per day that seems... not too concerning, especially if they claim things are on the upswing every day. Maybe just sit back and let increased flying by the public get you to $0 burn naturally?

RAD_PDX

The recently released DOD study provides very compelling evidence that COVID transmission on planes (with HEPA filters and when masks are worn) is non-existent.

StevenSeagalFan

right but what about the other aspects? TSA line, shuttle bus, gate area etc. that’s where I worry most.

NoLaGent

Of course, but that's not the airlines story to tell, they can only focus on what they have control over.

And for the record, I agree with you, everything surrounding the flight is where the actual risk is.

sfozrhfco

They basically admitted that they can not break even unless they get back to flying full not matter how much they add or subtract. They also admitted that shifting state of Alaska routes to Embraer is because mainline is no longer a viable option for those flights right now. They also said they want to get down to a level of staffing that matches up with the number they actually need to run the airline. With no additional government bailout, that means they will likely have to encourage more unpaid leaves or have to lay more people off. They are not planning a full recovery for two years at the earliest now so they know it will be a slow and painful recovery. They have enough cash to get by but still haven't made much progress on a fleet plan and it is unclear where they will focus their network rebuild outside of Seattle. In some ways they are good--financially at least--but in other ways, they have been rudderless for several years now and it is difficult to know what their strategy is other than protecting Seattle and trying to save money. The earnings call once again did not provide any clarity on that front.

notquiteaff

That’s great, but not necessarily a realistic flight experience. People eat and drink. I have seen people (in a grocery store) lower their mask so they can sneeze into their hand. The flights I personally am interested in are longer haul fights (beyond driving distance) where people are more likely to want or need to take their masks off. I did fly long haul in July, but it was in int’l business class and due to a family emergency. So while the DOD study is encouraging, it isn’t likely going to get me personally on an AS plane this year.

Kacee

Which of course is not the current environment, since passengers are allowed to remove their masks to eat and drink.

A confounding factor that airlines are conveniently ignoring.

alphaeagle

Presumably that's only in-flight when the filters and constant fresh air is happening, right? Otherwise during boarding and deplaning is not going to be much better than any other enclosed environment.

RAD_PDX

I'd take a look at the study before you make that assumption.