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About The daily Astorian. (Astoria, Or.) 1961-current | View Entire Issue (Jan. 25, 2020)
B5 THE ASTORIAN • SATURDAY, JANUARY 25, 2020 Grounded Boeing jet holds back profi ts, growth at airlines By DAVID KOENIG Associated Press DALLAS — The three big U.S. airlines that own Boeing 737 Max jets don’t expect the grounded plane back in their fl eets until after the the peak summer travel season, and that promises to lead to thousands more can- celed fl ights and higher costs well into another year. On Thursday, American Airlines executives said they canceled 10,000 fl ights in the fourth quarter because of the idled planes. Southwest Airlines said the grounding cut its 2019 operating income by $828 million. The airline expected to own about 75 Max jets by now — 10% of its fl eet — and the shortage is creating “a crisis-like challenge,” said CEO Gary Kelly. The airlines planned to add more fl ights in 2020 to take advantage of strong demand for travel. Now Southwest fi gures to shrink by up to 2.5% in the fi rst quarter, compared to early 2019. Beyond that, the air- line isn’t sure because it all depends on when the Max returns. Max operators say they are still confi dent in the plane, which they bought with its promise of better fuel economy and larger size than previous versions of the venerable Boeing 737, which has a good safety record. “We know it will fl y again some day,” American Air- lines CEO Doug Parker said of the Max. “When it does, we’ll be ready.” The comments, which echoed those by United Air- lines executives the day before, came as Ameri- can and Southwest reported fourth-quarter profi ts. Both American and Southwest have reached set- tlements with Boeing over Mike Stewart/AP Photo Southwest pilots prepare for a fl ight at Tampa International Airport in Florida. damages they suffered from the loss of their Max jets during 2019. They will con- tinue negotiating as the fi nancial impact lingers long into 2020. The Max has been grounded since last March after two crashes killed 346 people. Boeing, which is working on fi xes to software and other items, said this week that it doesn’t expect federal safety regulators to clear the plane to fl y until June. Southwest executives said even after the plane is re-certifi ed by the Fed- eral Aviation Administra- tion, they will need three or four more months to update operating manuals, get moth- balled planes ready to fl y, and train pilots in Max fl ight simulators. That would push the plane’s return into the fall. Southwest, American and United have all removed the Max from their sched- ules into June but are certain to push back their schedules again after Boeing’s latest announcement. Those airlines face a limit on growth and are keep- ing a few older planes fl y- ing instead of retiring them. Meanwhile, rival Delta Air Lines, which never bought any Max jets, continues to grow. Analysts said demand for travel remains healthy, driv- ing a closely watched mea- sure of revenue per seat higher. American reported record-high occupancy lev- els on its planes, which helped push earnings up 27% to $414 million. The results were slightly better than expected, with adjusted earn- ings of $1.15 per share being a penny higher than a FactSet survey of 18 analysts. Revenue rose more than 3% to $11.31 billion, match- ing the analysts’ average forecast. The Fort Worth, Texas, airline said 2020 adjusted earnings, excluding non-re- peating items, will be between $4 and $6 per share. That is in line with Wall Street expectations of $5.06 per share. Cowen analyst Hel- ane Becker said American’s 2020 forecast was proba- bly conservative because of uncertainty around the Max and the economy. Southwest’s profi t slipped 21% to $514 million, partly due to higher costs and lost revenue from the Max grounding. Analysts were looking for earnings of $1.09 per share, according to FactSet. South- west delivered 98 cents per share, but that included a loss of 18 cents per share related to the Max. Revenue was $5.73 billion, slightly better than analysts predicted. JetBlue, which didn’t buy the Max, said Thursday that fourth-quarter profi t fell 5% to $161 million or 56 cents per share, beating the ana- lysts’ forecast of 19 cents per share. The airline gave signs that it is getting long-rising costs under control, and it estimated 2020 earnings of $2.50 to $3 a share, above Wall Street’s $2.38 forecast. Looking for love online Dear Annie: I’m 29 and to gauge your chemistry, single. I’m proud to have and it prevents you from worked my butt off since endlessly instant mes- college and am now seeing saging with a guy whom the fruits of my labor. I’ve you’ll never end up meet- got the dream job that I’m ing. After all, if he can’t be passionate about, am mak- bothered to hop on a quick ing good money and have phone call with you, don’t bother with him. the most amaz- Be upfront about ing group of loved DEAR what you’re look- ones and mentors. ANNIE ing for: a relation- The cherry on top ship, not a hookup. of it all would be If he’s intimidated a man I can enjoy by your directness, all of this with. has different priori- Since I have a hec- ties or thinks that’s tic schedule and “too much,” then travel for work, I fi gured getting ANNIE LANE why would you Creators want to date him back into online Syndicate Inc. anyway? dating (in addition And lastly, a to good “old-fash- ioned” meeting people) note to anyone dipping his would offer some solid or her toe in the online-dat- ROI. It’s been more bag- ing waters, remember to gage than not, though, and always opt for a public I don’t know how to make meeting place and let a it work or whether I should friend know where you’ll be. just skip it altogether. Dear Annie: You have “Adam” and I had deli- cious witty banter over text published many letters for a week and a half. By from people bemoaning his pictures, he was the the fact that gifts that they perfect combination of gave were not acknowl- sexy and cute. When we edged. While I am fully in fi nally met, I knew pretty agreement that a “thank- quickly there wasn’t a you” is a must for any gift I long-term connection. receive, I do not agree that “Jeff” and I talked inces- anyone has an obligation to santly for about a week, send a gift in the fi rst place, as voiced by the recent let- and then he ghosted. I don’t expect the fi rst ter from “Unappreciated — or even the 10th — guy I Giver” who seems to be match with to be “the one.” putting herself on a guilt I’m willing to try them trip if she does not give. I am a few months short on till one fi ts just right, but I can’t stand my time of 80 years old; I have and energy being wasted! enough “stuff” around. What’s your advice on The holidays were a per- how to get quality expe- fect time to remember to riences out of online dat- make contact with friends ing? — Frustrated With and relatives that are at a distance, which I did with Swiping Dear Frustrated: If a Christmas letter, a phone the internet widened the call or an email. I look for- dating pool, it also mud- ward to and enjoy similar died the waters. The best contacts; they are the best approach in such environs gift that I receive — save, is a streamlined one: If you of course, for the yearly think you have a connec- photo of the grade-school tion with someone you’ve grandkids that comes in matched with online, the Christmas card from invite him for a phone call my kids (and the small box to see if you two hit it off of cookies from my daugh- before scheduling a date. ter-in-law). — Bill, The This gives you the chance Villages, Florida Health care is just the beginning. You deserve good health. 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