Airlines

Lufthansa gives Brussels a state-aid wake-up call

11 May 2023

Europe’s top court has ruled the $12 bln airline got too much of a sweetheart deal in its pandemic aid package. The stakes for Lufthansa look small. But it’s a bad omen for a European Commission facing increasingly tricky decisions on how far to loosen its single market.

Capital Calls: Microsoft/Activision, Subscriptions

24 Mar 2023

Concise views on global finance: The software giant convinced UK regulators to drop one of two major concerns about its $69 bln deal. Meanwhile, the U.S. Federal Trade Commission has picked an easier — and less controversial — fight than its antitrust crackdown.

Cathay’s people problem is Hong Kong’s too

10 Mar 2023

The carrier may struggle to hire fast enough to ramp up capacity. Higher salaries would be an obvious fix to lure back crew scarred by endless quarantine. In the meantime, Cathay will remain a globe-trotting reminder of the reopened city’s isolation for longer than anyone wants.

Elizabeth Warren leads cavalry into deal battles

7 Mar 2023

The Democratic senator urged the Transportation Department to join DOJ efforts to stop JetBlue’s $4 bln plan to buy rival Spirit. She also encouraged the FCC to crack down on Tegna’s sale and the OCC on TD-First Horizon. These odd interventions push trustbusting to new extremes.

IAG takeoff weighed down by debt dilemma

24 Feb 2023

With net debt above its market value, the $9 bln British Airways owner could use a rights issue. But it’s also back in the black after a painful pandemic, and deals may yield cost savings. Boss Luis Gallego has to work out which path is likely to annoy long-term investors least.

High-flying airlines still face stiff headwinds

25 Jan 2023

EasyJet shares surged on improved expectations, as rising numbers of holiday-goers look set to push the sector back into the black. But recent meltdowns show air travel has an increasing problem with tech glitches. It’s premature for investors to settle back in their seats.

Virgin Australia IPO relies on Qantas flight path

20 Jan 2023

Bain Capital may relist the carrier it bought in 2020 as travel revives and rivals’ shares rally. Virgin could be worth $800 mln if it replicates the projected juicy margins and growth rates of its larger rival. If not, the private equity firm might wait in the departure lounge.

Capital Calls: Southwest, U.S. jobs and wages

6 Jan 2023

Concise views on global finance: Financial bumpiness caused by the airline’s major flight disruptions should be temporary, partly due to limited competition; slower U.S. wage growth raises the chances that the Fed won’t have to crush the labor market to bring down inflation.

Capital Calls: DoorDash puts profit on the menu

30 Nov 2022

Concise views on global finance: The food-delivery service’s job cuts should pave the way to a stronger bottom line.

Capital Calls: Cross-border M&A, Riches to rugs

9 Nov 2022

Concise views on global finance: The market reaction to U.S.-based Chart Industries’ $4.4 bln deal to buy Scotland’s Howden reinforces the idea that it’s a bad time to shop overseas, while Peloton’s founders are shifting gears with a new bespoke carpet business.

Capital Calls: Italy’s next finance minister

14 Oct 2022

Concise views on global finance: Rightist leader Giorgia Meloni is likely to pick a pro-European politician as finance chief.

Capital Calls: TSMC

13 Oct 2022

Concise views on global finance: The $324 bln Taiwan Semiconductor Manufacturing barely addressed questions regarding U.S. technology export controls on China during its earnings call.

China’s dreary Golden Week has shades of grey

10 Oct 2022

Domestic tourism sales during the country's top holiday fell to less than 50% of pre-pandemic levels. Cities like Shanghai might get a welcome boost from shoppers that stayed put, but the sector drives roughly 30% of consumption. That’s cold comfort for the weakening economy.

Capital Calls: Chevron, Pickleball

29 Sep 2022

Concise views on global finance: The oil driller has sold its California headquarters building and is moving employees to Texas, while one of the fastest-growing U.S. games is beefing up its professional ambitions with an investment from basketball superstar LeBron James.

Capital Calls: EasyJet, Nexi

27 Sep 2022

Concise views on global finance: The budget airline scraps its offset plan and focuses efforts on cleaner technology; the 12 bln euro payment company’s valuation gap with peer Worldline looks increasingly hard to justify.

Alitalia successor approaches safe landing spot

1 Sep 2022

Investor Certares has bid 700 mln euros for a majority of ITA, the shrunken offshoot of the troubled airline. Backing from Air France and Delta should ensure better landing slots and access to lucrative U.S. routes. It may avoid more bailouts, but Rome will still have a big say.

Transportation M&A nightmare worth the trip

8 Aug 2022

Often when industries with monopolistic traits consolidate – airlines, trains - there’s a race to be an acquirer. Buyers end up paying top dollar, and regulatory concessions can be steep. Still other industries have shown the finish line is rewarding if investors stick it out.

China’s Hawaii washes away an economic sandcastle

8 Aug 2022

A Covid-19 outbreak has locked down cities in Hainan, stranding over 80,000 visitors. It sets back a decent recovery in tourism, a generator of more than 11% of pre-pandemic GDP. With other growth pillars shaky, it’s the worst time to give consumers another reason to check out.

JetBlue buckles up for long, turbulent M&A flight

28 Jul 2022

After a near-four-month tussle, the U.S. budget airline clinched a $3.8 bln deal with rival Spirit. It stacks up if hoped-for extra profit results. The price is still high: If the merger fails – as it might – JetBlue may have to pay Spirit one-fifth of its market value.

Cathay Pacific charts hopeful course for Hong Kong

18 Jul 2022

Huge capacity cuts and a bailout put a lid on debt as quarantine rules keep its home city isolated. Its shares, better performing than Singaporean and Western peers, imply the airline and the Asian hub will make a quick turnaround. But it faces a harder slog back to normal.