Ata Faces Tough Road

[lowecur]

Too much competition on a network built for longhaul. They are scrambling to get the 717 in place quickly, as their fleet won't allow them to compete. The 190 is out of the question, as Boeing is the only mfg that will work with them in a tough credit market.


Reuters
UPDATE - ATA posts wider loss in first-quarter
Friday May 7, 7:09 am ET

NEW YORK, May 7 (Reuters) - U.S. regional airline ATA Holdings Corp. (NasdaqNM:ATAH - News) on Friday reported a wider first-quarter loss, hurt by a one-time bond-related charge, higher fuel prices, and tough competition.

The Indianapolis-based carrier posted a net loss of $64.7 million, or $5.47 per share, compared with a loss of $11.4 million, or 97 cents per share, in the same quarter a year ago.

The results included a $27 million charge related to bond exchange restructurings.

In an effort to cut costs, ATA, the largest carrier at Chicago's Midway International Airport, said it has asked its cockpit and cabin crews to postpone pay increases scheduled for 2004 and 2005.

Looking ahead, the No. 10 U.S. carrier said it expects revenue in April to climb 6.3 percent from a year earlier.

 

[On Your Six]

How quickly can they get the 717 operation ramped up? It sounds like a somewhat desparate situation all of a sudden - I guess the super-high fuel costs aren't helping the situation...

 

[its none ya]

As long as negotiations go good, the company is planning on Nov. for the first aircraft, and one every 3 weeks there after.

Supposedly 74 717's in total.

We should know more next week.

 

[NZCHooverboy]

Not Total Doom and Gloom

Word has it that we made money in April. May looks a little flat, but we should do well this summer.

MGMT has apparently abandoned the "Honest Growth, Coast to Coast" for N-S point to point. Hopefully marketing will do its homework better.

The B-717 will give us a lot of flexibility. Some markets are too small for the B-737-800.

I'm guardedly optimistic.

 

[On Your Six]

What about potential hubs beyond MDW? Where will you put all of the 717s? Can MDW handle a lot more aircraft in terms of facilitites/gates?

Any talk about PIT or CLT as potential "focus" cities?

 

[its none ya]

There will be a new base, probably two over time, however the company is not releasing that information yet.

MDW is already almost to it's saturation level now.

 

[-9Capt]

Just announced today, ATA will begin scheduled flights to Europe. It's been rumored for some time now.

Also management has asked the pilots and FA's to delay raises scheduled for this year and next year.

The email I recieved was real brief, anyone have any more info?

 

[GogglesPisano]

"Regional Airline" ?

 

[Falconjet]

Major

ATA is a major airline, just one hardly anybody has ever heard about.

 

[ATA73Pilot]

I see that now both ATA and Jet Blue are mentioned as being the 10th. largest airline in various articles and publications.

 

[Ty Webb]

Re: Not Total Doom and Gloom

Originally posted by NZCHooverboy

MGMT has apparently abandoned the "Honest Growth, Coast to Coast" for N-S point to point. Hopefully marketing will do its homework better.


That's interesting, because at AirTran, we have been trying to branch West to get away from the N-S thing because of its seasonality. First and third quarter traffic on those routes is pretty weak.

 

[FlyBoeingJets]

Good point Ty.

We have to separate the sunshine that is being pumped by management from the hard numbers. ATA is not in as good a position as Airtran. ATA has one major hub, MDW, and shares it with powerhouse SWA. Airtran has got ATL against expensive DAL.

ATA management has to sell its plan to shareholders, bondholders, leaseholders and employees. Is it a viable plan? We'll see if the deal goes thru. Without a doubt it is VERY ambitious in the current environment. But it may be the only way to a profitable future.

Airtran's is equally ambitious but better financed and better positioned. Southwest and JetBlue have big plans and look very likely to succeed. Spirit, Frontier and America West also plan growth. Virgin is another potential stress to the system.

With all this growth someone has to take a hit. Will all the above succeed while the old guard takes it in the jimmies? I wish I knew.

I feel one thing is certain. The average major F/O and CA wage will take a hit. Capitol will move to the most efficient carriers (low CASM). The old carriers will take a pay cut to keep the new ones at bay or let them continue to take market share.

 

[727PAA]

Anything out of the negotiations

I was wondering if anything has come out of this weeks negotiations? What is the feeling with the union membership on the pay freeze and possible aircraft order?

Thanks

 

[Capt. Kramer]

We should know more after negotiations end on the 18th. As far as the concessions go, it ranges from fear on one end to anger on the other. Most people seem in favor of the possible new aircraft if the pay is fair. However, I am hearing that the company now wants to use the first 13-18 new aircraft to replace existing 737's. That would mean no expansion and no possible hiring for awhile. We shall see.......

 

[jettypeguy]

However, I am hearing that the company now wants to use the first 13-18 new aircraft to replace existing 737's. That would mean no expansion and no possible hiring for awhile. We shall see.......

I don't know where you're hearing this but per George Mickleson and Dave Wing both stated at the 1st quarter conference call that no existings 737's will be replaced by 717's and that any deal with boeing would only replace the orders we were supposed to get in 2005 and beyond. You can listen for yourself at www.ata.com